Financial Data and Key Metrics Changes - The company reported third quarter FFO of $8.1 million or $0.12 per share, representing an increase of 1.5% compared to the same quarter in 2023 [26] - Third quarter NOI decreased by 0.7% to $84.7 million, while cash basis NOI increased by 1.1% to $82.5 million compared to the same quarter in 2023 [26] - Adjusted EBITDAre increased by 0.9% to $83.9 million [26] - The net debt to total assets ratio improved to 68.1%, while the net debt coverage ratio declined to 12.1 times [30] Business Line Data and Key Metrics Changes - The company executed over 2.7 million square feet of leasing in the third quarter, with a weighted average rate that was 7% higher than prior leases [17] - The consolidated occupancy rate was 94.4%, a slight decrease from the previous quarter [14] - The company executed 13 renewals with FedEx, encompassing over 2 million square feet across eight states, with an average lease term of 5.1 years and a GAAP rollup in rent of 4.5% [21] Market Data and Key Metrics Changes - The portfolio consisted of 411 distribution and logistics properties in 39 states, totaling approximately 60 million square feet [11] - The company highlighted a unique Hawaii footprint with 226 properties totaling more than 16.7 million square feet [11] - 77% of annualized revenues come from investment-grade rated tenants and secure Hawaii land leases [12] Company Strategy and Development Direction - The company aims to capitalize on the attractive operating environment to deliver favorable leasing outcomes [18] - The management plans to address near-term expirations strategically to maximize mark-to-market rent growth while minimizing potential downtime [18] - The company is evaluating unsolicited offers for asset sales but notes a disconnect between property valuations and buyer offers [48] Management Comments on Operating Environment and Future Outlook - Management remains encouraged by the continued demand for high-quality industrial real estate and the strength in fundamentals [9] - The company expects strategic leasing approaches to result in strong tenant retention and stable cash flows [32] - Management is cautious about increasing dividends due to the need for liquidity and financial flexibility [20] Other Important Information - American Tire Distributors, a significant tenant, filed for voluntary Chapter 11 proceedings, but the company expects them to continue operating and fulfilling lease obligations [13][37] - The company announced it would maintain its quarterly cash dividend at $0.01 per share [19] Q&A Session Summary Question: Interest rate cap costs and trade-offs - Management discussed the interest rate for the loan increasing to 6.71% and the strike rate for the cap being set at 2.78%, allowing for upfront cost savings [34] Question: Leasing timelines for Hawaii and Indianapolis - Management indicated that leasing for the Hawaii land parcel is expected in the second half of 2025, while Indianapolis may see leasing in the first half of 2025 [36] Question: American Tire's lease status - Management expects American Tire to utilize the properties and not reject the leases, noting their history of renewing leases even during bankruptcy [38] Question: Dividend expectations - Management acknowledged the importance of dividends to investors but emphasized the need for financial flexibility before increasing the dividend level [40] Question: Interest expense forecast - Management clarified that the expected cash interest expense would be $60 million, with noncash amortization at $12 million, reflecting changes in interest rates and amortization of financing costs [43]

Core Viewpoint - Industrial Logistics Properties Trust (ILPT) reported quarterly funds from operations (FFO) of $0.12 per share, matching the Zacks Consensus Estimate, and showing no year-over-year change [1] - The company posted revenues of $108.95 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 1.13% and down from $110.14 million a year ago [2] Financial Performance - FFO for the previous quarter was also $0.14 per share, with the company having surpassed consensus FFO estimates only once in the last four quarters [1] - The current consensus FFO estimate for the upcoming quarter is $0.11 on revenues of $109.92 million, and for the current fiscal year, it is $0.51 on revenues of $442.97 million [7] Market Performance - ILPT shares have declined approximately 16% since the beginning of the year, contrasting with the S&P 500's gain of 22.1% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Outlook - The REIT and Equity Trust - Other industry is currently ranked in the top 24% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% of ranked industries [8]

Property and Occupancy - As of September 30, 2024, the company owned 411 properties with approximately 59,890,000 rentable square feet and a 94.4% occupancy rate[67]. - Occupancy at Mainland Properties was 97.7%, contributing to 72.1% of total annualized rental revenues as of September 30, 2024[78]. - Occupancy at Hawaii Properties was 85.7%, representing 27.9% of total annualized rental revenues, with potential for future rent growth due to periodic rent resets[79]. - 5.6% of rentable square feet were currently vacant as of September 30, 2024[81]. Rental Income and Financial Performance - Rental income and net operating income (NOI) increased during the nine months ended September 30, 2024, primarily due to leasing activity and rent resets, with long-term e-commerce trends contributing to high occupancy[69]. - Rental income for the nine months ended September 30, 2024, increased to $331,801, a 1.1% increase from $328,339 in the same period of 2023[93]. - Rental income for Q3 2024 was $108,945, a decrease of $1,197 or 1.1% compared to $110,142 in Q3 2023[84]. - NOI for Q3 2024 was $84,713, a decrease of $609 or 0.7% compared to $85,322 in Q3 2023[84]. - Net Operating Income (NOI) for the period was $257,062, up 1.1% from $254,150 in the previous year[93]. - The Funds From Operations (FFO) attributable to common shareholders for the nine months ended September 30, 2024, was $26,478, an increase of 13.0% from $23,236 in the same period of 2023[109]. Leasing Activity - The company entered into new and renewal leases totaling 2,757 thousand square feet during the three months ended September 30, 2024, with a weighted average rental rate change of 7.0%[72]. - During the nine months ended September 30, 2024, the company completed rent resets for approximately 106,000 square feet in Hawaii at rates 27.5% higher than prior rates[73]. - The company’s total leasing costs and concession commitments for new leases were $113,000, averaging $6.77 per square foot[72]. Expenses and Losses - Operating expenses totaled $24,232, down $588 or 2.4% from $24,820 in the same period last year[84]. - General and administrative expenses decreased by $475 or 6.2%, totaling $7,237 in Q3 2024[84]. - Total operating expenses rose to $74,739, reflecting a 0.7% increase compared to $74,189 in the prior year[93]. - The net loss attributable to common shareholders improved to $(71,568) from $(76,749), reflecting a 6.8% reduction in losses[93]. - The net loss attributable to common shareholders was $24,990, a decrease of $1,122 or 4.3% from $26,112 in Q3 2023[84]. Interest and Debt - Interest income increased significantly by 67.1% to $8,921, driven by higher interest rates and average cash balances[100]. - Interest expense rose to $220,797, a 2.4% increase from $215,558, primarily due to increased amortization related to interest rate caps[101]. - The company’s interest expense for the three months ended September 30, 2024, was $73,936, slightly up from $72,941 in the same period of 2023[107]. - The company had an aggregate principal amount of $4,312,421 of indebtedness, including the ILPT Floating Rate Loan and the Mountain Floating Rate Loan[125]. - A one percentage point increase in interest rates would result in a weighted average interest rate of 6.98% and total interest expense per year of $186,568[137]. Cash and Investments - Cash and cash equivalents at the end of the period increased to $264,931 from $222,503 in the previous year, reflecting a growth of 19.1%[112]. - The company reported a net cash provided by operating activities of $15,426 for the nine months ended September 30, 2024, compared to $14,063 in 2023, marking an increase of 9.7%[112]. - The company capitalized $5,637 for tenant improvements and leasing costs in the three months ended September 30, 2024, compared to $5,275 in the same period of 2023, indicating an increase of 6.9%[115]. Tenant and Lease Information - As of September 30, 2024, subsidiaries of FedEx and Amazon accounted for 22.7% and 8.0% of total leased square feet, representing 29.3% and 6.8% of total annualized rental revenues, respectively[77]. - As of September 30, 2024, 77.2% of annualized rental revenues came from investment-grade rated tenants, with only 4.0% of revenues from leases expiring in the next 12 months[110]. - Future rental rates will depend on prevailing market conditions, with historical increases not guaranteed[81]. Compliance and Governance - The company believes it was in compliance with all covenants and terms under the agreements governing its loans as of September 30, 2024[126].

Financial Performance - The net loss attributable to common shareholders was $25.0 million, or $0.38 per diluted share, while normalized FFO attributable to common shareholders was $8.1 million, or $0.12 per share [5]. - Adjusted EBITDAre increased by 0.9% to $83.9 million compared to Q3 2023 [5]. - Rental income for Q3 2024 was $108,945, a decrease of 1.1% from $110,142 in Q3 2023 [8]. - Net loss attributable to common shareholders for Q3 2024 was $(24,990), compared to $(26,112) in Q3 2023, showing an improvement of 4.3% [8]. - Adjusted EBITDAre for Q3 2024 was $83,947, down from $85,057 in Q2 2024 [6]. - Cash Basis NOI for Q3 2024 was $82,503, slightly down from $82,935 in Q2 2024 [6]. - Normalized FFO attributable to common shareholders for Q3 2024 was $8,063, consistent with Q2 2024 [6]. - CAD attributable to common shareholders for Q3 2024 was $11,247, down from $14,005 in Q2 2024 [6]. - Total rental income for the three months ended September 30, 2024, was $42,189,000, compared to $42,061,000 for the same period in 2023, reflecting a slight increase [33]. - The company reported a net loss attributable to common shareholders of $16,309,000 for the three months ended September 30, 2024 [20]. - Normalized FFO for the three months ended September 30, 2024, was $32,000, compared to $747,000 for the same period in 2023, reflecting a significant decrease [34]. - Net loss for the three months ended September 30, 2024, was $(26,737,000), slightly higher than the $(26,248,000) loss in the same period of 2023 [34]. - EBITDA for the three months ended September 30, 2024, was $31,044,000, compared to $30,749,000 for the same period in 2023, indicating a modest increase [34]. - Total expenses for the three months ended September 30, 2024, were $12,976,000, a decrease from $13,515,000 in the same period of 2023 [36]. - Cash Basis NOI for the three months ended September 30, 2024, was $82,503,000, compared to $81,643,000 for the same period in 2023, showing an increase of 1.1% [38]. Leasing Activity - In Q3 2024, Industrial Logistics Properties Trust (ILPT) executed approximately 2.74 million square feet of leases at rates 7.0% higher than prior rents, with a weighted average lease term of 5.5 years [2]. - Leasing activity included over 2.0 million square feet of renewals with FedEx, ILPT's largest tenant, at weighted average rental rates that were 4.5% higher than prior [5]. - The portfolio contains approximately 59.9 million rentable square feet, with 77% of annualized rental revenues coming from investment-grade tenants [4]. - The percentage of properties leased as of September 30, 2024, was 94.4%, down from 98.9% as of September 30, 2023 [14]. - As of September 30, 2024, the percentage of properties leased is 94.4%, down from 95.4% in the previous quarter [16]. - New leases showed a percentage change in GAAP rent of 4.1%, a significant decrease from 43.5% in the previous quarter [16]. - The top tenant, FedEx Corporation, accounts for 22.7% of total leased square feet and 29.3% of rental revenues [17]. - Leasing costs and concession commitments for new leases total $2,907,000, with an average cost per square foot of $6.77 [16]. - Scheduled rent resets at Hawaii properties total 3,384 square feet, with annualized rental revenues of $22,873,000 [19]. Financial Position - The company had approximately $153.9 million in cash and cash equivalents to meet capital obligations and fund future financing needs [5]. - Total liabilities as of September 30, 2024, were $4,412,049, compared to $4,401,896 as of December 31, 2023 [6]. - Total equity decreased to $1,042,759 as of September 30, 2024, from $1,161,779 as of December 31, 2023 [6]. - Total assets as of September 30, 2024, decreased to $5,454,808, down from $5,563,675 as of December 31, 2023, reflecting a decline of approximately 1.95% [9]. - Cash and cash equivalents increased to $153,863 as of September 30, 2024, from $112,341 as of December 31, 2023, an increase of approximately 36.9% [9]. - The weighted average interest rate on total debt was 5.36% as of September 30, 2024 [10]. - The company’s net debt to annualized Adjusted EBITDA ratio was 12.1x as of September 30, 2024, compared to 12.3x as of December 31, 2023 [12]. - The net debt to total gross assets ratio was 68.1% as of September 30, 2024, slightly improved from 68.2% as of June 30, 2024 [12]. - Total gross assets amounted to $2,522,145,000, while total debt was $2,585,000,000, resulting in a net debt to annualized Adjusted EBITDA ratio of 13.5x [20]. - The annualized Cash Basis NOI to total gross assets ratio was 7.9% [20]. Dividends and Distributions - ILPT's quarterly distribution was declared on October 16, 2024, to shareholders of record as of the close of business on October 30, 2024 [2]. - Annualized dividend yield at the end of Q3 2024 was 0.8%, down from 1.1% in Q2 2024 [6]. - The annualized dividend yield is calculated by dividing the annualized dividend paid by the closing price of ILPT's common shares [53]. Strategic Focus - The company remains focused on maximizing mark-to-market rent growth while evaluating opportunities to reduce operating expenses [2]. - The company plans to continue expanding its market presence and exploring new acquisition opportunities [22]. - The company believes that being managed by RMR provides a competitive advantage due to RMR's management depth and experience in the real estate industry [45]. - ILPT is included in 137 market indices, comprising more than 1% of several key indices as of September 30, 2024 [45]. Joint Ventures - ILPT owns a 61% equity interest in a joint venture that includes 94 properties with approximately 21.0 million rentable square feet [57]. - The joint venture, Mountain Industrial REIT LLC, had a total of 94 properties across 27 states as of September 30, 2024 [32]. - Distributions received from the joint venture for the three months ended September 30, 2024, were $990,000, down from $5,390,000 in the same period of 2023 [36]. - The weighted average interest rate for the joint venture's debt was 4.22% as of September 30, 2024 [36].

Financial Data and Key Metrics Changes - Cash basis NOI increased by 2.6% year-over-year, while normalized FFO rose by 18.1% [4][8] - GAAP and cash basis NOI were reported at $86.3 million and $82.9 million, reflecting increases of 2.2% and 2.6% year-over-year [8] - Interest expense increased by $1.8 million compared to the same period last year, totaling $73.6 million [9] - Net debt to total assets ratio improved by 60 basis points to 68.2%, and net debt coverage ratio improved by 80 basis points to 11.9x [10] Business Line Data and Key Metrics Changes - In the first half of 2024, the company signed 26 leases totaling 2.6 million square feet at weighted average rental rates that were 30.5% higher than prior rates [4][5] - Leasing spreads for GAAP and cash were 15.8% and 7.8%, respectively [6] - The company executed 15 new and renewal leases for approximately 628,000 square feet at a weighted average lease term of 6.8 years [5] Market Data and Key Metrics Changes - The Hawaii portfolio experienced minimal new construction and a market vacancy of 1%, leading to rental rate increases of 23.8% for executed leases [6] - A 2.2 million square foot land parcel in Hawaii became vacant, impacting occupancy which declined to 95.4% [6] Company Strategy and Development Direction - The company aims to generate organic cash flow growth and reduce leverage, which has decreased from 12.7x to 11.9x over the past year [8] - The leasing pipeline remains active with 36 deals for over 7 million square feet, of which 2.5 million square feet are in advanced stages [7] Management's Comments on Operating Environment and Future Outlook - Management remains encouraged by the demand for the company's high-quality portfolio, supported by solid leasing activity [4] - The company is proactively engaging in renewal discussions for upcoming lease expirations, with 1.3 million square feet or 3.1% of annualized revenue set to expire in 2024 [7] Other Important Information - Total cash as of June 30 was approximately $250 million, including $112 million of restricted cash, representing a growth of about $50 million over the past year [10] - The company plans to use cash for a replacement interest rate cap and to fund future leasing obligations [11] Q&A Session Summary Question: Timing for Home Depot and Indianapolis properties leasing - Management suggests modeling for the second half of 2025 due to the time required for negotiations [12] Question: Cost expectations for upcoming loan extension - Expected cost for the cap is between $25 million and $30 million, likely executed close to September 30 [13] Question: Pace of deleveraging - Management indicates that the pace of deleveraging should be similar to the past 12 months [14] Question: Consideration for increasing dividend payout - The Board discusses dividend payout at each meeting but currently plans to preserve cash for business operations [15] Question: Leasing pipeline execution rate - The leasing pipeline decreased slightly due to executed leases, resulting in a net positive of 150,000 square feet from the previous quarter [17][18] Question: Refinancing existing debt - Management is evaluating the potential benefits of refinancing existing debt before exercising the cap [21]

Core Viewpoint - Industrial Logistics Properties Trust has shown mixed performance in terms of estimate revisions and is currently rated as a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [2] Financial Performance - The company reported quarterly funds from operations (FFO) of $0.14 per share, which was in line with the Zacks Consensus Estimate and represents an increase from $0.12 per share a year ago [7] - Revenues for the quarter ended June 2024 were $110.62 million, slightly missing the Zacks Consensus Estimate by 0.52%, but showing an increase from $108.04 million in the same quarter last year [8] - The current consensus FFO estimate for the upcoming quarter is $0.12 on revenues of $110.7 million, and for the current fiscal year, it is $0.52 on revenues of $444.45 million [5] Market Context - Year-to-date, Industrial Logistics Properties Trust shares have increased by approximately 6.8%, underperforming compared to the S&P 500's gain of 14.5% [12] - The REIT and Equity Trust - Other industry, to which the company belongs, is currently ranked in the bottom 41% of over 250 Zacks industries, indicating potential challenges ahead [14]

For the quarterly period ended June 30, 2024 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 001-38342 INDUSTRIAL LOGISTICS PROPERTIES TRUST (Address of Principal Executive Offices) (Zip Code) 617-219-1460 (Registrant's Telephone Number, Including Area Code) Securities R ...

Industrial Logistics Properties Trust Second Quarter 2024 Financial Results and Supplemental Information July 30, 2024 Quarterly Results RETURN TO TABLE OF CONTENTS P = = = 7 - 1 7 7 6 INDUSTRIAL LOGISTICS PROPERTIES TRUST ANNOUNCES SECOND QUARTER 2024 FINANCIAL RESULTS "Operating results for ILPT's second quarter remained strong as we executed 628,000 square feet of new and renewal leases at weighted average rental rates that were 15.8% higher than prior rental rates for the same space and saw same propert ...

031 # II 1 用 Shares of Industrial Logistics Properties Trust (NASDAQ:ILPT) have been nearly decimated since the company employed a lot of leverage following an ill-time acquisition, amidst higher interest rates and some governance issues as well. This means that shares trade discounted during an era of near 100% occupancy rates and decent rental growth. In fact, shares trade at a fraction of book value, with investors having to hope for a lower interest rate environment and/or asset sales, and governance im ...

Industrial Logistics Properties Trust (NASDAQ:ILPT) Q1 2024 Results Conference Call May 1, 2024 10:00 AM ET Company Participants Kevin Brady - IR Yael Duffy - President & COO Tiffany Sy - CFO & Treasurer Conference Call Participants Bryan Maher - B. Riley FBR Mitch Germain - Citizens JMP Operator Good day, and welcome to the Industrial Logistics Properties Trust First Quarter 2024 Earnings Conference Call. [Operator Instructions] This event is being recorded. I would now like to turn the conference over to ...