InvenTrust Properties Corp. Reports 2022 Third Quarter Results

InvenTrust Properties Corp. (“InvenTrust” or the “Company”) (NYSE: IVT) today reported financial and operating results for the period ended September 30, 2022. For the three months ended September 30, 2022 and 2021, Net Income was $0.9 million, or $0.01 per diluted share, compared to Net Income of $4.0 million, or $0.06 per diluted share, respectively.

Third Quarter 2022 Highlights:

• NAREIT FFO for the quarter of $0.39 per diluted share

• Core FFO for the quarter of $0.37 per diluted share

• Leased Occupancy as of September 30, 2022 of 95.6%

• Executed 83 leases totaling approximately 478,000 square feet of pro rata GLA, of which 441,000 square feet was executed at a blended comparable lease spread of 8.2%

• Net Debt-to-Adjusted EBITDA of 5.0x at September 30, 2022

• Completed the private placement of $250 million of senior notes

• Completed a $10.8 million expansion of the Publix at Suncrest Village in Orlando, FL

“Since our listing on the New York Stock Exchange last October, our business plan and strategy has offered a simple and unique investment opportunity within the strip center sector,” Daniel (DJ) Busch, President and CEO of InvenTrust commented. “Our team’s efforts and execution across all areas of the business as well as our conservative balance sheet has the company positioned to navigate any economic scenario.”

FINANCIAL SUMMARY

NET INCOME

• Net Income for the three months ended September 30, 2022 was $0.9 million, or $0.01 per diluted share, compared to Net Income of $4.0 million, or $0.06 per diluted share, for the same period in 2021.

• Net Income for the nine months ended September 30, 2022 was $52.4 million, or $0.77 per diluted share, compared to Net Income of $5.4 million, or $0.08 per diluted share, for the same period in 2021.

NAREIT FFO

• NAREIT FFO for the three months ended September 30, 2022 was $26.1 million, or $0.39 per diluted share, compared to $26.3 million, or $0.37 per diluted share, for the same period in 2021.

• NAREIT FFO for the nine months ended September 30, 2022 was $88.2 million, or $1.31 per diluted share, compared to $74.1 million, or $1.03 per share, for the same period in 2021.

CORE FFO

• Core FFO for the three months ended September 30, 2022 was $25.2 million, or $0.37 per diluted share, compared to $27.3 million, or $0.38 per diluted share, for the same period in 2021.

• Core FFO for the nine months ended September 30, 2022 was $82.9 million, or $1.23 per diluted share, compared to $73.3 million, or $1.02 per diluted share, for the same period in 2021.

PRO RATA SAME PROPERTY NOI

• Pro Rata Same Property NOI for the three months ended September 30, 2022 was $35.8 million, a 2.8% decrease, compared to the same period in 2021. Excluding net out of period rent collection of $1.3 million, Pro Rata Same Property NOI would have increased 0.8%, when comparing the three months ended September 30, 2022 to the same period in 2021.

• Pro Rata Same Property NOI for the nine months ended September 30, 2022 was $110.5 million, a 5.4% increase, compared to the same period in 2021. Excluding net out of period rent collection of $1.3 million, Pro Rata Same Property NOI would have increased 6.6%, when comparing the nine months ended September 30, 2022 to the same period in 2021.

DIVIDEND

• For the quarter ending September 30, 2022, the Board of Directors declared a quarterly cash distribution of $0.2052 per share, payable on October 14, 2022.

PORTFOLIO PERFORMANCE & INVESTMENT ACTIVITY

• As of September 30, 2022, the Company’s Leased Occupancy was 95.6%.
  • Total Anchor Leased Occupancy, which includes spaces greater than or equal to 10,000 square feet, was 98.2% and Small Shop Leased Occupancy was 91.0%. Anchor Leased Occupancy remained flat and Small Shop Leased Occupancy increased 50 basis points on a sequential basis compared to the previous quarter.
  • Leased to Economic Occupancy spread of 210 basis points, which equates to approximately $5.2 million of base rent on an annualized basis.
• Blended re-leasing spreads for comparable new and renewal leases signed in the third quarter were 8.2%.
• Annualized Base Rent PSF (“ABR”) as of September 30, 2022 for the Pro Rata Combined Portfolio was $18.91, an increase of 2.6% compared to the same period in 2021. Anchor Tenant ABR PSF was $12.39 and Small Shop ABR PSF was $31.91 for the third quarter.
• In August 2022, the Company completed a $10.8 million expansion of the Publix at Suncrest Village in Orlando, Florida.

LIQUIDITY AND CAPITAL STRUCTURE

• InvenTrust had $574.1 million of total liquidity, as of September 30, 2022 comprised of $224.1 million of Pro Rata Cash and $350.0 million of availability under its Revolving Credit Facility.

• InvenTrust had no debt maturing in 2022 and $38.6 million of debt maturing in 2023, as of September 30, 2022.

• On August 11, 2022, the Company issued $150.0 million of seven year and $100.0 million of ten year senior notes with a weighted average fixed rate of 5.12% and weighted average term of approximately 8.2 years.

• As of September 30, 2022, the Company's weighted average interest rate on its consolidated debt was 3.89% and the weighted average remaining term was 5.2 years.

• As of September 30, 2022, the Company's weighted average interest rate on its pro rata debt was 3.81% and the weighted average remaining term was 4.9 years.

SUBSEQUENT ACTIVITY

• On October 28, 2022, the Company acquired Eastfield Village in Huntersville, North Carolina for $22.5 million. The 96,000 square foot neighborhood center is anchored by Food Lion.

2022 GUIDANCE

InvenTrust has updated its 2022 guidance, as summarized in the table below.

Net Income, NAREIT FFO, Core FFO and SPNOI guidance are inclusive of prior period unrecognized rent that we anticipate collecting in 2022.

The Company's 2022 Guidance is based on a number of assumptions that are subject to change and may be outside the Company’s control. If actual results vary from these assumptions, the Company's expectations may change. There can be no assurances that InvenTrust will achieve these results.

CONFERENCE CALL INFORMATION

Replay

Webcast Archive: https://www.inventrustproperties.com/investor-relations/

A webcast replay will be available shortly after the conclusion of the presentation using the webcast link above.

NON-GAAP FINANCIAL MEASURES

This Earnings Release includes certain non-GAAP financial measures and other terms that management believes are helpful in understanding our business. These measures should not be considered as alternatives to, or more meaningful than, net income (calculated in accordance with GAAP) or other GAAP financial measures, as an indicator of financial performance and are not alternatives to, or more meaningful than, cash flow from operating activities (calculated in accordance with GAAP) as a measure of liquidity. Non-GAAP performance measures have limitations as they do not include all items of income and expense that affect operations, and accordingly, should always be considered as supplemental financial results to those calculated in accordance with GAAP. The Company's computation of these non-GAAP performance measures may differ in certain respects from the methodology utilized by other REITs and, therefore, may not be comparable to similarly titled measures presented by such other REITs. Investors are cautioned that items excluded from these non-GAAP performance measures are relevant to understanding and addressing financial performance. A reconciliation of our non-GAAP measures to the most directly comparable GAAP financials measures are included herein.

SAME PROPERTY NOI or SPNOI

Information provided on a same property basis includes the results of properties that were owned and operated for the entirety of both periods presented. NOI excludes general and administrative expenses, direct listing costs, depreciation and amortization, provision for asset impairment, other income and expense, net, gains (losses) from sales of properties, gains (losses) on extinguishment of debt, interest expense, net, equity in earnings (losses) from unconsolidated entities, lease termination income and expense, and GAAP rent adjustments (such as straight-line rent, above/below market lease amortization and amortization of lease incentives).

NAREIT FUNDS FROM OPERATIONS (NAREIT FFO) and CORE FFO

Our non-GAAP measure of NAREIT Funds from Operations ("NAREIT FFO"), based on the National Association of Real Estate Investment Trusts ("NAREIT") definition, is net income (or loss) in accordance with GAAP, excluding gains (or losses) resulting from dispositions of properties, plus depreciation and amortization and impairment charges on depreciable real property. Adjustments for our unconsolidated joint venture is calculated to reflect our proportionate share of the joint venture's NAREIT FFO on the same basis. Core Funds From Operations (“Core FFO”) is an additional supplemental non-GAAP financial measure of our operating performance. In particular, Core FFO provides an additional measure to compare the operating performance of different REITs without having to account for certain remaining amortization assumptions within NAREIT FFO and other unique revenue and expense items which some may consider not pertinent to measuring a particular company’s on-going operating performance.

ADJUSTED EBITDA

Our non-GAAP measure of Adjusted EBITDA excludes gains (or losses) resulting from debt extinguishments, transaction expenses, straight-line rent adjustments, amortization of above and below market leases and lease inducements, and other unique revenue and expense items which some may consider not pertinent to measuring a particular company’s on-going operating performance. Adjustments for our unconsolidated joint venture is calculated to reflect our proportionate share of the joint venture's Adjusted EBITDA on the same basis.

NET DEBT-TO-ADJUSTED EBITDA

Net Debt-to-Adjusted EBITDA is Pro Rata Net Debt divided by Adjusted EBITDA on a trailing twelve month basis.

PRO RATA

Where appropriate, the Company has included the results from its ownership share of its joint venture properties when combined with the Company's wholly owned properties, defined as "Pro Rata," with the exception of property and lease count.

Financial Statements

Financial Statements, Continued

NAREIT FFO and Core FFO

Dollars in thousands, except share and per share amounts

The following table presents a reconciliation of Net Income to NAREIT FFO and Core FFO Attributable to Common Shares and Dilutive Securities and provides additional information related to its operations:

EBITDA, Pro Rata

Dollars in thousands

The following table presents a pro rata reconciliation of Net Income to EBITDA and Adjusted EBITDA, with reconciling items reflecting our consolidated entities and our pro rata share of our JV:

About InvenTrust Properties Corp.

InvenTrust Properties Corp. (“we,” the “Company,” “our,” “us,” "IVT" or "InvenTrust") is a premier Sun Belt, multi-tenant essential retail REIT that owns, leases, redevelops, acquires and manages grocery-anchored neighborhood and community centers as well as high-quality power centers that often have a grocery component. We pursue our business strategy by acquiring retail properties in Sun Belt markets, opportunistically disposing of retail properties, maintaining a flexible capital structure, and enhancing environmental, social and governance ("ESG") practices and standards. A trusted, local operator bringing real estate expertise to its tenant relationships, IVT has built a strong reputation with market participants across its portfolio. IVT is committed to leadership in ESG practices and has been a Global Real Estate Sustainability Benchmark (“GRESB”) member since 2013. As of September 30, 2022, the Company is an owner and manager of 62 retail properties, representing 10.5 million square feet of retail space. For more information, please visit www.inventrustproperties.com.

Forward-Looking Statements Disclaimer

Forward-Looking Statements in this press release, or made during the earnings call, which are not historical facts, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements, including statements about the Company’s 2022 guidance and ability to navigate any economic scenario, or regarding management’s intentions, beliefs, expectations, representation, plans or predictions of the future, are typically identified by words such as “may,” “could,” “expect,” “intend,” “plan,” “seek,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue,” “likely,” “will,” “would,” “outlook,” “guidance,” and variations of these terms and similar expressions, or the negative of these terms or similar expressions. Such forward-looking statements are necessarily based upon estimates and assumptions that, while considered reasonable by us and our management, are inherently uncertain. The following factors, among others, could cause actual results and financial position and timing of certain events to differ materially from those described in the forward-looking statements: the effects and duration of the COVID-19 pandemic; interest rate movements; local, regional, national and global economic performance; the impact of inflation on the Company and on its tenants; competitive factors; the impact of e-commerce on the retail industry; future retailer store closings; retailer consolidation; retailers reducing store size; retailer bankruptcies; government policy changes; and any material market changes and trends that could affect the Company’s business strategy. For further discussion of factors that could materially affect the outcome of our forward-looking statements and our future results and financial condition, see the Risk Factors included in InvenTrust’s most recent Annual Report on Form 10-K, as updated by any subsequent Quarterly Report on Form 10-Q, in each case as filed with the Securities and Exchange Commission. InvenTrust intends that such forward-looking statements be subject to the safe harbors created by Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, except as may be required by applicable law. We caution you not to place undue reliance on any forward-looking statements, which are made as of the date of this press release. We undertake no obligation to update publicly any of these forward-looking statements to reflect actual results, new information or future events, changes in assumptions or changes in other factors affecting forward-looking statements, except to the extent required by applicable laws. If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements.

Availability of Information on InvenTrust Properties Corp.'s Website and Social Media Channels

Investors and others should note that InvenTrust routinely announces material information to investors and the marketplace using U.S. Securities and Exchange Commission filings, press releases, public conference calls, webcasts and the InvenTrust investor relations website. The Company uses these channels as well as social media channels (e.g., the InvenTrust Twitter account (twitter.com/inventrustprop); and the InvenTrust LinkedIn account (linkedin.com/company/inventrustproperties)) as a means of disclosing information about the Company's business to our colleagues, investors, and the public. While not all of the information that the Company posts to the InvenTrust investor relations website or on the Company’s social media channels is of a material nature, some information could be deemed to be material. Accordingly, the Company encourages investors, the media and others interested in InvenTrust to review the information that it shares on www.inventrustproperties.com/investor-relations and on the Company’s social media channels.

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