Tanger Factory Outlet Centers, Inc. (NYSE:SKT) Q1 2022 Earnings Conference Call May 6, 2022 8:30 AM ET Company Participants Doug McDonald - SVP, Finance and Capital Markets Steven Tanger - Executive Chair Stephen Yalof - President, CEO & Director James Williams - EVP, CFO & Treasurer Conference Call Participants Todd Thomas - KeyBanc Capital Markets Michael Bilerman - Citigroup Inc. Floris Gerbrand Van Dijkum - Compass Point Research & Trading Caitlin Burrows - Goldman Sachs Group Emily Arft - Green Street ...

Financial Performance - The company's Q1 2022 results reflect strong operating fundamentals, driving robust NOI growth, positive leasing spreads, and increased tenant sales[14] - Same Center NOI increased by 99% year-over-year for the twelve months ended March 31, 2022[32] - Core FFO available to common shareholders was $045 per share in Q1 2022[80, 104] - Net income available to common shareholders was $20303 million in Q1 2022, compared to $3926 million in Q1 2021[101] Portfolio Metrics - Occupancy was 943% as of March 31, 2022, up 13%[32] - Tenant sales per square foot reached $464, up 181% from 1Q19[32] - Executed comparable leases had blended cash rent spreads of +99%[32] - The company executed 18 million square feet of leases in the period from 375 leases[32] - The portfolio consists of 136 million total square feet[24] Capital & Debt - The company maintains an investment-grade rating[24] - The company has limited floating rate exposure[70] - The company has $1079 million in square feet encumbered and $14680 million in square feet unencumbered[70]

Tanger Factory Outlet Centers, Inc. (NYSE:SKT) Citi's 2022 Global Property CEO Conference March 7, 2022 5:00 PM ET Company Participants Stephen Yalof - Director, President and Chief Executive Officer James Williams - Executive Vice President, Chief Financial Officer and Treasurer Conference Call Participants Katy McConnell - Citigroup Operator Good afternoon, everyone and welcome to the 5 PM session at Citi’s Global Property CEO Conference. I'm Katy McConnell with City research and we're pleased to have wi ...

Part I [Explanatory Note](index=3&type=section&id=Explanatory%20Note) This 10-K combines reports for Tanger Factory Outlet Centers, Inc. (REIT) and its Operating Partnership, providing a comprehensive enterprise view - The report combines the annual filings for Tanger Factory Outlet Centers, Inc. (the Company) and Tanger Properties Limited Partnership (the Operating Partnership), which are operated as a single enterprise[14](index=14&type=chunk)[18](index=18&type=chunk) - The Company is a REIT whose primary asset is its ownership interest in the Operating Partnership. The Operating Partnership holds all outlet centers and assets, conducts all operations, and generates the required capital[15](index=15&type=chunk)[19](index=19&type=chunk)[20](index=20&type=chunk) - As of December 31, 2021, the Company and its subsidiaries owned **104,084,734** units of the Operating Partnership, while other limited partners held **4,761,559** Class A common limited partnership units, which are exchangeable for the Company's common shares[17](index=17&type=chunk) [Item 1. Business](index=5&type=section&id=ITEM%201.%20BUSINESS) Tanger is a leading outlet center owner/operator in the US and Canada, focused on portfolio growth and NOI, with 2021 marked by strategic financing and ESG initiatives Portfolio Overview as of December 31, 2021 | Portfolio Type | Number of Centers | Total Gross Leasable Area (sq. ft.) | | :--- | :--- | :--- | | Consolidated | 30 | ~11.5 million | | Unconsolidated | 6 | ~2.1 million | - The consolidated portfolio was **95%** occupied as of year-end 2021, containing over **2,200** stores from approximately **500** brands[25](index=25&type=chunk) - The company's growth strategy includes increasing net operating income at existing centers, developing new centers, expanding and renovating properties, and acquiring outlet centers that meet strategic criteria[54](index=54&type=chunk)[55](index=55&type=chunk)[56](index=56&type=chunk) - As of December 31, 2021, the company had **310** full-time and **263** part-time employees. Females comprised **77%** of the total workforce and **45%** of the executive leadership team, while ethnic minorities made up **26%** of the total workforce[82](index=82&type=chunk)[85](index=85&type=chunk) - The company has established an ESG program with priority issues identified as Diversity, Equity and Inclusion; Energy Use and Efficiency; Community Involvement; Climate Change; and Tenants' Environmental and Social Footprint[87](index=87&type=chunk)[90](index=90&type=chunk) [Recent Developments](index=5&type=section&id=Recent%20Developments) In 2021, the company strengthened its capital structure via an ATM offering, debt refinancing, and credit line extension, while recording an impairment and selling an asset 2021 At-the-Market (ATM) Share Offering | Metric | Value | | :--- | :--- | | Shares Sold | 10.0 million | | Weighted Average Price | $18.97 per share | | Net Proceeds | $187.1 million | - The company issued **$400.0 million** in senior notes due 2031 at a **2.750%** interest rate, using the proceeds to redeem all outstanding **3.875%** notes due 2023 (**$250.0 million** total) and **3.750%** notes due 2024 (**$250.0 million**). This resulted in a loss on early extinguishment of debt, including make-whole premiums[36](index=36&type=chunk)[37](index=37&type=chunk) - A **$7.0 million** impairment charge was recorded in December 2021 for the Mashantucket (Foxwoods), Connecticut outlet center due to a decreased estimated hold period and declining operating results[40](index=40&type=chunk) - The company extended the maturity of its **$520.0 million** unsecured lines of credit from October 2021 to July 2025[35](index=35&type=chunk) [Item 1A. Risk Factors](index=14&type=section&id=ITEM%201A%20RISK%20FACTORS) The company faces risks from real estate illiquidity, tenant health, debt financing, interest rate volatility, cyber-attacks, and maintaining REIT status - **Real Estate Risks:** Investments are illiquid and subject to market volatility, economic conditions, and competition. The company may be unable to successfully develop new centers or expand existing ones, and properties may be subject to impairment charges[95](index=95&type=chunk)[96](index=96&type=chunk)[100](index=100&type=chunk)[101](index=101&type=chunk) - **Business & Operational Risks:** The COVID-19 pandemic continues to pose a significant threat to tenant financial health and consumer spending. The company is substantially dependent on rental income and the operational success of its retail tenants, who face risks from changing consumer habits, e-commerce, and potential bankruptcy[110](index=110&type=chunk)[113](index=113&type=chunk)[116](index=116&type=chunk)[125](index=125&type=chunk) - **Financial & Market Risks:** The company is subject to risks from debt financing, including the ability to refinance maturing debt on favorable terms. Interest rate fluctuations, particularly the phasing out of LIBOR, could adversely affect financing costs. The company also faces risks from cyber-attacks that could disrupt operations or expose sensitive data[130](index=130&type=chunk)[134](index=134&type=chunk)[143](index=143&type=chunk) - **Tax & Structural Risks:** Failure to qualify as a REIT would subject earnings to corporate-level taxation, significantly reducing cash available for distribution. The company is also dependent on distributions from the Operating Partnership to pay dividends and meet its financial obligations[137](index=137&type=chunk)[142](index=142&type=chunk) [Item 2. Properties](index=24&type=section&id=ITEM%202.%20PROPERTIES) Tanger's diversified portfolio includes 30 consolidated and 6 unconsolidated outlet centers, with 95% occupancy and key tenants contributing significantly to rent Consolidated Portfolio Occupancy and Rent (2017-2021) | Year | Occupancy | Average Annual Base Rent per sq. ft. | | :--- | :--- | :--- | | 2021 | 95% | $23.79 | | 2020 | 92% | $21.10 | | 2019 | 97% | $25.35 | | 2018 | 97% | $25.51 | | 2017 | 97% | $25.81 | Top 5 Tenants by Annualized Base Rent (as of Dec 31, 2021) | Tenant | % of Total GLA | % of Total Annualized Base Rent | | :--- | :--- | :--- | | The Gap, Inc. | 7.7% | 6.1% | | Premium Apparel, LLC; The Talbots, Inc. | 3.7% | 4.2% | | SPARC Group | 4.0% | 4.2% | | PVH Corp. | 2.6% | 3.6% | | Tapestry, Inc. | 2.0% | 3.4% | - Scheduled lease expirations for 2022 represent **18%** of annualized base rent, covering approximately **1.8 million** square feet[162](index=162&type=chunk) - The Deer Park, New York outlet center is the only property comprising **10%** or more of consolidated total assets. Its occupancy recovered to **95%** in 2021 from **89%** in 2020[176](index=176&type=chunk) [Item 3. Legal Proceedings](index=32&type=section&id=ITEM%203.%20LEGAL%20PROCEEDINGS) The company is involved in routine legal proceedings, none of which are expected to materially impact financial results - The Company and Operating Partnership are engaged in routine legal proceedings, none of which are expected to have a material adverse effect on financial results[182](index=182&type=chunk) [Information about the Executive Officers](index=32&type=section&id=Information%20about%20the%20Executive%20Officers) The company's executive leadership team, including Steven B. Tanger and Stephen J. Yalof, comprises experienced professionals, strengthened by key hires in 2021 Executive Officers | Name | Age | Position | | :--- | :--- | :--- | | Steven B. Tanger | 73 | Executive Chair of the Board | | Stephen J. Yalof | 59 | Director, President and Chief Executive Officer | | James F. Williams | 57 | Executive Vice President - Chief Financial Officer and Treasurer | | Chad D. Perry | 49 | Executive Vice President - General Counsel and Secretary | | Leslie A. Swanson | 51 | Executive Vice President - Chief Operating Officer | | Justin C. Stein | 42 | Executive Vice President - Leasing | | Andrew R. Wingrove | 39 | Executive Vice President - Chief Commercial Officer | Part II [Item 5. Market for Registrant's Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities](index=34&type=section&id=ITEM%205.%20MARKET%20FOR%20REGISTRANT'S%20COMMON%20EQUITY%2C%20RELATED%20SHAREHOLDER%20MATTERS%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES) Tanger's shares trade on NYSE; the company reinstated dividends in 2021 and authorized a share repurchase program, though stock performance lagged REIT indices - The Board authorized an **$80.0 million** share repurchase program through May 31, 2023. No shares were repurchased under this program as of December 31, 2021[196](index=196&type=chunk)[197](index=197&type=chunk) - Dividends were reinstated in January 2021 after a temporary suspension in May 2020. Quarterly dividends were paid for the full year 2021, with a total of **$0.7150 per unit** distributed by the Operating Partnership[199](index=199&type=chunk)[208](index=208&type=chunk) Five-Year Cumulative Total Return Performance | Index | 12/31/2016 | 12/31/2021 | | :--- | :--- | :--- | | Tanger Factory Outlet Centers, Inc. | $100.00 | $72.60 | | Dow Jones Equity All REIT Index | $100.00 | $180.39 | | Dow Jones U.S. Real Estate Retail Index | $100.00 | $89.37 | [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=39&type=section&id=ITEM%207.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) 2021 saw significant operational and financial recovery, with increased net income and rental revenues, improved liquidity, and stronger non-GAAP metrics, despite a debt extinguishment loss - Net income increased to **$9.6 million** in 2021 from a net loss of **$38.0 million** in 2020. The improvement was primarily due to higher revenues post-pandemic and lower impairment charges, partially offset by a **$47.9 million** loss on early debt extinguishment[226](index=226&type=chunk) - Rental revenues increased by **$29.8 million** in 2021 compared to 2020, largely due to a **$42.9 million** increase in revenues from existing properties as business conditions normalized after the COVID-19 disruptions of 2020[227](index=227&type=chunk) - The company's liquidity position was strong, with approximately **$681.3 million** available as of December 31, 2021, consisting of cash and undrawn capacity on its unsecured lines of credit[290](index=290&type=chunk) Key Non-GAAP Performance Metrics (2021 vs 2020) | Metric | 2021 | 2020 | | :--- | :--- | :--- | | FFO available to common shareholders (in thousands) | $138,114 | $154,122 | | Core FFO available to common shareholders (in thousands) | $188,360 | $153,708 | | Core FFO per share - diluted | $1.76 | $1.57 | | Same Center NOI - Consolidated (in thousands) | $284,768 | $246,245 | [Results of Operations](index=42&type=section&id=Results%20of%20Operations) Net income increased significantly in 2021 due to higher rental revenues and lower impairment, partially offset by a debt extinguishment loss and increased G&A expenses Change in Rental Revenues (2021 vs 2020, in thousands) | Component | 2021 | 2020 | Increase/(Decrease) | | :--- | :--- | :--- | :--- | | Rental revenues from existing properties | $407,164 | $364,214 | $42,950 | | Rental revenues from properties disposed | $272 | $7,315 | ($7,043) | | Lease termination fees | $2,225 | $12,125 | ($9,900) | | **Total Rental Revenues** | **$407,766** | **$377,932** | **$29,834** | - General and administrative expenses increased by **$18.1 million** in 2021, primarily due to higher compensation costs from new executive hires, professional fees related to rent collections, and **$3.6 million** in severance and voluntary retirement costs[235](index=235&type=chunk) - Impairment charges decreased to **$7.0 million** in 2021 (related to the Foxwoods center) from **$67.2 million** in 2020 (related to the Foxwoods and Jeffersonville centers)[236](index=236&type=chunk) - A loss on early extinguishment of debt of **$47.9 million** was recorded in 2021 due to make-whole premiums and write-offs from the redemption of senior notes due in 2023 and 2024[238](index=238&type=chunk) [Liquidity and Capital Resources](index=46&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintained strong liquidity in 2021, with increased operating cash flow and strategic financing activities, including an ATM offering and debt refinancing Cash Flow Summary (2021 vs 2020, in thousands) | Cash Flow Activity | 2021 | 2020 | Change | | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | $217,697 | $164,818 | $52,879 | | Net cash used in investing activities | ($22,739) | ($18,771) | ($3,968) | | Net cash used in financing activities | ($118,379) | ($77,593) | ($40,786) | - During 2021, the company sold **10.0 million** shares under its ATM program at a weighted average price of **$18.97 per share**, generating net proceeds of **$187.1 million**, which were used primarily to reduce debt[291](index=291&type=chunk) - The company redeemed all of its **3.875%** senior notes due 2023 and **3.750%** senior notes due 2024, funded by a new public offering of **$400.0 million** in **2.750%** senior notes due 2031[292](index=292&type=chunk)[293](index=293&type=chunk) - As of December 31, 2021, the company was in compliance with all debt covenants, with its most restrictive covenants being those in its senior, unsecured notes[303](index=303&type=chunk)[304](index=304&type=chunk) [Non-GAAP Supplemental Measures](index=57&type=section&id=Non-GAAP%20Supplemental%20Measures) While FFO decreased due to debt extinguishment, Core FFO and Same Center NOI significantly increased in 2021, reflecting strong operational recovery Reconciliation of Net Income to FFO and Core FFO (in thousands) | Metric | 2021 | 2020 | | :--- | :--- | :--- | | Net income (loss) | $9,558 | ($38,013) | | Adjustments (Depreciation, Impairment, etc.) | $129,009 | $200,215 | | FFO | $139,567 | $156,025 | | **FFO available to common shareholders** | **$138,114** | **$154,122** | | Further Adjustments (Loss on debt extinguishment, etc.) | $50,246 | ($417) | | **Core FFO available to common shareholders** | **$188,360** | **$153,708** | FFO and Core FFO Per Share (Diluted) | Metric | 2021 | 2020 | | :--- | :--- | :--- | | FFO available to common shareholders per share | $1.29 | $1.58 | | Core FFO available to common shareholders per share | $1.76 | $1.57 | - Same Center NOI for the consolidated portfolio increased by **15.6%** to **$284.8 million** in 2021 from **$246.2 million** in 2020[334](index=334&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=65&type=section&id=ITEM%207A.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company's primary market risk is interest rate exposure on its variable-rate debt, alongside unhedged foreign currency risk from Canadian investments - As of year-end 2021, **3%** of outstanding consolidated debt (excluding debt with interest rate protection) had variable interest rates. A **100 basis point** change in LIBOR would change annual interest expense by approximately **$401,000**[359](index=359&type=chunk) - The company is exposed to foreign currency risk from its Canadian investments, which are denominated in Canadian Dollars, but generally does not hedge this exposure[364](index=364&type=chunk) Fair Value vs. Recorded Value of Debt (in thousands) | Date | Fair Value of Debt | Recorded Value of Debt | | :--- | :--- | :--- | | December 31, 2021 | $1,445,337 | $1,397,076 | | December 31, 2020 | $1,639,803 | $1,567,886 | [Item 9A. Controls and Procedures](index=66&type=section&id=ITEM%209A.%20CONTROLS%20AND%20PROCEDURES) Management and independent auditors concluded that disclosure controls and internal controls over financial reporting were effective as of December 31, 2021 - The Principal Executive Officer and Principal Financial Officer concluded that the disclosure controls and procedures for both the Company and the Operating Partnership were effective as of December 31, 2021[367](index=367&type=chunk)[372](index=372&type=chunk) - Management concluded that the internal control over financial reporting for both entities was effective as of December 31, 2021, based on the COSO framework[369](index=369&type=chunk)[374](index=374&type=chunk) - The independent auditor, Deloitte & Touche LLP, provided an unqualified opinion on the effectiveness of internal control over financial reporting for both the Company and the Operating Partnership[371](index=371&type=chunk)[376](index=376&type=chunk) Part III [Item 10. Directors, Executive Officers and Corporate Governance](index=68&type=section&id=ITEM%2010.%20DIRECTORS%2C%20EXECUTIVE%20OFFICERS%20AND%20CORPORATE%20GOVERNANCE) Information on directors, executive officers, and corporate governance is incorporated by reference from the 2022 Proxy Statement - Information required by this item is incorporated by reference from the Company's 2022 Proxy Statement[381](index=381&type=chunk)[383](index=383&type=chunk) [Item 11. Executive Compensation](index=69&type=section&id=ITEM%2011.%20EXECUTIVE%20COMPENSATION) Executive compensation information is incorporated by reference from the 2022 Proxy Statement - Information required by this item is incorporated by reference from the Company's 2022 Proxy Statement[385](index=385&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters](index=69&type=section&id=ITEM%2012.%20SECURITY%20OWNERSHIP%20OF%20CERTAIN%20BENEFICIAL%20OWNERS%20AND%20MANAGEMENT%20AND%20RELATED%20SHAREHOLDER%20MATTERS) Security ownership information is incorporated by reference from the 2022 Proxy Statement, detailing equity compensation plan issuances Equity Compensation Plan Information as of December 31, 2021 | Plan Category | Number of Securities to be Issued Upon Exercise | Weighted Average Exercise Price | Number of Securities Remaining Available for Future Issuance | | :--- | :--- | :--- | :--- | | Approved by security holders | 2,421,866 | $16.62 | 2,110,394 | | Not approved by security holders | 1,000,000 | $7.15 | — | | **Total** | **3,421,866** | **$10.68** | **2,110,394** | [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=69&type=section&id=ITEM%2013.%20CERTAIN%20RELATIONSHIPS%20AND%20RELATED%20TRANSACTIONS%2C%20AND%20DIRECTOR%20INDEPENDENCE) Information on related party transactions and director independence is incorporated by reference from the 2022 Proxy Statement - Information required by this item is incorporated by reference from the Company's 2022 Proxy Statement[391](index=391&type=chunk) [Item 14. Principal Accounting Fees and Services](index=70&type=section&id=ITEM%2014.%20PRINCIPAL%20ACCOUNTING%20FEES%20AND%20SERVICES) Principal accounting fees and services information is incorporated by reference from the 2022 Proxy Statement - Information required by this item is incorporated by reference from the Company's 2022 Proxy Statement[393](index=393&type=chunk) Part IV [Item 15. Exhibits and Financial Statement Schedules](index=70&type=section&id=ITEM%2015.%20EXHIBITS%20AND%20FINANCIAL%20STATEMENT%20SCHEDULES) This section lists the financial statements, schedules, and exhibits filed as part of the Form 10-K, including consolidated financials and auditor reports - This item contains the index to the consolidated financial statements for both the Company and the Operating Partnership, as well as the financial statement schedule for Real Estate and Accumulated Depreciation[395](index=395&type=chunk) - A comprehensive list of exhibits is provided, including articles of incorporation, bylaws, debt indentures, material contracts, and executive compensation plans[397](index=397&type=chunk) [Financial Statements and Supplementary Data](index=80&type=section&id=Financial%20Statements%20and%20Supplementary%20Data) Audited consolidated financial statements for 2021, with an unqualified auditor opinion, detail the company's recovery, asset and equity changes, and critical audit matters - The independent auditor, Deloitte & Touche LLP, issued an unqualified opinion on the financial statements for both the Company and the Operating Partnership[411](index=411&type=chunk)[428](index=428&type=chunk) - The critical audit matter identified by the auditor was the impairment of long-lived assets, due to the challenging, subjective, and complex judgments required for management's cash flow estimates used in the impairment analysis[416](index=416&type=chunk)[433](index=433&type=chunk) Consolidated Balance Sheet Highlights - Tanger Factory Outlet Centers, Inc. (in thousands) | Account | Dec 31, 2021 | Dec 31, 2020 | | :--- | :--- | :--- | | Total Assets | $2,157,384 | $2,189,531 | | Total Debt | $1,397,076 | $1,567,886 | | Total Equity | $499,789 | $358,883 | Consolidated Statement of Operations Highlights - Tanger Factory Outlet Centers, Inc. (in thousands) | Account | 2021 | 2020 | | :--- | :--- | :--- | | Total Revenues | $426,525 | $389,991 | | Net Income (Loss) | $9,558 | ($38,013) | | Diluted EPS | $0.08 | ($0.40) |

Tanger Factory Outlet Centers, Inc. (NYSE:SKT) Q4 2021 Earnings Conference Call February 18, 2022 8:30 AM ET Company Participants Cyndi Holt - SVP, Finance & IR Steven Tanger - Executive Chair of the Board Stephen Yalof - President, CEO & Director James Williams - EVP, CFO & Treasurer Conference Call Participants Mary McConnell - Citigroup Samir Khanal - Evercore ISI Todd Thomas - KeyBanc Capital Markets Floris Van Dijkum - Compass Point Research & Trading Caitlin Burrows - Goldman Sachs Group Craig Schmidt ...

THE TANGER EXPERIENCE Management Presentation | February 17, 2022 FOURTH QUARTER 2021 dependence on rental income from real property; our dependence on the | --- | --- | --- | --- | |-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- ...

[Part I. Financial Information](index=7&type=section&id=Part%20I.%20Financial%20Information) [Item 1. Financial Statements](index=7&type=section&id=Item%201.%20Financial%20Statements) Unaudited consolidated financial statements for Tanger Factory Outlet Centers, Inc. and Tanger Properties Limited Partnership, detailing financial position, operations, and cash flows, with explanatory notes [Financial Statements of Tanger Factory Outlet Centers, Inc.](index=7&type=section&id=Financial%20Statements%20of%20Tanger%20Factory%20Outlet%20Centers%2C%20Inc.) Consolidated Balance Sheet Highlights (in thousands) | Metric | Sep 30, 2021 (in thousands) | Dec 31, 2020 (in thousands) | | :--- | :--- | :--- | | Total Assets | $2,149,161 | $2,189,531 | | Total Debt | $1,410,765 | $1,567,886 | | Total Equity | $480,160 | $358,883 | Consolidated Statement of Operations Highlights (in thousands) | Metric | Three Months Ended Sep 30, 2021 (in thousands) | Three Months Ended Sep 30, 2020 (in thousands) | Nine Months Ended Sep 30, 2021 (in thousands) | Nine Months Ended Sep 30, 2020 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | Total Revenues | $112,465 | $103,213 | $314,432 | $278,836 | | Net (Loss) Income | $(11,071) | $13,719 | $(4,133) | $(38,290) | | Net (Loss) Income Attributable to Company | $(10,579) | $13,029 | $(3,968) | $(36,541) | Earnings Per Share (EPS) | Metric | Three Months Ended Sep 30, 2021 | Three Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2021 | Nine Months Ended Sep 30, 2020 | | :--- | :--- | :--- | :--- | :--- | | Basic EPS | $(0.11) | $0.14 | $(0.05) | $(0.40) | | Diluted EPS | $(0.11) | $0.14 | $(0.05) | $(0.40) | - Net cash provided by operating activities for the nine months ended September 30, 2021, was **$143.95 million**, a significant increase from **$91.96 million** in the same period of 2020. Net cash used in financing activities was **$83.61 million**, primarily due to debt repayments and dividends[39](index=39&type=chunk) [Financial Statements of Tanger Properties Limited Partnership](index=13&type=section&id=Financial%20Statements%20of%20Tanger%20Properties%20Limited%20Partnership) - The financial statements of the Operating Partnership are substantially similar to those of the Company, as it holds all the outlet centers and assets and conducts all business operations. The main difference lies in the equity section, which is presented as Partners' Equity instead of Shareholders' Equity[15](index=15&type=chunk)[16](index=16&type=chunk) Operating Partnership Balance Sheet Highlights (in thousands) | Metric | Sep 30, 2021 (in thousands) | Dec 31, 2020 (in thousands) | | :--- | :--- | :--- | | Total Assets | $2,148,778 | $2,188,967 | | Total Debt | $1,410,765 | $1,567,886 | | Total Equity | $480,160 | $358,883 | [Notes to Consolidated Financial Statements](index=19&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) - As of September 30, 2021, the company owned and operated **30 consolidated outlet centers** (11.5 million sq. ft.) and had partial ownership in **6 unconsolidated outlet centers** (2.1 million sq. ft.)[58](index=58&type=chunk) - Due to the COVID-19 pandemic, the company offered tenants the option to defer **100%** of April and May 2020 rents, payable in January and February 2021. Net accounts receivable decreased from **$18.8 million** at year-end 2020 to **$6.5 million** as of September 30, 2021, due to collections of these deferred rents[70](index=70&type=chunk)[71](index=71&type=chunk) - In August 2021, the company issued **$400.0 million** of 2.750% senior notes due 2031. The proceeds were used to redeem all remaining 3.875% senior notes due 2023 (**$100.0 million**) and all 3.750% senior notes due 2024 (**$250.0 million**), resulting in a make-whole premium of **$31.9 million** in Q3 2021[101](index=101&type=chunk) - Under its At-the-Market (ATM) share offering program, the company sold **10.0 million common shares** for aggregate net proceeds of **$187.0 million** during the first nine months of 2021[116](index=116&type=chunk)[117](index=117&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=44&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q3 2021 financial condition and operations, including pandemic impact, liquidity, non-GAAP measures, and economic outlook [Results of Operations](index=48&type=section&id=Results%20of%20Operations) - For Q3 2021, net loss was **$11.1 million** compared to net income of **$13.7 million** in Q3 2020. The decrease was primarily driven by a **$33.8 million** loss on the early extinguishment of debt, partially offset by higher rental revenues as business recovered from the pandemic's impact in 2020[173](index=173&type=chunk)[175](index=175&type=chunk) - For the nine months ended September 30, 2021, net loss decreased to **$4.1 million** from **$38.3 million** in the prior-year period. The improvement was mainly due to the absence of a **$45.7 million** impairment charge taken in 2020 and stronger rental revenues, despite a **$47.9 million** loss on debt extinguishment in 2021[185](index=185&type=chunk) Change in Rental Revenues (Q3 2021 vs Q3 2020, in thousands) | Component | 2021 (in thousands) | 2020 (in thousands) | Increase/(Decrease) (in thousands) | | :--- | :--- | :--- | :--- | | Existing Properties | $105,346 | $96,199 | $9,147 | | Properties Disposed | $145 | $1,527 | $(1,382) | | Straight-line rent | $383 | $(1,741) | $2,124 | | **Total** | **$107,265** | **$100,251** | **$7,014** | [Liquidity and Capital Resources](index=55&type=section&id=Liquidity%20and%20Capital%20Resources) - As of September 30, 2021, the company's total liquidity was approximately **$663.1 million**, consisting of cash and cash equivalents and the full undrawn capacity of its **$520 million** unsecured lines of credit[235](index=235&type=chunk) - During the first nine months of 2021, the company redeemed all of its 2023 and 2024 senior notes and paid down **$50.0 million** of its unsecured term loan. These actions were funded by a new **$400.0 million** senior notes offering due 2031 and proceeds from its ATM program[222](index=222&type=chunk)[237](index=237&type=chunk)[240](index=240&type=chunk) - In July 2021, the company amended and extended its unsecured lines of credit to July 2025, with options to extend further. The amendment also eliminated the LIBOR floor[242](index=242&type=chunk) - The company was in compliance with all debt covenants as of September 30, 2021. Key covenants include total consolidated debt to adjusted total assets (<**60%**, actual **42%**) and EBITDA to Fixed Charges (>**1.5**, actual **4.1**)[246](index=246&type=chunk)[247](index=247&type=chunk) [Non-GAAP Supplemental Measures](index=65&type=section&id=Non-GAAP%20Supplemental%20Measures) FFO and Core FFO Reconciliation (in thousands) | Metric | Three Months Ended Sep 30, 2021 (in thousands) | Three Months Ended Sep 30, 2020 (in thousands) | Nine Months Ended Sep 30, 2021 (in thousands) | Nine Months Ended Sep 30, 2020 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | Net (Loss) Income | $(11,071) | $13,719 | $(4,133) | $(38,290) | | FFO | $18,204 | $43,074 | $89,494 | $102,724 | | Core FFO | $51,821 | $42,613 | $138,746 | $101,381 | FFO and Core FFO Per Share - Diluted | Metric | Three Months Ended Sep 30, 2021 | Three Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2021 | Nine Months Ended Sep 30, 2020 | | :--- | :--- | :--- | :--- | :--- | | FFO per share | $0.16 | $0.44 | $0.84 | $1.04 | | Core FFO per share | $0.47 | $0.44 | $1.32 | $1.04 | Same Center NOI (in thousands) | Period | 2021 (in thousands) | 2020 (in thousands) | % Change | | :--- | :--- | :--- | :--- | | Three Months Ended Sep 30 | $73,752 | $66,148 | +11.5% | | Nine Months Ended Sep 30 | $208,216 | $173,885 | +19.7% | [Economic Conditions and Outlook](index=72&type=section&id=Economic%20Conditions%20and%20Outlook) - Traffic and sales for the portfolio have returned to near or above pre-pandemic levels in the first nine months of 2021, leading to increased rental revenues[286](index=286&type=chunk) - Consolidated portfolio occupancy was **94.3%** as of September 30, 2021, an increase from **92.9%** as of September 30, 2020[291](index=291&type=chunk) - For the twelve months ended September 30, 2021, the company completed renewals and re-tenanted **1.6 million square feet** with a blended **0.6% decrease** in average base rental rates[288](index=288&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=73&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company's primary market risks are interest rate risk and foreign currency risk, with only **4%** of consolidated debt having variable interest rates not covered by swaps, impacting annual interest expense by approximately **$514,000** for a **100 basis point** LIBOR change, and foreign currency risk from Canadian investments - The company is exposed to interest rate risk, with **4%** of its consolidated debt subject to variable rates as of September 30, 2021. A **100 basis point** change in the LIBOR index would change annual interest expense by approximately **$514,000**[294](index=294&type=chunk) - The company uses interest rate swap agreements to fix rates on debt with notional amounts totaling **$300.0 million**[293](index=293&type=chunk) - Foreign currency risk exposure is concentrated in the Canadian Dollar from investments in Canadian outlet centers[298](index=298&type=chunk) [Item 4. Controls and Procedures](index=74&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures for both Tanger Factory Outlet Centers, Inc. and Tanger Properties Limited Partnership, concluding they were effective as of September 30, 2021, with no material changes to internal controls over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the disclosure controls and procedures for both the Company and the Operating Partnership were effective as of September 30, 2021[299](index=299&type=chunk)[300](index=300&type=chunk) - No changes were made to internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, internal controls[299](index=299&type=chunk)[300](index=300&type=chunk) [Part II. Other Information](index=74&type=section&id=Part%20II.%20Other%20Information) [Item 1. Legal Proceedings](index=74&type=section&id=Item%201.%20Legal%20Proceedings) The company is engaged in various legal proceedings arising from the normal course of business, with management not expecting a material adverse effect on its financial condition or results of operations - The company is involved in routine legal proceedings but does not expect them to have a material adverse effect on its financial results[302](index=302&type=chunk) [Item 1A. Risk Factors](index=74&type=section&id=Item%201A.%20Risk%20Factors) No material changes were reported from the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2020 - No material changes were reported from the risk factors disclosed in the Annual Report on Form 10-K for the year ended December 31, 2020[303](index=303&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=75&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section discusses the company's share repurchase program, with the Board authorizing a new program for up to **$80.0 million** of outstanding shares through May 2023, though no shares were repurchased during Q3 2021 - In May 2021, the Board of Directors authorized a share repurchase program of up to **$80.0 million** through May 31, 2023[305](index=305&type=chunk) - The company did not repurchase any of its common shares during the three months ended September 30, 2021. The full **$80.0 million** remains authorized for repurchase[306](index=3

Financial Data and Key Metrics Changes - Core FFO available to common shareholders for Q3 2021 was $0.47 per share, up from $0.44 per share in Q3 2020 [25] - Same-center NOI for the consolidated portfolio increased by 11.5% to $73.8 million, driven by a rebound in variable rents and other revenues [26] - Net debt to adjusted EBITDA improved to 5.3 times as of September 30, compared to 7.2 times for the same period last year [29] - Guidance for core FFO was increased to a range of $1.67 to $1.71 per share, reflecting a 9% increase at the midpoint [31] Business Line Data and Key Metrics Changes - Portfolio occupancy returned to pre-pandemic levels at 94.3%, up 140 basis points year-over-year [12] - Blended average rent spreads improved by 240 basis points on a cash basis compared to the previous quarter [13] - Tenant sales reached an all-time high of $448 per square foot, representing a 13% increase over the comparable 2019 period [17] - Non-rental revenues doubled compared to 2020 and increased by 38% over 2019 [20] Market Data and Key Metrics Changes - Traffic for the quarter was approximately 99% of the same period in 2019, with a return to pre-pandemic levels in September [17] - The company is focusing on growing its non-apparel and footwear tenant base, adding new brands in furniture, home goods, wellness, and beauty [18] Company Strategy and Development Direction - The company is executing a strategic plan focused on maximizing NOI and converting short-term leases into permanent deals [23] - There is a strong emphasis on enhancing the customer experience through new tenant categories and marketing partnerships [19] - The company is optimistic about the holiday shopping season and is proactively addressing potential logistics and staffing issues [22] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about sales growth and the ability to navigate challenges in the retail environment [33][37] - The company is seeing strong leasing momentum and is encouraged by the addition of new brands and categories [23] - Management is focused on maintaining a strong financial position while exploring growth opportunities [30] Other Important Information - The company has a strong pipeline of leasing activity, with a focus on home products and food and beverage categories [45] - The company is exploring acquisition opportunities and has established a peripheral land team to capitalize on un-monetized land [53][55] Q&A Session Summary Question: Outlook on percentage rent contribution - Management noted that variable rent numbers have been strong and expressed optimism about sales growth going into the fourth quarter [33] Question: Contribution of new tenant categories - Management highlighted significant deals in the home category and noted improved weekday traffic benefiting food retailers [34] Question: Fourth quarter guidance details - Management indicated that lower expectations for overage rents and higher operating expenses are primary drivers for conservative guidance [37] Question: Leasing pipeline and occupancy outlook - Management reported strong leasing momentum and a focus on home products, which are expected to drive traffic [44] Question: Growth of other revenues - Management discussed the potential for growth in marketing partnerships and onsite events, which have proven profitable [46] Question: Development plans for national projects - Management confirmed they are on track to start development in early 2022 [51] Question: Opportunities for redeployment of excess cash - Management indicated there are active acquisition opportunities and plans for peripheral land development [53] Question: Entertainment concepts in non-apparel growth - Management mentioned ongoing negotiations for entertainment concepts that will enhance customer engagement [60] Question: Supply chain concerns for outlet stores - Management expressed confidence in retailers' preparedness for the holiday season despite potential supply chain issues [61] Question: Dynamics of percentage rent deals - Management explained the strategy of trading base rent for variable rent components, which has proven beneficial [81] Question: Occupancy costs and conversion of leases - Management stated that they are successfully converting short-term leases into long-term deals, enhancing cash flow [87]

Summary of Tanger Factory Outlet Centers, Inc. Conference Call Company Overview - **Company**: Tanger Factory Outlet Centers, Inc. (NYSE:SKT) - **Industry**: Real Estate Investment Trust (REIT) specializing in upscale open-air outlet centers in the United States and Canada [4][5] Key Points and Arguments Financial Performance - **Occupancy and Sales Growth**: The company reported growth in occupancy, traffic, and tenant sales during the second quarter, with trends continuing into the third quarter [4] - **Sales per Square Foot**: The sales per square foot reached $424, marking the highest volume in the company's 40-year history [39] - **Debt Management**: The company raised $190 million through an ATM program and issued $400 million in ten-year bond debt at a 2.75% coupon rate, the lowest in its history [9][10] - **Liquidity Position**: Tanger has over $600 million in liquidity, including $100 million in cash and $520 million in undrawn lines of credit [10] Strategic Initiatives - **Tenant Mix and New Categories**: The company is expanding its tenant mix beyond apparel and footwear to include food concepts, restaurants, and local businesses, enhancing the shopping experience [5][6] - **Digital Initiatives**: Expansion of online pre-shop capabilities and virtual shopping programs to connect digital presence with physical stores [8][9] - **ESG Strategy**: Launched a small business initiative to support local retailers, enhancing tenant diversity and community engagement [6][50][52] Market Trends and Customer Engagement - **Increased Traffic**: The company has seen a rise in customer visits, particularly during weekdays, attributed to the appeal of food and beverage options and the centers' community-centric positioning [16][19] - **Demographic Shifts**: The introduction of new tenants has attracted a younger demographic, contributing to sustained traffic and sales growth [26] Challenges and Outlook - **COVID-19 Impact**: Despite concerns regarding the Delta variant, the company reported continued growth in traffic and sales, with no significant hesitancy from retailers in leasing new spaces [11][12] - **Net Debt-to-EBITDA Ratio**: The current ratio is 5.4 times, with expectations to return to pre-COVID levels of around 6 by year-end [29][30] - **Supply Chain Issues**: The company acknowledges challenges related to staffing and supply chain disruptions affecting retailers [54] Future Developments - **Nashville Project**: The company is optimistic about the Nashville market and plans to proceed with development once leasing thresholds are met [41] - **Acquisition Strategy**: Currently, the outlet center market is not trading at high volumes, but Tanger is open to accretive acquisition opportunities [47] Additional Important Content - **Customer Experience Enhancements**: The company has implemented various shopping options, including curbside pickup and virtual shopping, to improve customer convenience [43][45] - **Community Engagement**: The company emphasizes its role in local communities, providing job opportunities and supporting local businesses through its initiatives [50][52] - **Brand Recognition**: Tanger's strong brand identity is viewed as a competitive advantage in the retail REIT sector [58]

Financial Data and Key Metrics Changes - The second quarter core FFO available to common shareholders was $0.43 per share, compared to $0.10 per share in the second quarter of 2020 [28] - Same-center NOI for the consolidated portfolio increased by 87.6% for the quarter, reflecting a strong recovery from the pandemic [29] - Approximately 98% of contractual fixed rents billed in the first half of 2021 have been collected, including 98% of 2020 deferred rents due in the first half of 2021 [30] Business Line Data and Key Metrics Changes - Tenant sales productivity grew to $424 per square foot for the trailing 12 months, up 7.3% from $395 per square foot for the comparable 2019 period [14] - Same-center NOI in the second quarter was up 88% compared to the second quarter of 2020, representing 93% of the same period in 2019 [13] - Consolidated portfolio occupancy at quarter-end was 93%, a 130 basis point increase from the end of the first quarter [15] Market Data and Key Metrics Changes - Domestic traffic to the centers was above the same period of 2019, indicating a strong recovery in shopper visits [13] - The centers located in top 50 MSAs and drive-to resort areas showed the greatest improvement in traffic and sales [57] Company Strategy and Development Direction - The company is focused on growing non-store revenue streams, which are up 88% year-to-date from last year and 26% over 2019 [22] - A small business initiative was launched to support emerging retailers in local communities, enhancing tenant mix and attracting new shoppers [20] - The company is pursuing new uses and brands, including food concepts and experiential offerings, to increase shopper visits and frequency [19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the continued recovery in traffic, leasing, and business development results, positioning the company for long-term growth [27] - The guidance for full-year 2021 core FFO is expected to be in the range of $1.52 to $1.59 per share, reflecting continued sequential improvement [35] - Management noted that the operating environment remains stable, with no significant impacts from the delta variant reported by retailers [52] Other Important Information - The company has recaptured 135,000 square feet of space through the end of July, with potential for an additional 65,000 square feet related to bankruptcies and restructurings [36] - The company has maintained a strong financial position, with no significant debt maturities until December 2023 [34] Q&A Session Summary Question: How should we think about an annualized run rate for percentage rent going forward? - Management indicated that percentage rent reflects sales performance and expects a material impact on percentage rent as sales continue to improve [41] Question: What drove the significant reduction in CapEx guidance this quarter? - The reduction in CapEx reflects a strategic approach to the leasing environment, with some leasing activity pushed to 2022 [43] Question: How much occupancy is temporary or short-term in nature? - Approximately 9.5% of occupancy is temporary, with a strategy in place to convert short-term leases into permanent ones [47] Question: Are retailers reporting any changes related to the delta variant? - Management has not heard any reports of changes in sales or traffic related to the delta variant [52] Question: Can you provide a breakdown of traffic and sales improvements by center or region? - The best improvements are seen in core shopping centers located in drive-to resort areas and top 50 MSAs, while centers dependent on international tourism are recovering at a slower pace [58] Question: What is the status of the Nashville development? - The company anticipates reaching 60% leased status by early next year, at which point development will commence [72] Question: Are all centers in the fifth and sixth tiers still cash flowing? - Yes, all centers in that list are still cash flowing [78] Question: What are the major components affecting the FFO guidance? - Key components include a property tax refund, dilution from ATM shares, and higher operating expenses in the second half of the year [84]