NNN REIT(NNN) - 2025 Q2 - Quarterly Results

Executive Summary & Key Highlights NNN REIT, Inc. reported a strong second quarter 2025, with significant investments in 45 properties at an accretive cap rate of 7.4%. The company increased its 2025 Core FFO and AFFO guidance and announced its 36th consecutive annual dividend increase, demonstrating robust operational performance and financial flexibility Second Quarter 2025 Highlights NNN REIT reported strong Q2 2025 results, increasing Core FFO and AFFO per share, making significant property investments, and marking its 36th consecutive annual dividend increase - Reported net earnings of $0.54 per diluted share[5] - Grew Core FFO and AFFO per diluted share by 1.2% over prior year results, to $0.84 and $0.85, respectively[5] - Increased ABR by 6.7% over prior year results[5] - Closed on $232.5 million of investments across 45 properties at an initial cash cap rate of 7.4%, with a weighted average lease term of 17.8 years[5] - Sold 23 properties for $51.2 million, including $24.7 million of income producing properties at a weighted average cap rate of 6.2%[5] - Paid a $0.58 quarterly dividend, equating to a 5.4% annualized dividend yield and 68% AFFO payout ratio[5] - Announced a 3.4% increase in the third quarter 2025 quarterly dividend to $0.60 per share, marking the Company's 36th consecutive annual dividend increase[5] - Increased the midpoint of 2025 Core FFO and AFFO per share guidance by $0.01[5] - Increased 2025 acquisition volume guidance by $100 million[5] CEO Commentary The CEO highlighted strong Q2 investments of $233 million, over $460 million in H1 2025, and enhanced liquidity for strategic execution - NNN delivered another strong quarter, investing $233 million across 45 properties, at an accretive initial cash cap rate of 7.4%[3] - Over $460 million of real estate investments completed in the first half of 2025[3] - Nearly $1.5 billion of immediate liquidity following a note offering positions the company to raise 2025 Core FFO guidance and execute its strategy through year end[3] Additional Strategic Highlights NNN REIT enhanced balance sheet flexibility through equity issuance and a note offering, achieving $1.4 billion in liquidity and a sector-leading debt maturity - Raised $10.9 million in gross proceeds from the issuance of 254,222 common shares at an average price per share of $43.03[5] - Improved balance sheet flexibility, following the end of the quarter, through the issuance of $500 million principal amount of 4.600% senior unsecured notes due 2031 and the repayment of the outstanding balance on the unsecured revolving line of credit[5] - Pro forma for the 2031 Notes, the Company had a sector leading weighted average debt maturity of 11.0 years, no encumbered assets, no floating rate debt and $1.4 billion of total available liquidity[5] - Published the Company's third annual Corporate Sustainability Report[5] Financial Performance Overview NNN REIT reported mixed financial results for Q2 2025, with revenues increasing but net earnings declining year-over-year. However, key REIT performance metrics like FFO, Core FFO, and AFFO per diluted share showed modest growth, indicating underlying operational strength Revenues and Net Earnings, FFO, Core FFO and AFFO This section details NNN REIT's Q2 and H1 2025 financial results, including revenues, net earnings, FFO, Core FFO, and AFFO, with year-over-year comparisons Q2 and Six Months Ended June 30, 2025 vs 2024 Financial Results | Metric (dollars in thousands, except per share data) | Q2 2025 | Q2 2024 | YoY Change (Q2) | 6M 2025 | 6M 2024 | YoY Change (6M) | | :------------------------------------------------- | :------ | :------ | :-------------- | :------ | :------ | :-------------- | | Revenues | $226,802 | $216,813 | +4.6% | $457,656 | $432,220 | +5.9% | | Net earnings | $100,529 | $106,666 | -5.8% | $196,987 | $201,037 | -2.0% | | Net earnings per share | $0.54 | $0.58 | -6.9% | $1.05 | $1.10 | -4.5% | | FFO | $157,175 | $152,380 | +3.1% | $315,909 | $303,641 | +4.0% | | FFO per share | $0.84 | $0.83 | +1.2% | $1.69 | $1.66 | +1.8% | | Core FFO | $157,366 | $152,533 | +3.2% | $318,273 | $304,111 | +4.7% | | Core FFO per share | $0.84 | $0.83 | +1.2% | $1.70 | $1.67 | +1.8% | | AFFO | $158,523 | $153,596 | +3.2% | $321,538 | $306,855 | +4.8% | | AFFO per share | $0.85 | $0.84 | +1.2% | $1.72 | $1.68 | +2.4% | Reconciliation of Non-GAAP Financial Measures (FFO, Core FFO, AFFO) This section provides a reconciliation of NNN REIT's non-GAAP financial measures, including FFO, Core FFO, and AFFO per share, along with dividend and payout ratio details Q2 and Six Months Ended June 30, 2025 vs 2024 Non-GAAP Per Share Metrics | Metric (per share) | Q2 2025 | Q2 2024 | YoY Change (Q2) | 6M 2025 | 6M 2024 | YoY Change (6M) | | :----------------- | :------ | :------ | :-------------- | :------ | :------ | :-------------- | | FFO per share (Basic) | $0.84 | $0.84 | 0.0% | $1.69 | $1.67 | +1.2% | | FFO per share (Diluted) | $0.84 | $0.83 | +1.2% | $1.69 | $1.66 | +1.8% | | Core FFO per share (Basic) | $0.84 | $0.84 | 0.0% | $1.70 | $1.67 | +1.8% | | Core FFO per share (Diluted) | $0.84 | $0.83 | +1.2% | $1.70 | $1.67 | +1.8% | | AFFO per share (Basic) | $0.85 | $0.84 | +1.2% | $1.72 | $1.68 | +2.4% | | AFFO per share (Diluted) | $0.85 | $0.84 | +1.2% | $1.72 | $1.68 | +2.4% | | Dividend per share | $0.5800 | $0.5650 | +2.7% | $1.1600 | $1.1300 | +2.7% | | AFFO payout ratio | 68% | 67% | +1 pp | 67% | 67% | 0 pp | Portfolio Activity & Snapshot NNN REIT's portfolio expanded to 3,663 properties with a 98.0% occupancy rate as of June 30, 2025. The company actively managed its portfolio through significant acquisitions totaling $464.9 million in the first half of 2025 and strategic dispositions, maintaining a diversified tenant base across various lines of trade and states Portfolio Snapshot This section provides a snapshot of NNN REIT's portfolio as of June 30, 2025, detailing property count, gross leasable area, occupancy, lease term, and ABR Portfolio Snapshot as of June 30, 2025 | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :-------------------------- | :------------ | :------------- | :------------ | | Number of properties | 3,663 | 3,641 | 3,548 | | Total gross leasable area (sq ft) | 38,322,000 | 37,311,000 | 36,095,000 | | Occupancy rate | 98.0% | 97.7% | 99.3% | | Weighted average remaining lease term (years) | 9.8 | 9.9 | 10.0 | | ABR (dollars in thousands) | $893,782 | $874,301 | $837,568 | Property Acquisitions NNN REIT's property acquisitions for Q2 and H1 2025 totaled $464.9 million across 127 properties, with an average cap rate of 7.4% and long lease terms Property Acquisitions for Q2 and Six Months Ended June 30, 2025 | Metric (dollars in thousands) | Quarter Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :---------------------------- | :-------------------------- | :----------------------------- | | Total dollars invested | $232,536 | $464,929 | | Number of properties | 45 | 127 | | Gross leasable area (sq ft) | 1,399,000 | 2,230,000 | | Weighted average cap rate | 7.4% | 7.4% | | Weighted average lease term (years) | 17.8 | 18.0 | - Investments in the six months ended June 30, 2025, equating to 85% of the initial full year acquisition plan at the midpoint[5] Property Dispositions NNN REIT disposed of 23 properties for $51.2 million in Q2 2025, including income-producing assets at a weighted average cap rate of 6.2% Property Dispositions for Q2 and Six Months Ended June 30, 2025 | Metric (dollars in thousands) | Q2 2025 (Occupied) | Q2 2025 (Vacant) | Q2 2025 (Total) | 6M 2025 (Occupied) | 6M 2025 (Vacant) | 6M 2025 (Total) | | :---------------------------- | :----------------- | :--------------- | :-------------- | :----------------- | :--------------- | :-------------- | | Number of properties | 10 | 13 | 23 | 19 | 14 | 33 | | Gross leasable area (sq ft) | 162,000 | 196,000 | 358,000 | 220,000 | 210,000 | 430,000 | | Net sale proceeds | $24,727 | $26,521 | $51,248 | $38,067 | $29,020 | $67,087 | | Weighted average cap rate | 6.2% | — | 6.2% | 5.7% | — | 5.7% | Property Portfolio Details NNN REIT's portfolio is diversified across various lines of trade, states, and tenants, with a balanced lease expiration schedule over the next decade and beyond Top 20 Lines of Trade This section outlines NNN REIT's top 20 lines of trade by ABR, highlighting the diversification of its tenant base as of June 30, 2025 Top 20 Lines of Trade by ABR as of June 30, 2025 | Rank | Lines of Trade | % of ABR (June 30, 2025) | % of ABR (June 30, 2024) | | :--- | :---------------------- | :----------------------- | :----------------------- | | 1. | Automotive service | 18.2% | 16.9% | | 2. | Convenience stores | 16.5% | 16.2% | | 3. | Restaurants – limited service | 8.2% | 8.5% | | 4. | Entertainment | 7.3% | 6.6% | | 5. | Restaurants – full service | 7.0% | 8.4% | | 6. | Dealerships | 6.7% | 5.4% | | 7. | Health and fitness | 4.1% | 4.0% | | 8. | Theaters | 3.8% | 4.1% | | 9. | Equipment rental | 3.1% | 3.3% | | 10. | Automotive parts | 2.4% | 2.4% | | 11. | Wholesale clubs | 2.3% | 2.4% | | 12. | Drug stores | 2.1% | 2.3% | | 13. | Home improvement | 2.0% | 2.2% | | 14. | Medical service providers | 1.9% | 1.8% | | 15. | Pet supplies and services | 1.6% | 1.2% | | 16. | Discount retail | 1.4% | 1.6% | | 17. | Furniture | 1.3% | 2.0% | | 18. | Travel plazas | 1.2% | 1.3% | | 19. | Consumer electronics | 1.2% | 1.3% | | 20. | Home furnishings | 1.1% | 1.3% | | Total| | 100.0% | 100.0% | Top 20 States This section presents NNN REIT's property distribution across its top 20 states by number of properties and ABR as of June 30, 2025 Top 20 States by Properties and ABR as of June 30, 2025 | Rank | State | of Properties | % of ABR | | :--- | :------------- | :-------------- | :------- | | 1. | Texas | 590 | 18.8% | | 2. | Florida | 271 | 8.7% | | 3. | Illinois | 169 | 4.9% | | 4. | Georgia | 173 | 4.4% | | 5. | Ohio | 226 | 4.4% | | 6. | Indiana | 164 | 3.7% | | 7. | Tennessee | 154 | 3.7% | | 8. | North Carolina | 158 | 3.6% | | 9. | Michigan | 121 | 3.4% | | 10. | Arizona | 81 | 3.4% | | 11. | Virginia | 120 | 3.4% | | 12. | California | 72 | 2.9% | | 13. | Alabama | 150 | 2.8% | | 14. | Pennsylvania | 89 | 2.5% | | 15. | New Jersey | 33 | 2.4% | | 16. | Missouri | 106 | 2.4% | | 17. | Maryland | 50 | 2.1% | | 18. | Colorado | 45 | 2.0% | | 19. | South Carolina | 81 | 1.9% | | 20. | Oklahoma | 89 | 1.7% | | Other| | 721 | 16.9% | | Total| | 3,663 | 100.0% | Top 20 Tenants This section details NNN REIT's top 20 tenants by number of properties and ABR, showcasing the diversity of its tenant relationships Top 20 Tenants by Properties and ABR as of June 30, 2025 | Rank | Tenant | of Properties | % of ABR | | :--- | :------------------------------ | :-------------- | :------- | | 1. | 7-Eleven | 146 | 4.4% | | 2. | Mister Car Wash | 121 | 4.0% | | 3. | Dave & Buster's | 34 | 3.7% | | 4. | Camping World | 46 | 3.6% | | 5. | GPM Investments (convenience stores) | 147 | 2.7% | | 6. | Flynn Restaurant Group (Taco Bell/Arby's) | 204 | 2.6% | | 7. | AMC Theatres | 20 | 2.5% | | 8. | BJ's Wholesale Club | 13 | 2.3% | | 9. | LA Fitness | 25 | 2.3% | | 10. | Kent Distributors (convenience stores) | 49 | 2.3% | | 11. | Mavis Tire Express Services | 140 | 2.1% | | 12. | Couche Tard (Pantry) | 91 | 2.1% | | 13. | Walgreens | 49 | 1.7% | | 14. | Sunoco | 53 | 1.7% | | 15. | Chuck E. Cheese | 51 | 1.7% | | 16. | Casey's General Stores (convenience stores) | 62 | 1.6% | | 17. | United Rentals | 49 | 1.6% | | 18. | Tidal Wave Auto Spa | 35 | 1.4% | | 19. | Super Star Car Wash | 33 | 1.3% | | 20. | Bob Evans Restaurants | 105 | 1.2% | | Other| | 2,190 | 53.2% | | Total| | 3,663 | 100.0% | Lease Expirations This section provides the lease expiration schedule by year, detailing the percentage of ABR, number of properties, and gross leasable area Lease Expirations by Year as of June 30, 2025 | Year | % of ABR | of Properties | Gross Leasable Area (sq ft) | | :-------- | :------- | :-------------- | :-------------------------- | | 2025 | 2.2% | 90 | 512,000 | | 2026 | 3.9% | 196 | 1,899,000 | | 2027 | 7.1% | 216 | 3,277,000 | | 2028 | 5.6% | 253 | 2,270,000 | | 2029 | 4.4% | 141 | 2,071,000 | | 2030 | 4.7% | 179 | 2,275,000 | | 2031 | 6.8% | 191 | 2,668,000 | | 2032 | 5.1% | 190 | 1,846,000 | | 2033 | 4.5% | 136 | 1,411,000 | | 2034 | 5.5% | 180 | 2,334,000 | | Thereafter| 50.2% | 1,816 | 16,913,000 | - As of June 30, 2025, the weighted average remaining lease term is 9.8 years[53] Capital Structure, Liquidity & Debt NNN REIT actively managed its capital structure by issuing new senior unsecured notes to enhance liquidity and repay existing debt, resulting in a pro forma liquidity of $1.4 billion. The company maintains a strong balance sheet with a weighted average debt maturity of 11.1 years and favorable credit metrics, demonstrating compliance with all key financial covenants Capital Markets Activity NNN REIT raised $10.9 million through common share issuance and $500 million via senior unsecured notes, repaying its revolving credit line to enhance capital structure - Issued 254,222 common shares, raising $10.9 million in gross proceeds at an average price per share of $43.03, primarily through the Company's at-the-market equity program[10] - On July 1, 2025, NNN issued $500 million principal amount of 4.600% senior unsecured notes due 2031[5][10] - Proceeds from the 2031 Notes were used to repay the outstanding balance on the Company's unsecured revolving line of credit[5][10] Balance Sheet and Liquidity Overview NNN REIT maintained $4.7 billion in gross debt with an 11.1-year weighted average maturity, ending Q2 2025 with $939.0 million liquidity, and $1.4 billion pro forma for new notes - As of June 30, 2025, Gross Debt was $4.7 billion with a weighted average interest rate of 4.2% and a weighted average debt maturity of 11.1 years[11] - The Company ended the second quarter 2025 with $939.0 million of total available liquidity, comprised of $932.3 million of unused line of credit capacity and $6.7 million of cash and restricted cash[11] - Pro forma for the 2031 Notes, the Company had total available liquidity of $1.4 billion, comprised of $1.2 billion of unused line of credit capacity and $230.8 million of cash and restricted cash[5][11] - Net Debt to annualized EBITDAre and fixed charge coverage was 5.7x and 4.2x, respectively, as of June 30, 2025[11] Debt Summary and Credit Metrics This section provides a detailed summary of NNN REIT's unsecured debt, including principal amounts, rates, and maturities, alongside key credit metrics as of June 30, 2025 Debt Summary as of June 30, 2025 | Unsecured Debt Type | Principal (thousands) | Stated Rate | Effective Rate | Maturity Date | | :------------------------ | :-------------------- | :---------- | :------------- | :------------ | | Line of credit payable | $267,700 | SOFR + 87.5 bps | 5.165% | April 2028 | | Unsecured notes payable (2025) | $400,000 | 4.000% | 4.029% | November 2025 | | Unsecured notes payable (2026) | $350,000 | 3.600% | 3.733% | December 2026 | | Unsecured notes payable (2027) | $400,000 | 3.500% | 3.548% | October 2027 | | Unsecured notes payable (2028) | $400,000 | 4.300% | 4.388% | October 2028 | | Unsecured notes payable (2030) | $400,000 | 2.500% | 2.536% | April 2030 | | Unsecured notes payable (2033) | $500,000 | 5.600% | 5.905% | October 2033 | | Unsecured notes payable (2034) | $500,000 | 5.500% | 5.662% | June 2034 | | Unsecured notes payable (2048) | $300,000 | 4.800% | 4.890% | October 2048 | | Unsecured notes payable (2050) | $300,000 | 3.100% | 3.205% | April 2050 | | Unsecured notes payable (2051) | $450,000 | 3.500% | 3.602% | April 2051 | | Unsecured notes payable (2052) | $450,000 | 3.000% | 3.118% | April 2052 | | Total Unsecured Debt | $4,717,700 | | | | - Unsecured debt has a weighted average interest rate of 4.2% and a weighted average maturity of 11.1 years[41] Credit Metrics as of June 30, 2025 | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Gross Debt / Gross Assets | 41.7% | 40.7% | | Net Debt / EBITDAre (last quarter annualized) | 5.7 | 5.6 | | EBITDAre / fixed charges | 4.2 | 4.2 | Credit Facility and Notes Covenants NNN REIT confirms compliance with all covenants for its unsecured credit facility and notes as of June 30, 2025, demonstrating strong financial health and adherence to debt agreements - The Company believes it is in compliance with the covenants for its unsecured credit facility and notes as of June 30, 2025[45] Key Covenants Compliance as of June 30, 2025 | Key Covenants | Required | June 30, 2025 | | :-------------------------------- | :------- | :------------ | | Unsecured Bank Credit Facility: | | | | Maximum leverage ratio | < 0.60 | 0.39 | | Minimum fixed charge coverage ratio | > 1.50 | 4.26 | | Maximum secured indebtedness ratio | < 0.40 | — | | Unencumbered asset value ratio | > 1.67 | 2.65 | | Unencumbered interest ratio | > 1.75 | 4.17 | | Unsecured Notes: | | | | Limitation on incurrence of total debt | ≤ 60% | 41% | | Limitation on incurrence of secured debt | ≤ 40% | — | | Debt service coverage ratio | ≥ 1.5 | 4.2 | | Maintenance of total unencumbered assets | ≥ 150% | 244% | Dividend Information NNN REIT announced a 3.4% increase in its quarterly dividend to $0.60 per share, marking its 36th consecutive annual dividend increase, a testament to its consistent performance and commitment to shareholder returns - On July 15, 2025, the Board of Directors declared a quarterly dividend of $0.60 per share payable August 15, 2025[12] - The new quarterly dividend represents an annualized dividend of $2.40 per share with an annualized dividend yield of 5.6% as of June 30, 2025[12] - The 3.4% increase in the quarterly dividend marks the Company's 36th consecutive annual dividend increase, making NNN one of only three publicly traded real estate investment trusts to have increased annual dividends for 36 or more consecutive years[5][12][16] 2025 Guidance Update NNN REIT increased its 2025 guidance for Core FFO and AFFO per share by $0.01 at the midpoint, and raised its acquisition volume guidance by $100 million, reflecting confidence in future performance and growth strategy Updated 2025 Guidance Comparison | Metric (dollars in millions, except per diluted share data) | Previous 2025 Guidance | Updated 2025 Guidance | Change (Midpoint) | | :-------------------------------------------------------- | :--------------------- | :-------------------- | :---------------- | | Net earnings per share (excluding certain items) | $1.97 - $2.02 | $1.93 - $1.98 | -$0.04 | | Real estate depreciation and amortization per share | $1.36 | $1.41 | +$0.05 | | Core FFO per share | $3.33 - $3.38 | $3.34 - $3.39 | +$0.01 | | AFFO per share | $3.39 - $3.44 | $3.40 - $3.45 | +$0.01 | | General and administrative expenses | $47 - $48 | $47 - $48 | No Change | | Real estate expenses, net of tenant reimbursements | $15 - $16 | $17 - $18 | +$2 | | Acquisition volume | $500 - $600 | $600 - $700 | +$100 | | Disposition volume | $80 - $120 | $120 - $150 | +$30 | Corporate Information & Definitions NNN REIT is a real estate investment trust specializing in high-quality, long-term net-leased properties across 50 states. The company emphasizes its consistent dividend growth and provides comprehensive definitions for key financial metrics used in its reporting About NNN REIT, Inc. NNN REIT invests in high-quality, long-term net-leased properties across 50 states, boasting 3,663 properties and a 36-year record of consecutive dividend increases - NNN invests in high-quality properties subject generally to long-term, net leases with minimal ongoing capital expenditures[16] - As of June 30, 2025, the Company owned 3,663 properties in 50 states with a gross leasable area of approximately 38.3 million square feet and a weighted average remaining lease term of 10 years[16] - NNN is one of only three publicly traded real estate investment trusts to have increased annual dividends for 36 or more consecutive years[5][12][16] Forward-Looking Statements This section clarifies that statements not strictly historical are forward-looking, subject to risks that may cause actual results to differ, and NNN REIT undertakes no obligation to update them - Statements in this press release that are not strictly historical are 'forward-looking' statements, characterized by terms such as 'believe,' 'expect,' 'intend,' 'may,' 'estimated' or similar words[17] - Forward-looking statements involve known and unknown risks, which may cause the Company's actual future results to differ materially from expected results, including general economic conditions, local real estate conditions, changes in interest rates, and tenant financial condition[17] - NNN REIT, Inc. undertakes no obligation to publicly release the results of any revisions to these forward-looking statements[17] Non-GAAP Financial Measure Definitions This section defines key non-GAAP financial measures, including FFO, Core FFO, AFFO, EBITDAre, and various debt and asset metrics, as used in NNN REIT's reporting - Funds From Operations (FFO): Defined by Nareit as net earnings (GAAP) plus depreciation and amortization of real estate assets, excluding gains/losses, taxes on disposition, and impairment charges on depreciable real estate. It is generally considered the most appropriate measure of performance for real estate companies[18][19] - Core Funds From Operations (Core FFO): A non-GAAP measure that adjusts FFO to eliminate the impact of infrequent and unusual GAAP income and expense amounts not related to core real estate operations, used to evaluate performance across multiple periods and in comparison to peers[20] - Adjusted Funds From Operations (AFFO): A non-GAAP measure that adjusts FFO for certain non-cash items that reduce or increase net earnings in accordance with GAAP, considered a useful supplemental measure of performance[21] - Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (EBITDAre): A Nareit-established metric, calculated as net earnings (GAAP) plus interest expense, income tax expense, depreciation and amortization, excluding gains/losses on real estate disposition, impairment charges, and adjustments for noncontrolling interests[22] - Total Cash: Comprised of cash and cash equivalents and restricted cash and cash held in escrow per GAAP as reported on the balance sheet summary[23] - Gross Assets: Represents total assets (GAAP) adjusted to exclude accumulated amortization and depreciation and amortization of direct financing leases, providing an estimate of the Company's investments[23] - Total Debt: Defined as total debt per GAAP, including line of credit payable, notes payable (net of unamortized discount and costs), and mortgages payable (net of unamortized premium and costs)[24] - Gross Debt: Defined as Total Debt adjusted to exclude unamortized debt discounts and premiums and unamortized debt costs[24] - Net Debt: Defined as Gross Debt less Total Cash. Both Gross Debt and Net Debt are considered key supplemental measures of overall liquidity, capital structure, and leverage[25] - Annualized Base Rent (ABR): Represents the monthly cash base rent for all leases in place as of the end of the period multiplied by 12, providing an annualized amount at a point in time[27] Detailed Financial Statements This section provides the detailed unaudited balance sheet, income statement, and other financial information, along with comprehensive reconciliations of non-GAAP financial measures like FFO, Core FFO, AFFO, and EBITDAre, offering a complete view of the company's financial position and performance Balance Sheet Summary This section presents NNN REIT's unaudited balance sheet summary as of June 30, 2025, compared to December 31, 2024, detailing assets, liabilities, and equity Balance Sheet Summary (Unaudited) as of June 30, 2025 vs December 31, 2024 | Metric (dollars in thousands) | June 30, 2025 | December 31, 2024 | Change | | :---------------------------- | :------------ | :---------------- | :----- | | Assets: | | | | | Real estate portfolio, net | $9,023,171 | $8,746,168 | +3.16% | | Cash and cash equivalents | $5,973 | $8,731 | -31.60%| | Total assets | $9,148,677 | $8,872,728 | +3.11% | | Liabilities: | | | | | Line of credit payable | $267,700 | $0 | N/A | | Notes payable, net | $4,376,893 | $4,373,803 | +0.07% | | Total liabilities | $4,786,272 | $4,510,453 | +6.11% | | Total equity | $4,362,405 | $4,362,275 | +0.00% | | Common shares outstanding | 188,206,484 | 187,540,929 | +0.35% | Income Statement Summary This section provides NNN REIT's unaudited income statement summary for Q2 and H1 2025 versus 2024, detailing revenues, expenses, and net earnings Income Statement Summary (Unaudited) for Q2 and Six Months Ended June 30, 2025 vs 2024 | Metric (dollars in thousands) | Q2 2025 | Q2 2024 | YoY Change (Q2) | 6M 2025 | 6M 2024 | YoY Change (6M) | | :---------------------------- | :------ | :------ | :-------------- | :------ | :------ | :-------------- | | Revenues | $226,802 | $216,813 | +4.6% | $457,656 | $432,220 | +5.9% | | Operating expenses | $93,204 | $82,167 | +13.4% | $184,019 | $164,074 | +12.2% | | Gain on disposition of real estate | $16,198 | $17,621 | -8.1% | $20,011 | $22,442 | -10.9% | | Earnings from operations | $149,796 | $152,267 | -1.6% | $293,648 | $290,588 | +1.1% | | Interest expense | $49,282 | $46,577 | +5.8% | $97,005 | $90,646 | +7.0% | | Net earnings | $100,529 | $106,666 | -5.8% | $196,987 | $201,037 | -2.0% | | Diluted Net earnings per share | $0.54 | $0.58 | -6.9% | $1.05 | $1.10 | -4.5% | Other Financial Information This section provides additional financial details, including rental income, real estate expenses, and lease termination fees for Q2 2025 compared to the prior year - Rental income from operating leases for the quarter ended June 30, 2025, was $221,714 thousand, up from $211,557 thousand for the same period in 2024[33] - Real estate expenses, net of tenant reimbursements, increased to $(4,450) thousand for Q2 2025 from $(2,552) thousand for Q2 2024[33] - Lease termination fees were $2,248 thousand for the quarter ended June 30, 2025, compared to $2,053 thousand for the same period in 2024[33] Reconciliation of Non-GAAP Financial Measures (EBITDAre, Gross/Net Debt) This section reconciles non-GAAP financial measures, including EBITDAre, fixed charges, gross assets, total debt, gross debt, and net debt, for a comprehensive financial overview EBITDAre and Fixed Charges for Q2 and Six Months Ended June 30, 2025 vs 2024 | Metric (dollars in thousands) | Q2 2025 | Q2 2024 | 6M 2025 | 6M 2024 | | :---------------------------- | :------ | :------ | :------ | :------ | | Net earnings | $100,529 | $106,666 | $196,987 | $201,037 | | Interest expense | $49,282 | $46,577 | $97,005 | $90,646 | | Depreciation and amortization | $68,349 | $62,503 | $132,966 | $123,118 | | Gain on disposition of real estate | $(16,198) | $(17,621) | $(20,011) | $(22,442) | | Impairment losses – real estate | $4,535 | $944 | $6,047 | $2,148 | | EBITDAre | $206,497 | $199,069 | $412,994 | $394,507 | | Fixed charges | $49,824 | $48,194 | $98,468 | $94,122 | Gross Assets, Total Debt, Gross Debt, and Net Debt as of June 30, 2025 vs December 31, 2024 | Metric (dollars in thousands) | June 30, 2025 | December 31, 2024 | | :---------------------------- | :------------ | :---------------- | | Total assets | $9,148,677 | $8,872,728 | | Gross Assets | $11,323,185 | $10,940,903 | | Total Debt | $4,644,593 | $4,373,803 | | Gross Debt | $4,717,700 | $4,450,000 | | Total Cash | $(6,748) | $(9,062) | | Net Debt | $4,710,952 | $4,440,938 |