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- **Record Investment Performance**: $370M Q3 investments at 8% cash yield, driving AFFO up 12% YoY. 
- **Portfolio Strength**: 1.6% rent growth, 3.6x coverage, and 40bps watch list reduction. 
- **2026 Outlook**: $1.98-$2.04 AFFO target (+6-8%), supported by $1-1.4B investments. 
- **Capital Discipline**: 3.8x leverage, $1.4B liquidity, and 63% dividend payout ratio. 
- **Strategic Growth**: Industrial assets expanded to 3.5% of ABR with no concentration risk.

**【CEO Summary Section】**
- **Revenue and Investment Growth**: Q3 2025 investments reached $370 million, with 70% sourced from repeat tenants. Weighted average initial cash yield was 8%, and GAAP yield hit 10%, the highest on record. 
- **Portfolio Performance**: Same-store rent growth of 1.6%, up from 1.4% Q2. Rent coverage improved to 3.6x, with 120bps decline in ABR under 1x coverage. Tenant credit watch list reduced by 40bps. 
- **Guidance Updates**: AFFO per share raised to $1.87-$1.89 (prev $1.84-$1.86). 2026 AFFO guidance set at $1.98-$2.04 (+6-8%), with $1-1.4B investment target. 
- **Capital Allocation**: $1.4B liquidity, 3.8x leverage. $400M 10-year bond issued at 5.4% coupon to extend debt maturity. 

**【CFO Financial Commentary】**
- **Financial Results**: Q3 AFFO of $0.48 (+12% YoY), total AFFO $96.2M (+24% YoY). G&A expenses $10.2M, 6.7% of revenue (vs 5.1% YoY). Dividend payout ratio 63%. 
- **Balance Sheet**: Pro forma net debt/EBITDA 3.8x. $140M retained free cash flow annually. $521M unsettled forward equity to support 2026 investments. 
- **Cost Efficiency**: Cash G&A guidance $31-35M, down 4.7% of revenue (vs 5.1% YoY). 

**【Q&A Key Highlights】**
- **Cap Rate Compression**: Expect mid- to high 7% pipeline cap rates, driven by stable interest rates. 10-year Treasury decline from 4.5% to 4.0%. 
- **Competition Response**: 35% of deals won through reliability and execution, not price. 2026 investment pipeline remains strong. 
- **Credit Management**: Credit loss experience 30bps vs budget, no material impairments. 7 assets sold ($11.5M) at 6.6% yield to manage risk. 
- **Industrial Expansion**: 18.6-year lease terms, 2.3% escalations. Industrial assets now 3.5% of ABR, with no concentration risk (top 20 tenants 27.6% of ABR).

Essential Properties Realty Trust (EPRT)-23 Oct 25-2025 Q3 Earnings call transcript

- **Revenue Growth & Guidance**: Q2 investments of $334 million drove 7.9% cash yield; 2025 AFFO raised to $1.86-$1.89 (8% growth). 
- **Portfolio Strength**: 99.6% occupancy, 1.4% rent growth, and 3.4x tenant coverage ratio. 
- **Capital Flexibility**: $1.3 billion liquidity, 3.5x leverage, and $130 million annual retained cash flow. 
- **Strategic Focus**: Granular middle-market deals (93% under $4M), cautious on industrial expansion, and no near-term debt needs.

**【CEO Summary Section】**
- Q2 2025 revenue growth driven by $334 million in investments, with a weighted average cash yield of 7.9% and GAAP yield of 9.7%. 
- Portfolio performance strong: 1.4% same-store rent growth, 99.6% occupancy, and tenant credit losses below budget. 
- Updated 2025 AFFO guidance raised to $1.86-$1.89 per share (8% midpoint growth), with no incremental equity needed. 
- Investment pipeline expanded to $1 billion-$1.2 billion, up $100 million from prior guidance. 
- Capital position remains strong with $1.3 billion liquidity and 3.5x leverage. 

**【CFO Financial Commentary】**
- Q2 AFFO per share of $0.46 (7% YoY increase), total AFFO of $93 million (21% YoY growth). 
- G&A expenses up 23% YoY to $10.7 million due to team expansion, but cash G&A at 5.2% of revenue (down from 5.6%). 
- Dividend payout ratio 65%, with retained free cash flow of $34.4 million (annualized $130 million). 
- Balance sheet strengthened with $6.6 billion gross assets, $119 million equity raised via ATM, and $507 million unsettled forward equity. 

**【Q&A Key Highlights】**
- **Competition & Cap Rates**: CEO expects future cap rate compression but maintains ample deal flow; Q2 cap rates remained stable at 7.9%. 
- **Acquisition Strategy**: 93% of deals under $4 million, focusing on granular middle-market properties; $100 million+ deals rare but possible. 
- **Tenant Health**: Unit-level coverage ratio of 3.4x, with no material credit events; Zips Car Wash resolution aligned with budgeted losses. 
- **Industrial Expansion**: Small-scale industrial investments (e.g., $20 million deals) for fungible assets with alternative uses. 
- **Capital Markets**: No immediate debt issuance needed; may explore bond market for long-term capital alignment with 14-year lease terms.

Essential Properties Realty Trust, Inc. (EPRT) Q2 2025 Earnings Call Transcript

- **Q1 Investment Momentum**: $308M invested, 66% from repeat tenants, reaffirming $1.85-$1.89 AFFO guidance.
- **Financial Strength**: 3.4x leverage, $1.5B liquidity, and 7% AFFO growth.
- **Strategic Focus**: 20-year leases, 3x rent coverage, and reduced car wash exposure to 13.9%.
- **Market Dynamics**: Reduced competition in mid-market, while larger deals remain active.
- **Risk Mitigation**: 3.5x unit-level coverage and 99.7% occupancy support resilience.

**【CEO Opening Remarks】**
- Q1 2025 investments reached $308 million, with 66% from recurring tenant relationships.
- AFFO per share guidance reaffirmed at $1.85-$1.89, reflecting 7% midpoint growth.
- Capital markets activity included $300M equity issuance and $2.3B credit facility upsizing, resulting in 3.4x leverage and $1.5B liquidity.

**【COO Investment Update】**
- Q1 investments at 7.8% cash yield, with 90% in sale-leasebacks and 2.2% annual rent escalations.
- Weighted average lease term of 17.5 years and 3x unit-level rent coverage.
- YTD investments $443M, tracking toward $900M-$1.1B guidance without incremental capital needs.

**【CIO Portfolio & Credit Update】**
- Same-store rent growth of 1.5%, 99.7% occupancy, and 100% collections.
- Car wash industry exposure reduced to 13.9% of ABR, below 15% soft ceiling.
- Q1 dispositions of $24.3M at 6.9% yield, supporting portfolio risk management.

**【CFO Financial Highlights】**
- AFFO per share $0.45 (7% YoY growth), driven by $85.7M total AFFO.
- G&A expenses $11.5M, up 23% YoY due to team investment.
- Retained free cash flow $30.1M, enabling 10%+ capital needs coverage.
- Equity issuance $313M and unsettled forward equity $410M, supporting growth.

**【Q&A Key Themes】**
- **Market Competition**: Reduced competition in smaller transactions, while larger deals remain competitive.
- **Dave & Buster's Investment**: 20-year lease with >2x coverage, part of diversified portfolio (1.7% of ABR).
- **Economic Risks**: 3.5x unit-level coverage mitigates service/experience-based risk.
- **Leverage Strategy**: Targeting 4.6x leverage by 2026, with $560M liquidity for 2025 investments.

Essential Properties Realty Trust (EPRT)-24 Apr 25-2025 Q1 Earnings call transcript

- **AFFO Guidance Upped**: 2025 AFFO range raised to $1.85-$1.89, reflecting strong portfolio performance and disciplined capital allocation.
- **Zips Risk Mitigated**: Reduced car wash exposure to 14.2% ABR; Zips bankruptcy affects only 20 bps of ABR with potential 70-80% recovery.
- **Market Resilience**: Mid-7% cap rates support $900M-$1.1B investment pipeline despite normalized capital markets.
- **Financial Strength**: 3.8x leverage, $1.4B liquidity, and 66% AFFO payout ratio ensure balance sheet flexibility.
- **Tenant Diversification**: 17.6% ABR from top 10 tenants, with 3.5x unit-level rent coverage across portfolio.

**【CEO Overview】**
- Q4 2024 revenue growth driven by 79% of investments from existing tenant relationships, reflecting recurring business strength.
- Portfolio performance: 1.4% same-store rent growth, 99.7% occupancy, and 100% collections.
- Updated 2025 AFFO guidance to $1.85-$1.89, up $0.01 at the low end, with $900M-$1.1B investment pipeline amid modest cap rate compression.
- Proactive asset management reduced Zips Car Wash exposure to 20 basis points of ABR, down from 5% in 2017.

**【CFO Financial Highlights】**
- Q4 AFFO per share: $0.45 (7% YoY growth), total AFFO: $81.8M (+22% YoY).
- G&A efficiency: Recurring cash G&A as % of revenue = 4.8% (vs. 5.2% Q4 2023).
- Balance sheet: Pro-forma leverage 3.8x, liquidity $1.4B, and $381M unsettled forward equity.
- Dividend: $0.295 per share (66% AFFO payout ratio), with retained free cash flow of $30.6M Q4.

**【Q&A Key Takeaways】**
- **Zips Bankruptcy**: 3 properties, 20 bps ABR exposure; historical recovery rate 70-80%. No impact on Q4 collections.
- **Market Competition**: Cap rates compressing to mid-7% range vs. 8% in 2024; transaction environment remains favorable for relationship-driven deals.
- **Car Wash Strategy**: 14.2% ABR exposure (down from 15% Q3), with 200+ car washes across 54 operators. No systemic industry risk identified.
- **Capital Allocation**: 2025 equity issuance minimal; $1B revolver and $381M forward equity provide flexibility.
- **Tenant Credit**: 3.5x weighted average unit-level rent coverage; top 10 tenants account for 17.6% of ABR, mitigating concentration risk.

Essential Properties Realty Trust, Inc. (EPRT) Q4 2024 Earnings Call Transcript

Essential Properties Realty Trust (EPRT)-24 Oct 24-2024 Q3 Earnings call transcript

Essential Properties Realty Trust (EPRT)-25 Jul 24-2024 Q2 Earnings call transcript

Essential Properties Realty Trust (EPRT)-25 Apr 24-2024 Q1 Earnings call transcript

Essential Properties Realty Trust (EPRT)-15 Feb 24-2023 Q4 Earnings call transcript

Essential Properties Realty Trust (EPRT)-27 Jul 23-2023 Q2 Earnings call transcript

Essential Properties Realty Trust (EPRT)-27 Apr 23-2023 Q1 Earnings call transcript

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Essential Properties Realty Trust (EPRT)-28 Oct 22-2022 Q3 Earnings call transcript

Essential Properties Realty Trust (EPRT)-29 Jul 22-2022 Q2 Earnings call transcript

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