Orion Properties (ONL) Q2 2025 Earnings Call August 07, 2025 10:00 AM ET Speaker0Greetings. Welcome to Orion Properties Second Quarter twenty twenty May. As a reminder, this conference is being recorded. I would now like to turn the call over to Paul Hughes, General Counsel for Orion. Thank you.You may begin.Speaker1Thank you, and good morning, everyone. Yesterday, Orion released its results for the quarter ended 06/30/2025, filed its Form 10 Q with the Securities and Exchange Commission and posted its earn ...

This Investor Presentation includes a summary of various financial and operating information contained in the Company's Quarterly Report on Form 10-Q for the period ended June 30, 2025, and other filings with the Securities and Exchange Commission. You should carefully review the information contained in the Company's filings with the Securities and Exchange Commission in conjunction with the financial and operating information in this Investor Presentation. August 2025 Legal Disclaimer Investor Presentatio ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 | | Page | | --- | --- | | PART I | | | Item 1. Unaudited Financial Statements | 3 | | Orion Properties Inc. Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024 | 3 | | Orion Properties Inc. Consolidated Statements of Operations for the Three and Six Months Ended June 30, | | | 2025 and 2024 | 4 | | Orion Properties Inc. Consolidated Statements of Comprehensive Income (Loss) for the Three and Six Months | | | Ended Jun ...

- Completed 639,000 Square Feet of Leasing Year-to-Date, Including 179,000 Square Feet in the Second Quarter and 80,000 Square Feet Subsequent to Quarter End - - Sold Four Vacant Properties in the Second Quarter for $26.9 Million - - Declares Dividend for Third Quarter 2025 - Exhibit 99.1 FOR IMMEDIATE RELEASE Orion Properties Inc. Announces Second Quarter 2025 Results - Increases 2025 Core FFO Guidance Range and Lowers 2025 Net Debt to Adjusted EBITDA Range - Phoenix, AZ, August 6, 2025 -- Orion Properties ...

Financial Data and Key Metrics Changes - Orion generated total revenues of $38 million in the first quarter compared to $47.2 million in the same quarter of the prior year, reflecting a decrease [18] - The net loss attributable to common stockholders was $9.4 million or $0.17 per share, an improvement from a net loss of $26.2 million or $0.47 per share reported in the first quarter of 2024 [18] - Core FFO for the quarter was $10.7 million or $0.19 per share, down from $20.4 million or $0.36 in the same quarter of 2024 [18] - Adjusted EBITDA was $17.4 million versus $26.7 million in the same quarter of 2024 [18] - G&A expenses in the first quarter were $4.9 million, consistent with the same quarter of 2024 [19] Business Line Data and Key Metrics Changes - Over 450,000 square feet of leasing was completed as of May 6, which includes both new and renewal transactions with a weighted average lease term of 7.4 years [6] - Initial rent spreads on renewal leases during the first quarter were down about 18%, while ending rent spreads were up about 7% on average since the spin [9] - The operating property occupancy rate was 74.3% at quarter end, with a leased rate of 77.4% and a weighted average lease term of 5.2 years [9] Market Data and Key Metrics Changes - The company noted significant macroeconomic uncertainty impacting the broader markets, which could affect leasing activity [7] - The demand for dedicated use assets, which include medical, lab, R&D flex, and non-CBD government properties, is increasing, with approximately 32% of the portfolio by annualized base rent being dedicated use assets [12] Company Strategy and Development Direction - Orion is shifting its portfolio concentration away from traditional suburban office assets towards dedicated use assets, which are expected to provide more stable cash flows [11] - The company plans to continue monetizing non-core assets and redeploying capital to improve the quality of its remaining portfolio [10] - Future capital expenditures will focus on enhancing asset value to retain tenants and attract new ones [15] Management's Comments on Operating Environment and Future Outlook - Management anticipates that the next year or two will represent the low point for revenue and core FFO earnings, followed by accelerating growth into 2027 and beyond [15] - The company remains focused on maintaining significant liquidity to support ongoing leasing efforts and capital commitments [20] - Management expressed confidence in the transformation of the company and the positive direction of its strategic plan [17] Other Important Information - Orion's Board of Directors declared a quarterly cash dividend of $0.02 per share for the second quarter of 2025 [21] - The company expects G&A expenses for 2025 to be in line or slightly better than 2024 [21] Q&A Session Summary Question: What is the tone of discussions with prospects and is there a lengthening of the deal pipeline for leases? - Management noted that decision-making periods for tenants have been long, but there has not been a significant change recently [24] Question: Can you provide background on the recent property sales? - Management confirmed that the sold assets were vacant and expressed satisfaction with the pricing achieved [26] Question: Are you testing the waters with vacant and occupied assets for potential sales? - Management indicated that they are actively evaluating the market for both vacant and occupied properties [28] Question: What is happening with the former Walgreens assets? - Management stated that they are under an agreement with an institutional group to market the site for retail and entertainment use, with demolition of existing buildings starting [30]

Financial Data and Key Metrics Changes - Orion generated total revenues of $38 million in the first quarter compared to $47.2 million in the same quarter of the prior year [17] - The company reported a net loss attributable to common stockholders of $9.4 million or $0.17 per share, an improvement from a net loss of $26.2 million or $0.47 per share in the first quarter of 2024 [17] - Core FFO for the quarter was $10.7 million or $0.19 per share, down from $20.4 million or $0.36 in the same quarter of 2024 [17] - Adjusted EBITDA was $17.4 million versus $26.7 million in the same quarter of 2024 [17] - G&A expenses in the first quarter were $4.9 million, consistent with the same quarter of 2024 [18] Business Line Data and Key Metrics Changes - The company completed over 450,000 square feet of leasing as of May 6, which includes both new and renewal transactions with a weighted average lease term of 7.4 years [5] - Initial rent spreads on renewal leases during the first quarter were down about 18%, while average ending rent spreads were up about 7% since the spin [7] - The operating property occupancy rate was 74.3% at quarter end, with a leased rate of 77.4% and a weighted average lease term of 5.2 years [7] Market Data and Key Metrics Changes - The company noted significant variability in leasing spreads quarter to quarter due to the smaller size of its portfolio [7] - The demand for dedicated use assets, which include medical, lab, R&D flex, and non-CBD government properties, is increasing, with approximately 32% of the portfolio by annualized base rent being dedicated use assets [10] Company Strategy and Development Direction - Orion is shifting its portfolio concentration away from traditional suburban office assets towards dedicated use assets, which are expected to provide more stable cash flows [9] - The company plans to continue monetizing non-core assets and redeploying capital to improve the quality of its remaining portfolio [9] - The strategy includes maintaining significant liquidity to support ongoing leasing efforts and capital expenditures [12][19] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the significant macroeconomic uncertainty affecting the broader markets and its impact on tenant retention [6] - The company anticipates that the next year or two will represent the low point for revenue and core FFO earnings, followed by accelerating growth into 2027 and beyond [13] - Management remains focused on investing in well-located properties within target markets and enhancing asset value through capital expenditures [13] Other Important Information - Orion's liquidity remains strong at $244.5 million, comprised of cash on hand and available balance on the revolver [12] - The company declared a quarterly cash dividend of $0.02 per share for the second quarter of 2025 [20] Q&A Session Summary Question: What is the tone of discussions with prospects and is there a lengthening of the deal pipeline for leases? - Management noted that decision-making periods for tenants have been long since the market collapse, but no significant change has been observed recently [24] Question: Can you provide background on the recent property sales? - Management expressed satisfaction with the sales of vacant properties and indicated that they are testing the market for both vacant and occupied assets [26][28] Question: What is happening with the former Walgreens assets? - Management confirmed that they are under an agreement with an institutional group to market the site for retail and entertainment development, with demolition of existing buildings starting to reduce carrying costs [31][32]

Company Strategy & Portfolio - Orion Properties Inc is shifting its focus to properties with specialized use components, targeting sectors like government, medical, laboratory, R&D, and flex operations[7, 27] - The company aims to reduce exposure to traditional office properties and recycle capital into dedicated use assets[7, 23] - Orion is focused on key growth markets with strong fundamentals and demographic tailwinds[28] - The company seeks to build and maintain a sustainable investment-grade tenant base[30] Portfolio Highlights & Financials - As of March 31, 2025, Orion Properties Inc operated 68 properties with 8,037,000 rentable square feet and an occupancy rate of 74.3%[31] - The annualized base rent (ABR) was $14.95 per rentable square foot, totaling $120,121,000, with 72.3% from investment-grade tenants and a weighted average remaining lease term of 5.2 years[31] - The company had $227,800,000 in liquidity as of March 31, 2025, including $9,800,000 in cash and cash equivalents and $218,000,000 available on the credit facility revolver[57] Recent Activities - Orion completed 380,000 square feet of lease renewals and new leases during the first quarter of 2025, with a weighted average lease term of 6.7 years[57] - In April 2025, the company closed on the sale of three vacant properties for an aggregate gross sales price of $19,100,000[57] - As of May 7, 2025, agreements were in place to sell two operating properties for an aggregate gross sale price of $27,300,000[57]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________ to __________ Commission file number: 001-40873 Orion Properties Inc. (Exact name of registrant as specified in its charter) Maryland 87-1656425 (St ...

Exhibit 99.1 FOR IMMEDIATE RELEASE Orion Properties Inc. Announces First Quarter 2025 Results - Leased 380,000 Square Feet and an Additional 73,000 Square Feet Subsequent to Quarter End - - Sold Three Vacant Properties Subsequent to Quarter End for $19.1 Million - - Declares Dividend for Second Quarter 2025 - - Reaffirms 2025 Outlook - Phoenix, AZ, May 7, 2025 -- Orion Properties Inc. (NYSE: ONL) ("Orion" or the "Company"), a fully-integrated real estate investment trust ("REIT") which owns a diversified po ...

Investor Presentation March 2025 Legal Disclaimer This Investor Presentation includes "forward-looking statements" which reflect Orion Properties Inc.'s (the "Company", "Orion", "we", or "us") expectations and projections regarding future events and plans, future financial condition, results of operations, liquidity and business, including leasing and occupancy, acquisitions, dispositions, rent receipts, expected borrowings and financing costs and the payment of future dividends. Generally, the words "antic ...