NYSE$GNL

Global Net Lease Inc · Q2 2023 earnings

Q2 2023 earnings · · Investor relations

Briefing

Announced second quarter 2023 results, merger agreement with The Necessity Retail REIT, Inc., and strategic objectives execution.

Global Net Lease reported revenue of $95.8 million, a net loss of $31.4 million, and AFFO per diluted share of $0.40. The company leased over 900,000 square feet and progressed on strategic objectives, including a merger agreement with The Necessity Retail REIT, Inc.

  • Announced merger agreement with The Necessity Retail REIT, Inc. (NASDAQ:RTL), expected to close in September 2023, creating the third largest publicly traded net lease REIT with a global presence.
  • Revenue was $95.8 million compared to $95.2 million in second quarter 2022.
  • Core Funds from Operations (“Core FFO”) was $27.7 million, or $0.27 per diluted share, due in part to proxy related expenses of $22.0 million and $6.3 million of merger and transaction costs, compared to $50.0 million or $0.48 per diluted share in second quarter 2022.
  • Leased over 900,000 square feet through 11 leases and one tenant expansion project, resulting in nearly $20.2 million of net new straight-line rent over a weighted-average lease term of 6.0 years.

Headline financials

Total Revenue

$95.8M

Previous: $95.2M+0.7%
EPS (adj)

$0.27

Previous: $0.48-43.7%
Total Properties

317

Previous: 311+1.9%
Total Square Feet

39.6M

Previous: 39.5M+0.3%
Capital Expenditures

-$92.5M

Previous: -$38.7M-139.2%
Free Cash Flow

-$119M

Previous: -$39.4M-201.5%
Net Income

-$26.3M

Previous: -$716K-3567.3%
Operating Income

$4.49M

Previous: $14.8M-69.7%
Gross Profit

$86.8M

Previous: $87.4M-0.7%
Cash & Equivalents

$101M

Previous: $111M-9.3%
Total Assets

$4B

Previous: $4.04B-1.1%
Stock-Based Comp

$2.87M

Previous: $3.36M-14.5%

Revenue & EPS history

Global Net Lease · Revenue · Quarterly

$95.8M

Q2 2023+0.7%vs Q2 2022
Beat estimate in 6 of 14 quarters(43%)
ActualEstimate

Revenue by segment

Global Net Lease · $52.2M total across 2 segments · Q3 2023

  • Office
    $38.8M
  • Multi-Tenant Retail
    $13.4M

Forward guidance

Company expects merger with RTL to be accretive to AFFO per share and establish a sector-leading REIT.

Tailwinds

  • Merger with RTL expected to be accretive to AFFO per share.
  • Merger expected to create a sector-leading REIT with a world-class portfolio.
  • Internalization of GNL’s management.
  • Numerous governance enhancements.
  • Focus on industrial and distribution assets.

Headwinds

  • Risks related to completing the proposed REIT Merger and Internalization Merger.
  • Risk of potential repeal of the Company’s Shareholder’s Rights Plan.
  • Risks related to diverting the attention of the Company’s management from ongoing business operations.
  • Failure to realize the expected benefits of the proposed transactions.
  • Effect of any downgrade of the Company’s or RTL’s corporate rating or to any of their respective debt or equity securities

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2023

Historical avgQ2 2023

+0.2%

Avg return

Earnings day

+0.4%

Avg return

5 days after

+1.1%

Avg return

30 days after

56%

22 / 39 earnings

Positive

+6.2%

Q4 2024

Best reaction

-8.5%

Q4 2019

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-1.3%-0.3%+2.5%
Q4 2025-3.1%-3.2%-6.2%
Q3 2025+5.7%+5.0%+7.4%
Q1 2025+4.3%+5.6%+2.5%
Q4 2024+6.2%+9.7%+6.2%
Q3 2024+2.7%-0.4%-7.9%
Q2 2024+0.7%+0.4%+8.3%
Q1 2024-0.7%+2.5%+4.7%
Q4 2023-1.8%+0.1%+6.6%
Q3 2023-2.6%-5.1%+9.3%
Q2 2023+1.0%+5.8%+3.9%
Q1 2023-2.8%-7.5%-6.0%
Q4 2022+2.0%+1.3%-12.8%
Q3 2022+4.9%+6.8%+12.6%
Q2 2022-1.6%-0.3%-10.2%
Q1 2022-2.3%-8.1%+3.6%
Q4 2021+3.1%+0.9%+9.1%
Q3 2021-0.9%-3.7%-10.6%
Q2 2021+2.4%-0.6%-3.3%
Q1 2021+0.8%-1.3%+4.6%
Q4 2020+0.6%-3.1%-1.9%
Q3 2020-2.5%+12.7%+19.5%
Q2 2020+2.5%+6.6%+4.8%
Q1 2020+2.7%+2.1%+24.8%
Q4 2019-8.5%-8.1%-33.4%
Q3 2019+0.7%+1.2%+6.1%
Q2 2019+2.0%-0.1%-0.7%
Q1 2019+1.4%+2.6%+0.3%
Q4 2018-8.2%-5.8%-2.8%
Q3 2018+5.3%+4.3%-1.8%
Q2 2018+3.6%+2.2%-0.8%
Q1 2018+1.8%-2.2%+0.8%
Q4 2017-4.7%-3.7%+2.9%
Q3 2017-2.2%-1.7%-1.9%
Q2 2017-0.9%-2.4%+1.3%
Q1 2017-2.2%-3.5%-1.1%
Q4 2016+0.1%+0.4%-3.0%
Q3 2016+0.7%+6.5%+8.5%
Q2 2016-2.3%-0.9%-2.7%
Q4 2013
Q3 2013
Q2 2013
Q4 2012
Q3 2012
Q2 2012

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