UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition
On July 28, 2022, CTO Realty Growth, Inc., a Maryland corporation (the "Company"), issued an earnings press release, an investor presentation, and a supplemental disclosure package relating to the Company’s financial results for the quarter ended June 30, 2022. Copies of the press release, investor presentation, and supplemental disclosure package are attached hereto as Exhibits 99.1, 99.2 and 99.3, respectively, and are incorporated herein by reference.
The information in Item 2.02 of this Current Report, including Exhibits 99.1, 99.2 and 99.3, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, unless it is specifically incorporated by reference therein.
Item 7.01. Regulation FD Disclosure
On July 28, 2022, the Company issued an earnings press release, an investor presentation, and a supplemental disclosure package relating to the Company’s financial results for the quarter ended June 30, 2022. Copies of the earnings press release, investor presentation, and supplemental disclosure package are attached hereto as Exhibits 99.1, 99.2 and 99.3, respectively, and are incorporated herein by reference.
The furnishing of these materials is not intended to constitute a representation that such furnishing is required by Regulation FD or other securities laws, or that the materials include material investor information that is not otherwise publicly available. In addition, the Company does not assume any obligation to update such information in the future.
The information in Item 7.01 of this Current Report, including Exhibits 99.1, 99.2 and 99.3, is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act or the Exchange Act, unless it is specifically incorporated by reference therein.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
104 Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: July 28, 2022
CTO Realty Growth, Inc.
By: /s/ Matthew M. Partridge
Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
Press Release
Contact:Matthew M. Partridge
Senior Vice President, Chief Financial Officer and Treasurer
(407) 904-3324
mpartridge@ctoreit.com
FOR IMMEDIATE RELEASE | CTO REALTY GROWTH REPORTS SECOND |
WINTER PARK, FL – July 28, 2022 – CTO Realty Growth, Inc. (NYSE: CTO) (the “Company” or “CTO”) today announced its operating results and earnings for the quarter ended June 30, 2022.
Select Highlights
Page 1
CEO Comments
“I am very encouraged by our second quarter performance as our team continues to make strong operational progress with our leasing and repositioning initiatives and finds attractive opportunities for external growth through our disciplined, retail-focused investment strategy,” said John P. Albright, President and Chief Executive Officer of CTO Realty Growth. “Our recent Madison Yards acquisition was a great opportunity to acquire a newly built grocery-anchored shopping center in one of the strongest markets in the country, further improving our already high-quality, growth market-oriented portfolio. With year-to-date same-store NOI growth of more than 20% and over 200 bps of leased occupancy set to rent commence over the next twelve months, we’re very excited about our prospects to drive double digit same-store NOI growth during the back half of this year and in 2023. This embedded growth should continue to help drive strong earnings for the foreseeable future and further support our attractive and growing dividend.”
Quarterly Financial Results Highlights
The tables below provide a summary of the Company’s operating results for the three months ended June 30, 2022:
For the Three Months Ended June 30, 2022 |
| For the Three Months Ended June 30, 2021 | | Variance to Comparable Period in the Prior Year | ||||||||||
Net Income (Loss) Attributable to the Company | $ | 1,218 | | $ | (3,724) | | $ | 4,942 | 132.7% | |||||
Net Income (Loss) Attributable to Common Stockholders | $ | 22 | | $ | (3,724) | | $ | 3,746 | 100.6% | |||||
Net Income (Loss) per Diluted Share Attributable to Common Stockholders (1) | $ | 0.00 | | $ | (0.63) | | $ | 0.63 | 100.0% | |||||
| | | | | | | | | | |||||
Core FFO Attributable to Common Stockholders (2) | $ | 8,485 | | $ | 5,218 | | $ | 3,267 | 62.6% | |||||
Core FFO per Common Share – Diluted (2) | $ | 1.41 | | $ | 0.88 | | $ | 0.53 | 60.2% | |||||
| | | | | | | | | | |||||
AFFO Attributable to Common Stockholders (2) | $ | 8,890 | | $ | 6,294 | | $ | 2,596 | 41.2% | |||||
AFFO per Common Share – Diluted (2) | $ | 1.48 | | $ | 1.07 | | $ | 0.41 | 38.3% | |||||
| | | | | | | | | | |||||
Dividends Declared and Paid, per Preferred Share | $ | 0.40 | $ | — | | $ | 0.40 | 100.0% | ||||||
Dividends Declared and Paid, per Common Share | $ | 1.12 | | $ | 1.00 | | $ | 0.12 | 12.0% | |||||
(1) | The denominator for this measure in 2022 excludes the impact of 1.0 million shares related to the Company’s adoption of ASU 2020-06, effective January 1, 2022, which requires presentation on an if-converted basis for its 2025 Convertible Senior Notes, as the impact would be anti-dilutive. |
(2) | See the “Non-GAAP Financial Measures” section and tables at the end of this press release for a discussion and reconciliation of Net Income (Loss) Attributable to the Company to non-GAAP financial measures, including FFO Attributable to Common Stockholders, FFO per Common Share - Diluted, Core FFO Attributable to Common Stockholders, Core FFO per Common Share – Diluted, AFFO Attributable to Common Stockholders and AFFO per Common Share - Diluted. |
Year-to-Date Financial Results Highlights
The tables below provide a summary of the Company’s operating results for the six months ended June 30, 2022:
(in thousands, except per share data) | For the Six Months Ended June 30, 2022 |
| For the Six Months Ended June 30, 2021 | | Variance to Comparable Period in the Prior Year | |||||||||
Net Income Attributable to the Company | $ | 1,420 | | $ | 4,061 | | $ | (2,641) | (65.0%) | |||||
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Net Income (Loss) Attributable to Common Stockholders | $ | (971) | | $ | 4,061 | | $ | (5,032) | (123.9%) | ||||
Net Income (Loss) per Diluted Share Attributable to Common Stockholders (1) | $ | (0.16) | | $ | 0.69 | | $ | (0.85) | (123.2%) | ||||
| | | | | | | | | | ||||
Core FFO Attributable to Common Stockholders (2) | $ | 16,712 | | $ | 10,068 | | $ | 6,644 | 66.0% | ||||
Core FFO per Common Share – Diluted (2) | $ | 2.81 | | $ | 1.71 | | $ | 1.10 | 64.3% | ||||
| | | | | | | | | | ||||
AFFO Attributable to Common Stockholders (2) | $ | 17,607 | | $ | 11,981 | | $ | 5,626 | 47.0% | ||||
AFFO per Common Share – Diluted (2) | $ | 2.96 | | $ | 2.03 | | $ | 0.93 | 45.8% | ||||
| | | | | | | | | | ||||
Dividends Declared and Paid, per Preferred Share | $ | 0.80 | $ | — | | $ | 0.80 | 100.0% | |||||
Dividends Declared and Paid, per Common Share | $ | 2.20 | | $ | 2.00 | | $ | 0.20 | 10.0% | ||||
(1) | The denominator for this measure in 2022 excludes the impact of 1.0 million shares related to the Company’s adoption of ASU 2020-06, effective January 1, 2022, which requires presentation on an if-converted basis for its 2025 Convertible Senior Notes, as the impact would be anti-dilutive. |
(2) | See the “Non-GAAP Financial Measures” section and tables at the end of this press release for a discussion and reconciliation of Net Income Attributable to the Company to non-GAAP financial measures, including FFO Attributable to Common Stockholders, FFO per Common Share - Diluted, Core FFO Attributable to Common Stockholders, Core FFO per Common Share – Diluted, AFFO Attributable to Common Stockholders and AFFO per Common Share - Diluted. |
Investments
During the three months ended June 30, 2022, the Company originated two structured investments to provide $49.0 million of funding towards two properties. The Company’s second quarter 2022 investments included the following:
| ◾ | Provided $30.0 million of preferred equity for the acquisition of Watters Creek at Montgomery Farm, a grocery-anchored, mixed-use property located in Allen, Texas. Watters Creek at Montgomery Farm is approximately 458,000 square feet of grocery-anchored retail and office, anchored by Market Street, Anthropologie, Mi Cocina, DSW, The Cheesecake Factory, Brio Italian Grille, and Michaels, and includes a variety of national and local retailers and restaurants. The three-year preferred investment for the acquisition was fully funded at closing, is interest-only through maturity, includes an origination fee, and bears a fixed preferred return of 8.50%. |
| ◾ | Provided a $19.0 million first mortgage for the development of the retail portion of the WaterStar Orlando mixed-use property in Kissimmee, FL. WaterStar Orlando is a mixed-use project at the center of one of the strongest performing retail corridors in Florida, includes 320 onsite residential units, and is in close proximity to the Margaritaville Resort Orlando, Island H20 Water Park, and the western entrance to Walt Disney World. The retail portion of the development is 102,000 square feet and is anchored by Marshalls, Burlington, pOpshelf, Portillo’s and Outback Steakhouse. The loan matures on August 31, 2022, is interest-only through maturity, includes an origination fee, and bears a fixed interest-only rate of 8.00%. |
During the six months ended June 30, 2022, the Company acquired one multi-tenant retail property for total income property acquisition volume of $39.1 million and originated three structured investments to provide $57.7 million of funding towards three retail and mixed-use properties. These acquisitions and structured investments represent a blended weighted average going-in yield of 7.9%.
Subsequent to quarter-end, the Company acquired Madison Yards, a 162,500 square foot grocery-anchored property located in the Inman Park/Reynoldstown submarket along the Memorial Drive corridor of Atlanta, Georgia for a purchase price of $80.2 million. The property is 98% occupied, anchored by Publix and AMC Theatres, includes a well-crafted mix of retailers and restaurants, including AT&T, First Watch, and Orangetheory Fitness, and is the Company’s first Publix-anchored center. The purchase price represents a going-in cap rate below the range of the Company’s guidance for initial cash yields.
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Dispositions
During the six months ended June 30, 2022, the Company sold two single tenant income properties, one of which was classified as a commercial loan investment due to the tenant’s repurchase option, for $24.0 million at a weighted average exit cap rate of 6.0%.
Income Property Portfolio
The Company’s income property portfolio consisted of the following as of June 30, 2022:
Asset Type |
| # of Properties (1) |
| Square Feet |
| Weighted Average Remaining Lease Term |
Single Tenant |
| 7 |
| 422 |
| 6.3 years |
Multi-Tenant |
| 14 |
| 2,418 |
| 6.7 years |
Total / Weighted Average Lease Term |
| 21 |
| 2,840 |
| 6.6 years |
Property Type |
| # of Properties (1) |
| Square Feet |
| % of Cash Base Rent |
Retail |
| 14 |
| 1,905 |
| 61.5% |
Office | | 4 | | 532 | | 19.5% |
Mixed-Use | | 3 | | 403 | | 19.0% |
Total / Weighted Average Lease Term |
| 21 |
| 2,840 |
| 100.0% |
Leased Occupancy | 93.5% | | |
Economic Occupancy | 91.3% | | |
Physical Occupancy | 90.2% | | |
Square feet in thousands.
(1) | The properties include a property in Hialeah, Florida leased to a master tenant which includes three tenant repurchase options. Pursuant to FASB ASC Topic 842, Leases, the $21.0 million investment has been recorded in the Company’s consolidated balance sheets as a Commercial Loan Investment. |
Operational Highlights
The Company’s Same-Property NOI totaled $7.4 million during the second quarter of 2022, an increase of 23.8% over the comparable prior year period, as presented in the following table.
(in thousands) | For the Three Months Ended June 30, 2022 |
| For the Three Months Ended June 30, 2021 | | Variance to Comparable Period in the Prior Year | ||||
Single Tenant | $ | 2,190 | | $ | 2,055 | | $ | 135 | 6.6% |
Multi-Tenant | | 5,256 | | | 3,961 | | | 1,295 | 32.7% |
Total | $ | 7,446 | | $ | 6,016 | | $ | 1,430 | 23.8% |
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During the second quarter of 2022, the Company signed leases totaling 41,163 square feet. A summary of the Company’s leasing activity is as follows:
Retail |
| Square Feet | Weighted Average Lease Term | Cash Rent Per Square Foot | | Tenant Improvements | | Leasing Commissions | ||||
New Leases | | 31.0 | | 12.2 years | | $32.66 | | $ | 2,721 | | $ | 298 |
Renewals & Extensions |
| 10.2 | | 3.6 years | | $29.28 | | $ | — | | $ | 28 |
Total / Weighted Average |
| 41.2 | | 10.3 years | | $31.82 | | $ | 2,721 | | $ | 326 |
In thousands except for per square foot and lease term data.
Subsurface Interests
During the three months ended June 30, 2022, the Company sold approximately 8,330 acres of subsurface oil, gas, and mineral rights for $0.5 million, resulting in aggregate gains of $0.5 million.
During the six months ended June 30, 2022, the Company sold approximately 13,080 acres of subsurface oil, gas and mineral rights for $0.9 million, resulting in a gain on the sale of $0.8 million. As of June 30, 2022, the Company owns full or fractional subsurface oil, gas, and mineral interests underlying approximately 356,000 “surface” acres of land owned by others in 19 counties in Florida.
Capital Markets and Balance Sheet
During the quarter ended June 30, 2022, the Company completed the following notable capital markets activity:
| ◾ | Issued 88,065 common shares under its ATM offering program at a weighted average gross price of $66.03 per share, for total net proceeds of $5.7 million. |
| ◾ | Repurchased 20,010 shares for approximately $1.1 million at a weighted average gross price of $57.37 per share. |
| ◾ | Completed a three-for-one stock split and began trading at the post-split price on July 1, 2022. The stock split was effected in the form of a stock dividend of two additional shares of common stock for each outstanding share of common stock held as of the record date for the stock dividend. |
The following table provides a summary of the Company’s long-term debt, at face value, as of June 30, 2022:
| Principal |
| Interest Rate |
| Maturity Date | |
Revolving Credit Facility |
| $111.0 million |
| 30-day LIBOR + [1.35% – 1.95%] |
| May 2023 |
2025 Convertible Senior Notes |
| $51.0 million |
| 3.875% |
| April 2025 |
2026 Term Loan (1) |
| $65.0 million |
| 30-day LIBOR + [1.35% – 1.95%] |
| March 2026 |
2027 Term Loan (2) |
| $100.0 million |
| 30-day LIBOR + [1.35% – 1.95%] |
| January 2027 |
Mortgage Note (3) |
| $17.8 million |
| 4.06% |
| August 2026 |
Total Debt / Weighted Average Interest Rate |
| $344.8 million |
| 2.63% |
|
|
(1) | The Company utilized interest rate swaps on the $65.0 million 2026 Term Loan balance, including (i) its redesignation of the existing $50.0 million interest rate swap, entered into as of August 31, 2020, and (ii) a $15.0 million interest rate swap effective August 31, 2021, to fix LIBOR and achieve a weighted average fixed interest rate of 0.35% plus the applicable spread. |
(2) | The Company utilized interest rate swaps on the $100.0 million 2027 Term Loan balance, including (i) its redesignation of the existing $100.0 million interest rate swap, entered into as of March 31, 2020, and (ii) an additional interest rate swap, effective March 29, 2024, to extend the fixed interest rate through maturity on January 31, 2027, to fix LIBOR and achieve a fixed interest rate of 0.73% plus the applicable spread. |
(3) | Mortgage note assumed in connection with the acquisition of Price Plaza Shopping Center located in Katy, Texas. |
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As of June 30, 2022, the Company’s net debt to Pro Forma EBITDA was 6.6 times, and as defined in the Company’s credit agreement, the Company’s fixed charge coverage ratio was 3.4 times. As of June 30, 2022, the Company’s net debt to total enterprise value was 41.0%. The Company calculates total enterprise value as the sum of net debt, par value of its 6.375% Series A preferred equity, and the market value of the Company's outstanding common shares.
Dividends
On May 24, 2022, the Company announced a cash dividend on its common stock and Series A Preferred stock for the second quarter of 2022 of $1.12 per share and $0.40 per share, respectively, payable on June 30, 2022 to stockholders of record as of the close of business on June 9, 2022. The second quarter 2022 common stock cash dividend represents a 12.0% increase over the comparable prior year period quarterly dividend and a payout ratio of 79.4% and 75.7% of the Company’s second quarter 2022 Core FFO per diluted share and AFFO per diluted share, respectively.
2022 Outlook
The Company has increased its outlook for 2022 to take into account the Company’s year-to-date performance and revised expectations regarding the Company’s investment activities, forecasted capital markets transactions, and other significant assumptions. The revised per share estimates take into account the Company’s recently completed three-for-one stock split
The Company’s increased outlook for 2022 is as follows:
| 2022 Revised Outlook Range | | Change from Prior Outlook | ||||
| Low | | High | | Low | | High |
Acquisition of Income Producing Assets | $250.0 million | to | $275.0 million | | $50 million | to | $25 million |
Target Investment Initial Cash Yield | 7.00% | to | 7.25% | | 50 bps | to | 25 bps |
Disposition of Assets | $50.0 million | to | $80.0 million | | $10 million | to | $10 million |
Target Disposition Cash Yield | 6.25% | to | 6.75% | | 100 bps | to | 25 bps |
| | | | | | | |
Core FFO Per Diluted Share | $1.58 | to | $1.64 | | $0.06 | to | $0.04 |
AFFO Per Diluted Share | $1.70 | to | $1.76 | | $0.05 | to | $0.03 |
| | | | | | | |
Weighted Average Diluted Shares Outstanding | 18.3 million | to | 18.5 million | | 0 million | to | 0.3 million |
2nd Quarter Earnings Conference Call & Webcast
The Company will host a conference call to present its operating results for the quarter ended June 30, 2022 on Friday, July 29, 2022, at 9:00 AM ET.
A live webcast of the call will be available on the Investor Relations page of the Company’s website at www.ctoreit.com or at the link provided in the event details below. To access the call by phone, please go to the link provided in the event details below and you will be provided with dial-in details.
Webcast: https://edge.media-server.com/mmc/p/uh9ig8iu
Dial-In: https://register.vevent.com/register/BI03c8d5540d254fb798fffd5daa427848
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We encourage participants to dial into the conference call at least fifteen minutes ahead of the scheduled start time. A replay of the earnings call will be archived and available online through the Investor Relations section of the Company’s website at www.ctoreit.com.
About CTO Realty Growth, Inc.
CTO Realty Growth, Inc. is a publicly traded real estate investment trust that owns and operates a portfolio of high-quality, retail-based properties located primarily in higher growth markets in the United States. CTO also externally manages and owns a meaningful interest in Alpine Income Property Trust, Inc. (NYSE: PINE), a publicly traded net lease REIT.
We encourage you to review our most recent investor presentation and supplemental financial information, which is available on our website at www.ctoreit.com.
Safe Harbor
Certain statements contained in this press release (other than statements of historical fact) are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements can typically be identified by words such as “believe,” “estimate,” “expect,” “intend,” “anticipate,” “will,” “could,” “may,” “should,” “plan,” “potential,” “predict,” “forecast,” “project,” and similar expressions, as well as variations or negatives of these words.
Although forward-looking statements are made based upon management’s present expectations and reasonable beliefs concerning future developments and their potential effect upon the Company, a number of factors could cause the Company’s actual results to differ materially from those set forth in the forward-looking statements. Such factors may include, but are not limited to: the Company’s ability to remain qualified as a REIT; the Company’s exposure to U.S. federal and state income tax law changes, including changes to the REIT requirements; general adverse economic and real estate conditions; macroeconomic and geopolitical factors, including but not limited to inflationary pressures, interest rate volatility, global supply chain disruptions, and ongoing geopolitical war; the ultimate geographic spread, severity and duration of pandemics such as the COVID-19 Pandemic and its variants, actions that may be taken by governmental authorities to contain or address the impact of such pandemics, and the potential negative impacts of such pandemics on the global economy and the Company’s financial condition and results of operations; the inability of major tenants to continue paying their rent or obligations due to bankruptcy, insolvency or a general downturn in their business; the loss or failure, or decline in the business or assets of PINE; the completion of 1031 exchange transactions; the availability of investment properties that meet the Company’s investment goals and criteria; the uncertainties associated with obtaining required governmental permits and satisfying other closing conditions for planned acquisitions and sales; and the uncertainties and risk factors discussed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and other risks and uncertainties discussed from time to time in the Company’s filings with the U.S. Securities and Exchange Commission.
There can be no assurance that future developments will be in accordance with management’s expectations or that the effect of future developments on the Company will be those anticipated by management. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company undertakes no obligation to update the information contained in this press release to reflect subsequently occurring events or circumstances.
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Non-GAAP Financial Measures
Our reported results are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). We also disclose Funds From Operations (“FFO”), Core Funds From Operations (“Core FFO”), Adjusted Funds From Operations (“AFFO”), Pro Forma Earnings Before Interest, Taxes, Depreciation and Amortization (“Pro Forma EBITDA”), and Same-Property Net Operating Income (“Same-Property NOI”), each of which are non-GAAP financial measures. We believe these non-GAAP financial measures are useful to investors because they are widely accepted industry measures used by analysts and investors to compare the operating performance of REITs.
FFO, Core FFO, AFFO, Pro Forma EBITDA, and Same-Property NOI do not represent cash generated from operating activities and are not necessarily indicative of cash available to fund cash requirements; accordingly, they should not be considered alternatives to net income as a performance measure or cash flows from operating activities as reported on our statement of cash flows as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures.
We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT. NAREIT defines FFO as GAAP net income or loss adjusted to exclude extraordinary items (as defined by GAAP), net gain or loss from sales of depreciable real estate assets, impairment write-downs associated with depreciable real estate assets and real estate related depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries. The Company also excludes the gains or losses from sales of assets incidental to the primary business of the REIT which specifically include the sales of mitigation credits, impact fee credits, subsurface sales, and land sales, in addition to the mark-to-market of the Company’s investment securities and interest related to the 2025 Convertible Senior Notes, if the effect is dilutive. To derive Core FFO, we modify the NAREIT computation of FFO to include other adjustments to GAAP net income related to gains and losses recognized on the extinguishment of debt, amortization of above- and below-market lease related intangibles, and other unforecastable market- or transaction-driven non-cash items. To derive AFFO, we further modify the NAREIT computation of FFO and Core FFO to include other adjustments to GAAP net income related to non-cash revenues and expenses such as straight-line rental revenue, non-cash compensation, and other non-cash amortization, as well as adding back the interest related to the 2025 Convertible Senior Notes, if the effect is dilutive. Such items may cause short-term fluctuations in net income but have no impact on operating cash flows or long-term operating performance. We use AFFO as one measure of our performance when we formulate corporate goals.
To derive Pro Forma EBITDA, GAAP net income or loss attributable to the Company is adjusted to exclude extraordinary items (as defined by GAAP), net gain or loss from sales of depreciable real estate assets, impairment write-downs associated with depreciable real estate assets and real estate related depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries, non-cash revenues and expenses such as straight-line rental revenue, amortization of deferred financing costs, above- and below-market lease related intangibles, non-cash compensation, and other non-cash income or expense. Cash interest expense is also excluded from Pro Forma EBITDA, and GAAP net income or loss is adjusted for the annualized impact of acquisitions, dispositions and other similar activities.
To derive Same-Property NOI, GAAP net income or loss attributable to the Company is adjusted to exclude extraordinary items (as defined by GAAP), gain or loss on disposition of assets, gain or loss on extinguishment of debt, impairment charges, and depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries, if any, non-cash revenues and expenses such as above- and below-market lease related intangibles, straight-line rental revenue, and other non-cash income or expense. Interest expense, general and administrative expenses, investment and other income or loss, income tax benefit or expense, real estate operations revenues and direct cost of revenues, management fee income, and interest income from commercial loans and investments are also excluded from Same-Property NOI. GAAP net income or loss is further adjusted to remove the impact of properties that were not owned for the full current and prior year reporting periods presented. Cash rental income received under the leases pertaining to the Company’s assets that are presented as commercial loans and investments in accordance with GAAP is also used in lieu of the interest income equivalent.
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FFO is used by management, investors and analysts to facilitate meaningful comparisons of operating performance between periods and among our peers primarily because it excludes the effect of real estate depreciation and amortization and net gains or losses on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions. We believe that Core FFO and AFFO are additional useful supplemental measures for investors to consider because they will help them to better assess our operating performance without the distortions created by other non-cash revenues or expenses. We also believe that Pro Forma EBITDA is an additional useful supplemental measure for investors to consider as it allows for a better assessment of our operating performance without the distortions created by other non-cash revenues, expenses or certain effects of the Company’s capital structure on our operating performance. We use Same-Property NOI to compare the operating performance of our assets between periods. It is an accepted and important measurement used by management, investors and analysts because it includes all property-level revenues from the Company’s properties, less operating and maintenance expenses, real estate taxes and other property-specific expenses (“Net Operating Income” or “NOI”) of properties that have been owned and stabilized for the entire current and prior year reporting periods. Same-Property NOI attempts to eliminate differences due to the acquisition or disposition of properties during the particular period presented, and therefore provides a more comparable and consistent performance measure for the comparison of the Company's properties. FFO, Core FFO, AFFO, Pro Forma EBITDA, and Same-Property NOI may not be comparable to similarly titled measures employed by other companies.
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CTO Realty Growth, Inc.
Consolidated Balance Sheets
(In thousands, except share and per share data)
| | As of | ||||
|
| (Unaudited) |
| December 31, | ||
ASSETS | | | | | | |
Real Estate: | | | | | | |
Land, at Cost | | $ | 205,245 | | $ | 189,589 |
Building and Improvements, at Cost | | | 344,205 | | | 325,418 |
Other Furnishings and Equipment, at Cost | | | 741 | | | 707 |
Construction in Process, at Cost | | | 10,419 | | | 3,150 |
Total Real Estate, at Cost | | | 560,610 | | | 518,864 |
Less, Accumulated Depreciation | | | (31,735) | | | (24,169) |
Real Estate—Net | | | 528,875 | | | 494,695 |
Land and Development Costs | | | 686 | | | 692 |
Intangible Lease Assets—Net | | | 78,328 | | | 79,492 |
Assets Held for Sale | | | — | | | 6,720 |
Investment in Alpine Income Property Trust, Inc. | | | 38,483 | | | 41,037 |
Mitigation Credits | | | 3,436 | | | 3,702 |
Mitigation Credit Rights | | | 21,018 | | | 21,018 |
Commercial Loans and Investments | | | 68,783 | | | 39,095 |
Cash and Cash Equivalents | | | 7,137 | | | 8,615 |
Restricted Cash | | | 27,189 | | | 22,734 |
Refundable Income Taxes | | | 286 | | | 442 |
Deferred Income Taxes—Net | | | 105 | | | — |
Other Assets | | | 28,029 | | | 14,897 |
Total Assets | | $ | 802,355 | | $ | 733,139 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | | |
Liabilities: | | | | | | |
Accounts Payable | | $ | 1,325 | | $ | 676 |
Accrued and Other Liabilities | | | 15,705 | | | 13,121 |
Deferred Revenue | | | 5,358 | | | 4,505 |
Intangible Lease Liabilities—Net | | | 5,277 | | | 5,601 |
Deferred Income Taxes—Net | | | — | | | 483 |
Long-Term Debt | | | 343,196 | | | 278,273 |
Total Liabilities | | | 370,861 | | | 302,659 |
Commitments and Contingencies | | | | | | |
Stockholders’ Equity: | | | | | | |
Preferred Stock – 100,000,000 shares authorized; $0.01 par value, 6.375% Series A Cumulative Redeemable Preferred Stock, $25.00 Per Share Liquidation Preference, 3,000,000 shares issued and outstanding at June 30, 2022 and December 31, 2021 | | | 30 | | | 30 |
Common Stock – 500,000,000 shares authorized; $0.01 par value, 6,082,626 shares issued and outstanding at June 30, 2022 and 5,916,226 shares issued and outstanding at December 31, 2021 | | | 61 | | | 60 |
Additional Paid-In Capital | | | 86,347 | | | 85,414 |
Retained Earnings | | | 332,916 | | | 343,459 |
Accumulated Other Comprehensive Income | | | 12,140 | | | 1,517 |
Total Stockholders’ Equity | | | 431,494 | | | 430,480 |
Total Liabilities and Stockholders’ Equity | | $ | 802,355 | | $ | 733,139 |
Page 10
CTO Realty Growth, Inc.
Consolidated Statements of Operations
(Unaudited)
(In thousands, except share, per share and dividend data)
| | Three Months Ended | | Six Months Ended | ||||||||
| | June 30, | | June 30, | | June 30, | | June 30, | ||||
|
| 2022 |
| 2021 |
| 2022 |
| 2021 | ||||
Revenues | | | | | | | | | | | | |
Income Properties | | $ | 16,367 | | $ | 11,574 | | $ | 31,535 | | $ | 23,023 |
Management Fee Income | | | 948 | | | 752 | | | 1,884 | | | 1,421 |
Interest Income From Commercial Loans and Investments | | | 1,290 | | | 709 | | | 2,008 | | | 1,410 |
Real Estate Operations | | | 858 | | | 1,248 | | | 1,246 | | | 3,141 |
Total Revenues | | | 19,463 | | | 14,283 | | | 36,673 | | | 28,995 |
Direct Cost of Revenues | | | | | | | | | | | | |
Income Properties | | | (4,812) | | | (2,787) | | | (8,828) | | | (5,704) |
Real Estate Operations | | | (228) | | | (533) | | | (279) | | | (615) |
Total Direct Cost of Revenues | | | (5,040) | | | (3,320) | | | (9,107) | | | (6,319) |
General and Administrative Expenses | | | (2,676) | | | (2,665) | | | (5,719) | | | (5,797) |
Impairment Charges | | | — | | | (16,527) | | | — | | | (16,527) |
Depreciation and Amortization | | | (6,727) | | | (5,031) | | | (13,096) | | | (9,861) |
Total Operating Expenses | | | (14,443) | | | (27,543) | | | (27,922) | | | (38,504) |
Gain (Loss) on Disposition of Assets | | | — | | | 4,732 | | | (245) | | | 5,440 |
Gain (Loss) on Extinguishment of Debt | | | — | | | (641) | | | — | | | (641) |
Other Gains and Income (Loss) | | | — | | | 4,091 | | | (245) | | | 4,799 |
Total Operating Income (Loss) | | | 5,020 | | | (9,169) | | | 8,506 | | | (4,710) |
Investment and Other Income (Loss) | | | (1,311) | | | 3,903 | | | (3,205) | | | 9,235 |
Interest Expense | | | (2,277) | | | (2,421) | | | (4,179) | | | (4,865) |
Income (Loss) Before Income Tax Benefit (Expense) | | | 1,432 | | | (7,687) | | | 1,122 | | | (340) |
Income Tax Benefit (Expense) | | | (214) | | | 3,963 | | | 298 | | | 4,401 |
Net Income (Loss) Attributable to the Company | | | 1,218 | | | (3,724) | | | 1,420 | | | 4,061 |
Distributions to Preferred Stockholders | | | (1,196) | | | — | | | (2,391) | | | — |
Net Income (Loss) Attributable to Common Stockholders | | $ | 22 | | $ | (3,724) | | $ | (971) | | $ | 4,061 |
| | | | | | | | | | | | |
Per Share Information: | | | | | | | | | | | | |
Basic and Diluted Net Income (Loss) Attributable to Common Stockholders | | $ | 0.00 | | $ | (0.63) | | $ | (0.16) | | $ | 0.69 |
| | | | | | | | | | | | |
Weighted Average Number of Common Shares | | | | | | | | | | | | |
Basic and Diluted | | | 6,004,178 | | | 5,898,280 | | | 5,956,798 | | | 5,888,735 |
| | | | | | | | | | | | |
Dividends Declared and Paid – Preferred Stock | | $ | 0.40 | | $ | — | | $ | 0.80 | | $ | — |
Dividends Declared and Paid – Common Stock | | $ | 1.12 | | $ | 1.00 | | $ | 2.20 | | $ | 2.00 |
Page 11
CTO Realty Growth, Inc.
Non-GAAP Financial Measures
Same-Property NOI Reconciliation
(Unaudited)
| Three Months Ended | ||||
Net Income (Loss) Attributable to the Company | $ | 1,218 |
| $ | (3,724) |
Gain on Disposition of Assets | | — | | | (4,732) |
Loss on Extinguishment of Debt | | — | | | 641 |
Impairment Charges | | — | | | 16,527 |
Depreciation and Amortization | | 6,727 | | | 5,031 |
Amortization of Intangibles to Lease Income | | (497) | | | 338 |
Straight-Line Rent Adjustment | | 507 | | | 490 |
COVID-19 Rent Repayments | | (26) | | | (434) |
Other Income Property Related Non-Cash Amortization | | 38 | | | 38 |
Interest Expense | | 2,277 | | | 2,421 |
General and Administrative Expenses | | 2,676 | | | 2,665 |
Investment and Other Loss (Income) | | 1,311 | | | (3,903) |
Income Tax Expense (Benefit) | | 214 | | | (3,963) |
Real Estate Operations Revenues | | (858) | | | (1,248) |
Real Estate Operations Direct Cost of Revenues | | 228 | | | 533 |
Management Fee Income | | (948) | | | (752) |
Interest Income from Commercial Loans and Investments | | (1,290) | | | (709) |
Less: Impact of Properties Not Owned for the Full Reporting Period | | (4,494) | | | (3,557) |
Cash Rental Income Received from Properties Presented as | | 363 | | | 354 |
Same-Property NOI | $ | 7,446 |
| $ | 6,016 |
Page 12
CTO Realty Growth, Inc.
Non-GAAP Financial Measures
(Unaudited)
(In thousands, except per share data)
| | Three Months Ended | | Six Months Ended | ||||||||
| | June 30, 2022 | | June 30, 2021 | | June 30, 2022 | | June 30, 2021 | ||||
Net Income (Loss) Attributable to the Company | | $ | 1,218 | | $ | (3,724) | | $ | 1,420 | | $ | 4,061 |
Add Back: Effect of Dilutive Interest Related to 2025 Notes (1) | | | — | | | — | | | — | | | — |
Net Income (Loss) Attributable to the Company, If-Converted | | $ | 1,218 | | $ | (3,724) | | | 1,420 | | | 4,061 |
Depreciation and Amortization of Real Estate | | | 6,707 | | | 5,031 | | | 13,076 | | | 9,861 |
(Gains) Losses on Disposition of Assets | | | — | | | (4,732) | | | 245 | | | (5,440) |
Gains on Disposition of Other Assets | | | (632) | | | (748) | | | (964) | | | (2,575) |
Impairment Charges, Net | | | — | | | 12,474 | | | — | | | 12,474 |
Unrealized Loss (Gain) on Investment Securities | | | 1,891 | | | (3,386) | | | 4,348 | | | (8,220) |
Funds from Operations | | $ | 9,184 | | $ | 4,915 | | $ | 18,125 | | $ | 10,161 |
Distributions to Preferred Stockholders | | | (1,196) | | | — | | | (2,391) | | | — |
Funds From Operations Attributable to Common Stockholders | | $ | 7,988 | | $ | 4,915 | | $ | 15,734 | | $ | 10,161 |
Loss on Extinguishment of Debt | | | — | | | 641 | | | — | | | 641 |
Amortization of Intangibles to Lease Income | | | 497 | | | (338) | | | 978 | | | (734) |
Less: Effect of Dilutive Interest Related to 2025 Notes (1) | | | — | | | — | | | — | | | — |
Core Funds From Operations Attributable to Common Stockholders | | $ | 8,485 | | $ | 5,218 | | $ | 16,712 | | $ | 10,068 |
Adjustments: | | | | | | | | | | | | |
Straight-Line Rent Adjustment | | | (507) | | | (490) | | | (1,045) | | | (1,175) |
COVID-19 Rent Repayments | | | 26 | | | 434 | | | 53 | | | 654 |
Other Depreciation and Amortization | | | (31) | | | (150) | | | (170) | | | (374) |
Amortization of Loan Costs and Discount on Convertible Debt | | | 212 | | | 478 | | | 446 | | | 953 |
Non-Cash Compensation | | | 705 | | | 742 | | | 1,611 | | | 1,700 |
Non-Recurring G&A | | | — | | | 62 | | | — | | | 155 |
Adjusted Funds From Operations Attributable to Common Stockholders | | $ | 8,890 | | $ | 6,294 | | $ | 17,607 | | $ | 11,981 |
| | | | | | | | | | | | |
FFO Attributable to Common Stockholders per Common Share – Diluted | | $ | 1.33 | | $ | 0.83 | | $ | 2.64 | | $ | 1.73 |
Core FFO Attributable to Common Stockholders per Common Share – Diluted | | $ | 1.41 | | $ | 0.88 | | $ | 2.81 | | $ | 1.71 |
AFFO Attributable to Common Stockholders per Common Share – Diluted | | $ | 1.48 | | $ | 1.07 | | $ | 2.96 | | $ | 2.03 |
Page 13
CTO Realty Growth, Inc.
Non-GAAP Financial Measures
Reconciliation of Net Debt to Pro Forma EBITDA
(Unaudited)
(In thousands)
|
| |
Net Income Attributable to the Company | $ | 1,218 |
Depreciation and Amortization of Real Estate | 6,707 | |
Gains on Disposition of Other Assets |
| (632) |
Unrealized Loss on Investment Securities |
| 1,891 |
Distributions to Preferred Stockholders | | (1,196) |
Straight-Line Rent Adjustment |
| (507) |
Amortization of Intangibles to Lease Income | 497 | |
Other Depreciation and Amortization |
| (31) |
Amortization of Loan Costs and Discount on Convertible Debt |
| 212 |
Non-Cash Compensation |
| 705 |
Interest Expense, Net of Amortization of Loan Costs and Discount on Convertible Debt |
| 2,065 |
EBITDA | $ | 10,929 |
| | |
Annualized EBITDA | $ | 43,716 |
Pro Forma Annualized Impact of Current Quarter Acquisitions and Dispositions, Net (1) | | 3,050 |
Pro Forma EBITDA | $ | 46,766 |
| | |
Total Long-Term Debt | | 343,196 |
Financing Costs, Net of Accumulated Amortization | | 1,194 |
Unamortized Convertible Debt Discount | | 444 |
Cash & Cash Equivalents | | (7,137) |
Restricted Cash | | (27,189) |
Net Debt | $ | 310,508 |
| | |
Net Debt to Pro Forma EBITDA | 6.6x | |
| | |
(1) | Reflects the pro forma annualized impact on Annualized EBITDA of the Company’s acquisition and disposition activity during the three months ended June 30, 2022. |
Page 14
| Investor Presentation REALTY GROWTH July 2022 Madison Yards Atlanta, GA |
| © CTO Realty Growth, Inc. | ctoreit.com Year - To - Date Highlights 2 Accretive and Opportunistic Investment Activity ▪ Total year - to - date investment volume of $177.0 million at a weighted average cap rate of 7.2%, including the following notable i nvestments: o Acquired two multi - tenant retail income properties in Atlanta, GA and Houston, TX for a combined purchase price of $119.3 millio n o Provided $30.0 million of preferred equity to fund the acquisition and repositioning of the Watters Creek at Montgomery Farm gro cery - anchored, mixed - use property in Allen, Texas at an initial preferred return of 8.5% o Provided $27.7 million of first mortgages for the development of two high - quality, multi - tenant retail projects in submarkets of Atlanta, GA and Orlando, FL at a blended initial rate of 7.8% ▪ Sold two single tenant income properties for total disposition volume of $24.0 million at a weighted average exit cap rate of 6. 0% ▪ Currently have several legacy office and non - core properties on the market for disposition Strong Financial Performance ▪ Increased Core FFO and AFFO full year 2022 guidance by 9% and 3% per share at the midpoint, respectively, since the beginning of 2022 ▪ Completed three - for - one common stock split, effective July 1, 2022 ▪ Declared a $0.3733 Q2 2022 quarterly common stock dividend (stock split adjusted), representing a 3.7% increase over the Q1 2 022 quarterly common stock dividend and a 7.0% current annualized yield Attractive and Well Performing Portfolio ▪ Year - to - date Q2 2022 Same - Property NOI increase of 20.3%, or 14.2% excluding one - time, non - repeatable items ▪ Currently 91.7% occupied and 93.7% leased ▪ Signed 98,000 square feet of new leases, renewals and extensions with increases of 16.7% (1) through the first two quarters of 2022 As of July 22, 2022, unless otherwise noted. (1) Excludes newly leased units that were acquired as vacant. |
| © CTO Realty Growth, Inc. | ctoreit.com Company Profile 3 As of July 22, 2022, unless otherwise noted. (1) Based on $21.33 per share common stock price as of July 22, 2022. $40M INVESTMENT IN ALPINE INCOME PROPERTY TRUST $1.70 – $1.76 AFFO PER SHARE GUIDANCE RANGE (STOCK SPLIT ADJUSTED) 22 3.0M 7.2% PROPERTIES SQUARE FEET IMPLIED CAP RATE 94% LEASED OCCUPANCY Q2 2022 ANNUALIZED DIVIDEND (STOCK SPLIT ADJUSTED) $1.49/share 7.0% CURRENT ANNUALIZED DIVIDEND YIELD (1) $391M $399M $856M EQUITY MARKET CAP (1) OUTSTANDING DEBT TOTAL ENTERPRISE VALUE (NET OF CASH) SERIES A PREFERRED $75M The Exchange at Gwinnet Buford, GA |
| © CTO Realty Growth, Inc. | ctoreit.com Key Takeaways 4 Earnings Growth Through Capital Recycling Strong, long - term track record of monetizing assets at favorable spreads to drive accretive earnings growth and attractive risk - adjusted returns .. Attractive Dividend and Improving Payout Ratio CTO paid a $ 0 .. 3733 second quarter cash dividend (stock split adjusted), representing a 7 .. 0 % in - place annualized yield and improving AFFO payout ratio ( 86 % based on the midpoint of 2022 AFFO guidance) driven by the monetization and reinvestment of low cap rate, single tenant properties and non - income producing assets and strong same - store net operating income growth .. Valuation upside to the Peer Group Valuation upside as CTO is faster growing with a comparable 2022 E FFO multiple compared to the slower growing, retail - focused peers .. Differentiated Investment Strategy Retail - based investment strategy focused on grocery - anchored, traditional retail and mixed - use properties with value - add or long - term residual value opportunities with strong real estate fundamentals in growing markets that can be acquired at meaningful discounts to replacement cost .. High - Quality Portfolio in Faster Growing, Business Friendly Locations with Operational Upside Recently constructed real estate portfolio with a durable, stable tenant base located in faster growing, business friendly markets such as Atlanta, Dallas, Raleigh, Phoenix, Jacksonville, Tampa, Houston, and Salt Lake City, with acquired vacancy and/or repositioning upside .. Profitable External Investment Management External management of Alpine Income Property Trust, Inc .. (NYSE : PINE), a high - growth, publicly traded, single tenant net lease REIT, provides excellent in - place cash flow and significant valuation upside through the CTO’s 16 % retained ownership position .. Stable and Flexible Balance Sheet Conservatively levered balance sheet with ample liquidity, no near - term debt maturities and a demonstrated access to multiple capital sources provides financial stability and flexibility .. As of July 22, 2022, unless otherwise noted. |
| © CTO Realty Growth, Inc. | ctoreit.com NAV Components 5 Net Operating Income of Income Property Portfolio (1) $52.9 $52.9 $52.9 $52.9 $52.9 ÷ Capitalization Rate 6.00% 6.25% 6.50% 6.75% 7.00% Income Portfolio Value $882.0 $846.8 $814.2 $784.0 $756.0 Other Assets: + Estimated Value for Subsurface Interests, Mitigation Credits and Other Assets (2) $20.0 $20.0 $20.0 $20.0 $20.0 + Par Value Outstanding Balance of Structured Investments Portfolio (2) 49.8 49.8 49.8 49.8 49.8 + Cash, Cash Equivalents & Restricted Cash 9.5 9.5 9.5 9.5 9.5 + Value of Shares & Units in Alpine Income Property Trust (PINE) 40.0 40.0 40.0 40.0 40.0 + Value of PINE Management Agreement (3) 9.5 9.5 9.5 9.5 9.5 Other Assets Value $128.8 $128.8 $128.8 $128.8 $128.8 Total Implied Asset Value $1,010.8 $975.6 $943.0 $912.8 $884.8 - Total Debt Outstanding (2) $399.3 $399.3 $399.3 $399.3 $399.3 - Series A Preferred Equity $75.0 $75.0 $75.0 $75.0 $75.0 Note: 18,317,378 shares outstanding as of July 28, 2022. (1) Based on 2022 budgeted net operating income of the existing income property portfolio assets as of July 28, 2022. (2) As of July 28, 2022. (3) Calculated using the trailing 24 - month average management fee paid to CTO by PINE as of June 30, 2022, annualized by multipl ying by twelve, and then multiplying by three to account for a termination fee multiple. |
| © CTO Realty Growth, Inc. | ctoreit.com Recent Acquisition – Madison Yards, Atlanta, GA 6 Recently acquired 162,500 square foot grocery anchored shopping center that has established Atlanta as CTO’s top investment market ▪ Stable, high barrier - to - entry, in - fill location in Atlanta’s Inman Park/Beltline submarket ▪ Over 445 feet of direct Beltline frontage, Atlanta’s 22 - mile cultural, multiuse outdoor loop that attracts 1.7 million visitors annually ▪ True live, work, play property, anchored by Publix (17 years) and AMC (13 years), complimented by a service, experiential and food driven tenant lineup ▪ All leases except for one have base term rent increases ▪ More than 500 directly adjacent multi - family units and townhomes ▪ Population over 165,000 in a 3 - mile radius; average household income of $127,000 in one mile ▪ High - quality, class A property built in 2019 Madison Yards Atlanta, GA Madison Yards Atlanta, GA Madison Yards Atlanta, GA The Beltline Madison Yards |
| © CTO Realty Growth, Inc. | ctoreit.com Consistent Dividend Growth 7 $0.01 $0.01 $0.02 $0.02 $0.02 $0.03 $0.05 $0.07 $0.12 $0.91 $1.33 $1.47 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 (1) Implied 2022 dividend calculated as the paid Q1 and Q2 2022 dividends of $1.08 per common share and $1.12 per common share, respectively, multiplied by two to annualize the dividends paid and indicate the dividends that could be paid in all of 2022. T he 2022 implied dividend is presented for illustrative purposes only and there are no guarantees the Company will pay a dividend in the future. (2) 2022E AFFO per share for CTO is the midpoint of guidance, as provided on July 28, 2022. (3) Based on $21.33 per share common stock price as of July 22, 2022. ▪ 46 consecutive years of paying a common dividend ▪ Under current management (beginning in 2011), the Company’s common stock cash dividend has grown in each of the last 10 years ▪ Company policy is to target a payout ratio of 100% of taxable income ▪ Dividend increases are driven by increasing taxable income and free cash flow ▪ Current midpoint of guidance (2) implies an 86% 2022E AFFO per share dividend payout ratio (1) CTO converted to a REIT in December of 2020, accelerating the required dividend payout Increasing cash flow and earnings have driven a more than 60% increase to CTO’s annualized common stock dividend since 2020 Cash Dividend Per Share Paid (Split Adjusted) Current Annualized Per Share Cash Dividend $1.49 Annualized Per Share Cash Dividend Yield (3) 7.0% |
| © CTO Realty Growth, Inc. | ctoreit.com Peer Comparisons 17.1x 13.9x 13.4x 13.4x 13.2x 12.2x 11.4x 10.6x 10.5x 10.2x 10.0x 4.2% 3.7% 4.1% 4.3% 7.0% 3.7% 4.4% 4.5% 4.5% 4.3% 5.0% 3.50% 4.00% 4.50% 5.00% 5.50% 6.00% 6.50% 7.00% 7.50% 8.0x 9.0x 10.0x 11.0x 12.0x 13.0x 14.0x 15.0x 16.0x 17.0x 18.0x FRT KIM UE AAT CTO SITC BRX KRG WSR AKR RPT (1) All 2022E peer FFO multiples and dividend yield information are based on the closing stock price on July 22, 2022, using annu ali zed dividends and 2022E FFO per share estimates from the KeyBank The Leaderboard report dated July 24, 2022; CTO’s FFO multip le and dividend yield is based on its closing stock price on July 22, 2022, using its Q2 annualized dividend announced on May 24, 2022 (split adjusted), and 2022E Cor e FFO per share guidance as included in the Company’s 2022 Guidance provided on July 28, 2022. CTO has an outsized dividend yield and attractive absolute valuation relative to its retail - focused peer group and recent retail M&A multiples (KRG/RPAI and KIM/WRI), implying significant valuation upside. 2022E FFO Multiple and Annualized Dividend Yield (1) 8 CTO is trading at an implied 7.2% cap rate on its income producing property NOI |
| © CTO Realty Growth, Inc. | ctoreit.com Differentiated Investment Strategy 9 CTO has a retail - oriented real estate strategy that focuses on owning, operating and investing in high - quality properties through direct investment and management structures Multi - Tenant Asset Strategy ▪ Focused on retail - based multi - tenanted assets that have a grocery, lifestyle or community - oriented retail component and a complimentary mixed - use component, located in higher growth MSAs within the continental United States ▪ Acquisition targets exhibit strong current in - place yields with a future potential for increased returns through a combination of vacancy lease - up, redevelopment or rolling in - place leases to higher market rental rates Monetization of Non - Income Producing Assets ▪ CTO has a number of legacy non - income producing assets (mitigation credits and mineral rights) that when monetized, will unlock meaningful equity to be redeployed into income producing assets that can organically drive higher cash flow, FFO and AFFO per share Alpine Income Property Trust and Retained Net Lease Assets ▪ CTO seeded and externally manages Alpine Income Property Trust (NYSE: PINE), a pure play net lease REIT, which is a meaningful source of management fee income and dividend income through its direct investment of REIT shares and OP unit holdings ▪ CTO intends to monetize its remaining net lease properties at market pricing, creating attractive net investment spreads relative to where it is investing in multi - tenanted assets, and resulting in an opportunity to grow PINE through direct asset sales from CTO to PINE Targeting Multi - Tenant, Retail - Based, Value - Add Income Property Acquisitions Monetize Legacy Mitigation Credits, Mineral Rights and Other Assets Manage and Retain Ownership in Alpine REIT (NYSE:PINE) Monetize the Retained Net Lease & Office Properties at Opportunistic Valuations Focused Execution |
| © CTO Realty Growth, Inc. | ctoreit.com Real Estate and Investment Strategy CTO’s investment strategy is focused on generating relative outsized returns for our shareholders by acquiring and owning well - located properties in markets and states that are business and tax friendly, where the long - term cash flows and underlying real estate values are supported by significant population and job growth. ▪ Focused on markets/states projected to have outsized job and population growth with favorable business climates ▪ Geographic emphasis set to benefit from strong retailer demand to serve increasing populations ▪ Differentiated asset investment strategy prioritizes value - add retail and mixed - use properties with strong real estate fundamentals ▪ Track record of acquiring at meaningful discounts to replacement cost and below market leases where real estate fundamentals will drive outsized rental rate growth ▪ Seek properties with leasing or repositioning upside or highly stable assets with an identifiable opportunity to drive long - term, outsized risk - adjusted returns Miami Orlando Jacksonvill e Tampa Atlanta Nashville Charlotte Raleigh - Durham Washington, DC Dallas Houston Austin Denver Boulder Salt Lake City Las Vegas Reno Phoenix 10 CTO Target Market |
| © CTO Realty Growth, Inc. | ctoreit.com Meaningful Progress with Portfolio Repositioning 11 $365 $489 $349 0.0 50.0 100.0 150.0 200.0 250.0 300.0 350.0 400.0 450.0 500.0 0.0% 10000.0% 20000.0% 30000.0% 40000.0% 50000.0% 2020 2021 2022 Guidance Monetization of Non-Core Legacy Assets Dispositions Investments Investment and Disposition Activity Cumulative Investment Activity The Shops at Legacy Plano, TX 2022 AFFO is set to benefit from the full - year impact of 2021 transaction activity Price Plaza Shopping Center Katy, TX (1) Reflects the midpoint of 2022 Guidance provided on July 28, 2022. (1) |
| © CTO Realty Growth, Inc. | ctoreit.com Durable Portfolio with Growth Opportunities Recently constructed retail and mixed - use portfolio with a combination of value - add lease up, redevelopment and stable, in - place cash flows in some of the strongest markets in the United States. 12 Stable Cash Flow Essential Retail Repositioning Upside The Shops at Legacy Plano, TX Ashford Lane Atlanta, GA 125 Lincoln & 150 Washington Santa Fe, NM Madison Yards Atlanta, GA The Exchange at Gwinnett Buford, GA The Strand at St. John’s Town Center Jacksonville, FL Jordan Landing West Jordan, UT Crossroads Towne Center Chandler, AZ Beaver Creek Crossings Apex, NC |
| © CTO Realty Growth, Inc. | ctoreit.com Strong Demographic Portfolio 13 Percentages listed based on Annualized Base Rent. Differences are a result of rounding. (1) Source: Esri; Portfolio average weighted by the Annualized Base Rent of each property. (2) As ranked by Urban Land Institute & PWC in the ‘2022 Emerging Trends in Real Estate’ publication. Income Producing Property Atlanta, GA 23% Jacksonville, FL 14% Dallas, TX 14% Raleigh, NC 9% Phoenix, AZ 8% Albuquerque, NM 6% Houston, TX 5% Santa Fe, NM 5% Tampa, FL 4% Salt Lake City, UT 3% Miami, FL 3% Washington, DC 3% Las Vegas, NV 3% Daytona Beach, FL 2% Orlando, FL 1% > 20% 10% - 20% 5% - 10% < 5% Denotes an MSA with over one million people; Bold denotes a Top 30 ULI Market (2) % of Annualized Rent By State 240,100 Portfolio Average 5 - Mile Population (1) $123,850 Portfolio Average 5 - Mile Household Income (1) 0.9% Portfolio Average 2022 - 2027 Projected Annual Population Growth (1) 74% Percentage of Portfolio ABR from ULI’s Top 30 Markets (1) |
| © CTO Realty Growth, Inc. | ctoreit.com Meaningful Property Cash Flow & Leasing Momentum 14 3% 5% 4% 7% 13% 10% 16% 8% 6% 5% 4% 19% 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% 11.0% 12.0% 13.0% 14.0% 15.0% 16.0% 17.0% 18.0% 19.0% 20.0% Lease Rollover Schedule % of ABR Expiring Leases Signed in 2022 ▪ YTD Q2 2022 Year - Over - Year Same - Property NOI 20.3% o 30.2% YTD Q2 2022 multi - tenant same - property NOI growth o 4.0% YTD Q2 2022 single tenant same - property NOI growth ▪ YTD Q2 2022 Leasing Spreads 16.7% o 71.5% new lease spreads (excluding acquired vacancy) o 2.0% option & renewal spreads ▪ Leased Occupancy 93.7% o Over 200 bps of future occupancy pickup based on current spread between Occupancy and Leased Occupancy As of July 22, 2022, unless otherwise noted. |
| © CTO Realty Growth, Inc. | ctoreit.com Repositioning – Ashford Lane, Atlanta, GA 15 Acquired as Perimeter Place in 2020, with an opportunity to up - tier through targeted lease - up, an improved tenant mix and market repositioning ▪ High barrier - to - entry location with new residential projects, increasing density and 24 - hour demand ▪ Near southeast corporate headquarters for UPS, State Farm, First Data, IHG and Mercedes Benz ▪ 5 - mile population of more than 248,000; 5 - mile average household income of $164,000 THE HALL Ashford Lane Atlanta, GA Ashford Lane Atlanta, GA Ashford Lane Atlanta, GA |
| © CTO Realty Growth, Inc. | ctoreit.com Repositioning – Ashford Lane, Atlanta, GA 16 Ashford Lane will incorporate outdoor seating and eating areas, along with a number of new green spaces, including The Lawn , that will drive a more community - focused experience (Not Owned) (Not Owned) (Not Owned) THE HALL Ashford Lane Atlanta, GA Ashford Lane Atlanta, GA |
| © CTO Realty Growth, Inc. | ctoreit.com Repositioning – Ashford Lane, Atlanta, GA 17 Ashford Lane is being repositioned as a higher - end shopping and dining destination within a growing and relatively affluent submarket of Atlanta ▪ Opportunity to deliver increased rental rates with higher - end tenants supported by new multi - family and office development ▪ Additional green space, outdoor seating and eating areas will support improved foot traffic and offer restaurant - focused amenities ▪ Signed new leases with the following notable tenants in 2021 and 2022: Ashford Lane Atlanta, GA Ashford Lane Atlanta, GA Ashford Lane Atlanta, GA Ashford Lane Atlanta, GA Ashford Lane Atlanta, GA |
| © CTO Realty Growth, Inc. | ctoreit.com Repositioning – 125 Lincoln & 150 Washington, Santa Fe, NM 18 Recently signed a 9,200 square foot lease with the Rosewood Inn of Anasazi operator who will create four high - end suites on the 4 th floor ▪ Two - building property with dedicated underground parking in the heart of Santa Fe, just north of the historic Santa Fe Plaza ▪ Recently installed paid parking system to drive increased operational cash flow ▪ Currently negotiating letters of intent and forms of lease with multiple prospective tenants ▪ Prime 12,000 square foot street - level vacancy available for lease to anchor the property’s repositioning in the market Plaza 125 Lincoln & 150 Washington Santa Fe, NM 125 Lincoln & 150 Washington Santa Fe, NM 125 Lincoln & 150 Washington Santa Fe, NM |
| © CTO Realty Growth, Inc. | ctoreit.com 2022 Guidance 19 $ and shares outstanding in millions, except per share data. As of July 28, 2022, unless otherwise noted. (1) The effect of the Company’s recently announced three - for - one stock split has been accounted for in the Company’s revised guidanc e. CTO has provided guidance indicating as much as 25% year - over - year Core FFO per share growth in 2022. Low High Investments $250 million – $275 million $177.0 million of investments Target Initial Cash Yield 7.00% – 7.25% 7.2% Dispositions $50 million – $80 million $24.0 million of dispositions Target Disposition Cash Yield 6.25% – 6.75% 6.0% Core FFO Per Diluted Share $1.58 – $1.64 $0.94 in YTD Q2 2022 AFFO Per Diluted Share $1.70 – $1.76 $0.99 in YTD Q2 2022 Weighted Average Diluted Shares Outstanding 18.3 million – 18.5 million 18.3 million Revised 2022 (1) Year - To - Date Performance |
| © CTO Realty Growth, Inc. | ctoreit.com Balance Sheet 20 $51 $83 $100 $111 2022 2023 2024 2025 2026 2027 Unsecured Secured Revolving Credit Facility Components of Long - Term Debt Principal Interest Rate Type Revolving Credit Facility 111.0 million 30 - Day LIBOR + [1.35% – 1.95%] Floating 2025 Convertible Senior Notes 51.0 million 3.88% Fixed 2026 Term Loan (3) 65.0 million 30 - Day LIBOR + [1.35% – 1.95%] Fixed Mortgage Note 17.8 million 4.06% Fixed 2027 Term Loan (4) 100.0 million 30 - Day LIBOR + [1.35% – 1.95%] Fixed Total Debt $344.8 million As of June 30, 2022. $ and shares outstanding in millions. (1) Estimated liquidity is through a combination of revolving credit facility undrawn commitments and existing cash and restric ted cash. (2) Reflects $111.0 million outstanding under the Company’s $210 million senior unsecured revolving credit facility; the Company ’s senior unsecured revolving credit facility matures in May 2023 and includes a one - year extension option, subject to satisfact ion of certain conditions; the maturity date reflected assumes the Company exercises the one - year extension option. (3) The Company utilized interest rate swaps on the $65.0 million 2026 Term Loan balance, including (i) its redesignation of the existing $50.0 million interest rate swap, entered into as of August 31, 2020, and (ii) a $15.0 million interest rate swap ef fe ctive August 31, 2021, to fix LIBOR and achieve a weighted average fixed interest rate of 0.35% plus the applicable spread. (4) The Company utilized interest rate swaps on the $100.0 million 2027 Term Loan balance, including (i) its redesignation of th e existing $100.0 million interest rate swap, entered into as of March 31, 2020, and (ii) an additional interest rate swap, e ffe ctive March 29, 2024, to extend the fixed interest rate through maturity on January 31, 2027, to fix LIBOR and achieve a fixed interest rate of 0.73% plus the applicable spread. Debt Maturities ▪ More than $133 million of cash and undrawn commitments (1) ▪ No near - term debt maturities ▪ Minimal exposure to floating interest rates ▪ 41% net debt - to - total enterprise value (TEV) ▪ 6.6x Net Debt - to - Pro Forma EBITDA (2) |
| © CTO Realty Growth, Inc. | ctoreit.com Experienced Management Team CTO Realty Growth is led by an experienced management team with meaningful shareholder alignment , deep industry relationships and a strong long - term track record. 21 John P. Albright President & Chief Executive Officer ▪ Former Co - Head and Managing Director of Archon Capital, a Goldman Sachs Company; Executive Director of Merchant Banking – Investment Management at Morgan Stanley; and Managing Director of Crescent Real Estate (NYSE: CEI) Daniel E. Smith Senior Vice President, General Counsel & Corporate Secretary ▪ Former Vice President and Associate General Counsel of Goldman Sachs & Co. and Senior Vice President and General Counsel of Crescent Real Estate (NYSE: CEI) Lisa M. Vorakoun Vice President & Chief Accounting Officer ▪ Former Assistant Finance Director for the City of DeLand, Florida and Audit Manager for James Moore & Company, an Accounting and Consulting Firm Matthew M. Partridge Senior Vice President, Chief Financial Officer & Treasurer ▪ Former Chief Operating Officer and Chief Financial Officer of Hutton; Executive Vice President, Chief Financial Officer and Secretary of Agree Realty Corporation (NYSE: ADC); and Vice President of Finance for Pebblebrook Hotel Trust (NYSE: PEB) Steven R. Greathouse Senior Vice President & Chief Investment Officer ▪ Former Director of Finance for N3 Real Estate; Senior Associate of Merchant Banking – Investment Management at Morgan Stanley; and Senior Associate at Crescent Real Estate (NYSE: CEI) Helal A. Ismail Vice President – Investments ▪ Former Associate of Jefferies Real Estate Gaming and Lodging Investment Banking and Manager at B - MAT Homes, Inc. |
| © CTO Realty Growth, Inc. | ctoreit.com ESG – Corporate Responsibility CTO Realty Growth is committed to sustainability, strong corporate governance, and meaningful corporate social responsibility programs. 22 Social Responsibility Inclusive and Supportive Company Culture ▪ Dedicated to an inclusive and supportive office environment filled with diverse backgrounds and perspectives, with a demonstrated commitment to financial, mental and physical wellness Notable Community Outreach ▪ Numerous and diverse community outreach programs, supporting environmental, artistic, civil and social organizations in the community Corporate Governance ▪ Independent Chairman of the Board and 5 of 6 Directors classified as independent ▪ Annual election of all Directors ▪ Annual Board of Director evaluations ▪ Board oversees risk assessment/management, with oversight for specific areas of risk delegated to Board committees ▪ Stock ownership requirements for all Executive Management and Directors ▪ Prohibition against hedging and pledging CTO Realty Growth stock ▪ Robust policies and procedures for approval of related party transactions ▪ All team members adhere to a comprehensive Code of Business Conduct and Ethics policy |
| © CTO Realty Growth, Inc. | ctoreit.com ESG – Environmental Responsibility 23 Over the past nine years, CTO has planted approximately 170,000 pine trees in Florida and has restored over 700 acres of former industrial timberland. These 170,000 trees absorb more than 1,000 tons of carbon each year. Environmental Responsibility Committed Focus & Targeted Investment ▪ Committed to maintaining an environmentally conscious culture, the utilization of environmentally friendly & renewable products, and the promotion of sustainable business practices. Notable achievements: o Formed a conservation mitigation bank on approximately 2,500 acres of land, resulting in the land being barred from development permanently preserved o Invested in LED lighting, recycling and waste reduction strategies, programmable thermostats, energy management systems in our office and/or at our owned properties o Conveyed over 11,000 acres of land to the State of Florida to significantly enlarge the neighboring Tiger Bay State Forest Tenant Alignment ▪ Alignment with environmentally aware tenants who have strong sustainability programs and initiatives embedded into their corporate culture and business practices |
| NYSE: CTO Appendix The Shops at Legacy Plano, TX |
| © CTO Realty Growth, Inc. | ctoreit.com Schedule of Properties 25 Property Market Asset Type Property Type Square Feet In - Place Occupancy Leased Occupancy % of ABR The Shops at Legacy – Plano, TX Dallas, TX Multi - Tenant Mixed Use 237,572 92% 96% 13% Ashford Lane – Atlanta, GA Atlanta, GA Multi - Tenant Retail 282,839 71% 80% 10% Beaver Creek Crossings – Apex, NC Raleigh, NC Multi - Tenant Retail 321,977 96% 98% 9% Madison Yards – Atlanta, GA Atlanta, GA Multi - Tenant Retail 162,521 96% 98% 9% The Strand – Jacksonville, FL Jacksonville, FL Multi - Tenant Retail 204,552 95% 95% 8% Crossroads Towne Center – Chandler, AZ Phoenix, AZ Multi - Tenant Retail 244,843 100% 100% 8% Fidelity – Albuquerque, NM Albuquerque, NM Single Tenant Office 210,067 100% 100% 6% Price Plaza Shopping Center – Katy, TX Houston, TX Multi - Tenant Retail 205,813 95% 95% 5% 245 Riverside – Jacksonville, FL Jacksonville, FL Multi - Tenant Office 136,853 91% 92% 5% 125 Lincoln & 150 Washington - Santa Fe, NM Santa Fe, NM Multi - Tenant Mixed Use 137,659 74% 85% 5% The Exchange at Gwinnett - Buford, GA Atlanta, GA Multi - Tenant Retail 69,265 89% 89% 4% |
| © CTO Realty Growth, Inc. | ctoreit.com Schedule of Properties 26 Property Market Asset Type Property Type Square Feet In - Place Occupancy Leased Occupancy % of ABR Sabal Pavilion – Tampa, FL Tampa, FL Single Tenant Office 120,500 100% 100% 4% Jordan Landing – West Jordan, UT Salt Lake City, UT Multi - Tenant Retail 170,996 100% 100% 3% Westland Gateway Plaza – Hialeah, FL Miami, FL Multi - Tenant Retail 108,029 100% 100% 3% Eastern Commons – Henderson, NV Las Vegas, NV Multi - Tenant Retail 133,304 100% 100% 3% General Dynamics – Reston, VA Washington, DC Single Tenant Office 64,319 100% 100% 3% Landshark Bar & Grill – Daytona Beach, FL Daytona Beach, FL Single Tenant Retail 6,264 100% 100% 1% Westcliff Shopping Center – Fort Worth, TX Dallas, TX Multi - Tenant Retail 136,185 60% 60% 1% Chuy’s – Jacksonville, FL Jacksonville, FL Single Tenant Retail 7,950 100% 100% < 1% 369 N. New York Ave – Winter Park, FL Orlando, FL Multi - Tenant Mixed Use 28,008 100% 100% < 1% Firebirds – Jacksonville, FL Jacksonville, FL Single Tenant Retail 6,948 100% 100% < 1% Crabby’s Oceanside – Daytona Beach, FL Daytona Beach, FL Single Tenant Retail 5,780 100% 100% < 1% |
| © CTO Realty Growth, Inc. | ctoreit.com Forward Looking Statements & Non - GAAP Financial Measures 27 Forward Looking Statements Certain statements contained in this presentation (other than statements of historical fact) are forward - looking statements within the meaning of Section 27 A of the Securities Act of 1933 , as amended and Section 21 E of the Securities Exchange Act of 1934 , as amended .. Forward - looking statements can typically be identified by words such as “believe,” “estimate,” “expect,” “intend,” “anticipate,” “will,” “could,” “may,” “should,” “plan,” “potential,” “predict,” “forecast,” “project,” and similar expressions, as well as variations or negatives of these words .. Although forward - looking statements are made based upon management’s present expectations and reasonable beliefs concerning future developments and their potential effect upon the Company, a number of factors could cause the Company’s actual results to differ materially from those set forth in the forward - looking statements .. Such factors may include, but are not limited to : the Company’s ability to remain qualified as a REIT ; the Company’s exposure to U .. S .. federal and state income tax law changes, including changes to the REIT requirements ; general adverse economic and real estate conditions ; macroeconomic and geopolitical factors, including but not limited to inflationary pressures, interest rate volatility, global supply chain disruptions, and ongoing geopolitical war ; the ultimate geographic spread, severity and duration of pandemics such as the COVID - 19 Pandemic and its variants, actions that may be taken by governmental authorities to contain or address the impact of such pandemics, and the potential negative impacts of such pandemics on the global economy and the Company’s financial condition and results of operations ; the inability of major tenants to continue paying their rent or obligations due to bankruptcy, insolvency or a general downturn in their business ; the loss or failure, or decline in the business or assets of PINE ; the completion of 1031 exchange transactions ; the availability of investment properties that meet the Company’s investment goals and criteria ; the uncertainties associated with obtaining required governmental permits and satisfying other closing conditions for planned acquisitions and sales ; and the uncertainties and risk factors discussed in the Company’s Annual Report on Form 10 - K for the fiscal year ended December 31 , 2021 and other risks and uncertainties discussed from time to time in the Company’s filings with the U .. S .. Securities and Exchange Commission .. There can be no assurance that future developments will be in accordance with management’s expectations or that the effect of future developments on the Company will be those anticipated by management .. Readers are cautioned not to place undue reliance on these forward - looking statements, which speak only as of the date of this presentation .. The Company undertakes no obligation to update the information contained in this press release to reflect subsequently occurring events or circumstances .. Non - GAAP Financial Measures Our reported results are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”) .. We also disclose Funds From Operations (“FFO”), Core Funds From Operations (“Core FFO”), Adjusted Funds From Operations (“AFFO”), Pro Forma Earnings Before Interest, Taxes, Depreciation and Amortization (“Pro Forma EBITDA”), and Same - Property Net Operating Income (“Same - Property NOI”), each of which are non - GAAP financial measures .. We believe these non - GAAP financial measures are useful to investors because they are widely accepted industry measures used by analysts and investors to compare the operating performance of REITs .. FFO, Core FFO, AFFO, Pro Forma EBITDA, and Same - Property NOI do not represent cash generated from operating activities and are not necessarily indicative of cash available to fund cash requirements ; accordingly, they should not be considered alternatives to net income as a performance measure or cash flows from operating activities as reported on our statement of cash flows as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures .. |
| © CTO Realty Growth, Inc. | ctoreit.com Non - GAAP Financial Measures 28 Non - GAAP Financial Measures (continued) We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT .. NAREIT defines FFO as GAAP net income or loss adjusted to exclude extraordinary items (as defined by GAAP), net gain or loss from sales of depreciable real estate assets, impairment write - downs associated with depreciable real estate assets and real estate related depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries .. The Company also excludes the gains or losses from sales of assets incidental to the primary business of the REIT which specifically include the sales of mitigation credits, impact fee credits, subsurface sales, and land sales, in addition to the mark - to - market of the Company’s investment securities and interest related to the 2025 Convertible Senior Notes, if the effect is dilutive .. To derive Core FFO, we modify the NAREIT computation of FFO to include other adjustments to GAAP net income related to gains and losses recognized on the extinguishment of debt, amortization of above - and below - market lease related intangibles, and other unforecastable market - or transaction - driven non - cash items .. To derive AFFO, we further modify the NAREIT computation of FFO and Core FFO to include other adjustments to GAAP net income related to non - cash revenues and expenses such as straight - line rental revenue, non - cash compensation, and other non - cash amortization, as well as adding back the interest related to the 2025 Convertible Senior Notes, if the effect is dilutive .. Such items may cause short - term fluctuations in net income but have no impact on operating cash flows or long - term operating performance .. We use AFFO as one measure of our performance when we formulate corporate goals .. To derive Pro Forma EBITDA, GAAP net income or loss is adjusted to exclude extraordinary items (as defined by GAAP), net gain or loss from sales of depreciable real estate assets, impairment write - downs associated with depreciable real estate assets and real estate related depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries, non - cash revenues and expenses such as straight - line rental revenue, amortization of deferred financing costs, above - and below - market lease related intangibles, non - cash compensation, and other non - cash income or expense .. Cash interest expense is also excluded from Pro Forma EBITDA, and GAAP net income or loss is adjusted for the annualized impact of acquisitions, dispositions and other similar activities .. To derive Same - Property NOI, GAAP net income or loss attributable to the Company is adjusted to exclude extraordinary items (as defined by GAAP), gain or loss on disposition of assets, gain or loss on extinguishment of debt, impairment charges, and depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries, if any, non - cash revenues and expenses such as above - and below - market lease related intangibles, straight - line rental revenue, and other non - cash income or expense .. Interest expense, general and administrative expenses, investment and other income or loss, income tax benefit or expense, real estate operations revenues and direct cost of revenues, management fee income, and interest income from commercial loan and master lease investments are also excluded from Same - Property NOI .. GAAP net income or loss is further adjusted to remove the impact of properties that were not owned for the full current and prior year reporting periods presented .. Cash rental income received under the leases pertaining to the Company’s assets that are presented as commercial loan and master lease investments in accordance with GAAP is also used in lieu of the interest income equivalent .. FFO is used by management, investors and analysts to facilitate meaningful comparisons of operating performance between periods and among our peers primarily because it excludes the effect of real estate depreciation and amortization and net gains or losses on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions .. We believe that Core FFO and AFFO are additional useful supplemental measures for investors to consider because they will help them to better assess our operating performance without the distortions created by other non - cash revenues or expenses .. We also believe that Pro Forma EBITDA is an additional useful supplemental measure for investors to consider as it allows for a better assessment of our operating performance without the distortions created by other non - cash revenues, expenses or certain effects of the Company’s capital structure on our operating performance .. We use Same - Property NOI to compare the operating performance of our assets between periods .. It is an accepted and important measurement used by management, investors and analysts because it includes all property - level revenues from of the Company’s rental properties, less operating and maintenance expenses, real estate taxes and other property - specific expenses (“Net Operating Income” or “NOI”) of properties that have been owned and stabilized for the entire current and prior year reporting periods .. Same - Property NOI attempts to eliminate differences due to the acquisition or disposition of properties during the particular period presented, and therefore provides a more comparable and consistent performance measure for the comparison of the Company's properties .. FFO, Core FFO, AFFO, Pro Forma EBITDA, and Same - Property NOI may not be comparable to similarly titled measures employed by other companies .. |
| © CTO Realty Growth, Inc. | ctoreit.com References & Contacts 29 References and terms used in this presentation that are in addition to terms defined in the Non - GAAP Financial Measures include : ▪ This presentation has been published on July 28 , 2022 .. ▪ All information is as of June 30 , 2022 , unless otherwise noted .. ▪ Any calculation differences are assumed to be a result of rounding .. ▪ “ 2022 Guidance” is based on the 2022 Outlook provided in the Company’s Second Quarter 2022 Operating Results press release filed on July 28 , 2022 .. ▪ “Alpine” or “PINE” refers to Alpine Income Property Trust, a publicly traded net lease REIT traded on the New York Stock Exchange under the ticker symbol PINE .. ▪ “Annualized Straight - line Base Rent”, “ABR” or “Rent” and the statistics based on ABR are calculated based on our current portfolio and represent straight - line rent calculated in accordance with GAAP .. ▪ “ 2022 Net Operating Income” or “ 2022 NOI” is budgeted 2022 property - level net operating income based on the Company’s portfolio as of July 28 , 2022 .. ▪ “Credit Rated” is a tenant or the parent of a tenant with a credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Associated of Insurance Commissioners (NAIC) (together, the “Major Rating Agencies”) .. An “Investment Grade Rated Tenant” or “IG” references a Credit Rated tenant or the parent of a tenant, or credit rating thereof with a rating of BBB - , Baa 3 or NAIC - 2 or higher from one or more of the Major Rating Agencies .. ▪ “Contractual Base Rent” or “CBR” represents the amount owed to the Company under the terms of its lease agreements at the time referenced .. ▪ “Dividend” or “Dividends”, subject to the required dividends to maintain our qualification as a REIT, are set by the Board of Directors and declared on a quarterly basis and there can be no assurances as to the likelihood or number of dividends in the future .. ▪ “Investment in Alpine Income Property Trust” or “Alpine Investment” or “PINE Ownership” is calculated based on the 2 , 147 , 510 common shares and partnership units CTO owns in PINE and is based on PINE’s closing stock price .. ▪ “Leased Occupancy” refers to space that is currently leased but for which rent payments have not yet commenced .. ▪ “MSA” or “Metropolitan Statistical Area” is a region that consists of a city and surrounding communities that are linked by social and economic factors, as established by the U .. S .. Office of Management and Budget .. The names of the MSA have been shortened for ease of reference .. ▪ “Net Debt” is calculated as our total long - term debt as presented on the face of our balance sheet ; plus financing costs, net of accumulated amortization and unamortized convertible debt discount ; less cash, restricted cash and cash equivalents .. ▪ “Net Operating Income” or “NOI” is revenues from all income properties less operating expense, maintenance expense, real estate taxes and rent expense .. ▪ “Total Enterprise Value” is calculated as the Company’s Total Common Shares Outstanding multiplied by the common stock price ; plus the par value of the Series A perpetual preferred equity outstanding and Net Debt .. ▪ “Total Common Shares Outstanding” equaled 18 , 317 , 378 shares .. Investor Inquiries : Matthew M .. Partridge Senior Vice President, Chief Financial Officer and Treasurer ( 407 ) 904 - 3324 mpartridge@ctoreit .. com |
| © CTO Realty Growth, Inc. | ctoreit.com Consolidated Statements of Operations 30 CTO Realty Growth, Inc. Consolidated Statements of Operations (Unaudited, in thousands, except share, per share and dividend data) Three Months Ended Six Months Ended June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021 Revenues Income Properties $ 16,367 $ 11,574 $ 31,535 $ 23,023 Management Fee Income 948 752 1,884 1,421 Interest Income From Commercial Loans and Investments 1,290 709 2,008 1,410 Real Estate Operations 858 1,248 1,246 3,141 Total Revenues 19,463 14,283 36,673 28,995 Direct Cost of Revenues Income Properties (4,812) (2,787) (8,828) (5,704) Real Estate Operations (228) (533) (279) (615) Total Direct Cost of Revenues (5,040) (3,320) (9,107) (6,319) General and Administrative Expenses (2,676) (2,665) (5,719) (5,797) Impairment Charges — (16,527) — (16,527) Depreciation and Amortization (6,727) (5,031) (13,096) (9,861) Total Operating Expenses (14,443) (27,543) (27,922) (38,504) Gain (Loss) on Disposition of Assets — 4,732 (245) 5,440 Gain (Loss) on Extinguishment of Debt — (641) — (641) Other Gains and Income (Loss) — 4,091 (245) 4,799 Total Operating Income (Loss) 5,020 (9,169) 8,506 (4,710) Investment and Other Income (Loss) (1,311) 3,903 (3,205) 9,235 Interest Expense (2,277) (2,421) (4,179) (4,865) Income (Loss) Before Income Tax Benefit (Expense) 1,432 (7,687) 1,122 (340) Income Tax Benefit (Expense) (214) 3,963 298 4,401 Net Income (Loss) Attributable to the Company 1,218 (3,724) 1,420 4,061 Distributions to Preferred Stockholders (1,196) — (2,391) — Net Income (Loss) Attributable to Common Stockholders $ 22 $ (3,724) $ (971) $ 4,061 Per Share Information Basic and Diluted Net Income (Loss) Attributable to Common Stockholders $ 0.00 $ (0.63) $ (0.16) $ 0.69 Weighted Average Number of Common Shares Basic and Diluted 6,004,178 5,898,280 5,956,798 5,888,735 |
| © CTO Realty Growth, Inc. | ctoreit.com Same - Property NOI 31 Three Months Ended June 30, 2022 June 30, 2021 Net Income Attributable to the Company $ 1,218 $ (3,724) (Gain) Loss on Disposition of Assets — (4,732) Loss on Extinguishment of Debt — 641 Impairment Charges — 16,527 Depreciation and Amortization 6,727 5,031 Amortization of Intangibles to Lease Income (497) 338 Straight - Line Rent Adjustment 507 490 COVID - 19 Rent Repayments (26) (434) Other Income Property Related Non - Cash Amortization 38 38 Interest Expense 2,277 2,421 General and Administrative Expenses 2,676 2,665 Investment and Other Income (Loss) 1,311 (3,903) Income Tax Benefit 214 (3,963) Real Estate Operations Revenues (858) (1,248) Real Estate Operations Direct Cost of Revenues 228 533 Management Fee Income (948) (752) Interest Income from Commercial Loan and Master Lease Investments (1,290) (709) Less: Impact of Properties Not Owned the Full Reporting Period (4,494) (3,557) Cash Rental Income Received from Properties Presented as Commercial Loan and Master Lease Investments 363 354 Same - Property NOI $ 7,446 $ 6,016 Year - Over - Year Growth 23.8% CTO Realty Growth, Inc. Same - Property NOI Reconciliation (Unaudited, in thousands) |
| © CTO Realty Growth, Inc. | ctoreit.com Non - GAAP Financial Measures 32 Three Months Ended Six Months Ended June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021 Net Income Attributable to the Company $ 1,218 $ (3,724) $ 1,420 $ 4,061 Add Back: Effect of Dilutive Interest Related to 2025 Convertible Senior Notes (1) — — — — Net Income Attributable to the Company, If - Converted $ 1,218 $ (3,724) $ 1,420 $ 4,061 Depreciation and Amortization 6,707 5,031 13,076 9,861 Gains (Loss) on Disposition of Assets — (4,732) 245 (5,440) Gain on Disposition of Other Assets (632) (748) (964) (2,575) Impairment Charges, Net — 12,474 — 12,474 Unrealized (Gain) Loss on Investment Securities 1,891 (3,386) 4,348 (8,220) Funds from Operations $ 9,184 $ 4,915 $ 18,125 $ 10,161 Distributions to Preferred Stockholders (1,196) — (2,391) — Funds from Operations Attributable to Common Stockholders $ 7,988 $ 4,915 $ 15,734 $ 10,161 Loss on Extinguishment of Debt — 641 — 641 Amortization of Intangibles to Lease Income 497 (338) 978 (734) Less: Effect of Dilutive Interest Related to 2025 Convertible Senior Notes (1) — — — — Core Funds from Operations Attributable to Common Stockholders $ 8,485 $ 5,218 $ 16,712 $ 10,068 Adjustments: Straight - Line Rent Adjustment (507) (490) (1,045) (1,175) COVID - 19 Rent Repayments 26 434 53 654 Other Depreciation and Amortization (31) (150) (170) (374) Amortization of Loan Costs and Discount on Convertible Debt 212 478 446 953 Non - Cash Compensation 705 742 1,611 1,700 Non - Recurring G&A — 62 — 155 Adjusted Funds from Operations Attributable to Common Stockholders $ 8,890 $ 6,294 $ 17,607 $ 11,981 FFO Attributable to Common Stockholders per Common Share – Diluted $ 1.33 $ 0.83 $ 2.64 $ 1.73 Core FFO Attributable to Common Stockholders per Common Share – Diluted $ 1.41 $ 0.88 $ 2.81 $ 1.71 AFFO Attributable to Common Stockholders per Common Share – Diluted $ 1.48 $ 1.07 $ 2.96 $ 2.03 CTO Realty Growth, Inc. Non - GAAP Financial Measures (Unaudited, in thousands, except per share data) (1) Interest related to the 2025 Convertible Senior Notes excluded from net income attributable to the Company to derive FFO effe cti ve January 1, 2022 due to the implementation of ASU 2020 - 06 which requires presentation on an if - converted basis, as the impact to net income attributable to common stockholders would be anti - dilutive. |
| © CTO Realty Growth, Inc. | ctoreit.com Net Debt to Pro Forma EBITDA 33 CTO Realty Growth, Inc. Reconciliation of Net Debt to Pro Forma EBITDA (Unaudited, in thousands) Three Months Ended June 30, 2022 Net Income Attributable to the Company $ 1,218 Depreciation and Amortization 6,707 Gains on the Disposition of Other Assets (632) Unrealized Loss on Investment Securities 1,891 Distributions to Preferred Stockholders (1,196) Straight - Line Rent Adjustment (507) Amortization of Intangibles to Lease Income 497 Other Depreciation and Amortization (31) Amortization of Loan Costs and Discount on Convertible Debt 212 Non - Cash Compensation 705 Interest Expense, Net of Amortization of Loan Costs and Discount on Convertible Debt 2,065 EBITDA $ 10,929 Annualized EBITDA $ 43,716 Pro Forma Annualized Impact of Current Quarter Acquisitions and Dispositions, Net (1) 3,050 Pro Forma EBITDA $ 46,766 Total Long - Term Debt 343,196 Financing Costs, Net of Accumulated Amortization 1,194 Unamortized Convertible Debt Discount 444 Cash & Cash Equivalents (7,137) Restricted Cash (27,189) Net Debt $ 310,508 Net Debt to Pro Forma EBITDA 6.6x (1) Reflects the pro forma annualized impact on Annualized EBITDA of the Company’s acquisition and disposition activity during th e t hree months ended June 30, 2022. |
| REALTY GROWTH The Strand at St. John’s Town Center Jacksonville, FL |
| © CTO Realty Growth, Inc. | ctoreit.com REALTY GROWTH Supplemental Reporting Information Q2 2022 |
| © CTO Realty Growth, Inc. | ctoreit.com 1. Second Quarter 2022 Earnings Release 3 2. Key Financial Information ▪ Consolidated Balance Sheets 12 ▪ Consolidated Statements of Operations 13 ▪ Non - GAAP Financial Measures 14 3. Capitalization & Dividends 17 4. Summary of Debt 18 5. Investments 19 6. Dispositions 2 0 7. Portfolio Detail 21 8. Leasing Summary 23 9. Lease Expirations 24 10. Top Tenant Summary 25 11. Geographic Diversification 26 12. Other Assets 27 13. 2022 Guidance 28 14. Contact Information & Research Coverage 29 15. Safe Harbor, Non - GAAP Financial Measures, and Definitions and Terms 30 Table of Contents |
| © CTO Realty Growth, Inc. | ctoreit.com © CTO Realty Growth, Inc. | ctoreit.com 3 Press Release Contact: Matthew M. Partridge Senior Vice President , Chief Financial Officer and Treasurer (407) 904 - 3324 mpartridge@ctoreit.com FOR IMMEDIATE RELEASE CTO REALTY GROWTH REPORTS SECOND QUARTER 202 2 OPERATING RESULTS WINTER PARK , FL – July 2 8 , 20 2 2 – CTO Realty Growth, Inc. (NYSE: CTO) (the “Company” or “CTO” ) today announced its operating results and earnings for the quarter ended June 30 , 202 2 .. Select Highlights ▪ Reported Net Income per diluted share attributable to common stockholders of $0.0 0 for the quarter ended June 30 , 202 2 , a n increase of 1 00.0 % from the comparable prior year period .. ▪ Reported Core FFO per diluted share attributable to common stockholders of $1.4 1 for the quarter ended June 30, 2022, an increase of 60.2 % from the comparable prior year period. ▪ Reported AFFO per diluted share attributable to common stockholders of $ 1. 4 8 for the quarter ended June 30, 202 2 , an increase of 38.3 % from the comparable prior year period .. ▪ Entered into a preferred equity agreement to provide $30.0 million of funding towards the acquisition of the Watters Creek at Montgomery Farm in Allen, Texas at an initial investment yield above the range of the Company’s guidance for initial investment ca sh yields. ▪ Entered into a loan agreement to provide $19.0 million of funding towards the development of the retail portion of the WaterStar Orlando mixed - use property in Kissimmee , FL at an initial investment yield above the range of the Company’ s gu idanc e for initial investment cash yields. ▪ Reported a 23.8 % increase in Same - Property NOI during the quarter ended June 30, 2022, as compared to the comparable prior year period .. ▪ Paid a regular common stock cash dividend during the second quarter of 2022 of $1.12 per share, representing an increase of 12.0 % from the compar able prior year period , a payout ratio of 75.7% of the Company’s second quarter 2022 AFFO per diluted share, and an annualized yield of 6.9 % based on the closing price of the Company’s common stock on July 2 7 , 202 2 .. ▪ Completed a three - for - one stock split and began trading at the post - split price on July 1, 2022 .. The stock split was effected in the form of a stock dividend of two additional shares of common stock for each outstanding share of common stock held as of the record date for the stock dividend .. ▪ O n July 8, 2022, the Company acquired Madison Yards, a newly built, grocery - anchored retail property located in Atlanta, Georgia for a purchase price of $80.2 million. The purchase price represents a going - in cap rate below the range of the Company’s prior guidance for initial cash yields. |
| © CTO Realty Growth, Inc. | ctoreit.com © CTO Realty Growth, Inc. | ctoreit.com 4 CEO Comments “I am very encouraged by our second quarter performance as our team continues to make strong operational progress with our leasing and repositioning initiatives and find s attractive opportunities for external growth through our disciplined , retail - focused investment strategy ,” said John P. Albright, President and Chief Executive Off icer of CTO Realty Growth. “ Our recent Madison Yards acquisition was a great opportunity to acquire a newly built grocery - anchored shopping center in one of the strongest markets in the country , further improving our already high - quality, growth market - ori ented portfolio. With year - to - date same - store NOI growth of more than 20 % and over 200 bps of leased occupancy set to rent commence over the next twelve months, we’re very excited about our prospects to drive double digit same - store NOI growth during the back half of this year and in 2023 .. This embedded growth should continue to help drive strong earnings for the foreseeable future and further support our attractive and growing dividend. ” Quarterly Financial Results Highlights The table s below provide a summary of the Company’s operating results for the three months ended June 30 , 202 2 : (in thousands, except per share data) For the Three Months Ended June 3 0 , 2022 For the Three Months Ended June 3 0 , 202 1 Variance to Comparable Period in the Prior Year Net Income (Loss) Attributable to the Company $ 1,218 $ (3,724) $ 4,942 132.7 % Net Income (Loss) Attributable to Common Stockholders $ 22 $ (3,724) $ 3,746 100.6 % Net Income (Loss) per Diluted Share Attributable to Common Stockholders (1) $ 0. 00 $ (0.63) $ 0.63 100.0 % Core FFO Attributable to Common Stockholders ( 2 ) $ 8, 485 $ 5,218 $ 3,267 62.6 % Core FFO per Common Share – Diluted ( 2 ) $ 1. 41 $ 0. 88 $ 0.5 3 6 0.2 % AFFO Attributable to Common Stockholders ( 2 ) $ 8, 890 $ 6,294 $ 2,596 41.2 % AFFO per Common Share – Diluted ( 2 ) $ 1.48 $ 1.0 7 $ 0. 4 1 38.3 % Dividends Declared and Paid, per Preferred Share $ 0.40 $ — $ 0.40 100.0% Dividends Declared and Paid, per Common Share $ 1. 12 $ 1.00 $ 0. 12 12 ..0% (1) The denominator for this measure in 2022 excludes the impact of 1 .. 0 million shares related to the Company’s adoption of ASU 2020 - 06, effective January 1, 2022, which requires presentation on an if - converted basis for its 2025 Convertible Senior Notes , as the impact would be anti - dilutive. ( 2 ) See the “Non - GAAP Financial Measures” section and tables at the end of this press release for a discussion and reconciliation of Net Incom e (Loss) Attribut able to the Company to non - GAAP financial measures, including FFO Attributable to Common Stockholders, FFO per Common Share - Diluted, Core FFO Attributable to Common Stockholders, Core FFO per Common Share – Diluted, AFFO Attributable to Common Stockholde rs and AFFO per Common Share - Diluted. Year - to - Date Financial Results Highlights The tables below provide a summary of the Company’s operating results for the six months ended June 30, 2022: (in thousands, except per share data) For the Six Months Ended June 3 0 , 2022 For the Six Months Ended June 3 0 , 202 1 Variance to Comparable Period in the Prior Year Net Income Attributable to the Company $ 1, 420 $ 4,061 $ (2,641) (65.0 % ) |
| © CTO Realty Growth, Inc. | ctoreit.com © CTO Realty Growth, Inc. | ctoreit.com 5 Net Income (Loss) Attributable to Common Stockholders $ (971) $ 4,061 $ (5,032) ( 1 23 .. 9 % ) Net Income (Loss) per Diluted Share Attributable to Common Stockholders (1) $ ( 0. 16) $ 0.6 9 $ ( 0. 85) (123.2 %) Core FFO Attributable to Common Stockholders ( 2 ) $ 16,712 $ 10,068 $ 6,644 66.0 % Core FFO per Common Share – Diluted ( 2 ) $ 2.81 $ 1.71 $ 1. 1 0 64.3 % AFFO Attributable to Common Stockholders ( 2 ) $ 17 , 607 $ 11,981 $ 5,626 47.0 % AFFO per Common Share – Diluted ( 2 ) $ 2.9 6 $ 2.03 $ 0.9 3 45.8 % Dividends Declared and Paid, per Preferred Share $ 0. 8 0 $ — $ 0. 8 0 100.0% Dividends Declared and Paid, per Common Share $ 2.20 $ 2 ..00 $ 0. 20 10 ..0% (1) The denominator for this measure in 2022 excludes the impact of 1 .. 0 million shares related to the Company’s adoption of ASU 2020 - 06, effective January 1, 2022, which requires presentation on an if - converted basis for its 2025 Convertible Senior Notes , as the impact would be anti - dilutive. ( 2 ) See the “N on - GAAP Financial Measures” section and tables at the end of this press release for a discussion and reconciliation of Net Incom e Attributable to the Company to non - GAAP financial measures, including FFO Attributable to Common Stockholders, FFO per Common Share - Diluted, Core FFO Attributable to Common Stockholders, Core FFO per Common Share – Diluted, AFFO Attributable to Common Stockholders and AFFO per Common Share - Diluted. Investments During the three months ended June 30, 2022, the Company originated two structured investment s to provide $49.0 million of funding towards two properties. The Company’s second quarter 2022 investments included the following: ▪ Provided $30.0 million of pref erred equity for the acquisition of Watters Creek at Montgomery Farm, a grocery - anchored, mixed - use property located in Allen, Texas. Watters Creek at Montgomery Farm is approximately 458,000 square feet of grocery - anchored retail and office, anchored by M arket Street, Anthropologie, Mi Cocina, DSW, The Cheesecake Factory, Brio Italian Grille, and Michaels, and includes a variety of national and local retailers and restaurants. The three - year preferred investment for the acquisition was fully funded at clos ing, is interest - only through maturity, includes an origination fee, and bears a fixed preferred return of 8. 5 0 %. ▪ Provided a $19.0 million first mortgage for the development of the retail portion of the WaterStar Orlando mixed - use property in Kissimmee, FL .. WaterStar Orlando is a mixed - use project at the center of one of the strongest performing retail corridors in Florida, includes 320 onsite residential units, and is in close proximity to the Margaritaville Resort Orlando , Island H20 Water Park , and the western entrance to Walt Disney World .. The retail portion of the development is 102 ,000 square feet and is anchored by Marshalls , Burlington , pOpshelf , Portillo’s and Outback Steakhouse .. The loan matures on August 31, 2022 , is interest - only through mat urity, includes an origination fee, and bears a fixed interest - only rate of 8.00%. During the six months ended June 30, 202 2 , the Company acquired one multi - tenant retail property for total income property acquisition volume of $39.1 million and originated three structured investments to provide $ 57 ..7 million of funding towards three retail and mixed - use properties .. These acquisitions and structured investments represent a blended weighted average going - in yield of 7.9 % .. Subsequent to quarter - end, the Company acquired Madison Yards, a 162,500 square foot grocery - anchored property located in the Inman Park/Reynoldstown submarket along the Memorial Drive corridor of Atlanta, Georgia for a purchase price of $8 0.2 million. Th e p roperty is 98% occupied, anchored by Publix and AMC Theatres, includes a well - crafted mix of retailers and restaurants, including AT&T, First Watch, and Orangetheory Fitness, and is the Company’s |
| © CTO Realty Growth, Inc. | ctoreit.com © CTO Realty Growth, Inc. | ctoreit.com 6 first Publix - anchored center. The purchase price represents a going - in cap rate below the range of the Company’s guidance for initial cash yields. Dispositions During the six mon ths ended June 30, 202 2 , the Company sold two single tenant income properties, one of which was classified as a commercial loan investment due to the tenant’s repurchase option, for $24.0 million at a weighted average exit cap rate of 6.0%. Income Property Portfolio The Company’s income property portfolio consisted of the following as of June 3 0 , 2022: Asset Type # of Properties (1) Square Feet Weighted Average Remaining Lease Term Single Tenant 7 422 6.3 years Multi - Tenant 14 2,4 18 6.7 years Total / Weighted Average Lease Term 21 2, 840 6.6 years Property Type # of Properties (1) Square Feet % of Cash Base Rent Retail 14 1,9 05 6 1 .. 5 % Office 4 532 19. 5 % Mixed - Use 3 403 1 9.0 % Total / Weighted Average Lease Term 21 2,8 40 100.0% Leased Occupancy 93.5 % Ec onomic Occupancy 9 1.3 % Physical Occupancy 90.2 % Square feet in thousands. (1) The properties include a property in Hialeah, Florida leased to a master tenant which includes three tenant repurchase option s. Pursuant to FASB ASC Topic 842, Leases , the $21.0 million investment has been recorded in the Company’s consolidated balance she ets as a Commercial Loan Investment. Operational Highlights The Company’s Same - P roperty NOI totaled $ 7 ..4 million during the second quarter of 2022, an increase of 23.8 % over the comparable prior year period , as presented in the following table. ( in thousands ) For the Three Months Ended June 3 0 , 2022 For the Three Months Ended June 30 , 2021 Variance to Comparable Period in the Prior Year Single Tenant $ 2, 190 $ 2,055 $ 135 6.6 % Multi - Tenant 5,256 3,961 1,295 32.7 % |
| © CTO Realty Growth, Inc. | ctoreit.com © CTO Realty Growth, Inc. | ctoreit.com 7 Total $ 7,446 $ 6,016 $ 1,430 23.8 % During the second quarter of 2022, the Company signed leases totaling 41 , 163 square feet. A summary of the Company’s leasing activity is as follows: Retail Square Feet Weighted Average Lease Term Cash Rent Per Square Foot Tenant Improvements Leasing Commissions New Leases 3 1.0 12.2 years $ 32.66 $ 2,721 $ 298 Renewals & Extensions 10.2 3.6 years $ 29.28 $ — $ 28 Total / Weighted Average 41. 2 10.3 years $31. 82 $ 2,721 $ 326 In thousands except for per square foot and lease term data. Subsurface Interests During the three months ended June 3 0 , 2022, the Company sold approximately 8,330 acres of subsurface oil, gas, and mineral rights for $0. 5 million, resulting in aggregate gains of $0. 5 million. During the six months ended June 30, 202 2 , the Company sold approximately 13 , 08 0 acres of subsurface oil, gas and mineral rights for $ 0. 9 million, resulting in a gain on the sale of $ 0.8 million. As of June 30 , 202 2 , the Company owns full or fractional subsurface oil, gas, and mineral interests underlying approximately 356 ,000 “surface ” acres of land owned by others in 19 counties in Florida. Capital Markets and Balance Sheet During the quarter ended June 3 0 , 2022, the Company completed the following notable capital markets activity: ▪ I ssued 88,065 common shares under its ATM offering program at a weighted average gross price of $ 66.03 per share, for total net proceeds of $ 5.7 million. ▪ R epurchased 20,010 shares for approximately $ 1.1 million at a weighted average gross price of $ 57.37 per share. ▪ C ompleted a three - for - one stock split and began trading at the post - split price on July 1, 2022. The stock split was effected in the form of a stock dividend of two additional shares of common stock for each outstanding share of common stock held as of the record date for the stock dividend. The following table provides a summary of the Company’s long - term debt, at face value, as of June 30, 202 2 : Component of Long - Term Debt Principal Interest Rate Maturity Date Revolving Credit Facility $ 111 ..0 million 30 - day LIBOR + [1.35% – 1.95%] May 2023 2025 Convertible Senior Notes $51.0 million 3.875% April 2025 2026 Term Loan (1) $65.0 million 30 - day LIBOR + [1.35% – 1.95%] March 2026 2027 Term Loan (2) $100.0 million 30 - day LIBOR + [1.35% – 1.95%] January 2027 Mortgage Note (3) $17.8 million 4.06% August 2026 Total Debt / Weighted Average Interest Rate $ 344.8 million 2. 63 % (1) The Company utilized interest rate swaps on the $65.0 million 2026 Term Loan balance, including (i) its redesignation of the existing $50.0 million interest rate swap, entered into as of August 31, 2020, and (ii) a $15.0 million interest rate swap effectiv e August 31, 2021, to fix LIBOR and achieve a weighted average fixed interest rate of 0.35% plus the applicable spread. |
| © CTO Realty Growth, Inc. | ctoreit.com © CTO Realty Growth, Inc. | ctoreit.com 8 (2) The Company utilized interest rate swaps on the $100.0 million 2027 Term Loan balance, including (i) its redesignation of the existing $100.0 million interest rate swap, entered into as of March 31, 2020, and (ii) an additional interest rate swap, effectiv e March 29, 2024, to extend the fixed interest rate through maturity on January 31, 2027, to fix LIBOR and achieve a fixed interest rate of 0.73% plus the ap plicable spread. (3) Mortgage note assumed in connection with the acquisition of Price Plaza Shopp ing Center located in Katy, Texas. As of June 3 0 , 2022, the Company’s net debt to Pro Forma EBITDA was 6.6 times, and as defined in the Company’s credit agreement, the Company’s fixed charge coverage ratio was 3.4 times. As of June 3 0 , 2022, the Company’s net debt to total enterprise value was 41.0 %. The Company calculates total enterprise value as the sum of net debt , par value of its 6.375% Series A preferred equity, and the market value of the Company's outstanding common shares .. Dividend s On May 24 , 2022, the Company announced a cash dividend on its common stock and Series A Preferred stock for the second quarter of 2022 of $1. 12 per share and $0.40 per share, respectively, payable on June 3 0 , 2022 to stockholders of record as of the close of busi ness on June 9 , 2022. The second quarter 2022 common stock cash dividend represents a 12 ..0% increase over the comparable prior year period quarterly dividend and a payout ratio of 7 9 .. 4 % and 75.7 % of the Company’s second quarter 2022 Core FFO per diluted sh are and AFFO per diluted share, respectively. 202 2 Outlook The Company has increased its outlook for 2022 to take into account the Company’s year - to - date performance and revised expectations regarding the Company’s investment activities, forecasted capital markets transactions, and other significant assumptions. The revised per share estimates take into account the Company’s recently completed three - for - one stock split The Company’s increased outlook for 2022 is as follows : 2022 Revised Outlook Range Change from Prior Outlook Low High Low High Acquisition of Income Producing Assets $ 250 ..0 million to $2 7 5.0 million $50 million to $25 million Target Investment Initial Cash Yield 7. 00 % to 7. 25 % 50 bps to 25 bps Disposition of Assets $ 50 ..0 million to $ 80 ..0 million $10 million to $10 million Target Disposition Cash Yield 6. 25 % to 6. 75 % 100 bps to 25 bps Core FFO Per Diluted Share $ 1.58 to $ 1.64 $0.06 to $0.04 AFFO Per Diluted Share $ 1.70 to $ 1.76 $0.05 to $0.03 Weighted Average Diluted Shares Outstanding 18. 3 million to 18 .. 5 million 0 million to 0.3 million 2nd Quarter Earnings Conference Call & Webcast The Company will host a conference call to present its operating results for the quarter ended June 30, 2022 on Friday, July 2 9 , 2022, at 9:00 AM ET. A live webcast of the call will be available on the Investor Relations page of the Company’s website at www.ctoreit.com or at the link provided in the event details below. To access the call by phone, please go to the link provided in the event details below and you will be provided with dial - in details. |
| © CTO Realty Growth, Inc. | ctoreit.com © CTO Realty Growth, Inc. | ctoreit.com 9 Webcast: https://edge.media - server.com/mmc/p/uh9ig8iu Dial - In: https://register.vevent.com/register/BI03c8d5540d254fb798fffd5daa427848 We encourage participants to dial into the conference call at least fifteen minutes ahead of the scheduled start time. A replay of the earnings call will be archived and available online through the Investor Relations section of the Company’s website at www.ctoreit.com .. About CTO Realty Growth, Inc. CTO Realty Growth, Inc. is a publicly traded real estate investment trust that owns and operates a portfolio of high - quality, retail - based properties located primarily in higher growth markets in the United States. CTO also externally manages and owns a meaningful interest in Alpine I ncome Property Trust, Inc. (NYSE: PINE), a publicly traded net lease REIT. We encourage you to review our most recent investor presentation and supplemental financial information, which is available on our website at www.ctoreit.com .. Safe Harbor Certain statements contained in this press release (other than statements of historical fact) are forward - looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended , and Section 21E of t he Securities Exchange Act of 1934, as amended. Forward - looking statements can typically be identified by words such as “believe,” “estimate,” “expect,” “intend,” “anticipate,” “will,” “could,” “may,” “should,” “plan,” “potential,” “predict,” “forecast,” “ project,” and similar expressions, as well as variations or negatives of these words. Although forward - looking statements are made based upon management’s present expectations and reasonable beliefs concerning future developments and their potential effec t upon the Company, a number of factors could cause the Company’s actual results to differ materially from those set forth in the forward - looking statements. Such factors may include, but are not limited to: the Company’s ability to remain qualified as a R EIT; the Company’s exposure to U.S. federal and state income tax law changes, including changes to the REIT requirements; general adverse economic and real estate conditions; macroeconomic and geopolitical factors, including but not limited to inflationary pressures, interest rate volatility, global supply chain disruptions, and ongoing geopolitical war; the ultimate geographic spread, severity and duration of pandemics such as the COVID - 19 Pandemic and its variants, actions that may be taken by governmenta l authorities to contain or address the impact of such pandemics, and the potential negative impacts of such pandemics on the global economy and the Company’s financial condition and results of operations; the inability of major tenants to continue paying their rent or obligations due to bankruptcy, insolvency or a general downturn in their business; the loss or failure, or decline in the business or assets of PINE; the completion of 1031 exchange transactions; the availability of investment properties that meet the Company’s investment goals and criteria; the uncertainties associated with obtaining required governmental permits and satisfying other closing conditions for planned acquisitions and sales; and the uncertainties and risk factors discussed in the Company’s Annual Report on Form 10 - K for the fiscal year ended December 31, 2021 and other risks and uncertainties discussed from time to time in the Company’s filings with the U.S. Securities and Exchange Commission. There can be no assurance that future developments will be in accordance with management’s expectations or that the effect of future developments on the Company will be those anticipated by management. Readers are cautioned not to place undue reliance on these forward - looking statements , which speak only as of the date of this press release. The Company undertakes no obligation to update the information contained in this press release to reflect subsequently occurring events or circumstances. |
| © CTO Realty Growth, Inc. | ctoreit.com © CTO Realty Growth, Inc. | ctoreit.com 10 Non - GAAP Financial Measures Our reported results are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). We also disclose Funds From Operations (“FFO”), Core Funds From Operations (“Core FFO”), Adjusted Funds From Operations (“AFFO”), Pro Forma Earnings Before Interest, Taxes, Depreciation and Amortization (“Pro Forma EBITDA”), and Same - Property Net Operating Income (“Same - Property NOI”), each of which are non - GAAP financial measures. We believe these non - GAAP financial measu res are useful to investors because they are widely accepted industry measures used by analysts and investors to compare the operating performance of REITs. FFO, Core FFO, AFFO, Pro Forma EBITDA, and Same - Property NOI do not represent cash generated from operating activities and are not necessarily indicative of cash available to fund cash requirements; accordingly, they should not be considered alternatives to net income as a performance measure or cash flows from operating activities as reported on our s tatement of cash flows as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures. We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Esta te Investment Trusts, or NAREIT. NAREIT defines FFO as GAAP net income or loss adjusted to exclude extraordinary items (as defined by GAAP), net gain or loss from sales of depreciable real estate assets, impairment write - downs associated with depreciable r eal estate assets and real estate related depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries. The Company also excludes the gains or losses from sales of assets incidental to the primary business of the REIT which specifically include the sales of mitigation credits, impact fee credits, subsurface sales, and land sales, in addition to the mark - to - market of the Company’s investment securities and interest related to the 2025 Convertible Senior Notes , if the effect is dilutive. To derive Core FFO, we modify the NAREIT computation of FFO to include other adjustments to GAAP net income related to gains and losses recognized on the extinguishment of debt, amortization of above - and below - market lease rel ated intangibles, and other unforecastable market - or transaction - driven non - cash items. To derive AFFO, we further modify the NAREIT computation of FFO and Core FFO to include other adjustments to GAAP net income related to non - cash revenues and expenses such as straight - line rental revenue, non - cash compensation, and other non - cash amortization, as well as adding back the interest related to the 2025 Convertible Senior Notes, if the effect is dilutive. Such items may cause short - term fluctuations in net i ncome but have no impact on operating cash flows or long - term operating performance. We use AFFO as one measure of our performance when we formulate corporate goals. To derive Pro Forma EBITDA, GAAP net income or loss attributable to the Company is adjust ed to exclude extraordinary items (as defined by GAAP), net gain or loss from sales of depreciable real estate assets, impairment write - downs associated with depreciable real estate assets and real estate related depreciation and amortization, including th e pro rata share of such adjustments of unconsolidated subsidiaries, non - cash revenues and expenses such as straight - line rental revenue, amortization of deferred financing costs, above - and below - market lease related intangibles, non - cash compensation, an d other non - cash income or expense. Cash interest expense is also excluded from Pro Forma EBITDA, and GAAP net income or loss is adjusted for the annualized impact of acquisitions, dispositions and other similar activities. To derive Same - Property NOI, GA AP net income or loss attributable to the Company is adjusted to exclude extraordinary items (as defined by GAAP), gain or loss on disposition of assets, gain or loss on extinguishment of debt, impairment charges, and depreciation and amortization, includi ng the pro rata share of such adjustments of unconsolidated subsidiaries, if any, non - cash revenues and expenses such as above - and below - market lease related intangibles, straight - line rental revenue, and other non - cash income or expense. Interest expense , general and administrative expenses, investment and other income or loss, income tax benefit or expense, real estate operations revenues and direct cost of revenues, management fee income, and interest income from commercial loan s and investments are als o excluded from Same - Property NOI. GAAP net income or loss is further adjusted to remove the impact of properties that were not owned for the full current and prior year reporting periods presented. Cash rental income received under the leases pertaining t o the Company’s assets that are presented as commercial loan s and investments in accordance with GAAP is also used in lieu of the interest income equivalent. |
| © CTO Realty Growth, Inc. | ctoreit.com © CTO Realty Growth, Inc. | ctoreit.com 11 FFO is used by management, investors and analysts to facilitate meaningful comparisons of operati ng performance between periods and among our peers primarily because it excludes the effect of real estate depreciation and amortization and net gains or losses on sales, which are based on historical costs and implicitly assume that the value of real esta te diminishes predictably over time, rather than fluctuating based on existing market conditions. We believe that Core FFO and AFFO are additional useful supplemental measures for investors to consider because they will help them to better assess our opera ting performance without the distortions created by other non - cash revenues or expenses. We also believe that Pro Forma EBITDA is an additional useful supplemental measure for investors to consider as it allows for a better assessment of our operating perf ormance without the distortions created by other non - cash revenues, expenses or certain effects of the Company’s capital structure on our operating performance. We use Same - Property NOI to compare the operating performance of our assets between periods. It is an accepted and important measurement used by management, investors and analysts because it includes all property - level revenues from the Company’s properties, less operating and maintenance expenses, real estate taxes and other property - specific expen ses (“Net Operating Income” or “NOI”) of properties that have been owned and stabilized for the entire current and prior year reporting periods. Same - Property NOI attempts to eliminate differences due to the acquisition or disposition of properties during the particular period presented, and therefore provides a more comparable and consistent performance measure for the comparison of the Company's properties. FFO, Core FFO, AFFO, Pro Forma EBITDA, and Same - Property NOI may not be comparable to similarly tit led measures employed by other companies. |
| © CTO Realty Growth, Inc. | ctoreit.com © CTO Realty Growth, Inc. | ctoreit.com 12 Consolidated Balance Sheet CTO Realty Growth, Inc. Consolidated Balance Sheet s ( In thousands, except share and per share data ) As of (Unaudited) June 30, 2022 December 31, 2021 ASSETS Real Estate: Land, at Cost $ 205,245 $ 189,589 Building and Improvements, at Cost 344,205 325,418 Other Furnishings and Equipment, at Cost 741 707 Construction in Process, at Cost 10,419 3,150 Total Real Estate, at Cost 560,610 518,864 Less, Accumulated Depreciation (31,735) (24,169) Real Estate — Net 528,875 494,695 Land and Development Costs 686 692 Intangible Lease Assets — Net 78,328 79,492 Assets Held for Sale — 6,720 Investment in Alpine Income Property Trust, Inc. 38,483 41,037 Mitigation Credits 3,436 3,702 Mitigation Credit Rights 21,018 21,018 Commercial Loans and Investments 68,783 39,095 Cash and Cash Equivalents 7,137 8,615 Restricted Cash 27,189 22,734 Refundable Income Taxes 286 442 Deferred Income Taxes — Net 105 — Other Assets 28,029 14,897 Total Assets $ 802,355 $ 733,139 LIABILITIES AND STOCKHOLDERS’ EQUITY Liabilities: Accounts Payable $ 1,325 $ 676 Accrued and Other Liabilities 15,705 13,121 Deferred Revenue 5,358 4,505 Intangible Lease Liabilities — Net 5,277 5,601 Deferred Income Taxes — Net — 483 Long - Term Debt 343,196 278,273 Total Liabilities 370,861 302,659 Commitments and Contingencies Stockholders’ Equity: Preferred Stock – 100,000,000 shares authorized; $0.01 par value, 6.375% Series A Cumulative Redeemable Preferred Stock, $25.00 Per Share Liquidation Preference, 3,000,000 shares issued and outstanding at June 30, 2022 and December 31, 2021 30 30 Common Stock – 500,000,000 shares authorized; $0.01 par value, 6,082,626 shares issued and outstanding at June 30, 2022 and 5,916,226 shares issued and outstanding at December 31, 2021 61 60 Additional Paid - In Capital 86,347 85,414 Retained Earnings 332,916 343,459 Accumulated Other Comprehensive Income 12,140 1,517 Total Stockholders’ Equity 431,494 430,480 Total Liabilities and Stockholders’ Equity $ 802,355 $ 733,139 |
| © CTO Realty Growth, Inc. | ctoreit.com © CTO Realty Growth, Inc. | ctoreit.com 13 Consolidated P&L CTO Realty Growth, Inc. Consolidated Statement s of Operations (Unaudited ) (I n thousands, except share, per share and dividend data) Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, 2022 2021 2022 2021 Revenues Income Properties $ 16,367 $ 11,574 $ 31,535 $ 23,023 Management Fee Income 948 752 1,884 1,421 Interest Income From Commercial Loans and Investments 1,290 709 2,008 1,410 Real Estate Operations 858 1,248 1,246 3,141 Total Revenues 19,463 14,283 36,673 28,995 Direct Cost of Revenues Income Properties (4,812) (2,787) (8,828) (5,704) Real Estate Operations (228) (533) (279) (615) Total Direct Cost of Revenues (5,040) (3,320) (9,107) (6,319) General and Administrative Expenses (2,676) (2,665) (5,719) (5,797) Impairment Charges — (16,527) — (16,527) Depreciation and Amortization (6,727) (5,031) (13,096) (9,861) Total Operating Expenses (14,443) (27,543) (27,922) (38,504) Gain (Loss) on Disposition of Assets — 4,732 (245) 5,440 Gain (Loss) on Extinguishment of Debt — (641) — (641) Other Gains and Income (Loss) — 4,091 (245) 4,799 Total Operating Income (Loss) 5,020 (9,169) 8,506 (4,710) Investment and Other Income (Loss) (1,311) 3,903 (3,205) 9,235 Interest Expense (2,277) (2,421) (4,179) (4,865) Income (Loss) Before Income Tax Benefit (Expense) 1,432 (7,687) 1,122 (340) Income Tax Benefit (Expense) (214) 3,963 298 4,401 Net Income (Loss) Attributable to the Company 1,218 (3,724) 1,420 4,061 Distributions to Preferred Stockholders (1,196) — (2,391) — Net Income (Loss) Attributable to Common Stockholders $ 22 $ (3,724) $ (971) $ 4,061 Per Share Information: Basic and Diluted Net Income (Loss) Attributable to Common Stockholders $ 0.00 $ (0.63) $ (0.16) $ 0.69 Weighted Average Number of Common Shares Basic and Diluted 6,004,178 5,898,280 5,956,798 5,888,735 Dividends Declared and Paid – Preferred Stock $ 0.40 $ — $ 0.80 $ — Dividends Declared and Paid – Common Stock $ 1.12 $ 1.00 $ 2.20 $ 2.00 |
| © CTO Realty Growth, Inc. | ctoreit.com © CTO Realty Growth, Inc. | ctoreit.com 14 Non - GAAP Financial Measures CTO Realty Growth, Inc. Non - GAAP Financial Measures Same - Property NOI Reconciliation (Unaudited) (In thousands) Three Months Ended June 3 0 , 2022 June 3 0 , 2021 Net Income (Loss) Attributable to the Company $ 1,218 $ (3,724) Gain on Disposition of Assets — ( 4,732 ) Loss on Extinguishment of Debt — 641 Impairment Charges — 16,527 Depreciation and Amortization 6,727 5,031 Amortization of Intangibles to Lease Income (497) 338 Straight - Line Rent Adjustment 507 490 COVID - 19 Rent Repayments (26) (434) Other Income Property Related Non - Cash Amortization 38 38 Interest Expense 2,277 2,421 General and Administrative Expenses 2,676 2,665 Investment and Other Loss ( Income) 1,311 (3,903) Income Tax Expense ( Benefit ) 214 (3,963) Real Estate Operations Revenues (858) (1,248) Real Estate Operations Direct Cost of Revenues 228 533 Management Fee Income (948) (752) Interest Income from Commercial Loan s and Investments (1,290) (709) Less: Impact of Properties Not Owned for the Full Reporting Period (4,494) (3,557) Cash Rental Income Received from Properties Presented as Commercial Loan s and Investments 363 354 Same - Property NOI $ 7,446 $ 6,016 |
| © CTO Realty Growth, Inc. | ctoreit.com © CTO Realty Growth, Inc. | ctoreit.com 15 Non - GAAP Financial Measures CTO Realty Growth, Inc. Non - GAAP Financial Measures ( Unaudited ) (I n thousands, except per share data ) Three Months Ended Six Months Ended June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021 Net Income (Loss) Attributable to the Company $ 1,218 $ (3,724) $ 1,420 $ 4,061 Add Back: Effect of Dilutive Interest Related to 2025 Notes (1) — — — — Net Income (Loss) Attributable to the Company, If - Converted $ 1,218 $ (3,724) 1,420 4,061 Depreciation and Amortization of Real Estate 6,707 5,031 13,076 9,861 (Gains) Losses on Disposition of Assets — (4,732) 245 (5,440) Gains on Disposition of Other Assets (632) (748) (964) (2,575) Impairment Charges, Net — 12,474 — 12,474 Unrealized Loss (Gain) on Investment Securities 1,891 (3,386) 4,348 (8,220) Funds from Operations $ 9,184 $ 4,915 $ 18,125 $ 10,161 Distributions to Preferred Stockholders (1,196) — (2,391) — Funds From Operations Attributable to Common Stockholders $ 7,988 $ 4,915 $ 15,734 $ 10,161 Loss on Extinguishment of Debt — 641 — 641 Amortization of Intangibles to Lease Income 497 (338) 978 (734) Less: Effect of Dilutive Interest Related to 2025 Notes (1) — — — — Core Funds From Operations Attributable to Common Stockholders $ 8,485 $ 5,218 $ 16,712 $ 10,068 Adjustments: Straight - Line Rent Adjustment (507) (490) (1,045) (1,175) COVID - 19 Rent Repayments 26 434 53 654 Other Depreciation and Amortization (31) (150) (170) (374) Amortization of Loan Costs and Discount on Convertible Debt 212 478 446 953 Non - Cash Compensation 705 742 1,611 1,700 Non - Recurring G&A — 62 — 155 Adjusted Funds From Operations Attributable to Common Stockholders $ 8,890 $ 6,294 $ 17,607 $ 11,981 FFO Attributable to Common Stockholders per Common Share – Diluted $ 1. 33 $ 0.83 $ 2.64 $ 1.73 Core FFO Attributable to Common Stockholders per Common Share – Diluted $ 1. 41 $ 0.88 $ 2.81 $ 1.71 AFFO Attributable to Common Stockholders per Common Share – Diluted $ 1. 48 $ 1. 07 $ 2.96 $ 2.03 (1) Interest related to the 2025 Convertible Senior Notes excluded from net income attributable to the Company to derive FFO effe ctive January 1, 2022 due to the implementation of ASU 2020 - 06 which requires presentation on an if - converted basis, as the impact to net income attributable to common stockholders would be anti - dilutive .. |
| © CTO Realty Growth, Inc. | ctoreit.com © CTO Realty Growth, Inc. | ctoreit.com 16 Non - GAAP Financial Measures CTO Realty Growth, Inc. Non - GAAP Financial Measures Reconciliation of Net Debt to Pro Forma EBITDA (Unaudited) (In thousands) Three Months Ended June 3 0 , 2022 Net Income Attributable to the Company $ 1,218 Depreciation and Amortization of Real Estate 6, 707 Gains on Disposition of Other Assets ( 632 ) Unrealized Loss on Investment Securities 1,891 Distributions to Preferred Stockholders (1 ,196 ) Straight - Line Rent Adjustment ( 507 ) Amortization of Intangibles to Lease Income 497 Other Depreciation and Amortization ( 31 ) Amortization of Loan Costs and Discount on Convertible Debt 212 Non - Cash Compensation 705 Interest Expense, Net of Amortization of Loan Costs and Discount on Convertible Debt 2,065 EBITDA $ 10, 929 Annualized EBITDA $ 4 3,716 Pro Forma Annualized Impact of Current Quarter Acquisitions and Dispositions, Net (1) 3,050 Pro Forma EBITDA $ 4 6,766 Total Long - Term Debt 343,196 Financing Costs, Net of Accumulated Amortization 1, 194 Unamortized Convertible Debt Discount 444 Cash & Cash Equivalents ( 7,137 ) Restricted Cash ( 27, 189 ) Net Debt $ 310, 50 8 Net Debt to Pro Forma EBITDA 6. 6 x (1) Reflects the pro forma annualized impact on Annualized EBITDA of the Company’s acquisition and disposition activity during th e three months ended June 30 , 2022. |
| © CTO Realty Growth, Inc. | ctoreit.com Capitalization & Dividends $ and shares outstanding in thousands, except per share data. As of June 30, 2022, unless otherwise noted Equity Capitalization Common Shares Outstanding 6,083 Common Share Price $61.12 Total Common Equity Market Capitalization $371,770 Series A Preferred Shares Outstanding 3,000 Series A Preferred Par Value Per Share $25.00 Series A Preferred Par Value $75,000 Total Equity Capitalization $446,770 Debt Capitalization Total Debt Outstanding $344,834 Total Capitalization $791,604 Cash, Restricted Cash & Cash Equivalents $34,326 Total Enterprise Value $757,278 Dividends Paid Common Preferred Q3 2021 $1.00 $0.37 Q4 2021 $1.00 $0.40 Q1 2022 $1.08 $0.40 Q2 2022 $1.12 $0.40 Trailing Twelve Months Q2 2022 $4.20 $1.57 Q2 2022 Core FFO Per Diluted Share $1.41 Q2 2022 AFFO Per Diluted Share $1.48 Q2 2022 Core FFO Payout Ratio 79.4% Q2 2022 AFFO Payout Ratio 75.7% Dividend Yield Q2 2022 $1.12 $0.40 Annualized Q2 2022 Dividend $4.48 $1.59 Price Per Share as of June 30, 2022 $61.12 $22.98 Implied Dividend Yield 7.3% 6.9% 17 |
| © CTO Realty Growth, Inc. | ctoreit.com Debt Summary $ in thousands. As of June 30, 2022, unless otherwise noted. (1) See reconciliation as part of Non - GAAP Financial Measures in the Company’s Second Quarter 2022 Earnings Release. Indebtedness Outstanding Face Value Interest Rate Maturity Date Type Revolving Credit Facility $111,000 30 - Day LIBOR + [1.35% – 1.95%] May 2023 Variable 2025 Convertible Senior Notes 51,034 3.88% April 2025 Fixed 2026 Term Loan 65,000 30 - Day LIBOR + [1.35% – 1.95%] March 2026 Fixed Mortgage Note 17,800 4.06% August 2026 Fixed 2027 Term Loan 100,000 30 - Day LIBOR + [1.35% – 1.95%] January 2027 Fixed Total / Wtd .. Avg. $344,834 2.63% Fixed vs. Variable Face Value Interest Rate % of Total Debt Total Fixed Rate Debt 233,834 2.52% 68% Total Variable Rate Debt 111,000 30 - Day LIBOR + [1.35% – 1.95%] 32% Total / Wtd .. Avg. $344,834 2.63% 100% Leverage Metrics Face Value of Debt $344,834 Cash, Restricted Cash & Cash Equivalents ($34,326) Net Debt $310,508 Total Enterprise Value $757,278 Net Debt to Total Enterprise Value 41% Net Debt to Pro Forma EBITDA (1) 6.6x 18 |
| © CTO Realty Growth, Inc. | ctoreit.com Year - to - Date Investments $ in thousands. As of June 30, 2022. Property Acquisitions Market Type Date Acquired Square Feet Price Occupancy At Acq .. Price Plaza Shopping Center – Katy, TX Houston, TX Multi - Tenant Retail March 2022 205,813 $39,100 95% Total Acquisitions 205,813 $39,100 19 Structured Investments Market Type Date Originated Capital Commitment Structure Phase II of The Exchange at Gwinnett – Buford, GA Atlanta, GA Retail Outparcels January 2022 $8,700 First Mortgage Watters Creek at Montgomery Farm – Allen, TX Dallas, TX Grocery Anchored Retail April 2022 $30,000 Preferred Equity WaterStar Orlando – Kissimmee , FL Orlando, FL Retail Outparcels April 2022 $19,000 First Mortgage Improvemeny Loan at Ashford Lane – Atlanta, GA Atlanta, GA Tenant Improvement Loan May 2022 $1,500 Landlord Financing Total Structured Investments $59,200 |
| © CTO Realty Growth, Inc. | ctoreit.com Property Market Type Date Sold Square Feet Price Gain (Loss) Party City – Oceanside, NY New York, NY Single Tenant Retail January 2022 15,500 $6,949 ($60) The Carpenter Hotel – Austin, TX Austin, TX Hospitality Ground Lease March 2022 73,508 17,095 (178) Total Dispositions 89,008 $24,044 ($238) Year - to - Date Dispositions 20 $ in thousands. As of June 30, 2022. |
| © CTO Realty Growth, Inc. | ctoreit.com Portfolio Detail 21 Property Type Year Acquired/ Developed Square Feet In - Place Occupancy Leased Occupancy Cash ABR Cash ABR PSF Jacksonville, FL The Strand at St. Johns Town Center Multi - Tenant Retail 2019 204,573 95% 95% $4,652 $22.74 245 Riverside Multi - Tenant Office 2015 136,853 91% 92% 2,973 $21.73 Firebirds Wood Fired Grill Single Tenant Retail 2018 6,948 100% 100% 298 $42.89 Chuy's Single Tenant Retail 2018 7,950 100% 100% 355 $44.65 Total Jacksonville, FL 356,324 94% 94% $8,278 $23.23 Atlanta, GA Ashford Lane Multi - Tenant Retail 2020 282,839 71% 80% $5,976 $21.13 The Exchange at Gwinnett Multi - Tenant Retail 2021 69,265 89% 89% 1,956 $28.24 Total Atlanta, GA 352,104 74% 82% $7,932 $22.53 Dallas, TX The Shops at Legacy Multi - Tenant Mixed Use 2021 237,572 92% 96% $7,041 $29.64 Westcliff Shopping Center Multi - Tenant Retail 2017 136,185 60% 60% 499 $3.67 Total Dallas, TX 373,757 80% 83% $7,540 $20.18 Raleigh, NC Beaver Creek Crossings Multi - Tenant Retail 2021 321,977 96% 98% $5,312 $16.50 Phoenix, AZ Crossroads Town Center Multi - Tenant Retail 2020 244,843 100% 100% $4,949 $20.21 Albuquerque, NM Fidelity Single Tenant Office 2018 210,067 100% 100% $3,567 $16.98 Houston, TX Price Plaza Shopping Center Multi - Tenant Retail 2022 205,813 95% 95% $3,164 $15.37 Santa Fe, NM 125 Lincoln & 150 Washington Multi - Tenant Mixed Use 2021 137,659 74% 85% $2,738 $19.89 $ in thousands, except per square foot data. |
| © CTO Realty Growth, Inc. | ctoreit.com Portfolio Detail $ in thousands, except per square foot data. 22 Property Type Year Acquired/ Developed Square Feet In - Place Occupancy Leased Occupancy Cash ABR Cash ABR PSF Tampa, FL Sabal Pavilion Single Tenant Office 2020 120,500 100% 100% $2,265 $18.80 Salt Lake City, UT Jordan Landing Multi - Tenant Retail 2021 170,996 100% 100% $1,670 $9.77 Washington, DC General Dynamics Single Tenant Office 2019 64,319 100% 100% $1,580 $24.56 Las Vegas, NV Eastern Commons Multi - Tenant Retail 2021 133,304 100% 100% $1,539 $11.55 Miami, FL Westland Gateway Plaza Multi - Tenant Retail 2020 108,029 100% 100% $1,460 $13.52 Daytona Beach, FL Landshark Bar & Grill Single Tenant Retail 2018 6,264 100% 100% $628 $100.32 Crabby's Oceanside Single Tenant Retail 2018 5,780 100% 100% 273 $47.28 Total Daytona Beach, FL 12,044 100% 100% $901 $74.86 Orlando, FL Winter Park Office Multi - Tenant Mixed Use 2021 28,008 100% 100% $350 $12.50 Total Portfolio 2,839,744 91% 93% $53,246 $18.75 |
| © CTO Realty Growth, Inc. | ctoreit.com Leasing Summary $ and square feet in thousands, except per square foot data. 23 Renewals and Extensions Q1 2022 Q2 2022 Q3 2022 Q4 2022 2022 Leases 8 5 13 Square Feet 32.5 10.2 42.7 New Cash Rent PSF $31.57 $29.28 $31.02 Tenant Improvements $368 $0 $368 Leasing Commissions $36 $28 $64 Weighted Average Term 6.2 3.6 5.4 New Leases Q1 2022 Q2 2022 Q3 2022 Q4 2022 2022 Leases 10 7 17 Square Feet 24.4 30.9 55.3 New Cash Rent PSF $31.32 $32.66 $32.07 Tenant Improvements $691 $2,721 $3,412 Leasing Commissions $335 $298 $633 Weighted Average Term 8.9 12.2 10.1 All Leases Summary Q1 2022 Q2 2022 Q3 2022 Q4 2022 2022 Leases 18 12 30 Square Feet 56.9 41.1 98.0 New Cash Rent PSF $31.46 $31.82 $31.61 Tenant Improvements $1,059 $2,721 $3,780 Leasing Commissions $371 $326 $697 Weighted Average Term 6.6 10.3 8.1 |
| © CTO Realty Growth, Inc. | ctoreit.com Lease Expiration Schedule $ and square feet in thousands. 24 Year Leases Expiring Expiring SF % of Total Cash ABR % of Total 2022 19 70 2.5% 1,623 3.0% 2023 25 165 5.8% 3,733 7.0% 2024 20 66 2.3% 1,792 3.4% 2025 21 138 4.9% 3,821 7.2% 2026 43 417 14.7% 7,615 14.3% 2027 38 382 13.5% 5,998 11.3% 2028 21 479 16.9% 9,412 17.7% 2029 18 238 8.4% 4,515 8.5% 2030 10 95 3.3% 1,814 3.4% 2031 26 89 3.1% 2,641 5.0% Thereafter 24 455 16.0% 10,283 19.3% Total 265 2,594 91.3% 53,246 100.0% Vacant 246 8.7% Total 2,840 100.0% |
| © CTO Realty Growth, Inc. | ctoreit.com Top Tenant Summary 25 Tenant/Concept Credit Rating (1) Leases Leased Square Feet % of Total Cash ABR % of Total Fidelity A+ 1 210 7.4% 3,567 6.7% Ford Motor Credit BB+ 1 121 4.2% 2,265 4.3% WeWork CCC+ 1 59 2.1% 1,977 3.7% General Dynamics A - 1 64 2.3% 1,580 3.0% At Home B 2 192 6.8% 1,546 2.9% Seritage Growth Properties Not Rated 1 108 3.8% 1,460 2.7% Ross/dd’s DISCOUNT BBB+ 4 106 3.7% 1,334 2.5% Best Buy BBB+ 2 82 2.9% 1,224 2.3% Darden Restaurants BBB 3 27 1.0% 1,207 2.3% Harkins Theatres Not Rated 1 56 2.0% 956 1.8% Regal Cinemas Not Rated 1 45 1.6% 948 1.8% The Hall at Ashford Lane Not Rated 1 17 0.6% 851 1.6% Hobby Lobby Not Rated 1 55 1.9% 715 1.3% Burlington BB+ 1 47 1.6% 699 1.3% PNC Bank A 2 10 0.4% 684 1.3% Landshark Bar & Grill Not Rated 1 6 0.2% 628 1.2% Raymond James & Associates BBB+ 2 24 0.8% 600 1.1% TJ Maxx/HomeGoods/Marshalls A 1 50 1.8% 526 1.0% Bob’s Discount Furniture Not Rated 1 42 1.5% 509 1.0% Dick’s Sporting Goods BBB 1 45 1.6% 494 0.9% Other 236 1,228 43.2% 29,476 55.4% Total 265 2,594 91.3% 53,246 100.0% Vacant 246 8.7% Total 2,840 100.0% $ and square feet in thousands. (1) A credit rated, or investment grade rated tenant (rating of BBB - , NAIC - 2 or Baa3 or higher) is a tenant or the parent of a t enant with a credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Association of Insurance Commissioners (NAIC). |
| © CTO Realty Growth, Inc. | ctoreit.com Geographic Diversification 26 Markets Leases Square Feet % of Total Cash ABR % of Total Jacksonville, FL 4 356 12.5% 8,278 15.5% Atlanta, GA 2 352 12.4% 7,931 14.9% Dallas, TX 2 374 13.2% 7,541 14.2% Raleigh, NC 1 322 11.3% 5,312 10.0% Phoenix, AZ 1 245 8.6% 4,949 9.3% Albuquerque, NM 1 210 7.4% 3,567 6.7% Houston, TX 1 206 7.2% 3,164 5.9% Santa Fe, NM 1 138 4.8% 2,738 5.1% Tampa, FL 1 121 4.2% 2,265 4.3% Salt Lake City, UT 1 171 6.0% 1,670 3.1% Washington, DC 1 64 2.3% 1,580 3.0% Las Vegas, NV 1 133 4.7% 1,539 2.9% Miami, FL 1 108 3.8% 1,460 2.7% Daytona Beach, FL 2 12 0.4% 902 1.7% Orlando, FL 1 28 1.0% 350 0.7% Total 21 2,840 100.0% 53,246 100.0% States Properties Square Feet % of Total Cash ABR % of Total Florida 9 625 22.0% 13,255 24.9% Texas 3 580 20.4% 10,705 20.1% Georgia 2 353 12.4% 7,931 14.9% New Mexico 2 347 12.2% 6,305 11.8% North Carolina 1 322 11.3% 5,312 10.0% Arizona 1 245 8.6% 4,949 9.3% Utah 1 171 6.0% 1,670 3.1% Virginia 1 64 2.3% 1,580 3.0% Nevada 1 133 4.7% 1,539 2.9% Total 21 2,840 100.0% 53,246 100.0% $ and square feet in thousands. |
| © CTO Realty Growth, Inc. | ctoreit.com Other Assets $ and shares outstanding in thousands, except per share data. As of June 30, 2022. 27 Investment Securities Shares & Operating Partnership Units Owned Value Per Share June 30, 2022 Estimated Value Annualized Dividend Per Share In - Place Annualized Dividend Income Alpine Income Property Trust 2,148 $17.92 $38,490 $1.08 $2,320 Structured Investments Type Origination Date Maturity Date Original Loan Amount Amount Outstanding Interest Rate 4311 Maple Avenue, Dallas, TX Mortgage Note October 2020 April 2023 $400 $400 7.50% 110 N. Beach St., Daytona Beach, FL Mortgage Note June 2021 December 2022 364 364 10.00% Phase II of The Exchange at Gwinnett Construction Loan January 2022 January 2024 8,700 — 7.25% Watters Creek at Montgomery Farm Preferred Investment April 2022 April 2025 30,000 30,000 8.50% WaterStar Orlando Construction Loan April 2022 August 2022 19,000 16,068 8.00% Improvement Loan at Ashford Lane Improvement Loan May 2022 April 2025 1,500 1,053 12.00% Total Structured Investments $59,964 $47,885 Subsurface Interests Acreage Estimated Value Acres Available for Sale 356,000 acres $5,000 Mitigation Credits and Rights State Credits Federal Credits Total Book Value Mitigation Credits 41.0 18.8 $ 3,400 Mitigation Credit Rights 257.6 156.4 21,000 Total Mitigation Credits 298.6 175.2 $ 24,400 |
| © CTO Realty Growth, Inc. | ctoreit.com 2022 Guidance $ and shares outstanding in millions, except per share data. As of July 28, 2022. 28 Low High Acquisition & Structured Investments $250 - $275 Target Initial Investment Cash Yield 7.00% - 7.25% Dispositions $50 - $80 Target Disposition Cash Yield 6.25% - 6.75% Core FFO Per Diluted Share $1.58 - $1.64 AFFO Per Diluted Share $1.70 - $1.76 Weighted Average Diluted Shares Outstanding 18.3 - 18.5 The Company has increased its outlook for 2022 to take into account the Company’s year - to - date performance and revised expectations regarding the Company’s investment activities, forecasted capital markets transactions, and other significant assumptions .. The revised per share estimates take into account the Company’s recently completed three - for - one stock split .. |
| © CTO Realty Growth, Inc. | ctoreit.com Contact Information & Research Coverage Contact Information Corporate Office Locations Investor Relations Transfer Agent New York Stock Exchange 369 N. New York Ave., 3 rd Floor Winter Park, FL 32789 1140 N. Williamson Blvd., Suite 140 Daytona Beach, FL 32114 Matt Partridge SVP, CFO & Treasurer (407) 904 - 3324 mpartridge@ctoreit.com Computershare Trust Company, N.A. (800) 368 - 5948 www.computershare.com Ticker Symbol: CTO www.ctoreit.com Research Analyst Coverage Institution Coverage Analyst Email Phone B. Riley Craig Kucera craigkucera@brileyfin.com (703) 312 - 1635 BTIG Michael Gorman mgorman@btig.com (212) 738 - 6138 Compass Point Merrill Ross mross@compasspointllc.com (202) 534 - 1392 EF Hutton Guarav Mehta gmehta@efhuttongroup.com (212) 970 - 5261 Janney Rob Stevenson robstevenson@janney.com (646) 840 - 3217 Jones Research Jason Stewart jstewart@jonestrading.com (646) 465 - 9932 Raymond James RJ Milligan rjmilligan@raymondjames.com (727) 567 - 2585 29 |
| © CTO Realty Growth, Inc. | ctoreit.com Safe Harbor 30 Certain statements contained in this presentation (other than statements of historical fact) are forward - looking statements within the meaning of Section 27 A of the Securities Act of 1933 , as amended and Section 21 E of the Securities Exchange Act of 1934 , as amended .. Forward - looking statements can typically be identified by words such as “believe,” “estimate,” “expect,” “intend,” “anticipate,” “will,” “could,” “may,” “should,” “plan,” “potential,” “predict,” “forecast,” “project,” and similar expressions, as well as variations or negatives of these words .. Although forward - looking statements are made based upon management’s present expectations and reasonable beliefs concerning future developments and their potential effect upon the Company, a number of factors could cause the Company’s actual results to differ materially from those set forth in the forward - looking statements .. Such factors may include, but are not limited to : the Company’s ability to remain qualified as a REIT ; the Company’s exposure to U .. S .. federal and state income tax law changes, including changes to the REIT requirements ; general adverse economic and real estate conditions ; macroeconomic and geopolitical factors, including but not limited to inflationary pressures, interest rate volatility, global supply chain disruptions, and ongoing geopolitical war ; the ultimate geographic spread, severity and duration of pandemics such as the COVID - 19 Pandemic and its variants, actions that may be taken by governmental authorities to contain or address the impact of such pandemics, and the potential negative impacts of such pandemics on the global economy and the Company’s financial condition and results of operations ; the inability of major tenants to continue paying their rent or obligations due to bankruptcy, insolvency or a general downturn in their business ; the loss or failure, or decline in the business or assets of PINE ; the completion of 1031 exchange transactions ; the availability of investment properties that meet the Company’s investment goals and criteria ; the uncertainties associated with obtaining required governmental permits and satisfying other closing conditions for planned acquisitions and sales ; and the uncertainties and risk factors discussed in the Company’s Annual Report on Form 10 - K for the fiscal year ended December 31 , 2021 and other risks and uncertainties discussed from time to time in the Company’s filings with the U .. S .. Securities and Exchange Commission .. There can be no assurance that future developments will be in accordance with management’s expectations or that the effect of future developments on the Company will be those anticipated by management .. Readers are cautioned not to place undue reliance on these forward - looking statements, which speak only as of the date of this presentation .. The Company undertakes no obligation to update the information contained in this press release to reflect subsequently occurring events or circumstances .. |
| © CTO Realty Growth, Inc. | ctoreit.com Non - GAAP Financial Measures 31 Our reported results are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”) .. We also disclose Funds From Operations (“FFO”), Core Funds From Operations (“Core FFO”), Adjusted Funds From Operations (“AFFO”), Pro Forma Earnings Before Interest, Taxes, Depreciation and Amortization (“Pro Forma EBITDA”), and Same - Property Net Operating Income (“Same - Property NOI”), each of which are non - GAAP financial measures .. We believe these non - GAAP financial measures are useful to investors because they are widely accepted industry measures used by analysts and investors to compare the operating performance of REITs .. FFO, Core FFO, AFFO, Pro Forma EBITDA, and Same - Property NOI do not represent cash generated from operating activities and are not necessarily indicative of cash available to fund cash requirements ; accordingly, they should not be considered alternatives to net income as a performance measure or cash flows from operating activities as reported on our statement of cash flows as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures .. We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT .. NAREIT defines FFO as GAAP net income or loss adjusted to exclude extraordinary items (as defined by GAAP), net gain or loss from sales of depreciable real estate assets, impairment write - downs associated with depreciable real estate assets and real estate related depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries .. The Company also excludes the gains or losses from sales of assets incidental to the primary business of the REIT which specifically include the sales of mitigation credits, impact fee credits, subsurface sales, and land sales, in addition to the mark - to - market of the Company’s investment securities and interest related to the 2025 Convertible Senior Notes, if the effect is dilutive .. To derive Core FFO, we modify the NAREIT computation of FFO to include other adjustments to GAAP net income related to gains and losses recognized on the extinguishment of debt, amortization of above - and below - market lease related intangibles, and other unforecastable market - or transaction - driven non - cash items .. To derive AFFO, we further modify the NAREIT computation of FFO and Core FFO to include other adjustments to GAAP net income related to non - cash revenues and expenses such as straight - line rental revenue, non - cash compensation, and other non - cash amortization, as well as adding back the interest related to the 2025 Convertible Senior Notes, if the effect is dilutive .. Such items may cause short - term fluctuations in net income but have no impact on operating cash flows or long - term operating performance .. We use AFFO as one measure of our performance when we formulate corporate goals .. To derive Pro Forma EBITDA, GAAP net income or loss is adjusted to exclude extraordinary items (as defined by GAAP), net gain or loss from sales of depreciable real estate assets, impairment write - downs associated with depreciable real estate assets and real estate related depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries, non - cash revenues and expenses such as straight - line rental revenue, amortization of deferred financing costs, above - and below - market lease related intangibles, non - cash compensation, and other non - cash income or expense .. Cash interest expense is also excluded from Pro Forma EBITDA, and GAAP net income or loss is adjusted for the annualized impact of acquisitions, dispositions and other similar activities .. |
| © CTO Realty Growth, Inc. | ctoreit.com Non - GAAP Financial Measures 32 To derive Same - Property NOI, GAAP net income or loss attributable to the Company is adjusted to exclude extraordinary items (as defined by GAAP), gain or loss on disposition of assets, gain or loss on extinguishment of debt, impairment charges, and depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries, if any, non - cash revenues and expenses such as above - and below - market lease related intangibles, straight - line rental revenue, and other non - cash income or expense .. Interest expense, general and administrative expenses, investment and other income or loss, income tax benefit or expense, real estate operations revenues and direct cost of revenues, management fee income, and interest income from commercial loan and master lease investments are also excluded from Same - Property NOI .. GAAP net income or loss is further adjusted to remove the impact of properties that were not owned for the full current and prior year reporting periods presented .. Cash rental income received under the leases pertaining to the Company’s assets that are presented as commercial loan and master lease investments in accordance with GAAP is also used in lieu of the interest income equivalent .. FFO is used by management, investors and analysts to facilitate meaningful comparisons of operating performance between periods and among our peers primarily because it excludes the effect of real estate depreciation and amortization and net gains or losses on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions .. We believe that Core FFO and AFFO are additional useful supplemental measures for investors to consider because they will help them to better assess our operating performance without the distortions created by other non - cash revenues or expenses .. We also believe that Pro Forma EBITDA is an additional useful supplemental measure for investors to consider as it allows for a better assessment of our operating performance without the distortions created by other non - cash revenues, expenses or certain effects of the Company’s capital structure on our operating performance .. We use Same - Property NOI to compare the operating performance of our assets between periods .. It is an accepted and important measurement used by management, investors and analysts because it includes all property - level revenues from of the Company’s rental properties, less operating and maintenance expenses, real estate taxes and other property - specific expenses (“Net Operating Income” or “NOI”) of properties that have been owned and stabilized for the entire current and prior year reporting periods .. Same - Property NOI attempts to eliminate differences due to the acquisition or disposition of properties during the particular period presented, and therefore provides a more comparable and consistent performance measure for the comparison of the Company's properties .. FFO, Core FFO, AFFO, Pro Forma EBITDA, and Same - Property NOI may not be comparable to similarly titled measures employed by other companies .. |
| © CTO Realty Growth, Inc. | ctoreit.com Definitions & Terms 33 References and terms used in this presentation that are in addition to terms defined in the Non - GAAP Financial Measures include : ▪ This presentation has been published on July 28 , 2022 .. ▪ All information is as of June 30 , 2022 , unless otherwise noted .. ▪ Any calculation differences are assumed to be a result of rounding .. ▪ “ 2022 Guidance” is based on the 2022 Outlook provided in the Company’s Second Quarter 2022 Operating Results press release filed on July 28 , 2022 .. ▪ “Alpine” or “PINE” refers to Alpine Income Property Trust, a publicly traded net lease REIT traded on the New York Stock Exchange under the ticker symbol PINE .. ▪ “Annualized Straight - line Base Rent”, “ABR” or “Rent” and the statistics based on ABR are calculated based on our current portfolio and represent straight - line rent calculated in accordance with GAAP .. ▪ “ 2022 Net Operating Income” or “ 2022 NOI” is budgeted 2022 property - level net operating income based on the Company’s portfolio as of June 30 , 2022 , plus the annualized current quarterly dividend and management fees from PINE based on the Company’s PINE ownership as of June 30 , 2022 .. ▪ “Credit Rated” is a tenant or the parent of a tenant with a credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Association of Insurance Commissioners (NAIC) (together, the “Major Rating Agencies”) .. An “Investment Grade Rated Tenant” or “IG” references a Credit Rated tenant or the parent of a tenant, or credit rating thereof with a rating of BBB - , Baa 3 or NAIC - 2 or higher from one or more of the Major Rating Agencies .. ▪ “Contractual Base Rent” or “CBR” represents the amount owed to the Company under the terms of its lease agreements at the time referenced .. ▪ “Dividend” or “Dividends”, subject to the required dividends to maintain our qualification as a REIT, are set by the Board of Directors and declared on a quarterly basis and there can be no assurances as to the likelihood or number of dividends in the future .. ▪ “Investment in Alpine Income Property Trust” or “Alpine Investment” or “PINE Ownership” is calculated based on the 2 , 147 , 510 common shares and partnership units CTO owns in PINE and is based on PINE’s closing stock price .. ▪ “Leased Occupancy” refers to space that is currently leased but for which rent payments have not yet commenced .. ▪ “MSA” or “Metropolitan Statistical Area” is a region that consists of a city and surrounding communities that are linked by social and economic factors, as established by the U .. S .. Office of Management and Budget .. The names of the MSA have been shortened for ease of reference .. ▪ “Net Debt” is calculated as our total long - term debt as presented on the face of our balance sheet ; plus financing costs, net of accumulated amortization and unamortized convertible debt discount ; less cash, restricted cash and cash equivalents .. ▪ “Net Operating Income” or “NOI” is revenues from all income properties less operating expense, maintenance expense, real estate taxes and rent expense .. ▪ “Total Enterprise Value” is calculated as the Company’s Total Common Shares Outstanding multiplied by the common stock price ; plus the par value of the Series A perpetual preferred equity outstanding and Net Debt .. |
