• Acquisitions: $265 million in acquisitions at a 7.1% cap rate for 2024.
• Q4 Acquisitions: 45 properties for $133 million at a 7% cap rate.
• Rent Coverage: 4.9 times for the majority of the portfolio in Q4.
• Same-Store Sales Growth: Chili's 31%, Olive Garden 2%, LongHorn 7.5% for the respective periods.
• Equity Raised: Over $318 million in 2024, with $102 million in Q4.
• Fixed Charge Coverage Ratio: 4.5 times.
• Net Debt to Adjusted EBITDAre: 4.9 times in Q4.
• Liquidity: Approximately $500 million available.
• Q4 AFFO: $0.44 per share, up 2.3% from Q4 last year.
• Full Year 2024 AFFO: $1.73 per share, up 3.6% from 2023.
• Q4 Cash Rental Income: $60.8 million, up 6.6% year-over-year.
• Full Year 2024 Cash Rent: $235.4 million, up 8.8% from 2023.
• Portfolio Occupancy: 99.6%.
• Base Rent Collection: 99.4% for Q4.

• Warning! GuruFocus has detected 9 Warning Signs with FCPT.

Release Date: February 13, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Four Corners Property Trust Inc (NYSE:FCPT) ended 2024 with $265 million in acquisitions at a blended 7.1% cap rate, demonstrating strong acquisition performance.
• The company maintained high portfolio occupancy at 99.6% and collected 99.4% of base rent for the fourth quarter, indicating strong operational performance.
• FCPT has significant liquidity with approximately $500 million available, providing a solid foundation for future growth and acquisitions.
• The company reported a 3.6% increase in full-year 2024 AFFO per share, reflecting financial growth and stability.
• FCPT's core tenants, such as nationally branded casual dining operators, continue to outperform the industry, with strong same-store sales growth reported by brands like Chili's and Olive Garden.

Negative Points

• Rising interest rates created a challenging backdrop for net lease companies, impacting acquisition volumes across the sector.
• The company paused incremental acquisitions in the first half of 2024 due to unfavorable investment spreads, indicating potential growth limitations.
• Despite high occupancy, there was a slight sequential decline in rent collection, which could indicate emerging challenges in rent payments.
• The company faces competition in the acquisition market, particularly from private buyers, which could impact future deal flow.
• FCPT does not provide forward guidance, which may create uncertainty for investors regarding future performance and strategic direction.

Q & A Highlights

Q: Can you discuss which areas in your portfolio are seeing better or worse trends, even if rents aren't at risk? A: William Lenehan, CEO, mentioned that there isn't a notable standout in their portfolio, except for Chili's. Casual dining brands are growing, and their QSR exposure, mainly Burger King, is doing well. Other sectors are defensive, allowing FCPT to focus on growth rather than defense.

Q: How far off is FCPT from issuing public bonds? A: William Lenehan, CEO, stated that they are working on it, with the upsize of their revolver in anticipation of having that option. They have borrowed in the private note market before, but public bonds currently offer more attractive pricing. They have various options for debt and will focus on this in 2025.

Q: Should we expect a similar acquisition cadence in non-restaurant retail segments going forward? A: William Lenehan, CEO, explained that while they don't plan it out specifically, the trend of increasing exposure in medical retail and auto service may continue. They are not trying to fill quotas but are open to new sectors and opportunities.

Q: Do you still feel good about being in the green zone for acquisitions given interest rate movements? A: William Lenehan, CEO, confirmed they are in the green zone and have substantial capital raised to fund acquisitions. They are well-positioned for 2025 acquisitions, which puts them in a favorable position compared to peers.

Q: Has FCPT seen any impact on tenants from labor policies by the new administration? A: William Lenehan, CEO, stated they haven't seen any significant impact yet. They are monitoring potential economic impacts from political changes but haven't identified any standout issues affecting their business.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.