Americold Realty Trust(US:COLD)2023-02-17 01:24Financial Data and Key Metrics Changes - For Q4 2022, rent and storage revenue increased by 8.9% year-over-year, with service revenue per throughput pallet rising by 9.8% [10][25] - The company achieved FFO per share of $1.11 for the full year 2022, driven by a global warehouse same-store revenue growth of 8.5% and NOI growth of 6.7% [25][43] - Economic occupancy increased by 634 basis points year-over-year to 85%, the highest level since Q4 2019 [12][25] Business Line Data and Key Metrics Changes - The same-store economic occupancy for Q4 2022 was 85%, reflecting a significant recovery in customer service and operational efficiency [12][25] - The perm to temp hours ratio improved to 73/27, up 11 points from Q4 2021, indicating better labor management [19][25] - Fixed commitment contracts accounted for approximately 41.9% of rent and storage revenue, a 260 basis point improvement from the previous year [58] Market Data and Key Metrics Changes - The company noted that food manufacturers are ramping up production levels, contributing to increased demand for cold storage services [31][39] - The overall economic environment is expected to lead to lower throughput volumes as consumers reduce basket sizes due to inflation [28][43] Company Strategy and Development Direction - The company is focused on repricing warehouse services to offset inflationary pressures and protect margins [17][50] - A partnership with DP World aims to explore opportunities for developing cold storage facilities at global port locations, enhancing the company's market reach [36][37] - The company plans to invest in a new cloud-based ERP system to improve operational efficiency and integrate global acquisitions [48][53] Management's Comments on Operating Environment and Future Outlook - Management expects inflationary pressures to continue, particularly in power costs, but anticipates moderation in certain areas [5][28] - The company is guiding for AFFO per share in the range of $1.14 to $1.24 for 2023, reflecting cautious optimism amid economic challenges [52][68] - Management highlighted the importance of improving labor efficiency and reducing turnover to enhance service margins [20][96] Other Important Information - The company achieved ENERGY STAR certification for 19 facilities in the U.S. in 2022, with plans for further certifications in 2023 [30] - The company has invested approximately $471 million in development projects, with an additional $76 million planned for the next year [42][91] Q&A Session Summary Question: What are the expectations for labor and occupancy in 2023? - Management emphasized the need for permanent labor to improve productivity and reduce costs associated with temporary labor [80][96] Question: How does the company view throughput trends moving forward? - Management noted that reduced disposable income and rising prices are leading to smaller basket sizes and less pantry loading, impacting throughput [99][120] Question: Can you elaborate on the DP World partnership? - The partnership allows for a first look at opportunities for cold storage development globally, leveraging DP World's insights into market needs [128][115]