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Physicians Realty Trust Reports First Quarter 2021 Financial Results

Announces $0.08 Net Income per Share and $0.27 Normalized FFO per Share for the First Quarter of 2021 

First Quarter and Recent Highlights:

• Reported first quarter 2021 total revenue of $113.3 million, an increase of 5.5% over the prior year period.
• Generated first quarter net income per share of $0.08 on a fully diluted basis compared to net income per share of $0.07 on a fully diluted basis in the same period last year.
• Generated first quarter Normalized Funds From Operations (Normalized FFO) of $0.27 per share on a fully diluted basis compared to $0.26 per share for the same period last year.
• New investments and development commitments of $16.3 million during the first quarter.
• First quarter MOB Same-Store Cash Net Operating Income growth was 2.4% year-over-year.
• Declared a quarterly dividend of $0.23 per share and OP Unit for the first quarter 2021, paid April 16, 2021.
• Sold 2,887,296 common shares pursuant to the ATM program at a weighted average price of $18.32 during the first quarter 2021, resulting in net proceeds of approximately $52.4 million.

MILWAUKEE–(BUSINESS WIRE)–
Physicians Realty Trust (NYSE: DOC) (the “Company,” the “Trust,” “we,” “our” and “us”), a self-managed health care real estate investment trust, today announced results for the first quarter ended March 31, 2021.

John T. Thomas, President and Chief Executive Officer of the Trust, commented, “We are off to a very good start in 2021, with excellent operating results and substantially all of our providers back to pre-pandemic volumes and performance, with many of them providing vaccine locations in our facilities. As we progress through 2021, we continue to see many off-market opportunities to Invest in Better® through acquisitions and financing new development for growth. In addition to the recently closed $35 million Adventist Wesley Chapel facility in Tampa, we have over $160 million of LOIs in various stages of negotiations.

“We are very proud to announce we have earned the 2021 ENERGY STAR® Partner of the Year Award. This award is a testament to our dedication to ESG, and we plan to continue implementing best practices across our portfolio. We will be publishing our second annual ESG report in June 2021 and are excited to share our ESG performance within that report. We look forward to discussing first quarter performance during today’s conference call,” Mr. Thomas concluded.

First Quarter Financial Results

Total revenue for the first quarter ended March 31, 2021 was $113.3 million, an increase of 5.5% from the first quarter 2020. As of March 31, 2021, the portfolio was 96% leased.

Total expenses for the first quarter 2021 were $95.1 million, compared to total expenses of $92.3 million for the first quarter 2020.

Net income for the first quarter 2021 was $17.8 million, compared to net income of $15.0 million for the first quarter 2020.

Net income attributable to common shareholders for the first quarter 2021 was $17.2 million. Diluted earnings per share for the first quarter 2021 was $0.08 based on approximately 217.3 million weighted average common shares and operating partnership units (OP Units) outstanding.

Funds From Operations (FFO) for the first quarter 2021 consisted of net income plus depreciation and amortization on our consolidated portfolio of $37.9 million and our unconsolidated joint ventures of $2.2 million and an insignificant loss on the sale of an investment property. This was partially offset by $0.2 million of other adjustments, resulting in $0.27 per share on a fully diluted basis. Normalized FFO had no additional adjustments and was also $57.7 million, or $0.27 per share on a fully diluted basis.

Normalized Funds Available for Distribution (FAD) for the first quarter 2021, which consists of normalized FFO adjusted for non-cash share compensation, straight-line rent adjustments, amortization of acquired above-market and below-market leases and assumed debt, amortization of lease inducements, amortization of deferred financing costs, recurring capital expenditures, loan reserve adjustments, and our share of adjustments from unconsolidated investments was $54.5 million.

Our Medical Office Building (MOB) Same-Store portfolio, which includes 247 properties representing approximately 93% of our consolidated leasable square footage, generated year-over-year MOB Same-Store Cash Net Operating Income (Cash NOI) growth of 2.4% for the first quarter 2021.

Other Recent Events

First Quarter Investment Activity

Since our February 25, 2021 press release and through March 31, 2021, the Company closed on a construction loan agreement related to the development of the TOPA Hillwood MOB in Fort Worth, Texas. This 20,220 square foot off-campus cancer center is 100% pre-leased to Physician Reliance, a subsidiary of U.S. Oncology/McKesson (Moody’s: Baa2), for a 10-year term commencing upon the expected completion of construction in 2022. The loan has a total capacity of $10.5 million, with $2.6 million funded through March 31, 2021, and yields interest at a rate of 6.0%. Upon receipt of the certificate of occupancy, the Company will have an option to purchase the asset at a 6.2% capitalization rate. The Company also paid $0.3 million of additional purchase consideration under an earn-out agreement.

First Quarter Disposition Activity

During the first quarter 2021, the Company completed the disposition of one property from our original legacy portfolio located in Michigan for approximately $0.5 million, recognizing an insignificant loss on the sale.

First Quarter Capital Activity

During the first quarter 2021, the Company issued 2,887,296 shares pursuant to its ATM program at a weighted average price of $18.32 for net proceeds of $52.4 million.

On January 4, 2021, 116,110 Series A Preferred Units of the Operating Partnership issued in connection with the January 9, 2018 acquisition of the HealthEast Clinic & Specialty Center were redeemed for a total value of $25.3 million. Following this redemption, there are no longer any Series A Preferred Units outstanding.

Other Recent Activity

Since March 31, 2021, the Company has closed on the acquisition of a newly completed medical office facility and a medical condominium unit for an aggregate purchase price of approximately $36.2 million.

AdventHealth Wesley Chapel MOB II – On April 21, 2021, the Company closed on the acquisition of a newly completed 96,768 square foot medical office facility located in Wesley Chapel, Florida for a purchase price of approximately $35.3 million. The property is currently 92% leased with a weighted average lease term of 12 years. The building is anchored by the obligated investment grade tenancy of AdventHealth (S&P: ‘AA’) and Moffitt Cancer Center (S&P: ‘A-’), leasing 79% of the property in total. The first year unlevered yield on this investment is expected to be approximately 5.4%.

Atlanta Medical Condominium Investment – On April 7, 2021, the Company closed on the acquisition of a medical condominium unit located in an Atlanta “Pill Hill” MOB at a price of approximately $0.9 million. With this acquisition, the units purchased by the Company represent 26% of the building square footage and are 94% occupied. The property is 105,000 square feet and consists of additional condos that the Company intends to evaluate for investment in the future.

Dividend Paid

On March 19, 2021, our Board of Trustees authorized and declared a cash distribution of $0.23 per common share and OP Unit for the quarterly period ended March 31, 2021. The dividend was paid on April 16, 2021 to common shareholders and OP Unit holders of record as of the close of business on April 2, 2021.

2021 ENERGY STAR® Partner Of The Year Award

The Company is proud to announce it has earned the 2021 ENERGY STAR® Partner of the Year Award from the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Energy. “This recognition is a testament to the long-time commitment we have made to elevating Environmental, Social, and Governance (ESG) principles across all facets of our business,” said John Thomas, President and Chief Executive Officer of the Trust. Earning an ENERGY STAR Partner of the Year Award distinguishes corporate energy management programs and is the highest level of EPA recognition. Partners must perform at a superior level of energy management, demonstrate best practices across the organization, prove organization-wide energy savings, and communicate the benefits of ENERGY STAR. As an ENERGY STAR partner since 2014, the Company has made an ongoing and long-term commitment to incorporate better environmental impact principles into our business thoughtfully and responsibly.

Conference Call Information

The Company has scheduled a conference call on Wednesday, May 5, 2021, at 2:00 p.m. ET to discuss its financial performance and operating results for the first quarter ended March 31, 2021. The conference call can be accessed by dialing (877) 407-0784 from within the U.S. or (201) 689-8560 for international callers. Participants can reference the Physicians Realty Trust First Quarter Earnings Call or passcode: 13717583. The conference call also will be available via a live listen-only webcast and can be accessed through the Investor Relations section of the Company’s website, www.docreit.com. A replay of the conference call will be available beginning May 5, 2021, at 5:00 p.m. ET until June 5, 2021, at 11:59 p.m. ET, by dialing (844) 512-2921 (U.S.) or (412) 317-6671 (International); passcode: 13717583. A replay of the webcast also will be accessible on the Investor Relations website for one year following the event. Beginning May 5, 2021, the Company’s supplemental information package for the first quarter 2021 will be accessible through the Investor Relations section of the Company’s website under the “Supplemental” tab.

About Physicians Realty Trust

Physicians Realty Trust is a self-managed health care real estate company organized to acquire, selectively develop, own and manage health care properties that are leased to physicians, hospitals and health care delivery systems. The Company invests in real estate that is integral to providing high quality health care. The Company conducts its business through an UPREIT structure in which its properties are owned by Physicians Realty L.P., a Delaware limited partnership (the “operating partnership”), directly or through limited partnerships, limited liability companies or other subsidiaries. The Company is the sole general partner of the operating partnership and, as of March 31, 2021, owned approximately 97.4% of OP Units.

Investors are encouraged to visit the Investor Relations portion of the Company’s website (www.docreit.com) for additional information, including annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, press releases, supplemental information packages and investor presentations.

Forward-Looking Statements

This press release contains statements that 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, pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “anticipate”, “believe”, “expect”, “estimate”, “plan”, “outlook”, “continue”, “intend”, and “project” and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward looking statements may include statements regarding the Company’s strategic and operational plans, the Company’s ability to generate internal and external growth, the future outlook, anticipated cash returns, cap rates or yields on properties, anticipated closing of property acquisitions, ability to execute its business plan, and the impact of the Coronavirus (COVID-19) pandemic on the Company’s business. While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. Forward looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward looking statements are based on information available at the time those statements are made and/or management’s good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward looking statements. These forward-looking statements are subject to various risks and uncertainties, not all of which are known to the Company and many of which are beyond the Company’s control, which could cause actual results to differ materially from such statements. These risks and uncertainties are described in greater detail in the Company’s filings with the Securities and Exchange Commission (the “Commission”), including, without limitation, the Company’s annual and periodic reports and other documents filed with the Commission. Unless legally required, the Company disclaims any obligation to update any forward-looking statements after the date of this release, whether as a result of new information, future events or otherwise. For a discussion of factors that could impact the Company’s results, performance, or transactions, see Part I, Item 1A (Risk Factors) of the Company’s Annual Report on Form 10-K/A for the fiscal year ended December 31, 2020.

Physicians Realty Trust
Condensed Consolidated Statements of Income
(in thousands, except share and per share data)
		Three Months Ended March 31,
		2021				2020
Revenues:
Rental revenues		$	80,395			$	77,870
Expense recoveries		27,560				24,876
Interest income on real estate loans and other		5,384				4,682
Total revenues		113,339				107,428
Expenses:
Interest expense		13,715				15,626
General and administrative		9,465				8,977
Operating expenses		33,934				30,963
Depreciation and amortization		37,976				36,747
Total expenses		95,090				92,313
Income before equity in loss of unconsolidated entities and loss on sale of investment property:		18,249				15,115
Equity in loss of unconsolidated entities		(420)				(155)
Loss on sale of investment property		(24)				—
Net income		17,805				14,960
Net income attributable to noncontrolling interests:
Operating Partnership		(459)				(404)
Partially owned properties (1)		(152)				(142)
Net income attributable to controlling interest		17,194				14,414
Preferred distributions		(13)				(317)
Net income attributable to common shareholders		$	17,181			$	14,097
Net income per share:
Basic		$	0.08			$	0.07
Diluted		$	0.08			$	0.07
Weighted average common shares:
Basic		210,529,698				196,211,728
Diluted		217,322,425				202,842,340
Dividends and distributions declared per common share		$	0.23			$	0.23

(1)

Includes amounts attributable to redeemable noncontrolling interests.

Physicians Realty Trust
Condensed Consolidated Balance Sheets
(in thousands, except share and per share data)
		March 31,				December 31,
		2021				2020
ASSETS
Investment properties:
Land and improvements		$	231,645			$	231,621
Building and improvements		3,825,776				3,824,796
Tenant improvements		76,008				73,145
Acquired lease intangibles		405,601				406,935
		4,539,030				4,536,497
Accumulated depreciation		(721,456)				(687,554)
Net real estate property		3,817,574				3,848,943
Right-of-use lease assets, net		136,589				137,180
Real estate loans receivable, net		206,938				198,800
Investments in unconsolidated entities		75,537				77,755
Net real estate investments		4,236,638				4,262,678
Cash and cash equivalents		3,949				2,515
Tenant receivables, net		5,696				4,757
Other assets		124,612				144,000
Total assets		$	4,370,895			$	4,413,950
LIABILITIES AND EQUITY
Liabilities:
Credit facility		$	402,827			$	412,322
Notes payable		968,868				968,653
Mortgage debt		50,950				57,875
Accounts payable		2,658				7,007
Dividends and distributions payable		52,320				52,116
Accrued expenses and other liabilities		71,043				91,929
Lease liabilities		73,946				74,116
Acquired lease intangibles, net		6,319				6,641
Total liabilities		1,628,931				1,670,659
Redeemable noncontrolling interests – Series A Preferred Units (2020) and partially owned properties		6,733				28,289
Equity:
Common shares, $0.01 par value, 500,000,000 common shares authorized, 212,822,677 and 209,550,592 common shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively		2,128				2,096
Additional paid-in capital		3,356,415				3,303,231
Accumulated deficit		(689,769)				(658,171)
Accumulated other comprehensive loss		(5,062)				(5,859)
Total shareholders’ equity		2,663,712				2,641,297
Noncontrolling interests:
Operating Partnership		71,113				73,302
Partially owned properties		406				403
Total noncontrolling interests		71,519				73,705
Total equity		2,735,231				2,715,002
Total liabilities and equity		$	4,370,895			$	4,413,950

Physicians Realty Trust
Reconciliation of Non-GAAP Measures
(in thousands, except share and per share data)
		Three Months Ended March 31,
		2021				2020
Net income		$	17,805			$	14,960
Earnings per share – diluted		$	0.08			$	0.07
Net income		$	17,805			$	14,960
Net income attributable to noncontrolling interests – partially owned properties		(152)				(142)
Preferred distributions		(13)				(317)
Depreciation and amortization expense		37,877				36,655
Depreciation and amortization expense – partially owned properties		(70)				(75)
Loss on sale of investment property		24				—
Proportionate share of unconsolidated joint venture adjustments		2,197				1,700
FFO applicable to common shares		$	57,668			$	52,781
Net change in fair value of derivative		—				(91)
Normalized FFO applicable to common shares		$	57,668			$	52,690
FFO per common share		$	0.27			$	0.26
Normalized FFO per common share		$	0.27			$	0.26
Normalized FFO applicable to common shares		$	57,668			$	52,690
Non-cash share compensation expense		3,707				2,996
Straight-line rent adjustments		(2,725)				(3,731)
Amortization of acquired above/below-market leases/assumed debt		864				889
Amortization of lease inducements		264				290
Amortization of deferred financing costs		581				599
TI/LC and recurring capital expenditures		(5,638)				(3,060)
Loan reserve adjustments		(47)				—
Proportionate share of unconsolidated joint venture adjustments		(211)				(187)
Normalized FAD applicable to common shares		$	54,463			$	50,486
Weighted average number of common shares outstanding		217,322,425				202,842,340

		Three Months Ended March 31,
		2021				2020
Net income		$	17,805			$	14,960
General and administrative		9,465				8,977
Depreciation and amortization expense		37,976				36,747
Interest expense		13,715				15,626
Net change in the fair value of derivative		—				(91)
Loss on sale of investment property		24				—
Proportionate share of unconsolidated joint venture adjustments		3,511				2,454
NOI		$	82,496			$	78,673
NOI		$	82,496			$	78,673
Straight-line rent adjustments		(2,725)				(3,731)
Amortization of acquired above/below-market leases		880				905
Amortization of lease inducements		264				290
Loan reserve adjustments		(47)				—
Proportionate share of unconsolidated joint venture adjustments		(171)				(165)
Cash NOI		$	80,697			$	75,972
Cash NOI		$	80,697			$	75,972
Assets not held for all periods		(2,049)				(566)
LTACH & Hospital Cash NOI		(4,336)				(3,822)
Lease termination fees		—				(180)
Interest income on real estate loans		(4,107)				(3,487)
Joint ventures and other income		(3,270)				(2,573)
MOB Same-Store Cash NOI		$	66,935			$	65,344

		Three Months Ended March 31,
		2021				2020
Net income		$	17,805			$	14,960
Depreciation and amortization expense		37,976				36,747
Interest expense		13,715				15,626
Loss on sale of investment property		24				—
Proportionate share of unconsolidated joint venture adjustments		3,482				2,426
EBITDAre		$	73,002			$	69,759
Non-cash share compensation expense		3,707				2,996
Non-cash changes in fair value		—				(91)
Pursuit costs		20				—
Non-cash intangible amortization		1,128				1,453
Pro forma adjustments for investment activity		6				(35)
Adjusted EBITDAre		$	77,863			$	74,082

This press release includes Funds From Operations (FFO), Normalized FFO, Normalized Funds Available For Distribution (FAD), Net Operating Income (NOI), Cash NOI, MOB Same-Store Cash NOI, Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (EBITDAre) and Adjusted EBITDAre, which are non-GAAP financial measures. For purposes of the SEC’s Regulation G, a non-GAAP financial measure is a numerical measure of a company’s historical or future financial performance, financial position or cash flows that excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable financial measure calculated and presented in accordance with GAAP in the statement of operations, balance sheet or statement of cash flows (or equivalent statements) of the company, or includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable financial measure so calculated and presented. As used in this press release, GAAP refers to generally accepted accounting principles in the United States of America. Pursuant to the requirements of Regulation G, we have provided reconciliations of the non-GAAP financial measures to the most directly comparable GAAP financial measures.

We believe that information regarding FFO is helpful to shareholders and potential investors because it facilitates an understanding of the operating performance of our properties without giving effect to real estate depreciation and amortization, which assumes that the value of real estate assets diminishes ratably over time. We calculate FFO in accordance with standards established by the National Association of Real Estate Investment Trusts (Nareit). Nareit defines FFO as net income or loss (computed in accordance with GAAP) before noncontrolling interests of holders of OP units, excluding preferred distributions, gains (or losses) on sales of depreciable operating property, impairment write-downs on depreciable assets, plus real estate related depreciation and amortization (excluding amortization of deferred financing costs). Our FFO computation includes our share of required adjustments from our unconsolidated joint ventures and may not be comparable to FFO reported by other REITs that do not compute FFO in accordance with the Nareit definition or that interpret the Nareit definition differently than we do. The GAAP measure that we believe to be most directly comparable to FFO, net income, includes depreciation and amortization expenses, gains or losses on property sales, impairments, and noncontrolling interests. In computing FFO, we eliminate these items because, in our view, they are not indicative of the results from the operations of our properties. To facilitate a clear understanding of our historical operating results, FFO should be examined in conjunction with net income (determined in accordance with GAAP) as presented in our financial statements. FFO does not represent cash generated from operating activities in accordance with GAAP, should not be considered to be an alternative to net income or loss (determined in accordance with GAAP) as a measure of our liquidity and is not indicative of funds available for our cash needs, including our ability to make cash distributions to shareholders.

We use Normalized FFO, which excludes from FFO net change in fair value of derivative financial instruments, acceleration of deferred financing costs, net change in fair value of contingent consideration, and other normalizing items. However, our use of the term Normalized FFO may not be comparable to that of other real estate companies as they may have different methodologies for computing this amount. Normalized FFO should not be considered as an alternative to net income or loss (computed in accordance with GAAP), as an indicator of our financial performance or of cash flow from operating activities (computed in accordance with GAAP), or as an indicator of our liquidity, nor is it indicative of funds available to fund our cash needs, including our ability to make distributions. Normalized FFO should be reviewed in connection with other GAAP measurements.

We define Normalized FAD, a non-GAAP measure, which excludes from Normalized FFO non-cash share compensation expense, straight-line rent adjustments, amortization of acquired above-market or below-market leases and assumed debt, amortization of lease inducements, amortization of deferred financing costs, and loan reserve adjustments, including our share of all required adjustments from unconsolidated joint ventures. We also adjust for recurring capital expenditures related to tenant improvements and leasing commissions, and cash payments from seller master leases and rent abatement payments, including our share of all required adjustments for unconsolidated joint ventures. Other REITs or real estate companies may use different methodologies for calculating Normalized FAD, and accordingly, our computation may not be comparable to those reported by other REITs. Although our computation of Normalized FAD may not be comparable to that of other REITs, we believe Normalized FAD provides a meaningful supplemental measure of our performance due to its frequency of use by analysts, investors, and other interested parties in the evaluation of our performance as a REIT. Normalized FAD should not be considered as an alternative to net income or loss attributable to controlling interest (computed in accordance with GAAP) or as an indicator of our financial performance. Normalized FAD should be reviewed in connection with other GAAP measurements.

NOI is a non-GAAP financial measure that is defined as net income or loss, computed in accordance with GAAP, generated from our total portfolio of properties and other investments before general and administrative expenses, depreciation and amortization expense, interest expense, net change in the fair value of derivative financial instruments, gain or loss on the sale of investment properties, and impairment losses, including our share of all required adjustments from our unconsolidated joint ventures. We believe that NOI provides an accurate measure of operating performance of our operating assets because NOI excludes certain items that are not associated with management of the properties. Our use of the term NOI may not be comparable to that of other real estate companies as they may have different methodologies for computing this amount.

Cash NOI is a non-GAAP financial measure which excludes from NOI straight-line rent adjustments, amortization of acquired above and below market leases, and other non-cash and normalizing items, including our share of all required adjustments from unconsolidated joint ventures. Other non-cash and normalizing items include items such as the amortization of lease inducements, loan reserve adjustments, payments received from seller master leases and rent abatements, and changes in fair value of contingent consideration. We believe that Cash NOI provides an accurate measure of the operating performance of our operating assets because it excludes certain items that are not associated with management of the properties. Additionally, we believe that Cash NOI is a widely accepted measure of comparative operating performance in the real estate community. Our use of the term Cash NOI may not be comparable to that of other real estate companies as such other companies may have different methodologies for computing this amount.

MOB Same-Store Cash NOI is a non-GAAP financial measure which excludes from Cash NOI assets not held for the entire preceding five quarters, non-MOB assets, and other normalizing items not specifically related to the same-store property portfolio. Management considers MOB Same-Store Cash NOI a supplemental measure because it allows investors, analysts, and Company management to measure unlevered property-level operating results. Our use of the term MOB Same-Store Cash NOI may not be comparable to that of other real estate companies, as such other companies may have different methodologies for computing this amount.

We calculate EBITDAre in accordance with standards established by Nareit and define EBITDAre as net income or loss computed in accordance with GAAP plus depreciation and amortization, interest expense, gain or loss on the sale of investment properties, and impairment loss, including our share of all required adjustments from unconsolidated joint ventures. We define Adjusted EBITDAre, which excludes from EBITDAre non-cash share compensation expense, non-cash changes in fair value, pursuit costs, non-cash intangible amortization, the pro forma impact of investment activity, and other normalizing items. We consider EBITDAre and Adjusted EBITDAre important measures because they provide additional information to allow management, investors, and our current and potential creditors to evaluate and compare our core operating results and our ability to service debt.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210505005576/en/

Physicians Realty Trust

John T. Thomas

President and CEO

(214) 549-6611

[email protected]

Jeffrey N. Theiler

Executive Vice President and CFO

(414) 367-5610

[email protected]

KEYWORDS: Wisconsin United States North America

INDUSTRY KEYWORDS: Commercial Building & Real Estate Construction & Property Finance Hospitals REIT Professional Services Health General Health Residential Building & Real Estate

MEDIA:

Logo

Mogo Completes Acquisition of Investing App Moka, Bringing Total Members to Approximately 1.6 Million

Includes over $250 million of AUM along with registered portfolio management capabilities throughout Canada & Europe

Company targeting launch of free stock-trading for Canadians before year-end

All figures in Canadian $

VANCOUVER, British Columbia–(BUSINESS WIRE)–Mogo Inc. (NASDAQ:MOGO) (TSX:MOGO) (“Mogo” or the “Company”), a digital payments and financial technology company, today announced it has closed its previously announced acquisition of Moka Financial Technologies Inc. (“Moka“), one of Canada’s leading saving and investing apps, in an all-stock transaction pursuant to the terms of a definitive share exchange agreement (the “Share Exchange Agreement“) entered into by Mogo, Moka and all of the shareholders of Moka (the “Vendors“). The acquisition increases Mogo’s member base to approximately 1.6 million and expands Mogo’s wealth offering to include saving and investing products. In addition, the acquisition will accelerate Mogo’s plan to launch a free stock trading solution for Canadians in 2021, further solidifying its position as the most comprehensive digital wallet in Canada.

“We welcome the Moka team to the Mogo platform. This acquisition accelerates our expansion in the $4 trillion wealth management industry, a market that is undergoing rapid digital disruption and where we believe we can create tremendous value for our members and our shareholders,” said David Feller, Mogo’s Founder and CEO. “By adding Moka’s digital saving and investing products, technology platform and experienced fintech team, we move forward with one of the most compelling and differentiated value propositions in Canadian finance. Moka will form the core of MogoWealth, along with MogoCrypto, making Mogo’s digital wallet the most comprehensive solution in Canada.”

Philip Barrar, Founder & CEO of Moka, added: “We’re excited to complete this transaction and begin collaborating with the Mogo team. Both organizations share a passion for building great digital products to improve the financial well-being of our members, and collectively we form Canada’s leading fintech team with deep capabilities in digital saving and investing, lending, and cryptocurrency.”

Greg Feller, President and CFO of Mogo, added: “This highly strategic acquisition adds important capabilities in saving and investing, immediately increases our member base, and accelerates the growth of our subscription & transaction-based revenue. We are already moving ahead to further expand the MogoWealth product offering, including introducing a free stock trading solution to Mogo members.”

Pursuant to the terms of the Share Exchange Agreement, Mogo has acquired all of the issued and outstanding shares of Moka (the “Acquisition”) in exchange for the issuance of 4,999,991 common shares of Mogo (the “Mogo Consideration Shares”) to the Vendors. All of the Mogo Consideration Shares issued pursuant to the Acquisition are subject to a four-month statutory hold and a six-month escrow restriction from the date of closing, with additional escrow and vesting restrictions for certain Moka employees and shareholders.

Concurrent with the completion of the acquisition, the Company announced that Philip Barrar, Founder & CEO of Moka, joins Mogo’s leadership team in a newly created role of Chief Innovation Officer. In addition, Dr. Liam Cheung, Chairman of Moka and partner at Moka shareholder Tactico, is expected to join Mogo’s board of directors following Mogo’s next annual general meeting. Cheung is a seasoned financial services entrepreneur and executive with over 25 years of experience.

About Moka

Montreal-based Moka launched in 2017 with the social mission to help millennials achieve their financial goals, and it has since been downloaded by over 1 million consumers and earned thousands of 5-star reviews. The Moka app has become one of Canada’s most popular investing apps due to its roundup feature, which automatically rounds up daily purchases and invests the spare change in personalized, diversified portfolios of low-cost Exchange-Traded Funds. Moka members can invest through a TFSA, RRSP or non-registered account. There is no financial knowledge, minimum investment or lifestyle change required to use Moka, so anyone can start saving and investing by downloading the app and simply linking an existing debit or credit card.

About Mogo

Mogo is empowering its more than one million members with simple digital solutions to help them get in control of their financial health. Through the Mogo app, consumers can access a digital spending account with Mogo Visa* Platinum Prepaid Card featuring automatic carbon offsetting, easily buy and sell bitcoin, and get free monthly credit score monitoring, ID fraud protection, and personal loans. Mogo’s wholly-owned subsidiary, Carta Worldwide, also offers a digital payments platform that powers the next-generation card programs from innovative fintech companies in Europe, North America and APAC. To learn more, please visit mogo.ca or download the mobile app (iOS or Android).

Forward-Looking Statements

This news release may contain “forward-looking statements” within the meaning of applicable securities legislation, including statements regarding the expansion of Mogo’s wealth offering, including the planned launch of Mogo’s free stock trading solution, and the anticipated benefits of the Acquisition. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management at the time of preparation, are inherently subject to significant business, economic and competitive uncertainties and contingencies, and may prove to be incorrect. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual financial results, performance or achievements to be materially different from the estimated future results, performance or achievements expressed or implied by those forward-looking statements and the forward-looking statements are not guarantees of future performance. Mogo’s growth, its ability to expand into new products and markets and its expectations for its future financial performance are subject to a number of conditions, many of which are outside of Mogo’s control, including the receipt of any required regulatory approvals. For a description of the risks associated with Mogo’s business please refer to the “Risk Factors” section of Mogo’s current annual information form, which is available at www.sedar.com and www.sec.gov. Except as required by law, Mogo disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, events or otherwise.

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Craig Armitage

Investor Relations

[email protected]

(416) 347-8954

US Investor Relations Contact

Lytham Partners, LLC

Ben Shamsian

New York | Phoenix

(646) 829 -9701

[email protected]

KEYWORDS: North America Canada

INDUSTRY KEYWORDS: Mobile/Wireless Technology Finance Security Banking Other Technology Professional Services Software Data Management Other Professional Services

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Posted on May 5, 2021 7:48 am

UNFI Adopts Emerging Transportation Technology to Reduce Emissions

UNFI Adopts Emerging Transportation Technology to Reduce Emissions

All-electric trailers support UNFI’s ability to reduce its greenhouse gas emission footprint in California

PROVIDENCE, R.I.–(BUSINESS WIRE)–
United Natural Foods, Inc. (NYSE: UNFI) today announced it is adding 53 all-electric transport refrigerated trailer units (TRUs) to its fleet located at the company’s Riverside, Calif. distribution center. This effort is in keeping with UNFI’s Better for All 2030 Environmental, Social and Governance (ESG) agenda, and the company’s bold commitments to take innovative action on global social and environmental issues that help transform the future of food. The company is one of the first wholesalers to utilize the innovative technology and comes as the California Air Resources Board (CARB) announced plans in January to impose zero-emission requirements on TRUs sold or operated in California by December 31, 2029.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20210505005564/en/

United Natural Foods, Inc. (UNFI) is adding 53 all-electric transport refrigerated trailer units (TRUs) to its fleet located at the company’s Riverside, Calif. distribution center. The all-electric TRU achieves zero-emission results by using a high efficiency refrigeration system powered by roof mounted solar photovoltaic panels, a wheel-momentum generator, lithium-ion batteries, and a unique auxiliary power unit to eliminate the requirement for diesel fuel to power the refrigeration system. The company is one of the first wholesalers to utilize the innovative technology and comes as the California Air Resources Board (CARB) announced plans in January to impose zero-emission requirements on TRUs sold or operated in California by December 31, 2029. (Photo: Business Wire)

The all-electric TRU achieves zero-emission results by using a high efficiency refrigeration system powered by roof mounted solar photovoltaic panels, a wheel-momentum generator, lithium-ion batteries, and a unique auxiliary power unit to eliminate the requirement for diesel fuel to power the refrigeration system. Through this process, the refrigeration system provides multi-zone temperature settings with the capability of maintaining a full load of frozen product from minus 10 to minus 20 degrees F throughout the distribution route.

To accomplish this work, UNFI is removing 53 of its diesel-powered TRUs from operation and utilizing Advanced Energy Machines (AEM), a leader in the electrification of refrigerated trailers, to rebuild the units to all-electric specifications. UNFI will lease the TRUs through PLM Trailer Leasing for five years while the company continues to explore how they integrate into its operations. By operating the all-electric TRUs, UNFI anticipates it will save approximately 135,000 gallons of diesel fuel per year while reducing particulate matter pollutant emissions and greenhouse gas emissions.

“Nearly 50 percent of UNFI’s direct greenhouse gas emissions are from our fleet of trucks and trailers. These 53 all-electric TRUs will help us get a head start on the proposed CARB zero-emission requirements, and are expected to allow us to decrease our emissions as we make progress on our climate action commitments under Better For All,” said Jeff Wismans, national director of fleet operations at UNFI. “Adding these TRUs comes after an exhaustive 4-month pilot testing the equipment through a variety of conditions with the intention to replace diesel-powered TRUs. When we look at it from an operational standpoint, we’re not changing anything, but it gives us a fresh look at running our operations and finding additional efficiencies.”

To help reduce the cost of retrofitting the diesel powered TRU, PLM applied for and received vouchers on UNFI’s behalf through CARB’s Clean Off Road Equipment (CORE) Voucher Incentive Project. CARB launched CORE in 2017 to accelerate the purchase of zero-emission freight handling equipment in California by providing a streamlined voucher process to offset the higher cost of such technologies.

About United Natural Foods

UNFI is North America’s premier food wholesaler delivering the widest variety of products to customer locations throughout North America including natural product superstores, independent retailers, conventional supermarket chains, ecommerce retailers and food service customers. By providing this deeper ‘full-store’ selection and compelling brands for every aisle, UNFI is uniquely positioned to deliver great food, more choices and fresh thinking to customers everywhere. Today, UNFI is the largest publicly traded grocery distributor in the United States. To learn more about how UNFI is Moving Food Forward, visit www.unfi.com.

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Investor Contact

Steve Bloomquist

952-828-4144

[email protected]

Media Contact

Jeff Swanson

952-903-1645

[email protected]

KEYWORDS: United States North America California Rhode Island

INDUSTRY KEYWORDS: Alternative Vehicles/Fuels Trucking Automotive Transport Supermarket Food/Beverage Logistics/Supply Chain Management Retail Supply Chain Management

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United Natural Foods, Inc. (UNFI) is adding 53 all-electric transport refrigerated trailer units (TRUs) to its fleet located at the company’s Riverside, Calif. distribution center. The all-electric TRU achieves zero-emission results by using a high efficiency refrigeration system powered by roof mounted solar photovoltaic panels, a wheel-momentum generator, lithium-ion batteries, and a unique auxiliary power unit to eliminate the requirement for diesel fuel to power the refrigeration system. The company is one of the first wholesalers to utilize the innovative technology and comes as the California Air Resources Board (CARB) announced plans in January to impose zero-emission requirements on TRUs sold or operated in California by December 31, 2029. (Photo: Business Wire)

Juniper Networks Leans into SASE with Announcement of Juniper Security Director Cloud

Cloud-based portal helps customers transition seamlessly and securely to a SASE architecture by safeguarding users, applications and infrastructure amid network transformation

SUNNYVALE, Calif.–(BUSINESS WIRE)–Juniper Networks (NYSE:JNPR), a leader in secure, AI-driven networks, today announced that the company is continuing its investment in the Secure Access Service Edge (SASE) market with the introduction of Juniper® Security Director Cloud, a cloud-based portal that distributes connectivity and security services to sites, users and applications, as well as manages customers’ SASE transformations.

Technology disruptors, such as 5G and an increasingly distributed workforce, are changing how organizations do business and architect their networks. Enterprises, as well as cloud and service providers, are shifting from monolithic centralized data center architectures to SASE, decentralized architectures that bring services closer to end-users around the globe.

Juniper Security Director Cloud bridges organizations’ current security deployments with their future SASE rollouts by providing security that is managed anywhere and everywhere, on-premises and in the cloud, from the cloud. Benefits include:

• Experience-led management to facilitate network transformation. Security Director Cloud delivers a transformational management experience that reduces overhead that is inherent in architectural shifts and distributed security delivery. It features zero-touch provisioning and intuitive configuration wizards for secure connectivity, content security and advanced threat prevention for both on-premises and cloud-based security policy. In addition, a multi-directional sync between cloud-hosted and on-premises management and individual firewalls provides a cohesive management experience that supports a seamless and secure shift to a SASE architecture.
• Unified policies across physical, virtual and cloud-based security. Customers can create security policies — including user- and application-based access, IPS, anti-malware and web security policies — that follow users, devices or applications as they move to new locations, and automatically apply them. This unified policy construct across traditional and cloud-delivered security vehicles minimizes operational overhead otherwise required to recreate policies from one platform to another and decreases attack vectors inadvertently created by human error.
• Validated security effectiveness. Juniper provides cyberattack protection that has been validated by objective, third-party testing to be more than 99% effective against network and application exploits, new and commodity malware, IoT botnets and other attack techniques targeted at the edge and in the data center. This includes achieving the highest security efficacy rating at 99.5% from CyberRatings.org compared to leading security vendors for Enterprise Firewall, and 100% effectiveness with zero false positives in ICSA Labs’ Advanced Threat Defense test in Q4 of 2020. Security Director Cloud delivers policies empowered with these proven threat prevention technologies, ensuring quick access to applications and consistent security enforcement.
• Visibility into threat behaviors across the entire network with Security Director Insights. Security Director Cloud features correlated visibility into attacks across the network by bringing together threat detection information – including detections from other vendors’ products – into an attack timeline, and it enables one-touch mitigation to quickly address gaps in defense.

“Juniper is leading the move into the SASE market with a great management experience, putting our customers and their teams first,” said Samantha Madrid, VP of Security Business & Strategy at Juniper Networks. “With the introduction of Security Director Cloud, we’re able to meet customers where they are as they transition to a SASE architecture by delivering networking and security services from the cloud to sites, users and applications around the world. Security Director Cloud is like ‘iCloud’ for security operators, providing the ‘and’ strategy that enables our enterprise, cloud and service provider customers to transform their networks seamlessly and securely.”

As a security provider, Juniper has gained market momentum with a consistent string of growth and awards, including being named as a Customers’ Choice in the April 2021 Gartner Peer Insights “Voice of the Customer” for Network Firewalls, and by CRN as a Top-20 Coolest Network Security Vendor for the second year in a row. In addition, Juniper experienced double-digit revenue growth in security year-over-year for Q1 of 2021, including growth across all customer verticals. This puts Juniper in a unique position to support customers as they transform their networks and implement a SASE architecture. With the announcement of Security Director Cloud and the recent acquisition of 128 Technology’s Session Smart SD-WAN, Juniper Networks leads the market in successfully converging networking and security, aligning to its Connected Security strategy, effectively supporting both on-premises and distributed workforces and ensuring the best possible experience for all.

Supporting quotes:

“Over the past year, as our workforce became more distributed, securely managing our network across multiple international data centers was a challenge. Juniper gets that challenge and, with Security Director Cloud, we are able to centralize management in the cloud as we move to SASE. Now, we can support a distributed workforce and my team can secure all our locations, users and applications without having to jump through a bunch of hoops. The unified security management solution also helps us address availability, logging and consistent policy enforcement more effectively.”

– Jason Philp, Director of Infrastructure at Beeline

“Juniper Connected Security coming together with Session Smart technology is excellent news for our business. Having started our Juniper journey with 128 Technology, we are happily looking forward to adding their full SASE capabilities to our offering, with both validated security efficacy and AI-driven SD-WAN, that allow us to best facilitate our customers’ network transformations.”

– Mark Marquez, EVP of Technology at Momentum Telecom

Additional resources:

• Launch blog: Introducing Juniper® Security Director Cloud, Juniper’s Portal to SASE
• Launch page: Journey to SASE and Beyond
• Product & solutions pages
  • SASE
  • Security Director Cloud
  • Session-Smart SD-WAN
• CyberRatings.org Enterprise Firewall Report
• ICSA Labs Advanced Threat Defense Report
• Gartner Peer Insights “Voice of the Customer” for Network Firewalls
• CRN Top 20 Coolest Network Security Vendor

About Juniper Networks

Juniper Networks challenges the inherent complexity that comes with networking and security in the multicloud era. We do this with products, solutions and services that transform the way people connect, work and live. We simplify the process of transitioning to a secure and automated multicloud environment to enable secure, AI-driven networks that connect the world. Additional information can be found at Juniper Networks (www.juniper.net) or connect with Juniper on Twitter, LinkedIn and Facebook.

Forward-Looking Statements

Statements in this press release concerning Juniper Networks’ prospects, product availability, future products and expected performance, and expected benefits of our products to users, including network visibility and security efficacy, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act that involve a number of uncertainties and risks. Actual results or events could differ materially from those anticipated in those forward-looking statements as a result of certain factors, including delays in scheduled product availability, incompatibility of technologies, the company’s failure to accurately predict emerging technological trends, and other factors listed in Juniper Networks’ most recent report on Form 10-K and Form 10-Q filed with the Securities and Exchange Commission. All statements made in this press release are made only as of the date of this press release. Juniper Networks undertakes no obligation to update the information in this release in the event facts or circumstances subsequently change after the date of this press release. Any future product, feature, enhancement or related specification that may be referenced in this press release are for information purposes only, are subject to change at any time without notice and are not commitments to deliver any future product, feature, enhancement or related specification. The information contained in this press release is intended to outline Juniper Networks’ general product direction and should not be relied on in making a purchasing decision.

Juniper Networks, the Juniper Networks logo, Juniper, Junos, and other trademarks listed here are registered trademarks of Juniper Networks, Inc. and/or its affiliates in the United States and other countries. Other names may be trademarks of their respective owners.

Category-Security

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Media Relations:

Leslie Ruble

Juniper Networks

408-936-2111

[email protected]

KEYWORDS: California United States North America

INDUSTRY KEYWORDS: Technology Mobile/Wireless Security Telecommunications Software Networks Internet Hardware Data Management

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The Marcus Corporation Reports First Quarter Fiscal 2021 Results

Marcus Theatres and Marcus Hotels & Resorts both outperformed respective industries as recovery begins to take hold

MILWAUKEE–(BUSINESS WIRE)–The Marcus Corporation (NYSE: MCS) today reported results for the first quarter fiscal 2021 ended April 1, 2021.

First Quarter Fiscal 2021 Highlights

• Total revenues for the first quarter of fiscal 2021 were $50,787,000 compared to total revenues of $159,460,000 for the first quarter of fiscal 2020.
• Operating loss was $35,661,000 for the first quarter of fiscal 2021, compared to operating loss of $22,200,000 for the prior year quarter.
• Net loss attributable to The Marcus Corporation was $28,130,000 for the first quarter of fiscal 2021, compared to net loss attributable to The Marcus Corporation of $19,352,000 for the same period in fiscal 2020.
• Net loss per diluted common share attributable to The Marcus Corporation was $0.93 for the first quarter of fiscal 2021, compared to net loss per diluted common share attributable to The Marcus Corporation of $0.64 for the first quarter of fiscal 2020.
• Adjusted net loss attributable to The Marcus Corporation was $29,069,000 for the first quarter of fiscal 2021, compared to Adjusted net loss attributable to The Marcus Corporation of $8,837,000 for the first quarter of fiscal 2020.
• Adjusted net loss per diluted common share attributable to The Marcus Corporation was $0.96 for the first quarter of fiscal 2021, compared to Adjusted net loss per diluted common share attributable to The Marcus Corporation of $0.29 for the prior year quarter.
• Adjusted EBITDA was a loss of $17,469,000 for the first quarter of fiscal 2021, compared to Adjusted EBITDA of $12,050,000 for the comparable prior year period.
• Adjusted net loss attributable to The Marcus Corporation, Adjusted net loss per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA reflect adjustments made by the company to eliminate a nonrecurring state government grant during the first quarter of fiscal 2021 and to eliminate the impact of certain nonrecurring property closure expenses and impairment charges during the first quarter of fiscal 2020.

“As we head further into 2021, the recovery is beginning to take hold, as evidenced by our improving operating performance compared to prior quarters,” said Gregory S. Marcus, president and chief executive officer of The Marcus Corporation. “Both of our operating businesses once again significantly outperformed their respective industries during the quarter. Significant progress administering the vaccine, improving conditions in our markets and growing consumer confidence are bringing more people back to our theatres, hotels and restaurants, although still at levels well below the norm. While it will take some time to return to pre-pandemic levels, the quality of our assets, the appealing experiences we provide and our continued focus on service and safety have positioned both Marcus Theatres and Marcus Hotels & Resorts for the continued recovery. We are encouraged by the improvements we are seeing and remain optimistic for the future.”

Marcus Theatres^®

The first quarter began with 52% of theaters open due to state and local restrictions in several markets. As restrictions were lifted and several new films were released by movie studios, Marcus Theatres began reopening more theatres, and as of Friday, May 7, nearly 89% of theatres will be open, many with expanded operating days and hours. The expectation is that the majority of the remaining closed theatres will reopen by the end of May as more anticipated new films are released and demand returns.

The division’s operating loss in the first quarter of fiscal 2021 was favorably impacted by a nonrecurring state government grant of $1.3 million. Average concession revenues per person increased 16 percent compared to the first quarter of fiscal 2020, further contributing to the division’s improved results compared to recent quarters.

Marcus Theatres outperformed the industry by 9.0 percentage points during the fiscal 2021 first quarter, according to data received from Comscore. We believe this made Marcus Theatres the top performing theatre circuit during the quarter compared to the top 10 circuits in the United States. Sales attributable to Marcus Private Cinema exceeded expectations, helping to partially offset reduced traditional attendance and contributing to the division’s outperformance. Marcus Private Cinema is a program where guests can reserve an entire auditorium for up to 20 people, offering a safe, fun and stress-free social gathering opportunity for a flat fee.

“With restrictions loosening in markets like New York and California, studios are showing an increased willingness to begin releasing new films to theatres,” said Rolando Rodriguez, chairman, president and chief executive officer of Marcus Theatres. “The recent successes of ‘Godzilla vs. Kong,’ ‘Mortal Kombat’ and ‘Demon Slayer’ are particularly exciting, becoming the best performing films since the onset of the pandemic and underscoring the pent-up demand for out-of-home entertainment. Looking forward, we know Marcus Theatres has many significant advantages compared to our competitors, including what we believe is the highest percentage of recliner seating, proprietary large-format screens and food and beverage options in the industry. We look forward to welcoming even more guests back to the big screen at Marcus Theatres, including to the newly remodeled Mid Rivers Cinema in St. Peters, MO, which is reopening this Friday.”

Several films generated box office interest in the first quarter, including “Raya and the Last Dragon,” “Tom and Jerry,” “The Croods: A New Age,” “Wonder Woman 1984” and “The Little Things.” Highly anticipated films for the remainder of the fiscal 2021 second quarter include “Cruella,” “Quiet Place II,” “Conjuring: The Devil Made Me Do It,” “In the Heights” and “Fast & Furious 9.” The film slate for the remainder of 2021, which includes films such as “Black Widow,” “Space Jam: The New Legacy,” “Hotel Transylvania: Transformania,” “The Suicide Squad,” “Free Guy,” “Venom: Let There Be Carnage,” “Dune,” “No Time to Die,” “Top Gun: Maverick,” “West Side Story,” and “Spider Man: No Way Home,” is also expected to be very strong.

Marcus^® Hotels & Resorts

While the first quarter is historically the slowest quarter of the fiscal year for Marcus Hotels & Resorts, the division’s operating loss improved significantly compared to the first quarter of fiscal 2020 due to strong cost controls across all properties and strong leisure demand. Improved operating performance at the Grand Geneva Resort & Spa in Lake Geneva, Wis., which saw record ski revenues during the quarter, contributed to the division’s improvement this quarter. Despite the challenges associated with operating during a pandemic, Marcus Hotels & Resorts outperformed the industry and its competitive sets by approximately eight and six percentage points, respectively.

“While the pandemic continues to impact both business and group travel, our results in the first quarter exceeded expectations,” said Michael Evans, president of Marcus Hotels & Resorts. “Demand continues to be driven by ‘drive-to leisure’ consumers as they seek opportunities to get away, change their scenery and do something new. And while business travel will likely remain limited in the near term, vaccination progress and improving conditions in our markets bodes well for a gradual increase in this market segment in the months ahead.”

Group pace for fiscal 2021 remains behind prior years at this same time, but bookings are increasing for later in 2021 and into 2022. That includes many cancelled group bookings due to COVID-19, which are rebooking for future dates.

Balance Sheet and Liquidity

The Marcus Corporation’s financial position remains strong, with $213 million in cash and revolving credit availability at the end of the quarter.

“Our significant liquidity, combined with the receipt of expected income tax refunds and proceeds from the sale of surplus real estate, positions us to continue to meet our obligations as they come due and continue to sustain operations throughout fiscal 2021 and into 2022, even in the unlikely event our properties continue to generate significantly reduced revenues,” said Douglas Neis, executive vice president, chief financial officer and treasurer of The Marcus Corporation.

Early in the first quarter of fiscal 2021, the company received the remaining requested tax refunds from its fiscal 2019 return. In addition, the company filed income tax refund claims related to its fiscal 2020 tax return during the fiscal 2021 first quarter. The company continues to pursue select real estate sales, receiving proceeds from the sale of an equity interest in a joint venture during the first quarter and obtaining additional letters of intent or contracts for several other asset sales.

Conference Call and Webcast

The Marcus Corporation management will hold a conference call today, Wednesday, May 5, 2021 at 10:00 a.m. Central/11:00 a.m. Eastern time. Interested parties may listen to the call live on the internet through the investor relations section of the company’s website: www.marcuscorp.com, or by dialing 1-574-990-3059 and entering the passcode 9054694.

A telephone replay of the conference call will be available through Wednesday, May 12, 2021, by dialing 1-855-859-2056 and entering passcode 9054694. The webcast will be archived on the company’s website until its next earnings release.

Non-GAAP Financial Measures

Adjusted net earnings (loss) attributable to The Marcus Corporation, Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA have been presented in this press release as supplemental measures of financial performance that are not required by, or presented in accordance with, GAAP. The company defines Adjusted net earnings (loss) attributable to The Marcus Corporation as net earnings (loss) attributable to The Marcus Corporation adjusted to eliminate the impact of certain items that the company does not consider indicative of its core operating performance and the tax effect related to those items. The company defines Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation as Adjusted net earnings (loss) attributable to The Marcus Corporation divided by diluted weighted average shares outstanding. The company defines Adjusted EBITDA as net earnings (loss) attributable to The Marcus Corporation before investment income or loss, interest expense, other expense, gain or loss on disposition of property, equipment and other assets, equity earnings or losses from unconsolidated joint ventures, net earnings or losses attributable to noncontrolling interests, income taxes and depreciation and amortization, adjusted to eliminate the impact of certain items that the company does not consider indicative of its core operating performance. Reconciliations of these measures to the equivalent measures under GAAP are set forth in the attached tables.

Adjusted net earnings (loss) attributable to The Marcus Corporation, Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA are key measures used by management and the company’s board of directors to assess the company’s financial performance and enterprise value. The company believes that Adjusted net earnings (loss) attributable to The Marcus Corporation, Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA are useful measures, as they eliminate certain expenses that are not indicative of the company’s core operating performance and facilitate a comparison of the company’s core operating performance on a consistent basis from period to period. The company also uses Adjusted EBITDA as a basis to determine certain annual cash bonuses and long-term incentive awards, to supplement GAAP measures of performance to evaluate the effectiveness of its business strategies, to make budgeting decisions, and to compare its performance against that of other peer companies using similar measures. Adjusted net earnings, Adjusted diluted earnings per share and Adjusted EBITDA are also used by analysts, investors and other interested parties as performance measures to evaluate industry competitors.

Adjusted net earnings (loss) attributable to The Marcus Corporation, Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA are non-GAAP measures of the company’s financial performance and should not be considered as alternatives to net earnings (loss) or diluted earnings (loss) per share as a measure of financial performance, or any other performance measure derived in accordance with GAAP and they should not be construed as an inference that the company’s future results will be unaffected by unusual or non-recurring items. Additionally, Adjusted net earnings (loss) attributable to The Marcus Corporation and Adjusted EBITDA are not intended to be measures of liquidity or free cash flow for management’s discretionary use. In addition, these non-GAAP measures exclude certain non-recurring and other charges. Each of these non-GAAP measures has its limitations as an analytical tool, and you should not consider them in isolation or as a substitute for analysis of the company’s results as reported under GAAP. In evaluating Adjusted net earnings (loss) attributable to The Marcus Corporation, Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA, you should be aware that in the future the company will incur expenses that are the same as or similar to some of the items eliminated in the adjustments made to determine Adjusted net earnings (loss) attributable to The Marcus Corporation, Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA, such as acquisition expenses, preopening expenses, accelerated depreciation, impairment charges and other adjustments. The company’s presentation of Adjusted net earnings (loss) attributable to The Marcus Corporation, Adjusted net earnings (loss) per diluted common share attributable to The Marcus Corporation and Adjusted EBITDA should not be construed to imply that the company’s future results will be unaffected by any such adjustments. Definitions and calculations of Adjusted net earnings (loss), Adjusted diluted earnings (loss) per share and Adjusted EBITDA differ among companies in our industries, and therefore Adjusted net earnings (loss), Adjusted diluted earnings (loss) per share and Adjusted EBITDA disclosed by the company may not be comparable to the measures disclosed by other companies.

About The Marcus Corporation

Headquartered in Milwaukee, The Marcus Corporation is a leader in the lodging and entertainment industries, with significant company-owned real estate assets. The Marcus Corporation’s theatre division, Marcus Theatres^®, is the fourth largest theatre circuit in the U.S. and currently owns or operates 1,097 screens at 89 locations in 17 states under the Marcus Theatres, Movie Tavern^® by Marcus and BistroPlex^® brands. The company’s lodging division, Marcus^® Hotels & Resorts, owns and/or manages 18 hotels, resorts and other properties in eight states. For more information, please visit the company’s website at www.marcuscorp.com.

Certain matters discussed in this press release are “forward-looking statements” intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements may generally be identified as such because the context of such statements include words such as we “believe,” “anticipate,” “expect” or words of similar import. Similarly, statements that describe our future plans, objectives or goals are also forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties which may cause results to differ materially from those expected, including, but not limited to, the following: (1) the adverse effects of the COVID-19 pandemic on our theatre and hotels and resorts businesses, results of operations, liquidity, cash flows, financial condition, access to credit markets and ability to service our existing and future indebtedness; (2) the duration of the COVID-19 pandemic and related government restrictions and social distancing requirements and the level of customer demand following the relaxation of such requirements; (3) the availability, in terms of both quantity and audience appeal, of motion pictures for our theatre division (particularly following the COVID-19 pandemic, during which the production of new movie content temporarily ceased and release dates for motion pictures have been postponed), as well as other industry dynamics such as the maintenance of a suitable window between the date such motion pictures are released in theatres and the date they are released to other distribution channels; (4) the effects of adverse economic conditions in our markets, including but not limited to, those caused by the COVID-19 pandemic; (5) the effects of adverse economic conditions, including but not limited to, those caused by the COVID-19 pandemic, on our ability to obtain financing on reasonable and acceptable terms, if at all; (6) the effects on our occupancy and room rates caused by the COVID-19 pandemic and the effects on our occupancy and room rates of the relative industry supply of available rooms at comparable lodging facilities in our markets once hotels and resorts have more fully reopened; (7) the effects of competitive conditions in our markets; (8) our ability to achieve expected benefits and performance from our strategic initiatives and acquisitions; (9) the effects of increasing depreciation expenses, reduced operating profits during major property renovations, impairment losses, and preopening and start-up costs due to the capital intensive nature of our business; (10) the effects of weather conditions, particularly during the winter in the Midwest and in our other markets; (11) our ability to identify properties to acquire, develop and/or manage and the continuing availability of funds for such development; (12) the adverse impact on business and consumer spending on travel, leisure and entertainment resulting from terrorist attacks in the United States, other incidents of violence in public venues such as hotels and movie theatres or epidemics (such as the COVID-19 pandemic); and (13) a disruption in our business and reputational and economic risks associated with civil securities claims brought by shareholders. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, including developments related to the COVID-19 pandemic, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. Our forward-looking statements are based upon our assumptions, which are based upon currently available information, including assumptions about our ability to manage difficulties associated with or related to the COVID-19 pandemic; the assumption that our theatre closures, hotel closures and restaurant closures are not expected to be permanent or to re-occur; the continued availability of our workforce; and the temporary and long-term effects of the COVID-19 pandemic on our business. Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements made herein are made only as of the date of this press release and we undertake no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.

THE MARCUS CORPORATION
Consolidated Statements of Earnings (Loss)
(Unaudited)
(in thousands, except per share data)
		13 Weeks Ended
		April 1,				March 26,
		2021				2020
Revenues:
Theatre admissions		$	10,685			$	55,395
Rooms			9,044				16,989
Theatre concessions			9,919				45,930
Food and beverage			5,912				13,614
Other revenues			11,894				18,776
			47,454				150,704
Cost reimbursements			3,333				8,756
Total revenues			50,787				159,460
Costs and expenses:
Theatre operations			18,270				54,016
Rooms			5,265				9,655
Theatre concessions			4,496				22,211
Food and beverage			5,370				14,465
Advertising and marketing			2,549				5,390
Administrative			13,316				17,732
Depreciation and amortization			17,979				19,033
Rent			6,341				6,954
Property taxes			4,739				6,029
Other operating expenses			4,790				8,707
Impairment charges			–				8,712
Reimbursed costs			3,333				8,756
Total costs and expenses			86,448				181,660
Operating loss			(35,661	)			(22,200	)
Other income (expense):
Investment income (loss)			40				(695	)
Interest expense			(4,843	)			(2,516	)
Other expense			(628	)			(590	)
Gain (loss) on disposition of property, equipment and other assets			2,204				(12	)
Equity losses from unconsolidated joint ventures			–				(57	)
			(3,227	)			(3,870	)
Loss before income taxes			(38,888	)			(26,070	)
Income tax benefit			(10,758	)			(6,570	)
Net loss			(28,130	)			(19,500	)
Net loss attributable to noncontrolling interests			–				(148	)
Net loss attributable to The Marcus Corporation		$	(28,130	)		$	(19,352	)
Net loss per common share attributable to The Marcus Corporation – diluted		$	(0.93	)		$	(0.64	)
Weighted average shares outstanding – diluted			31,196				30,975

THE MARCUS CORPORATION
Condensed Consolidated Balance Sheets
(In thousands)
		(Unaudited)			(Audited)
		April 1,			December 31,
		2021			2020
Assets:
Cash and cash equivalents		$	6,013		$	6,745
Restricted cash			6,890			7,343
Accounts receivable			6,572			6,359
Government grants receivable			–			4,913
Refundable income taxes			24,867			27,934
Assets held for sale			8,658			4,117
Other current assets			10,654			10,406
Property and equipment, net			828,240			848,328
Operating lease right-of-use assets			227,899			229,660
Other assets			106,036			108,373
Total Assets		$	1,225,829		$	1,254,178
Liabilities and Shareholders’ Equity:
Accounts payable		$	13,277		$	13,158
Taxes other than income taxes			16,765			18,308
Other current liabilities			64,260			65,787
Short-term borrowings			83,259			87,194
Current portion of finance lease obligations			2,731			2,783
Current portion of operating lease obligations			18,914			19,614
Current maturities of long-term debt			11,361			10,548
Finance lease obligations			19,166			19,744
Operating lease obligations			228,493			230,550
Long-term debt			227,770			193,036
Deferred income taxes			20,131			33,429
Other long-term obligations			61,847			61,304
Equity			457,855			498,723
Total Liabilities and Shareholders’ Equity		$	1,225,829		$	1,254,178

THE MARCUS CORPORATION
Business Segment Information
(Unaudited)
(In thousands)
			Theatres				Hotels/ Resorts				Corporate Items				Total
13 Weeks Ended April 1, 2021
Revenues			$	22,562			$	28,125			$	100			$	50,787
Operating loss				(25,639	)			(5,708	)			(4,314	)			(35,661	)
Depreciation and amortization				12,786				5,127				66				17,979
13 Weeks Ended March 26, 2020
Revenues			$	109,211			$	50,160			$	89			$	159,460
Operating loss				(7,083	)			(10,853	)			(4,264	)			(22,200	)
Depreciation and amortization				13,510				5,412				111				19,033

Corporate items include amounts not allocable to the business segments. Corporate revenues consist principally of rent and the corporate operating loss includes general corporate expenses. Corporate information technology costs and accounting shared services costs are allocated to the business segments based upon several factors, including actual usage and segment revenues.

THE MARCUS CORPORATION
Reconciliation of Adjusted net loss and Adjusted net loss per diluted common share
(Unaudited)
(In thousands, except per share data)
			13 Weeks Ended
			April 1,				March 26,
			2021				2020
Net loss attributable to The Marcus Corporation			$	(28,130	)		$	(19,352	)
Add (deduct):
Property closure expenses – theatres (a)				–				2,787
Property closure expenses – hotels (b)				–				2,730
Impairment charges (c)				–				8,712
Government grant (d)				(1,271	)			–
Tax impact of adjustments to net earnings (e)				332				(3,714	)
Adjusted net earnings (loss) attributable to The Marcus Corporation			$	(29,069	)		$	(8,837	)
Net loss per diluted common share attributable to The Marcus Corporation			$	(0.93	)		$	(0.64	)
Adjusted net loss per diluted common share attributable to The Marcus Corporation			$	(0.96	)		$	(0.29	)

(a)		Reflects nonrecurring costs (primarily payroll) related to the required closure of all of the company’s movie theatres due to the COVID-19 pandemic.
(b)		Reflects nonrecurring costs (primarily payroll) related to the closure of the company’s hotels and resorts due to reduced occupancy as a result of the COVID-19 pandemic.
(c)		Impairment charges related to intangible assets (trade name) and several theatre locations.
(d)		Reflects a nonrecurring state government grant awarded to our theatres for COVID-19 relief.
(e)		Represents the tax effect related to adjustments (a), (b), (c) and (d) to net earnings, calculated using a statutory tax rate of 26.1%.

Reconciliation of Net loss to Adjusted EBITDA
(Unaudited)
(In thousands)
			13 Weeks Ended
			April 1,				March 26,
			2021				2020
Net loss attributable to The Marcus Corporation			$	(28,130	)		$	(19,352	)
Add (deduct):
Investment income				(40	)			695
Interest expense				4,843				2,516
Other expense				628				590
(Gain) loss on disposition of property, equipment and other assets				(2,204	)			12
Equity losses from unconsolidated joint ventures				–				57
Net earnings (loss) attributable to noncontrolling interests				–				(148	)
Income tax benefit				(10,758	)			(6,570	)
Depreciation and amortization				17,979				19,033
Share-based compensation expenses (a)				1,484				988
Property closure expenses – theatres (b)				–				2,787
Property closure expenses – hotels (c)				–				2,730
Impairment charges (d)				–				8,712
Government grant (e)				(1,271	)			–
Adjusted EBITDA			$	(17,469	)		$	12,050

(a)		Non-cash charges related to share-based compensation programs.
(b)		Reflects nonrecurring costs (primarily payroll) related to the required closure of all of the company’s movie theatres due to the COVID-19 pandemic.
(c)		Reflects nonrecurring costs (primarily payroll) related to the closure of the company’s hotels and resorts due to reduced occupancy as a result of the COVID-19 pandemic.
(d)		Impairment charges related to intangible assets (trade name) and several theatre locations.
(e)		Reflects a nonrecurring state government grant awarded to our theatres for COVID-19 relief.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20210505005166/en/

For additional information, contact:

Douglas A. Neis

(414) 905-1100

KEYWORDS: United States North America Wisconsin

INDUSTRY KEYWORDS: Entertainment Film & Motion Pictures General Entertainment Vacation Lodging Destinations Travel

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