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EPR PROPERTIES (EPR)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 delivered modest top-line growth (+3% YoY) but a GAAP net loss driven by non‑cash impairments and JV write‑offs; non‑GAAP FFOAA/AFFO per share remained resilient versus prior year .
  • Introduced FY2025 FFOAA guidance of $4.94–$5.14 per diluted share (+3.5% y/y midpoint) and investment spending of $200–$300M; disposition proceeds of $25–$75M .
  • Raised the monthly common dividend 3.5% to $0.295 beginning with the April 15, 2025 payment; AFFO payout guided to ~70% at the midpoint .
  • Strategic pivot away from operating properties: exited the Breaux Bridge RV JV (impairment $16.1M; $10.3M provision), under contract to sell four theater assets, and recognized $40.0M impairments tied to expected sales .
  • Liquidity and balance sheet remain solid (cash $22.1M; $175.0M drawn on $1.0B revolver; only $300.0M of 2025 maturities); net debt/Adj. EBITDAre 5.3x in Q4 .

What Went Well and What Went Wrong

What Went Well

  • Strong non‑GAAP operating performance: Q4 FFOAA per diluted share rose to $1.23 (+4% y/y), AFFO per diluted share rose to $1.22 (+5% y/y) despite macro and impairment noise .
  • Percentage rent structure under Regal and broader box office recovery supported theaters; management expects 2025 NABOG of $9.3–$9.7B .
  • Portfolio quality and coverage: total portfolio 99% leased/operated; overall TTM coverage 2.0x with non‑theater at 2.5x; theaters stabilized at 1.5x .
  • Quote: “We are pleased to have delivered 3.4% earnings growth for full year 2024 when removing the impact of out‑of‑period deferred rent and interest collections” – CEO Greg Silvers .

What Went Wrong

  • GAAP net loss in Q4 from non‑cash impairment charges ($40.0M on theater assets under contract and $16.1M on the RV JV) and credit loss provision ($9.9M) .
  • Operating properties volatility (Kartrite hotel/indoor waterpark expense pressures incl. insurance) offset gains from managed theaters, prompting exit from operating asset strategy .
  • Percentage rent down q/q (seasonality and asset sales) and other income declined q/q reflecting operating property dynamics .

Financial Results

MetricQ2 2024Q3 2024Q4 2024
Total Revenue ($USD thousands)$173,095 $180,507 $177,234
Diluted EPS ($USD)$0.51 $0.53 $(0.19)
FFOAA per diluted share ($USD)$1.22 $1.30 $1.23
AFFO per diluted share ($USD)$1.20 $1.29 $1.22
Adjusted EBITDAre ($USD thousands)$135,676 $142,647 $135,505

Revenue mix

Revenue Mix ($USD thousands)Q2 2024Q3 2024Q4 2024
Rental Revenue$145,093 $148,677 $149,116
Other Income$14,418 $17,419 $13,197
Mortgage & Other Financing Income$13,584 $14,411 $14,921

KPIs and ratios

KPI / RatioQ2 2024Q3 2024Q4 2024
Percentage Rent ($USD thousands)$1,973 $5,944 $4,723
Investment Spending ($USD thousands)$46,947 $81,970 $49,291
Disposition Proceeds ($USD thousands)$10,305 $8,656 $9,272
Net Debt / Adjusted EBITDAre (x)5.2x 5.0x 5.3x
Interest Coverage (x)3.8x 4.0x 3.8x
AFFO Payout Ratio (%)71% 66% 70%

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
FFOAA per diluted share ($)FY2025N/A$4.94–$5.14 Introduced
Net income per diluted share ($)FY2025N/A$2.84–$3.04 Introduced
Investment Spending ($M)FY2025N/A$200–$300 Introduced
Disposition Proceeds ($M)FY2025N/A$25–$75 Introduced
Percentage Rent ($M)FY2025N/A$18–$22 Introduced
G&A Expense ($M)FY2025N/A$52–$55 Introduced
Other Income ($M)FY2025N/A$42–$52 Introduced
Other Expense ($M)FY2025N/A$42–$52 Introduced
Monthly Dividend ($/share)2025$0.285 (declared Feb 14, 2025) $0.295 (payable Apr 15, 2025) Raised 3.5%

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 2024 and Q3 2024)Current Period (Q4 2024)Trend
Box Office / TheatersNABOG accelerating; 2024 raised to $8.2–$8.5B; Regal lease year ~$7.9B 2025 NABOG est. $9.3–$9.7B; theaters stabilized; percentage rent structure benefiting FFO Improving slate and revenue trajectory
Operating PropertiesLodging JV expense pressures; Kartrite challenges; hurricanes in St. Pete (impairments) Explicit pivot: “juice isn’t worth the squeeze”; exiting RV JV; actively selling operating theaters Strategic exit underway
Cost of Capital & FundingNew $1B revolver; maturities staggered; no equity issuance planned Low‑8% blended cost; target +100–150 bps spread; plan to term out revolver with ~$400M bond Improving, disciplined funding
Percentage RentGuidance $12–$16M (2024) raised to $13.5–$16.5M 2025 guidance $18–$22M; Regal drives upside; some offsets from base rent step‑ups Higher run‑rate expected
Fitness & Wellness / AttractionsSprings Resort expansion, Topgolf refreshes, Andretti builds progressing Portfolio revenue/EBITDARM up in ski; Andretti new units; Diggerland acquisition Growth and reinvestment

Management Commentary

  • “We anticipate approximately 3.5% earnings growth at the midpoint of guidance through efficient sourcing of capital, which is not dependent upon any equity issuance” – CEO Greg Silvers .
  • “We will no longer pursue these types of [operating] investments… the juice isn’t worth the squeeze in terms of performance” – EVP & CIO Greg Zimmerman .
  • “We expect results for Q1 2025 to be ~$0.10 per share lower than the full‑year divided by four” – CFO Mark Peterson .
  • “We finalized our exit earlier this month… recognized $16.1M impairment and $10.3M provision for credit loss on the subordinated mortgage note” – CFO Mark Peterson .

Q&A Highlights

  • Cost of capital and deployment: blended cost in low‑8% (60/40 equity/debt); require 100–150 bps spread for incremental deployment . Funding plan includes a potential ~$400M bond to term out revolver draws .
  • Asset sales: one non‑vacant theater under contract at ~9% cap rate; broader leased theater market still thin but expected to thaw with box office recovery .
  • Credit losses: budgeted at 1% of EBITDA ($5M) consistent with historical practice .
  • Strategy: explicit exit from operating properties (Kartrite and certain theaters) due to volatility and insurance costs; focus on net lease structures (hot springs, Andretti, fitness/wellness) .
  • Percentage rent: high‑end achievement tied primarily to Regal box office performance; non‑theater percentage rents largely stable with puts/takes from base rent step‑ups .

Estimates Context

  • Attempts to retrieve S&P Global consensus estimates for Q4 2024 were unavailable due to provider limits; therefore, comparison to Wall Street consensus could not be performed at this time. Values would be retrieved from S&P Global when available.

Key Takeaways for Investors

  • Non‑GAAP earnings power intact: FFOAA/AFFO per share remained strong despite GAAP impairments; 2025 FFOAA guidance implies mid‑single‑digit growth and supports the dividend increase .
  • Strategic de‑risking: accelerated exit from operating assets (RV JV, operating theaters) reduces earnings volatility and insurance exposure; redeployment into net‑lease experiential should improve quality and predictability .
  • Box office is a 2025 tailwind: management’s $9.3–$9.7B NABOG forecast and Regal percentage rent mechanics support upside skew; watch slate cadence and Q2–Q4 seasonality .
  • Balance sheet flexibility: limited 2025 maturities ($300M), ample revolver, intent to term out with bonds; net debt/Adj. EBITDAre in a manageable 5.3x range .
  • Trading implications: dividend uplift and 2025 guidance are near‑term catalysts; confirmation of theater asset sales and further JV exits could unlock value by simplifying the portfolio .
  • Monitor percentage rent and managed property performance: percentage rent guidance step‑up and reduction in operating property exposure should reduce volatility; Q1 seasonality noted by CFO .
  • Execution focus: timely dispositions (two theater properties under contract and two leased to smaller operator) and disciplined capital allocation (mortgage‑to‑fee conversions, Andretti builds, hot springs) remain key .
All quantitative data and statements are sourced from EPR’s Q4 2024 8‑K and exhibits, Q4 2024 press release, Q4 2024 earnings call transcript, and prior quarter filings and materials: **[1045450_0001045450-25-000049_ex991-eprx12312024earnings.htm:0]** **[1045450_0001045450-25-000049_ex991-eprx12312024earnings.htm:1]** **[1045450_0001045450-25-000049_ex991-eprx12312024earnings.htm:2]** **[1045450_0001045450-25-000049_ex991-eprx12312024earnings.htm:3]** **[1045450_0001045450-25-000049_ex991-eprx12312024earnings.htm:4]** **[1045450_0001045450-25-000049_ex991-eprx12312024earnings.htm:6]** **[1045450_0001045450-25-000049_ex991-eprx12312024earnings.htm:7]** **[1045450_0001045450-25-000049_ex991-eprx12312024earnings.htm:10]** **[1045450_0001045450-25-000049_ex993-eprx12312024suppleme.htm:3]** **[1045450_0001045450-25-000049_ex993-eprx12312024suppleme.htm:13]** **[1045450_0001045450-25-000049_ex993-eprx12312024suppleme.htm:16]** **[1045450_6ba447c3788744779f8362c6bc5eecbe_0]** **[1045450_6ba447c3788744779f8362c6bc5eecbe_5]** **[1045450_EPR_3418273_1]** **[1045450_EPR_3418273_2]** **[1045450_EPR_3418273_3]** **[1045450_EPR_3418273_6]** **[1045450_EPR_3418273_7]** **[1045450_EPR_3418273_8]** **[1045450_EPR_3418273_11]** **[1045450_EPR_3418273_15]** **[1045450_EPR_3418273_16]** **[1045450_EPR_3418273_22]** **[1045450_0001045450-24-000085_ex991-eprx9302024earningsr.htm:5]** **[1045450_0001045450-24-000085_ex991-eprx9302024earningsr.htm:8]** **[1045450_0001045450-24-000085_ex991-eprx9302024earningsr.htm:11]** **[1045450_0001045450-24-000085_ex993-eprx9302024supplemen.htm:3]** **[1045450_0001045450-24-000085_ex993-eprx9302024supplemen.htm:7]** **[1045450_0001045450-24-000085_ex993-eprx9302024supplemen.htm:13]** **[1045450_0001045450-24-000085_ex993-eprx9302024supplemen.htm:16]** **[1045450_0001045450-24-000057_ex991-eprx6302024earningsr.htm:3]** **[1045450_0001045450-24-000057_ex991-eprx6302024earningsr.htm:6]** **[1045450_0001045450-24-000057_ex991-eprx6302024earningsr.htm:9]** **[1045450_0001045450-24-000057_ex993-eprx6302024supplemen.htm:3]** **[1045450_0001045450-24-000057_ex993-eprx6302024supplemen.htm:13]** **[1045450_0001045450-24-000057_ex993-eprx6302024supplemen.htm:16]** **[1045450_c73845786e9b41ab8b75f21396941b76_0]**.