• Earnings Growth: 3.4% earnings growth for the full year 2024, excluding out-of-period deferred rent and interest collections.
• Total Investments: Approximately $6.9 billion with 346 properties, 99% leased or operated.
• Experiential Portfolio: 278 properties, 93% of total investments, approximately $6.4 billion, 99% leased or operated.
• Box Office Revenue: Q4 2024 box office totaled $2.3 billion, up 26% from Q4 2023; 2024 box office was $8.6 billion, down 4% from 2023.
• FFO Adjusted: $1.23 per share for Q4 2024 versus $1.18 in the prior year.
• AFFO: $1.22 per share for Q4 2024 compared to $1.16 in the prior year.
• Total Revenue: $177.2 million for Q4 2024 versus $172 million in the prior year.
• Investment Spending: $49.3 million in Q4 2024, total $263.9 million for 2024.
• Disposition Proceeds: $74.4 million for 2024, net gain on sale of $16.1 million.
• Net Debt to Adjusted EBITDAre: 5.3 times for Q4 2024.
• Dividend Increase: 3.5% increase in monthly cash dividend to common shareholders.
• 2025 Guidance: FFO adjusted per share guidance of $4.94 to $5.14, investment spending guidance of $200 million to $300 million, disposition proceeds guidance of $25 million to $75 million.

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

Release Date: February 27, 2025

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

Positive Points

• EPR Properties (NYSE:EPR) reported a 3.4% earnings growth for the full year 2024, demonstrating resilience in a challenging macro environment.
• The box office performance in the second half of 2024 exceeded expectations, with a significant rebound in North American box office revenues.
• EPR Properties (NYSE:EPR) successfully expanded its experiential portfolio, including investments in Topgolf and Andretti Indoor Karting and Gaming.
• The company announced a 3.5% increase in its monthly cash dividend to common shareholders, reflecting strong financial management.
• EPR Properties (NYSE:EPR) maintained a strong balance sheet with a fixed charge coverage ratio of 3.2 times and a net debt to adjusted EBITDAre of 5.1 times.

Negative Points

• The company's education portfolio saw a 3% decrease in EBITDARM due to operating cost increases.
• EPR Properties (NYSE:EPR) faced challenges with its operating properties, including significant increases in insurance costs.
• The company exited its investment in a Camp Margaritaville RV Resort due to underperformance and required capital infusions.
• EPR Properties (NYSE:EPR) recognized noncash impairment charges of $40 million related to theater properties under contracts to sell.
• The volatility in performance and expense pressures led EPR Properties (NYSE:EPR) to decide against pursuing certain types of investments.

Q & A Highlights

Q: How are the two remaining RV parks performing compared to the one in Louisiana that you exited? A: Gregory Silvers, CEO, mentioned that the remaining RV parks are performing better. The Margaritaville conversion in Louisiana did not work well, but the Jellystone parks have been more established and are expanding their offerings. Mark Peterson, CFO, added that the contribution from these parks is expected to be nominal in 2025.

Q: Are you still interested in lodging-type assets like Hot Springs that aren't attached to a water park? A: Gregory Silvers, CEO, stated that they prefer net lease or fixed income structures over operating assets. They still like certain sectors but prefer them in a net lease environment. Gregory Zimmerman, CIO, added that they are bullish on Hot Springs, viewing them as part of an overall attraction rather than pure lodging.

Q: What are the best investment opportunities given your improved cost of equity and strong balance sheet? A: Gregory Zimmerman, CIO, expressed optimism about fitness and wellness, attractions, and Eat and Play areas. They are seeing good opportunities across their verticals and are being careful given their cost of capital.

Q: What drove the stronger second half in the movie theater business, and will it continue into 2025? A: Gregory Silvers, CEO, explained that the increase in the number of movie titles led to a more normalized schedule, encouraging consumers to return to theaters. This trend is expected to continue into 2025 and beyond.

Q: How do you plan to fund 2025 investments, considering your debt maturities and equity issuance stance? A: Mark Peterson, CFO, outlined that they have flexibility with their line of credit and plan to term out debt with a bond deal. They have room in their laddering for various maturities and will watch the market to determine the right time for a bond issuance.

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