Executive Summary

Q4 2024 revenue modestly beat Street, while GAAP EPS missed; company-level profitability tracked on AFFO was solid with $0.33 per share (historical) and $0.27 pro forma, consistent with the ABS payoff pro forma construct and 4Q guidance; 2025 AFFO/share guidance initiated at $1.20–$1.26 . Revenue actual: $15.514M vs Street $15.179M; Primary EPS actual: -$0.41 vs Street -$0.01; FFO/Share (Street proxy for AFFO in REIT coverage): $0.2625 consensus; see Estimates Context for details (S&P Global)* .
Execution highlighted by $103.4M of Q4 acquisitions at 7.9% WACR and 11-year WALT; occupancy ~98% with diversified tenant base; management is deliberately avoiding pharmacy and casual dining while sourcing at cap rates above public-peer markets .
Capital structure de-risked: IPO proceeds used to retire legacy facilities; ABS notes repaid 12/30; $200M term loan swapped to a 4.96% all-in rate; net debt/Annualized Adjusted EBITDAre ~5.2x at 12/31/24 .
Watchlist-driven vacancies concentrated in sit-down casual dining and select other categories; mgmt expects substantial majority back online by late 2025 at “meaningful recovery rates,” but embedded 2–3% 2025 bad debt on cash NOI creates near-term AFFO headwind .

What Went Well and What Went Wrong

What Went Well
- Sourcing at outsized yields: $103.4M acquired at 7.9% cap rate in Q4; early Q1 activity running 7.8–7.9% and signed PSAs at ~8.2% cap rate; mgmt believes niche sourcing and surety of close enable “pricing arbitrage” .
- Balance sheet transition executed: IPO proceeds repaid legacy CIBC revolver/term loan; ABS notes retired 12/30 via new $200M term loan + revolver; $200M term loan hedged to ~4.96% all-in; leverage at ~5.2x Net Debt/Annualized Adj. EBITDAre .
- Diversification and tenant discipline: ~307 properties across 35 states; top tenant 2.9% ABR; active avoidance of pharmacy and casual dining in new acquisitions; 95% corporate credits in Q4 acquisitions .
What Went Wrong
- GAAP earnings pressure: Q4 internalization expense and impairments drove negative FFO and a GAAP net loss (-$21.5M); Primary EPS missed Street as GAAP not the key REIT KPI .
- Tenant stress in certain categories: Hooters, TGI Fridays, On The Border, JOANN Fabrics, etc., drove occupancy dip and ~200 bps bad debt in Q4; 2025 bad debt guide 2–3% of cash NOI .
- Rate headwinds to 2025 run-rate: Replacement of 3.4% ABS with floating SOFR debt adds near-term AFFO drag despite swaps; mgmt acknowledged sensitivity to SOFR until greater scale is achieved .

Financial Results

Quarterly performance and Street comparison

Metric	Q4 2023	Q2 2024	Q3 2024	Q4 2024	Street Q4 2024
Revenues ($M)	$14.343	$15.259	$14.534	$15.514	$15.179*
Net (Loss) Income ($M)	$8.429	$(3.369)	$(3.339)	$(21.488)	—
Primary EPS ($)	—	—	—	$(0.408) (actual in SPGI)*	$(0.0107)*
FFO ($M)	$2.322	$4.159	$3.780	$(9.963)	—
FFO/Share ($)	—	$0.32	$0.30	$(0.36)	$0.2625*
AFFO ($M)	$4.844	$4.989	$4.762	$9.055 (historical) / $7.404 (pro forma)	—
AFFO/Share ($)	—	$0.39	$0.38	$0.33 (historical) / $0.27 (pro forma)	—

Notes: Street figures marked with an asterisk (*) retrieved from S&P Global; values may reflect coverage conventions where “FFO/Share (REIT)” is used as the primary per-share operating KPI for REITs rather than GAAP EPS. Values retrieved from S&P Global.

KPI and portfolio metrics

KPI	Q3 2024	Q4 2024
Properties (#)	278	307
Occupancy (%)	98.9%	97.7%
ABR ($M)	$52.1	$58.8
WALT (years)	6.7	7.2
Net Debt / Annualized Adj. EBITDAre (x)	9.8x (historical) / 3.9x (pro forma)	5.2x (historical)
Dividend/Share ($)	$0.215 declared (payable Jan 15, 2025)	$0.215 declared (record Mar 31, 2025)

Capital markets and acquisitions

Q4 2024 acquisitions: 29 properties for $103.4M at 7.9% cap rate; WALT 11 years .
Subsequent activity: 15 properties for $37.9M at 7.8% cap; PSAs for $18.2M at 8.2% cap (through press release date) . Separate intra-quarter update cited 14 properties for $35.3M at 7.8% and 6 under contract for $20.7M at 8.2% .
ABS notes repaid 12/30; $200M term loan fixed at ~4.96% all-in via swaps; $68.5M drawn on revolver at 12/31/24 .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
AFFO/Share	Q4 2024	$0.32–$0.34	Actual $0.33 (historical); $0.27 (pro forma)	Met (historical); consistent with pro forma construct
AFFO/Share	FY 2025	—	$1.20–$1.26	Initiated
Acquisitions ($)	FY 2025	—	$175M–$200M	Initiated
Dispositions ($)	FY 2025	—	$5M–$20M	Initiated
Bad Debt (% cash NOI)	FY 2025	—	2%–3%	Initiated
Non-reimbursed property & operating exp. ($)	FY 2025	—	$2.0M–$2.6M	Initiated
Cash G&A ($)	FY 2025	—	$8.9M–$9.5M	Initiated
Dividend ($/share)	Q1 2025	—	$0.215 declared (record Mar 31, 2025)	New declaration

Earnings Call Themes & Trends

Topic	Previous Mentions (Q-2 and Q-1)	Current Period (Q4 2024)	Trend
Acquisition cap rates / pipeline	Q3: >$100M under PSA at ~7.9%; expected mid-7s in 1Q25	Q4 closed $103.4M at 7.9%; Q1 pacing 7.8–7.95% (above prior guide)	Improving sourcing yields; slight tightening risk 2H25
Tenant health / bad debt	Q3: ~1% FY bad debt run-rate; watchlist (Freddy’s, TGI Fridays, Hooters, etc.) ~2% ABR	Q4 bad debt ~200 bps; 2025 guide 2%–3%; expect substantial majority back online by late 2025	Near-term headwind; recovery plan underway
Category exposure (pharmacy, casual dining)	Q3: reducing exposure; 0 pharmacy & 0 fast casual in new PSAs	Continued avoidance in new buys; sit-down casual driving issues; exposure down to ~15% ABR by Q4 end	Risk mitigation continues
Capital structure / rates	Q3: ABS at 3.4% provided Q4 tailwind; plan to repay in Dec; new $250M revolver and $200M term loan	ABS repaid; $200M term loan swapped to ~4.96%; leverage ~5.2x	Transition complete; rate sensitivity persists
Leverage / equity sensitivity	Q3: pro forma leverage ~3.9x; disciplined equity use	Target ~6x ND/EBITDA over time; runway without near-term equity; can dial back acquisitions if needed	Prudent leverage stance maintained

Management Commentary

“We are pleased to report a very successful first quarter as a public company… acquiring over $100 million… at above-market cap rates… We are initiating 2025 AFFO per share guidance of $1.20 to $1.26” .
“We continue to acquire on average in the high 7s… pricing arbitrage… targeting strong credit in essential services; avoiding casual dining and pharmacy; cautious on car washes” .
“We… locked in our $200 million term loan… all-in rate of 4.96%… our earnings are a bit more sensitive to short-term SOFR swings until we achieve greater scale” .
“On our… watch list… represent about 4% of our ABR… expect that a substantial majority of these properties should be back online in late 2025 at meaningful recovery rates” .

Q&A Highlights

Pipeline and cap rates: Robust pipeline with acquisitions transacting in “high 7s”; mix across medical/dental, automotive services, convenience, fitness, finance; actively avoiding pharmacy/casual dining; 98% of new acquisitions with received financials .
Bad debt trajectory: FY25 bad debt guided to 2–3% of cash NOI; majority relates to identified watchlist; expected normalization after 2025 as assets are repurposed/sold .
Re-tenanting progress: Negotiations with six users covering 12 assets; 3 under contract that could recover ~32–34% of the 4% ABR lost; with LOIs/lease could reach ~50% recovery .
Leverage and equity costs: Comfortable operating around ~6x ND/EBITDA over time; current cost of equity not conducive to issuance; sufficient runway via balance sheet and ability to moderate acquisition cadence .
G&A outlook: Slight uptick reflects full public-company cost stack, not headcount; platform can scale with limited incremental hires .

Estimates Context

Q4 2024 revenue: $15.514M vs Street $15.179M* (beat) .
Q4 2024 Primary EPS: actual -$0.408 vs Street -$0.0107* (miss); GAAP EPS less indicative for REITs [SPGI; see above]*.
Q4 2024 FFO/Share: Company FFO/share was negative due to one-time items; Street “FFO/Share (REIT)” consensus $0.2625* appears to track underlying cash earnings more akin to AFFO, which was $0.33 (historical) and $0.27 pro forma .
FY 2025 context: Street FFO/Share (REIT) consensus ~$0.98* vs company AFFO/share guidance $1.20–$1.26, implying potential upward revisions if execution sustains acquisitions at ~7.8–8.2% cap rates and re-leasing progresses .

Note: Asterisk (*) denotes values retrieved from S&P Global.

Key Takeaways for Investors

Acquisition spreads are the near-term stock driver: sourcing at 7.8–8.2% cap rates in a fragmented, private-seller market can compound AFFO growth even with higher floating costs; mgmt is leaning into essential-service credits and avoiding problem categories .
Near-term AFFO headwind is manageable: bad debt at 2–3% of cash NOI in 2025 and ABS-to-SOFR transition weigh temporarily; hedges, mix shift, and re-tenanting plan should mitigate through late 2025 .
Balance sheet flexibility preserved: ~5.2x leverage and access to revolver/term loan support FY25 $175–$200M acquisition plan without near-term equity; mgmt prepared to modulate cadence if market/equity costs warrant .
Q4 met company guidance on an AFFO basis and modestly beat Street revenue; REIT investors should anchor on AFFO/Share and cash metrics versus GAAP EPS volatility from one-time internalization/impairment .
Portfolio quality/nimbleness: 35 states, 320 tenants, top tenant 2.9% ABR, and frontage-focused real estate shorten re-leasing timelines; exposure to challenged categories continues to decline .

Appendix: Additional Data

Acquisition/portfolio data points

Q4 acquisitions: 29 properties; WACR 7.9%; WALT 11 years; 12 new tenants; 4 new states .
Portfolio overview (12/31/24): 307 properties; ~2.4M sqft; 97.7% leased; 320 tenants; WALT 7.2 years .

Capital structure

Debt at 12/31/24: Term loan $200M; Revolver $68.5M; Net Debt $263.4M; Net Debt/Annualized Adj. EBITDAre ~5.2x; swaps fixed term loan at ~4.96% .

Distributions

Dividend: $0.215 per share declared 3/18/25 (record 3/31/25; payable on/before 4/15/25) .

All citations: .

Values marked with an asterisk (*) were retrieved from S&P Global.

FrontView REIT, Inc. (FVR)·Q4 2024 Earnings Summary