BOSTON--(BUSINESS WIRE)--Plymouth Industrial REIT, Inc. (NYSE America: PLYM) today announced its consolidated financial results for the second quarter ended June 30, 2019 and other recent developments.

Second Quarter and Subsequent Highlights

• Reported results for the second quarter of 2019 reflect a net loss attributable to common stockholders of $6.0 million, or $(0.88) per weighted average common share; net operating income (“NOI”) of $11.0 million; Funds from Operations attributable to common stockholders and unit holders (“FFO”) of $0.50 per weighted average common share and units; and Adjusted FFO (“AFFO”) of $0.43 per weighted average common share and units. FFO and AFFO per weighted average common share and units reflect approximately 3.85 million common shares issued during the first half of 2019 through a follow-on common stock offering and the Company’s at-the-market equity (“ATM”) program.
• For the second quarter of 2019, declared a regular quarterly cash dividend of $0.375 for the common stock and a regular quarterly cash dividend of $0.46875 per share for the 7.50% Series A Cumulative Redeemable Preferred Stock (“the “Preferred Stock”).
• Capital markets activity significantly improved the Company’s balance sheet with a total of 3.6 million shares issued during the second quarter, raising net proceeds of $58.3 million, and a new $100 million secured credit facility completed in August 2019 with expanded capacity, lower borrowing costs and greater flexibility.
• During the second quarter of 2019 and to date in the third quarter of 2019, the Company acquired, or agreed to acquire, 16 properties totaling 2.8 million square feet in one-off and portfolio transactions representing total consideration of approximately $113 million.
• To reflect the impact from a follow-on common stock offering and recent acquisition activity noted above, adjusted the 2019 full year expected results to a net loss of $(1.33) to $(1.30) per share; Nareit FFO attributable to common stockholders and unit holders of $2.10 to $2.13 per diluted share; and AFFO of $1.73 to $1.76 per diluted share.

Jeff Witherell, Chairman and Chief Executive Officer of Plymouth Industrial REIT, noted, “Our second quarter results were in line with our short-term expectations and our outlook for the year. We executed on the main priorities of leasing the portfolio, sourcing new acquisition opportunities and improving our capital structure. The increase in portfolio occupancy is expected to continue during the second half of the year as we maintain leasing momentum on renewals and current vacancy. The pace of acquisitions has accelerated to date in the third quarter, and we continue to work on new opportunities from our pipeline. This activity is possible due to the improvements we made to our balance sheet with a successful equity offering and ATM activity during the second quarter along with a significantly expanded credit facility with lower borrowing costs.”

Financial Results for the Second Quarter of 2019

The completion of a follow-on common stock offering in July 2018, a follow-on common stock offering in May 2019 and the strategic investment by Madison International Realty in December 2018 provided the Company with a meaningfully different capital structure for the second quarter of 2019 compared to the second quarter of 2018. The Company believes the use of the respective proceeds and related higher share count, makes year-over-year comparisons less meaningful, particularly on a per share basis.

Net loss attributable to common stockholders for the quarter ended June 30, 2019 was $6.0 million, or $(0.88) per weighted average common share outstanding, compared with net loss attributable to common stockholders of $7.7 million, or $(2.27) per weighted average common share, for the same period in 2018. The decrease in net loss was primarily due to an increase in net operating income partially offset by redemption value per the terms of the Series B Preferred Stock agreement. Weighted average common shares outstanding for the second quarters ended June 30, 2019 and 2018 were 6.8 million and 3.4 million, respectively. The year-over-year increase in weighted average common shares was related to the Company’s issuance of 425,000 shares of common stock on its ATM in the first and second quarters of 2019 and a follow-on offering of 3,425,000 shares of common stock in the second quarter of 2019.

Consolidated total revenues for the quarter ended June 30, 2019 were $17.0 million, compared with $12.0 million for the same period in 2018.

NOI for the quarter ended June 30, 2019 was $11.0 million compared with $8.2 million for the same period in 2018.

EBITDA for the quarter ended June 30, 2019 was $9.2 million compared with $6.7 million for the same period in 2018.

FFO attributable to common stockholders and unit holders for the quarter ended June 30, 2019 was $4.1 million, or $0.50 per weighted average common share and unit, compared with $1.6 million, or $0.39 per weighted average common share and unit for the same period in 2018, primarily as a result of the contribution from acquisitions. Weighted average common shares and units outstanding for the second quarters ended June 30, 2019 and 2018 were 8.0 million and 4.0 million, respectively. The year-over-year increase in weighted average common shares and units was related to the Company’s activity on its ATM in the first and second quarters of 2019 and the follow-on offering of common stock in the second quarter of 2019.

AFFO for the quarter ended June 30, 2019 was $3.4 million, or $0.43 per weighted average common share and unit, compared with $1.7 million, or $0.42 per weighted average common share and unit, for the same period in 2018, primarily driven by the change in FFO attributable to common stockholders and unit holders.

See “Non-GAAP Financial Measures” for complete definitions of NOI, EBITDA, FFO and AFFO and the financial tables accompanying this press release for reconciliations of net income to NOI, EBITDA, FFO and AFFO.

Capital Markets Activity

During April 2019, the Company issued approximately 147,000 common shares through its ATM program at an average price of $16.79 per share, raising approximately $2.4 million in net proceeds.

The Company also issued an aggregate of 3,425,000 shares of common stock in May 2019 in a follow-on offering at a public offering price of $17.50 per share, resulting in net proceeds to the Company of approximately $55.9 million. Proceeds from the offering were used to repay outstanding borrowings on the Company’s secured credit facility and fund acquisition activity during the second quarter and to date in the third quarter.

On August 7, 2019, the Company closed on a new $100 million secured credit facility led by KeyBank National Association, Barclays and Capital One. The new facility, which matures in August 2023, provides incremental borrowing capability along with a $100 million accordion feature and a 50-basis-point reduction in borrowing costs with interest at LIBOR plus a margin between 200 to 250 basis points, depending on the Company’s leverage.

Investment Activity

As of June 30, 2019, the Company had real estate investments comprised of 57 industrial properties totaling 12.5 million square feet with occupancy of 96.1%. During the second quarter of 2019 and to date in the third quarter of 2019, the Company acquired, or agreed to acquire, 16 properties totaling 2.8 million square feet in one-off and portfolio transactions representing total consideration of approximately $113 million. The acquisitions are expected to be funded with proceeds from the Company’s capital markets activity, borrowings on its secured credit facility and assumed financing.

On June 10, 2019, the Company completed the acquisition of a 485,000-square-foot, two-tenant Class B industrial building in Indianapolis, Indiana that is 100% leased for $17.1 million in cash. The acquisition is projected to provide an initial yield of 7.7%.

On July 29, 2019, the Company acquired a 129,000-square-foot multi-tenant Class B industrial building in St. Louis, Missouri for $5.4 million in cash. The acquisition is projected to provide an initial yield of 8.6%.

The Company signed a definitive agreement to acquire two industrial buildings in Memphis, Tennessee totaling 566,281 square feet for total consideration of $22.05 million. The acquisition is projected to provide an initial yield of 8.1% and is expected to close by September 30, 2019, subject to customary closing conditions.

The Company signed a definitive agreement to acquire a six-building light industrial and flex portfolio in Cincinnati and Columbus, Ohio totaling 591,695 square feet for total consideration of $36.2 million. The acquisition is projected to provide an initial yield of 8.4% and is expected to close by mid-August 2019, subject to customary closing conditions.

The Company is finalizing an agreement to acquire a seven-building Class B industrial portfolio in Chicago, Illinois totaling 1,071,129 square feet for $32.25 million in cash. The acquisition is projected to provide an initial yield of 8.25% and is expected to close by September 1, 2019, subject to customary closing conditions.

Leasing Activity

Leases commencing during the second quarter of 2019 totaled an aggregate of 714,000 square feet, 573,000 of which were leases of at least six months. The leases greater than six months included 253,000 square feet of renewal leases and 320,000 square feet of new leases, and the Company will experience an 8.3% increase in rental rates on a cash basis from these leases.

Quarterly Distributions to Stockholders

On May 31, 2019, the Company announced the Board of Directors declared a regular quarterly cash dividend of $0.46875 per share for the Preferred Stock for the second quarter of 2019. The dividend was paid on July 1, 2019 to stockholders of record on June 14, 2019.

On June 14, 2019, the Company announced the Board of Directors declared a regular quarterly cash dividend of $0.375 per share for the Company’s common stock for the second quarter of 2019. The dividend was payable on July 31, 2019, to stockholders of record on June 28, 2019.

Guidance for 2019

The Company adjusted its guidance for the year ending December 31, 2019 to reflect the impact from an equity offering and ATM activity during the quarter and recent acquisition activity. The Company now expects it results for 2019 to be in a range of a net loss of $(1.33) to $(1.30) per weighted average common share and operating unit outstanding, Nareit FFO attributable to common stockholders and unit holders of $2.10 to $2.13 per weighted average common share and unit and AFFO of $1.73 to $1.76 per weighted average common share and unit.

See “Non-GAAP Financial Measures” for a complete definition of FFO and AFFO and the financial table accompanying this press release for reconciliations of net income to FFO and AFFO.

A reconciliation of projected net loss per weighted average common share and unit outstanding to projected Nareit FFO attributable to common stockholders and unit holders per weighted average common share and unit and AFFO per weighted average common share and unit is provided as follows:

The Company’s guidance for net loss, FFO attributable to common stockholders and unit holders and AFFO attributable to common stockholders and unit holders for 2019 is based on the following assumptions. Other than noted below, this guidance excludes the potential impact of additional acquisitions or dispositions, if completed:

• Total revenues of $71.6 million to $72.0 million
• Net operating income of $46.85 million to $47.15 million
• EBITDA of $39.4 million to $39.8 million
• General and administrative expenses of $7.1 to $7.5 million, including non-cash expenses of $1.2 million
• Same-store portfolio occupancy of 95% to 96%
• Recurring capital expenditures of $3.5 million to $3.7 million
• 8.4 million weighted average common shares and operating partnership units outstanding for the year (9.8 million common shares and operating partnership units currently outstanding)
• The completion of approximately $90.5 million in acquisitions currently under agreement between mid-August 2019 and September 30, 2019

About Plymouth

Plymouth Industrial REIT, Inc. is a vertically integrated and self-managed real estate investment trust focused on the acquisition and operation of single and multi-tenant industrial properties located in secondary and select primary markets across the United States. The Company seeks to acquire properties that provide income and growth that enable the Company to leverage its real estate operating expertise to enhance shareholder value through active asset management, prudent property re-positioning and disciplined capital deployment.