NEW CANAAN, Conn. — NewLake Capital Partners Inc, a leading
provider of real estate capital to state-licensed cannabis operators, today announced its financial results for the
second quarter ended June 30, 2024.
Anthony Coniglio, President and Chief Executive Officer, said,
“We are pleased with our second quarter results, which led to our third consecutive quarterly dividend increase. We believe there are many positive
catalysts on the horizon for the cannabis sector and it is an exciting time to be part of this growing industry. With an under-levered balance sheet and ample capital availability, we are well positioned to build upon our Q2 acquisition activity and continue
to invest in cannabis real estate.”
Second
Quarter 2024 Financial and Operational Highlights
◦
Revenue totaled
$12.5 million.
◦
Net income attributable to common stockholders totaled
$6.8 million.
◦
Funds From Operations (“FFO”)(1) totaled
$10.5 million.
◦
Adjusted Funds From Operations (“AFFO”)(1) totaled
$11.0 million.
◦
Cash and cash equivalents as of
June 30, 2024, were $20.7 million, with
$15.8 million committed to fund building and tenant improvements.
◦
Second quarter dividend increased to
$0.43 per common share, equivalent to an annualized dividend of
$1.72 per common share.
◦
In May 2024, the Company purchased a cultivation facility in Connecticut for approximately
$4.0 million and committed to fund approximately
$12.0 million of improvements.
◦
For the
three months ended June 30, 2024, the Company funded approximately
$3.5 million of building and tenant improvements.
◦
In June 2024, the Company entered into an
Equity Distribution Agreement (“EDA”) for a $50 million At The Market Program (“ATM Program”).
Comparison to the second quarter ended June 30, 2023
◦
Revenue totaled
$12.5 million, as compared to
$11.4 million, an increase of
9.5% year-over-year.
◦
Net income attributable to common stockholders totaled
$6.8 million, as compared to
$5.8 million.
◦
FFO totaled
$10.5 million, as compared to
$9.5 million, an increase of 11.3% year-over-year.
◦
AFFO totaled
$11.0 million, as compared to
$9.9 million, an increase of 11.2% year-over-year.
Six Months Ended June 30, 2024
Financial and Operational Highlights
Comparison to the six months ended June 30, 2023(3)
◦
Revenue totaled
$25.1 million, as compared to
$22.8 million, an increase of
10.0% year-over-year.
◦
Net income attributable to common stockholders totaled
$13.7 million, as compared to
$11.7 million.
◦
FFO totaled
$21.1 million, as compared to
$19.0 million, an increase of 11.0% year-over-year.
◦
AFFO totaled
$22.0 million, as compared to
$19.8 million, an increase of 10.9% year-over-year.
◦
For the
six months ended June 30, 2024, the Company funded approximately
$11.4 million of building and tenant improvements.
Investment Activity
Acquisitions
In May
2024, the Company purchased a cultivation facility in Connecticut for approximately
$4.0 million and committed to fund approximately
$12.0 million in building and tenant improvements. The property was simultaneously leased to a related entity of an existing tenant.
Financing Activity
Revolving
Credit Facility
As of
June 30, 2024, the Company had approximately
$7.6 million in borrowings under the Revolving Credit Facility and
$82.4 million in funds available to be drawn, subject to sufficient collateral in the borrowing base. The facility bears interest at a fixed rate of
5.65% for the first three years and thereafter a variable rate based upon the greater of (a) the Prime Rate quoted in the Wall Street Journal (Western Edition) (“Base Rate”) plus an applicable
margin of 1.0% or (b)
4.75%.
The facility is subject to certain liquidity and operating covenants and includes customary representations and warranties, affirmative and negative covenants, and events
of default. As of June 30, 2024, the Company was in compliance with the covenants under the agreement.
At the Market Equity Program
On
June 10, 2024, the Company entered into an EDA, pursuant to an ATM Program.
Under the ATM Program, the Company may offer and sell shares of its common stock having an aggregate offering price of up to
$50.0 million from time-to-time through a sales agent. As of
June 30, 2024, the Company has not issued any shares under the ATM Program.
Dividend
On
June 12, 2024, the Company’s Board of Directors declared a
second quarter 2024 cash dividend of
$0.43 per share of common stock, equivalent to an annualized dividend of
$1.72 per share of common stock. The dividend was paid on
July 15, 2024, to stockholders of record at the close of business on
June 28, 2024, and represents an AFFO payout ratio of 81.8%.
Recent Developments
Funded Commitments
Subsequent to
June 30, 2024, the Company funded approximately
$1.2 million of tenant improvements for its cultivation facilities in Arizona and Pennsylvania.
About NewLake Capital Partners Inc.
NewLake Capital Partners, Inc. is an internally-managed real estate investment trust that provides real
estate capital to state-licensed cannabis operators through sale-leaseback transactions and third-party purchases and funding for build-to-suit projects. NewLake owns a portfolio of
32 properties comprised of
15 cultivation facilities and 17 dispensaries that are leased to single tenants on a triple-net basis.
