Group 1 - The article discusses the recent financial performance of a specific company, highlighting a revenue increase of 15% year-over-year, reaching $2.5 billion [1] - It notes that the company's net income rose to $300 million, representing a 20% increase compared to the previous year [1] - The report emphasizes the growth in the company's market share, which has expanded by 5% in the last quarter [1] Group 2 - The article outlines the strategic initiatives the company has undertaken, including the launch of new product lines that contributed to the revenue growth [1] - It mentions the company's investment in technology upgrades, which are expected to enhance operational efficiency and reduce costs by 10% [1] - The article also highlights the competitive landscape, indicating that the company is well-positioned against its main rivals, who have seen stagnant growth [1]

Group 1 - The article discusses the recent financial performance of a specific company, highlighting a revenue increase of 15% year-over-year, reaching $2.5 billion [1] - It notes that the company's net income rose to $300 million, representing a 20% increase compared to the previous year [1] - The report emphasizes the growth in the company's market share, which expanded by 5% in the last quarter [1] Group 2 - The article outlines the strategic initiatives the company has undertaken, including investments in technology and expansion into new markets [1] - It mentions the challenges faced by the company, such as increased competition and supply chain disruptions [1] - The article concludes with a positive outlook for the company's future growth, projecting a 10% increase in revenue for the next fiscal year [1]

Group 1 - Global Net Lease (NYSE: GNL) has experienced a high beta dividend yield, with dividends cut four times since 2020, indicating a precarious income-oriented position for investors [1] - The equity market is characterized by daily price fluctuations that can lead to significant long-term wealth creation or destruction [1] - Pacifica Yield focuses on long-term wealth creation by targeting undervalued high-growth companies, high-dividend stocks, REITs, and green energy firms [1]

Group 1 - The Conservative Income Portfolio aims to target value stocks with high margins of safety while reducing volatility through well-priced options [1] - The Enhanced Equity Income Solutions Portfolio is designed to generate yields of 7-9% while minimizing volatility [1] - Global Net Lease, Inc. (NYSE: GNL) is undergoing a transformation, focusing on property dispositions and attempting to improve its financial metrics [2][3] Group 2 - Trapping Value consists of a team of analysts with over 40 years of combined experience in generating options income and capital preservation [3] - The investing group operates two income-generating portfolios and a bond ladder, emphasizing lower volatility income investing [3]

PART I - FINANCIAL INFORMATION [Financial Statements](index=2&type=section&id=Item%201.%20Financial%20Statements) The unaudited financial statements reflect a strategic shift from the Multi-Tenant Retail Disposition, resulting in decreased assets and a higher net loss Consolidated Balance Sheet Summary (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total real estate investments, net | $4,366,367 | $4,622,033 | | Assets related to discontinued operations | $2,337 | $1,816,131 | | Total Assets | $4,984,916 | $6,955,764 | | Total Liabilities | $3,152,537 | $4,768,806 | | Total Stockholders' Equity | $1,832,379 | $2,186,958 | Consolidated Statement of Operations Summary (in thousands) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Revenue from tenants | $257,320 | $293,344 | | Total expenses | $242,756 | $214,336 | | Loss from continuing operations | $(127,026) | $(29,108) | | (Loss) from discontinued operations | $(86,496) | $(30,307) | | Net loss | $(213,522) | $(59,415) | | Net loss attributable to common stockholders | $(235,394) | $(81,287) | | Net loss per share (Basic and Diluted) | $(1.04) | $(0.35) | - The sale of the Multi-Tenant Retail Portfolio is treated as a **discontinued operation**, significantly impacting the comparability of financial statements[34](index=34&type=chunk)[40](index=40&type=chunk) [Note 3 — Multi-Tenant Retail Disposition](index=13&type=section&id=Note%203%20%E2%80%94%20Multi-Tenant%20Retail%20Disposition) The company sold its 100-property Multi-Tenant Retail Portfolio for approximately $1.78 billion, resulting in a $52.0 million loss from discontinued operations - The sale of 100 multi-tenant retail properties was completed in multiple closings during Q1 and Q2 2025 for a contract price of approximately **$1.78 billion**[33](index=33&type=chunk)[47](index=47&type=chunk) Gain (Loss) on Multi-Tenant Retail Disposition (in thousands) | Period | Gain / (Loss) on Sale | | :--- | :--- | | Three Months Ended June 30, 2025 | $33,232 | | Six Months Ended June 30, 2025 | $(51,955) | - A multi-tenant disposition receivable of **$90.2 million** was recorded at fair value as of June 30, 2025, representing potential proceeds from leases not yet commenced at the time of closing[59](index=59&type=chunk)[60](index=60&type=chunk) - The disposition was considered a triggering event, leading to a **goodwill impairment charge of $7.1 million** in Q1 2025, writing off the entire segment's goodwill[62](index=62&type=chunk) [Note 5 — Mortgage Notes Payable, Net](index=20&type=section&id=Note%205%20%E2%80%94%20Mortgage%20Notes%20Payable%2C%20Net) Net mortgage notes payable decreased significantly to $1.31 billion due to assumptions by the buyer in the Multi-Tenant Retail Disposition Mortgage Notes Payable, Net (in thousands) | Date | Outstanding Loan Amount | Effective Interest Rate | | :--- | :--- | :--- | | June 30, 2025 | $1,312,718 | 4.4% | | December 31, 2024 | $1,768,608 | N/A | - As part of the Multi-Tenant Retail Disposition, mortgages with principal amounts of **$256.3 million** and **$210.0 million** were assumed by the buyer, RCG[47](index=47&type=chunk)[80](index=80&type=chunk) [Note 6 — Revolving Credit Facility](index=21&type=section&id=Note%206%20%E2%80%94%20Revolving%20Credit%20Facility) The Revolving Credit Facility balance was reduced to $740.7 million using disposition proceeds and was subsequently replaced with a new facility Revolving Credit Facility Balance (in thousands) | Date | Outstanding Balance | | :--- | :--- | | June 30, 2025 | $740,682 | | December 31, 2024 | $1,390,292 | - Subsequent to the quarter end, on August 6, 2025, the company entered into a **new $1.8 billion credit agreement** to replace and terminate the existing facility[90](index=90&type=chunk)[227](index=227&type=chunk)[231](index=231&type=chunk) [Note 10 — Stockholders' Equity](index=29&type=section&id=Note%2010%20%E2%80%94%20Stockholders'%20Equity) The company executed a $75.9 million share repurchase program and reduced its quarterly common stock dividend to increase cash retention - On February 20, 2025, the Board authorized a **$300 million share repurchase program**, and during the first six months, the company repurchased **10.1 million shares for $75.9 million**[144](index=144&type=chunk)[147](index=147&type=chunk) - The quarterly common stock dividend was **reduced to $0.190 per share**, effective with the dividend declared in April 2025[157](index=157&type=chunk) - **No shares** of Common Stock or Series B Preferred Stock were sold through the respective ATM programs during the first six months of 2025[149](index=149&type=chunk)[152](index=152&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=43&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) The $1.78 billion retail disposition transformed the company's focus, enabling significant debt reduction and improved capital structure - As of June 30, 2025, the portfolio consisted of **911 properties**, **98% leased**, with a weighted-average remaining lease term of 6.2 years[242](index=242&type=chunk) - The company's strategic disposition initiative led to a significant reduction in total gross debt to **$3.1 billion** at June 30, 2025, from **$5.1 billion** a year prior[273](index=273&type=chunk)[304](index=304&type=chunk) FFO and AFFO Reconciliation Summary (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net loss attributable to common stockholders | $(35,079) | $(46,600) | $(235,394) | $(81,287) | | FFO attributable to common stockholders | $(14,400) | $36,193 | $18,561 | $91,966 | | Core FFO attributable to common stockholders | $7,122 | $50,855 | $42,089 | $107,447 | | AFFO attributable to common stockholders | $53,108 | $76,692 | $119,328 | $151,656 | [Results of Operations](index=46&type=section&id=Results%20of%20Operations) Revenue from tenants decreased due to property sales, while the net loss widened significantly from increased impairment and derivative losses Revenue from Tenants by Segment - Six Months Ended June 30 (in thousands) | Segment | 2025 | 2024 | | :--- | :--- | :--- | | Industrial & Distribution | $113,008 | $123,432 | | Retail | $72,314 | $83,281 | | Office | $71,998 | $69,767 | | **Total** | **$257,320** | **$293,344** | - Impairment charges for the six months ended June 30, 2025, totaled **$70.1 million**, a significant increase from $31.7 million in the same period of 2024[294](index=294&type=chunk)[296](index=296&type=chunk) - Interest expense **decreased to $106.8 million** for the first six months of 2025 from $136.6 million in 2024, driven by lower average debt balances[304](index=304&type=chunk) [Liquidity and Capital Resources](index=55&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity was reshaped by dispositions, using proceeds for over $1.2 billion in net debt repayments and share repurchases - Net cash provided by operating activities was **$111.2 million** for the six months ended June 30, 2025, compared to $162.5 million in the prior year period[314](index=314&type=chunk)[315](index=315&type=chunk)[316](index=316&type=chunk) - Net cash used in financing activities was **$1.4 billion** for the six months ended June 30, 2025, including **$722.2 million in net paydowns** on the revolving credit facility[320](index=320&type=chunk) - The company's debt leverage ratio **improved to 58.9%** as of June 30, 2025, from 63.8% at December 31, 2024[333](index=333&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=62&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company reports no material change in its market risk exposure during the first half of 2025 - There has been **no material change** in the company's exposure to market risk during the first six months of 2025[373](index=373&type=chunk) [Controls and Procedures](index=62&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes to internal controls during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were **effective** as of the end of the period[374](index=374&type=chunk) - **No material changes** to the internal control over financial reporting were identified during the quarter ended June 30, 2025[375](index=375&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=63&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently subject to any material legal or regulatory proceedings - The company is **not subject to any material legal proceedings**[164](index=164&type=chunk)[377](index=377&type=chunk) [Risk Factors](index=63&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the company's risk factors have been identified since its 2024 Annual Report - **No material changes** to risk factors were reported since the company's 2024 Form 10-K and Q1 2025 Form 10-Q[378](index=378&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=63&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased 7.7 million shares for $56.5 million in Q2 2025, with $224.3 million remaining under its repurchase program Common Stock Repurchases for Q2 2025 | Period | Total Shares Purchased | Average Price Paid per Share | Maximum Value Remaining (in thousands) | | :--- | :--- | :--- | :--- | | April 2025 | 4,924,685 | $7.25 | $244,907 | | May 2025 | 2,425,943 | $7.58 | $226,522 | | June 2025 | 303,992 | $7.47 | $224,252 | | **Total** | **7,654,620** | **$7.37** | **$224,252** |

Financial Data and Key Metrics Changes - For Q2 2025, the company recorded revenue of $124.9 million and a net loss attributable to common stockholders of $35.1 million, with AFFO at $53.1 million or $0.24 per share [16][19] - The gross outstanding debt balance was $3.1 billion at the end of Q2 2025, a reduction of $2 billion from the end of 2024 [17] - The net debt to adjusted EBITDA ratio improved to 6.6 times, down from 8.1 times at the end of 2024 [17] Business Line Data and Key Metrics Changes - The company completed the $1.8 billion sale of its multi-tenant retail portfolio, increasing occupancy to 98% from 97% as of year-end 2024 [5][6] - The percentage of leases with rent escalators increased to 88% from 81% [6] - The office portfolio maintained 100% rent collection and had the highest percentage of investment-grade tenancy at 77% [9] Market Data and Key Metrics Changes - Geographically, 70% of straight-line rent is earned in North America and 30% in Europe, providing diversification across economic cycles [13][14] - The company has reduced its exposure to the gas and convenience store sector, with assets sold amounting to approximately $108 million, decreasing portfolio exposure to 2.1% from 5.3% [10][11] Company Strategy and Development Direction - The company aims to drive sustainable long-term growth by optimizing its portfolio, reducing leverage, and lowering its cost of capital [5] - The strategic focus includes reducing exposure to non-core assets, particularly in the office sector, while maintaining a disciplined approach to tenant retention [9][10] - The company plans to use proceeds from asset sales to fund stock buybacks and further deleverage [43][50] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in performance and raised the lower end of AFFO per share guidance to a range of $0.92 to $0.96 for the remainder of 2025 [19] - The company is focused on completing ongoing initiatives, including dispositions and lease renewals, to maintain earnings within the stated guidance range [27] - Management acknowledged the disappointing share price performance despite improvements in the balance sheet and extended debt maturities [13] Other Important Information - The company repurchased 10.2 million shares at a weighted average price of $7.52, totaling $77 million, capitalizing on an AFFO yield of approximately 12% [12] - The company has no remaining debt maturities in 2025 and $95 million of debt tied to retail assets expiring in 2026 [12] Q&A Session Summary Question: What is the target percentage for office assets and the timeline for reduction? - Management indicated a strategic approach to office portfolio reduction, emphasizing the strong performance and high-quality tenants, without providing specific targets or timelines [25][26] Question: When does management expect earnings to begin growing again? - Management raised the lower end of the earnings guidance to $0.92 to $0.96 per share and indicated that they would provide guidance for 2026 later in the year [27] Question: Can management comment on the recent share sale by the CEO? - The CEO explained that the sale was due to personal obligations and should not be interpreted negatively regarding the company's future [28][29] Question: How does management view the auto manufacturing sector within the portfolio? - Management expressed confidence in the critical assets within the auto manufacturing sector, particularly those tied to US manufacturers, and does not foresee significant issues [33][34] Question: What is the pace of future dispositions? - Management indicated a pipeline of approximately $300 million in future dispositions and emphasized the strategic nature of these sales [42]

Financial Performance & Strategic Objectives - GNL reduced net debt by $748 million in Q2 2025, decreasing Net Debt to Adjusted EBITDA to 66x[10] - GNL increased the low end of its AFFO per Share guidance to a new range of $092 to $096[22] - GNL reaffirms its Net Debt to Adjusted EBITDA range of 65x to 71x[22] - GNL's liquidity totaled $10 billion in Q2 2025[36] Portfolio Transformation & Leasing Activity - GNL completed the final phases of the ~$18 billion Multi-Tenant Portfolio Sale, transforming into a pure-play net-lease REIT[11] - GNL achieved 60% renewal spreads and increased occupancy to 98% across the portfolio[12] - GNL's total non-core dispositions reach over $30 billion[24] - GNL repurchased 102 million shares for a total of $77 million[13] Balance Sheet & Credit Rating - S&P upgraded GNL's corporate credit rating to BB+ from BB[12] - GNL reduced net debt by $20 billion since Q2'24[13, 29] - GNL refinanced its Revolving Credit Facility, extending weighted average debt maturity to 37 years[11, 13]

Financial Performance - Global Net Lease (GNL) reported quarterly funds from operations (FFO) of $0.24 per share, exceeding the Zacks Consensus Estimate of $0.20 per share, but down from $0.33 per share a year ago, indicating a FFO surprise of +20.00% [1] - The company posted revenues of $124.91 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 18.37%, compared to $203.29 million in revenues from the same quarter last year [2] - Over the last four quarters, GNL has surpassed consensus FFO estimates three times, but has only topped consensus revenue estimates once [2] Stock Performance - GNL shares have declined approximately 5.9% since the beginning of the year, while the S&P 500 has gained 7.1% [3] - The current consensus FFO estimate for the upcoming quarter is $0.22 on revenues of $138.07 million, and for the current fiscal year, it is $0.87 on revenues of $614.37 million [7] Industry Outlook - The REIT and Equity Trust - Other industry, to which GNL belongs, is currently ranked in the top 40% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - The performance of GNL's stock may be influenced by the overall industry outlook, as empirical research indicates a strong correlation between near-term stock movements and trends in estimate revisions [5][8]

[Financial Performance and Position](index=6&type=section&id=Financial%20Performance%20and%20Position) The company's financial performance in Q2 2025 reflects a net loss and decreased assets, while non-GAAP metrics provide additional operational insights [Key Metrics](index=6&type=section&id=Key%20Metrics) Global Net Lease's Q2 2025 results show $124.9 million in tenant revenue, a $35.1 million net loss, and $53.1 million in AFFO Q2 2025 Financial & Operational Highlights | Metric | Value | | :--- | :--- | | Revenue from tenants | $124.9 million | | Net loss attributable to common stockholders | $(35.1) million | | Basic and diluted net loss per share | $(0.16) | | AFFO attributable to common stockholders | $53.1 million | | Dividends per share | $0.19 | | Gross asset value | $6.04 billion | | Net debt | $2.97 billion | | Number of properties | 911 | | Leased Percentage | 98% | | Weighted-average remaining lease term | 6.2 years | Q2 2025 Capitalization Metrics | Metric | Value | | :--- | :--- | | Net debt to gross asset value | 49.2% | | Net debt to annualized adjusted EBITDA | 6.6x | | Weighted-average interest rate cost | 4.3% | | Weighted-average debt maturity | 2.9 years | | Interest Coverage Ratio | 2.7x | [Consolidated Financial Statements](index=7&type=section&id=Consolidated%20Financial%20Statements) The company's Q2 2025 consolidated balance sheet shows total assets of $5.0 billion and liabilities of $3.2 billion, reflecting asset reclassification [Consolidated Balance Sheets](index=7&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets decreased to $4.98 billion from $6.96 billion, reflecting discontinued operations Balance Sheet Comparison (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total real estate investments, net | $4,366,367 | $4,622,033 | | Assets related to discontinued operations | $2,337 | $1,816,131 | | Total Assets | $4,984,916 | $6,955,764 | | Total Liabilities | $3,152,537 | $4,768,806 | | Total Equity | $1,832,379 | $2,186,958 | [Consolidated Statements of Operations](index=8&type=section&id=Consolidated%20Statements%20of%20Operations) For Q2 2025, the company reported $124.9 million in tenant revenue and a net loss of $24.1 million Quarterly Operating Results (in thousands, except per share data) | Metric | Q2 2025 | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | :--- | | Revenue from tenants | $124,905 | $132,415 | $137,783 | | Operating income (loss) | $42,297 | $(27,874) | $56,220 | | Net loss | $(24,143) | $(189,379) | $(6,522) | | Net loss attributable to common stockholders | $(35,079) | $(200,315) | $(17,458) | | Net loss per share | $(0.16) | $(0.87) | $(0.08) | [Non-GAAP Measures](index=9&type=section&id=Non-GAAP%20Measures) Q2 2025 non-GAAP metrics show Adjusted EBITDA of $113.4 million, Cash NOI of $124.4 million, and AFFO of $53.1 million Quarterly Non-GAAP Performance (in thousands) | Metric | Q2 2025 | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | :--- | | Adjusted EBITDA | $113,359 | $138,416 | $150,260 | | Cash NOI | $124,366 | $150,799 | $161,172 | | FFO attributable to common stockholders | $(14,400) | $32,961 | $64,334 | | AFFO attributable to common stockholders | $53,108 | $66,220 | $78,297 | Non-GAAP Per Share Data | Metric | Q2 2025 | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | :--- | | FFO per diluted common share | $(0.06) | $0.14 | $0.28 | | Core FFO per diluted common share | $0.03 | $0.15 | $0.30 | | AFFO per diluted common share | $0.24 | $0.29 | $0.34 | [Debt and Capital Structure](index=11&type=section&id=Debt%20and%20Capital%20Structure) Global Net Lease's debt as of June 30, 2025, totaled $3.12 billion, with a 4.3% interest rate and 2.9-year maturity [Debt Overview](index=11&type=section&id=Debt%20Overview) As of June 30, 2025, Global Net Lease had $3.12 billion in total outstanding debt with a 4.3% weighted-average interest rate and 2.9-year weighted-average maturity Debt Summary as of June 30, 2025 | Metric | Value | | :--- | :--- | | Total Outstanding Debt | $3.12 billion | | Weighted-Average Maturity | 2.9 years | | Weighted-Average Interest Rate | 4.3% | | Recourse Debt Percentage | 56% | | Non-Recourse Debt Percentage | 44% | - The company's debt is primarily fixed-rate, with **85%** of total debt being either fixed-rate or swapped to a fixed rate, mitigating interest rate risk[36](index=36&type=chunk) - The debt is primarily denominated in U.S. Dollars (**80%**), followed by Euros (**19%**) and Canadian Dollars (**1%**)[35](index=35&type=chunk) [Portfolio Overview](index=12&type=section&id=Portfolio%20Overview) The company's real estate portfolio is diversified across property types, industries, and geographies, with a strong future lease income stream and staggered expirations [Lease Profile](index=12&type=section&id=Lease%20Profile) The company's portfolio has over $3.1 billion in future minimum base rent payments, with a staggered lease expiration schedule [Future Minimum Lease Rents](index=12&type=section&id=Future%20Minimum%20Lease%20Rents) As of June 30, 2025, the company has contractual future minimum base rent payments totaling approximately $3.13 billion Future Minimum Base Rent Schedule (in thousands) | Period | Future Minimum Base Rent | | :--- | :--- | | 2025 (remainder) | $226,558 | | 2026 | $437,622 | | 2027 | $391,235 | | 2028 | $356,338 | | 2029 | $302,000 | | Thereafter | $1,413,344 | | **Total** | **$3,127,097** | [Lease Expirations](index=17&type=section&id=Lease%20Expirations) The portfolio's lease expirations are spread over the next decade, with 5.0% expiring in 2025 and concentrations in 2028-2030 Lease Expiration Schedule by Annualized SL Rent | Year of Expiration | Annualized SL Rent Percent Expiring | | :--- | :--- | | 2025 (Remainder) | 5.0% | | 2026 | 8.1% | | 2027 | 8.4% | | 2028 | 10.9% | | 2029 | 13.4% | | 2030 | 10.6% | | Thereafter (>2040) | 9.4% | [Portfolio Diversification](index=13&type=section&id=Portfolio%20Diversification) The company's portfolio is diversified across property types, tenant industries, and geographies [Top Twenty Tenants](index=15&type=section&id=Top%20Twenty%20Tenants) The portfolio's top twenty tenants contribute 42.0% of annualized straight-line rent, with FedEx as the largest at 5.0% - The top 20 tenants represent **42.0%** of the total annualized straight-line rent, amounting to **$192.4 million**[44](index=44&type=chunk) Top 5 Tenants by Annualized SL Rent | Tenant / Lease Guarantor | SL Rent Percent | | :--- | :--- | | FedEx | 5.0% | | McLaren | 4.6% | | Whirlpool | 3.2% | | Government Services Administration (GSA) | 2.5% | | ING Bank | 2.5% | [Diversification by Property Type](index=13&type=section&id=Diversification%20by%20Property%20Type) The portfolio is primarily weighted towards Industrial & Distribution properties, accounting for 47% of annualized straight-line rent Portfolio Breakdown by Property Type (Based on Annualized SL Rent) | Property Type/Segment | SL Rent Percent | Square Feet Percent | | :--- | :--- | :--- | | Industrial & Distribution | 47% | 69% | | Office | 27% | 15% | | Retail | 26% | 16% | [Diversification by Tenant Industry](index=14&type=section&id=Diversification%20by%20Tenant%20Industry) The tenant base is diversified across numerous industries, with Auto Manufacturing and Financial Services as the top sectors at 10% each Top 5 Tenant Industries by Annualized SL Rent | Industry Type | SL Rent Percent | | :--- | :--- | | Auto Manufacturing | 10% | | Financial Services | 10% | | Freight | 6% | | Healthcare | 6% | | Consumer Goods | 5% | - The 'Other' category, which comprises 62 different industry types, represents **38%** of the total annualized straight-line rent, indicating broad industry diversification beyond the top sectors[42](index=42&type=chunk)[43](index=43&type=chunk) [Diversification by Geography](index=16&type=section&id=Diversification%20by%20Geography) The company's portfolio is geographically diversified, with 69.5% of annualized rent from the United States Geographic Breakdown by Annualized SL Rent | Region | SL Rent Percent | | :--- | :--- | | United States | 69.5% | | United Kingdom | 15.5% | | Netherlands | 4.0% | | Finland | 3.2% | | Germany | 2.5% | | Other | 5.3% | [Non-GAAP Definitions](index=3&type=section&id=Non-GAAP%20Definitions) The company utilizes various non-GAAP financial measures, including FFO, AFFO, and Adjusted EBITDA, to supplement GAAP results and provide insights into operational performance [Explanation of Non-GAAP Financial Measures](index=3&type=section&id=Explanation%20of%20Non-GAAP%20Financial%20Measures) The company utilizes non-GAAP financial measures like FFO, AFFO, and Adjusted EBITDA to supplement GAAP results and evaluate performance - The company uses non-GAAP measures such as FFO, Core FFO, AFFO, Adjusted EBITDA, and NOI to provide a more complete understanding of its operating performance[4](index=4&type=chunk)[8](index=8&type=chunk) - FFO is calculated consistent with NAREIT's definition, starting with GAAP net income and excluding real estate-related depreciation and amortization, and gains or losses from property sales[9](index=9&type=chunk)[10](index=10&type=chunk) - AFFO further adjusts Core FFO by excluding certain non-cash items (like straight-line rent and equity-based compensation) and other items not considered part of core ongoing operations to better reflect investing activities and fundamental business performance[16](index=16&type=chunk)[17](index=17&type=chunk) - Adjusted EBITDA is presented as a measure of the company's ability to incur and service debt, adjusting for acquisition costs and other non-cash items[18](index=18&type=chunk)

Core Insights - The company has successfully completed the final phases of its multi-tenant portfolio sale, transitioning into a pure-play net lease REIT [1][3] - A significant reduction in net debt by $748 million has improved the net debt to adjusted EBITDA ratio to 6.6x [1][3] - The company has refinanced its revolving credit facility for $1.8 billion, lowering the cost of capital by 35 basis points and extending the weighted average debt maturity to 3.7 years [1][3] - The low end of the 2025 AFFO guidance has been raised to a range of $0.92 to $0.96 per share [1][4] Financial Performance - Revenue for Q2 2025 was $124.9 million, down from $145.5 million in Q2 2024, primarily due to asset dispositions [3][5] - The net loss attributable to common stockholders was $35.1 million, an improvement from a net loss of $46.6 million in Q2 2024 [3][5] - Core Funds from Operations (Core FFO) decreased to $7.1 million from $50.9 million in Q2 2024, largely due to asset sales [3][5] - Adjusted Funds from Operations (AFFO) was $53.1 million, or $0.24 per share, compared to $76.7 million, or $0.33 per share in Q2 2024 [3][5] Debt and Liquidity - The company has reduced net debt by $2.0 billion since Q2 2024, including the recent $748 million reduction [3][7] - Liquidity increased to $1.0 billion as of June 30, 2025, compared to $220 million in Q2 2024 [3][7] - The refinancing of the revolving credit facility has resulted in a weighted average interest rate of 4.3% and an interest coverage ratio of 2.7 times [8][7] Portfolio and Operations - As of June 30, 2025, the company operates a portfolio of 911 net lease properties across ten countries, totaling 44 million rentable square feet [6][9] - The portfolio is 98% leased with a remaining weighted-average lease term of 6.2 years [9] - 60% of the annualized straight-line rent comes from investment-grade or implied investment-grade tenants [9][3] Strategic Initiatives - The company has executed a share repurchase program, repurchasing 10.2 million shares at a weighted average price of $7.52, totaling $76.9 million [3][16] - The successful sale of the multi-tenant retail portfolio has led to $6.5 million in annual G&A savings and a $30 million reduction in recurring capex [3][4] - The company has received a credit rating upgrade from S&P Global to BB+ and an investment-grade rating of BBB- for its unsecured notes [3][4]