NNN REIT, Inc. Announces First Quarter 2025 Results and Maintains 2025 Guidance

, /PRNewswire/ -- NNN REIT, Inc. (NYSE: NNN) (the "Company" or "NNN"), a real estate investment trust, today announced financial and operating results for the quarter ended March 31, 2025. Highlights include: First Quarter 2025 Highlights: Net earnings of $0.51 per diluted share Grew Core FFO and AFFO per diluted share by 3.6% over prior year results, to $0.86 and $0.87, respectively Increased ABR by 5.2% over the prior year result Closed on $232.4 million of investments, at an initial cash cap rate of 7.4% and weighted average lease term of over 18 years, completing over 40% of the 2025 acquisition volume plan at the midpoint Maintained balance sheet flexibility with a sector leading 11.6-year weighted average debt maturity, no encumbered assets, only 2.5% of floating rate debt and $1.1 billion of total available liquidity Maintained high occupancy levels of 97.7% near NNN's 20-year occupancy average of 98.2% Paid a $0.58 quarterly dividend, equating to a 5.4% annualized dividend yield and 66% AFFO payout ratio Steve Horn, Chief Executive Officer, commented: "NNN's strong first quarter results and leadership in the triple-net market, combined with our deep tenant relationships and flexible balance sheet, position us to effectively execute our 2025 business plan and deliver continued per-share growth during the current macroeconomic conditions." FINANCIAL RESULTS Revenues and net earnings, FFO, Core FFO and AFFO and diluted per share amounts: Quarter Ended March 31, (dollars in thousands, except per share data) 2025 2024 Revenues $ 230,854 $ 215,407 Net earnings $ 96,458 $ 94,371 Net earnings per share $ 0.51 $ 0.52 FFO $ 158,734 $ 151,261 FFO per share $ 0.85 $ 0.83 Core FFO $ 160,907 $ 151,578 Core FFO per share $ 0.86 $ 0.83 AFFO $ 163,015 $ 153,259 AFFO per share $ 0.87 $ 0.84 OPERATING RESULTS As of March 31, 2025 As of December 31, 2024 As ofMarch 31, 2024 Number of properties 3,641 3,568 3,546 Total gross leasable area (square feet) 37,311,000 36,557,000 36,137,000 Occupancy rate 97.7 % 98.5 % 99.4 % Weighted average remaining lease term (years) 9.9 9.9 10.0 As previously announced, NNN initiated eviction proceedings for 64 properties leased to a mid-western restaurant operator. As of March 31, 2025, NNN had taken back possession of all 64 properties, of which 31 have been re-leased. Additionally, out of 35 properties that had previously been leased to a southeast U.S. furniture retailer that filed for bankruptcy in 2024, as of March 31, 2025, NNN had sold seven and re-leased five of these properties. PROPERTY ACQUISITIONS (dollars in thousands) Quarter Ended March 31, 2025 Total dollars invested(1) $ 232,393 Number of properties 82 Gross leasable area (square feet)(2) 831,000 Weighted average cap rate(3) 7.4 % Weighted average lease term (years) 18.4 (1) Includes dollars invested in projects under construction or tenant improvements. (2) Includes additional square footage from completed construction on existing properties. (3) Calculated as the initial cash annual base rent divided by the total purchase price of the properties. PROPERTY DISPOSITIONS Quarter Ended March 31, 2025 (dollars in thousands) Occupied Vacant Total Number of properties 9 1 10 Gross leasable area (square feet) 58,000 14,000 72,000 Net sale proceeds $ 13,340 $ 2,499 $ 15,839 Weighted average cap rate(1) 4.9 % — 4.9 % (1) Calculated as the cash annual base rent divided by the total gross proceeds received for the properties. BALANCE SHEET AND LIQUIDITY As of March 31, 2025, Gross Debt was $4.6 billion with a weighted average interest rate of 4.1% and a weighted average debt maturity of 11.6 years. The Company ended the first quarter 2025 with $1.1 billion of total available liquidity, comprised of $1.1 billion of unused line of credit capacity. Net Debt to annualized EBITDAre and fixed charge coverage was 5.5x and 4.2x, respectively, as of March 31, 2025. DIVIDEND As previously announced, on April 15, 2025, the Board of Directors of NNN declared a quarterly dividend of $0.58 per share payable May 15, 2025, to shareholders of record as of April 30, 2025. The quarterly dividend represents an annualized dividend of $2.32 per share, an annualized dividend yield of 5.4% and an AFFO payout ratio of 66% as of March 31, 2025. NNN is one of only three publicly traded real estate investment trusts to have increased annual dividends for 35 or more consecutive years. 2025 GUIDANCE The Company maintains previously provided 2025 guidance as summarized below: (dollars in millions, except per diluted share data) 2025 Guidance Net earnings per share excluding any gains on disposition of real estate, impairment losses and executive retirement costs $1.97 - $2.02 Real estate depreciation and amortization per share $1.36 Core FFO per share $3.33 - $3.38 AFFO per share $3.39 - $3.44 General and administrative expenses $47 - $48 Real estate expenses, net of tenant reimbursements $15 - $16 Acquisition volume $500 - $600 Disposition volume $80 - $120 Guidance is based on current plans and assumptions and is subject to risks and uncertainties more fully described in this press release and the Company's reports filed with the Securities and Exchange Commission (the "Commission"). CONFERENCE CALL INFORMATION The Company will host a conference call on Thursday, May 1, 2025 at 10:30 a.m. ET to discuss first quarter results. A live webcast of the conference call will be available on the Company's website at www.nnnreit.com or by using the following link. The conference call can also be accessed by dialing 888-506-0062 in the U.S. or 973-528-0011 for international callers and entering the participant code 696567 or referencing NNN REIT, Inc. A telephonic replay of the call will be available through May 8, 2025, by dialing 877-481-4010 in the U.S. or 919-882-2331 internationally and entering the code 52285. ABOUT NNN REIT, INC. NNN invests in high-quality properties subject generally to long-term, net leases with minimal ongoing capital expenditures. As of March 31, 2025, the Company owned 3,641 properties in 50 states with a gross leasable area of approximately 37,311,000 square feet and a weighted average remaining lease term of 10 years. NNN is one of only three publicly traded real estate investment trusts to have increased annual dividends for 35 or more consecutive years. For more information on the Company, visit www.nnnreit.com. FORWARD-LOOKING STATEMENTS Statements in this press release that are not strictly historical are "forward-looking" statements. These statements generally are characterized by the use of terms such as "believe," "expect," "intend," "may," "estimated" or other similar words or expressions. Forward-looking statements involve known and unknown risks, which may cause the Company's actual future results to differ materially from expected results. These risks include, among others, general economic conditions, including inflation, local real estate conditions, changes in interest rates, increases in operating costs, the preferences and financial condition of the Company's tenants, the availability of capital, risks related to the Company's status as a real estate investment trust ("REIT"), and the potential impacts of an epidemic or pandemic on the Company's business operations, financial results and financial position on the world economy. Additional information concerning these and other factors that could cause actual results to differ materially from these forward-looking statements is contained from time to time in the Company's Commission filings, including, but not limited to, the Company's (i) Annual Report on Form 10-K for the year ended December 31, 2024 and (ii) Quarterly Report on Form 10-Q for the quarter ended March 31, 2025. Copies of each filing may be obtained from the Company or the Commission. Such forward-looking statements should be regarded solely as reflections of the Company's current operating plans and estimates. Actual operating results may differ materially from what is expressed or forecast in this press release. NNN REIT, Inc. undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date these statements were made. DEFINITIONS Funds From Operations ("FFO") is a relative non-GAAP financial measure of operating performance of an equity REIT in order to recognize that income-producing real estate historically has not depreciated on the basis determined under GAAP. FFO is defined by the National Association of Real Estate Investment Trusts ("Nareit") and is used by the Company as follows: net earnings (computed in accordance with GAAP) plus depreciation and amortization of assets unique to the real estate industry, excluding gains (or including losses), any applicable taxes on the disposition of certain assets and any impairment charges on a depreciable real estate asset, net of recoveries. FFO is generally considered by industry analysts to be the most appropriate measure of performance of real estate companies. FFO does not necessarily represent cash provided by operating activities in accordance with GAAP and should not be considered an alternative to net earnings as an indication of the Company's performance or to cash flow as a measure of liquidity or ability to make distributions. Management considers FFO an appropriate measure of performance of an equity REIT because it primarily excludes the assumption that the value of the real estate assets diminishes predictably over time, and because industry analysts have accepted it as a performance measure. Core Funds From Operations ("Core FFO") is a non-GAAP measure of operating performance that adjusts FFO to eliminate the impact of certain GAAP income and expense amounts that the Company believes are infrequent and unusual in nature and/or not related to its core real estate operations. Exclusion of these items from similar FFO-type metrics is common within the REIT industry, and management believes that presentation of Core FFO provides investors with a potential metric to assist in their evaluation of the Company's operating performance across multiple periods and in comparison to the operating performance of its peers because it removes the effect of unusual items that are not expected to impact the Company's operating performance on an ongoing basis. Core FFO is used by management in evaluating the performance of the Company's core business operations and is a factor in determining management compensation. Items included in calculating FFO that may be excluded in calculating Core FFO may include items such as transaction related gains, income or expense, impairments on land, executive retirement costs or other non-core amounts as they occur. Adjusted Funds From Operations ("AFFO") is a non-GAAP financial measure of operating performance used by many companies in the REIT industry. AFFO adjusts FFO for certain non-cash items that reduce or increase net earnings in accordance with GAAP. AFFO should not be considered an alternative to net earnings, as an indication of the Company's performance or to cash flow as a measure of liquidity or ability to make distributions. Management considers AFFO a useful supplemental measure of the Company's performance. Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate as defined by Nareit ("EBITDAre") is a metric established by Nareit and commonly used by real estate companies. The measure is a result of net earnings (computed in accordance with GAAP), plus interest expense, income tax expense, depreciation and amortization, excluding any gains (or including any losses) on disposition of real estate, any impairment charges, net of recoveries and after adjustments for income and losses attributable to noncontrolling interests. Management considers the non-GAAP measure of EBITDAre to be an appropriate measure of the Company's performance and should be considered in addition to, net earnings or loss, as a measure of the Company's operating performance. Total Cash is comprised of cash and cash equivalents and restricted cash and cash held in escrow per GAAP as reported on the balance sheet summary. Gross Assets represents total assets (reported in accordance with GAAP) adjusted to exclude accumulated amortization and depreciation and amortization of direct financing leases. The result provides an estimate of the investments made by the Company. Total Debt is defined by the Company as total debt per GAAP as reported on the balance sheet summary including line of credit payable, notes payable, net of unamortized discount and unamortized debt costs and mortgages payable, net of unamortized premium and debt costs, as applicable. Gross Debt is defined by the Company as Total Debt adjusted to exclude unamortized debt discounts and premiums and unamortized debt costs. Net Debt is defined by the Company as Gross Debt less Total Cash. Management considers the non-GAAP measures of Gross Debt and Net Debt each to be a key supplemental measure of the Company's overall liquidity, capital structure and leverage. The Company's computation of FFO, Core FFO, AFFO, EBITDAre, Total Cash, Gross Assets, Gross Debt and Net Debt may differ from the methodology for calculating these non-GAAP financial measures used by other REITs, and therefore, may not be comparable to such other REITs. Reconciliations of net earnings, Total Debt and total assets (all computed in accordance with GAAP) to FFO, Core FFO, AFFO, EBITDAre, Gross Assets, Gross Debt and Net Debt (each of which is a non-GAAP financial measure), as applicable, are included in the financial information accompanying this release. Annualized Base Rent ("ABR") represents the monthly cash base rent for all leases in place as of the end of the period multiplied by 12. Accordingly, this methodology produces an annualized amount as of a point in time but does not take into consideration future (i) scheduled rent increases, (ii) leasing activity, or (iii) lease expirations. NNN REIT, Inc. Income Statement Summary (dollars in thousands, except per share data) (unaudited) Quarter Ended March 31, 2025 2024 Revenues: Rental income $ 230,574 $ 214,825 Interest and other income from real estate transactions 280 582 230,854 215,407 Operating expenses: General and administrative 13,008 12,584 Real estate 9,375 7,154 Depreciation and amortization 64,617 60,615 Leasing transaction costs 130 33 Impairment losses – real estate, net of recoveries 1,512 1,204 Executive retirement costs 2,173 317 90,815 81,907 Gain on disposition of real estate 3,813 4,821 Earnings from operations 143,852 138,321 Other expenses (revenues): Interest and other income (329) (119) Interest expense 47,723 44,069 47,394 43,950 Net earnings $ 96,458 $ 94,371 Weighted average shares outstanding: Basic 186,855,097 181,794,208 Diluted 187,080,084 182,212,897 Net earnings per share available to stockholders: Basic $ 0.52 $ 0.52 Diluted $ 0.51 $ 0.52 NNN REIT, Inc. Other Information (dollars in thousands) (unaudited) Quarter Ended March 31, 2025 2024 Rental income from operating leases(1) $ 224,056 $ 209,084 Earned income from direct financing leases(1) $ 114 $ 119 Percentage rent(1) $ 886 $ 888 Real estate expenses reimbursed from tenants(1) $ 5,518 $ 4,734 Real estate expenses (9,375) (7,154) Real estate expenses, net of tenant reimbursements $ (3,857) $ (2,420) Amortization of debt costs $ 1,466 $ 1,301 Non-real estate depreciation expense $ 43 $ 111 (1) For the quarters ended March 31, 2025 and 2024, the aggregate of such amounts is $230,574 and $214,825, respectively, and is classified as rental income on the income statement summary. NNN REIT, Inc. Balance Sheet Summary (dollars in thousands) (unaudited) March 31,2025 December 31,2024 Assets: Real estate portfolio, net of accumulated depreciation and amortization $ 8,898,036 $ 8,746,168 Cash and cash equivalents 5,097 8,731 Restricted cash and cash held in escrow 427 331 Receivables, net of allowance of $679 and $617, respectively 3,577 2,975 Accrued rental income, net of allowance of $3,311 and $4,156, respectively 34,245 34,005 Debt costs, net of accumulated amortization of $27,725 and $27,002, respectively 8,288 8,958 Other assets 72,048 71,560 Total assets $ 9,021,718 $ 8,872,728 Liabilities: Line of credit payable $ 116,300 $ — Notes payable, net of unamortized discount and unamortized debt costs 4,375,337 4,373,803 Accrued interest payable 74,698 29,699 Other liabilities 98,896 106,951 Total liabilities 4,665,231 4,510,453 Total equity 4,356,487 4,362,275 Total liabilities and equity $ 9,021,718 $ 8,872,728 Common shares outstanding 187,950,480 187,540,929 NNN REIT, Inc. Reconciliation of Non-GAAP Financial Measures (dollars in thousands, except per share data) (unaudited) Quarter Ended March 31, 2025 2024 Net earnings $ 96,458 $ 94,371 Real estate depreciation and amortization 64,577 60,507 Gain on disposition of real estate (3,813) (4,821) Impairment losses – depreciable real estate, net of recoveries 1,512 1,204 FFO 158,734 151,261 Executive retirement costs 2,173 317 Core FFO 160,907 151,578 Straight-line accrued rent, net of reserves (509) 36 Net capital lease rent adjustment 60 54 Below-market rent amortization (93) (117) Stock based compensation expense 3,571 3,567 Capitalized interest expense (921) (1,859) AFFO $ 163,015 $ 153,259 FFO per share: Basic $ 0.85 $ 0.83 Diluted $ 0.85 $ 0.83 Core FFO per share: Basic $ 0.86 $ 0.83 Diluted $ 0.86 $ 0.83 AFFO per share: Basic $ 0.87 $ 0.84 Diluted $ 0.87 $ 0.84 Dividend per share $ 0.5800 $ 0.5650 AFFO payout ratio (1) 66 % 67 % (1) Calculated as total dividends paid as a percentage of AFFO for each respective period. NNN REIT, Inc. Reconciliation of Non-GAAP Financial Measures (continued) (dollars in thousands, except per share data) (unaudited) Quarter Ended March 31, 2025 2024 Net earnings $ 96,458 $ 94,371 Interest expense 47,723 44,069 Depreciation and amortization 64,617 60,615 Gain on disposition of real estate (3,813) (4,821) Impairment losses – real estate, net of recoveries 1,512 1,204 EBITDAre $ 206,497 $ 195,438 Interest expense $ 47,723 $ 44,069 Add back: capitalized interest 921 1,859 Fixed charges $ 48,644 $ 45,928 March 31,2025 December 31,2024 Total assets $ 9,021,718 $ 8,872,728 Accumulated depreciation & amortization 2,123,438 2,065,520 Amortization of direct financing leases 2,715 2,655 Gross Assets $ 11,147,871 $ 10,940,903 Debt outstanding: Line of credit $ 116,300 $ — Notes payable, net of unamortized discount and unamortized debt costs 4,375,337 4,373,803 Total Debt 4,491,637 4,373,803 Unamortized note discount 45,646 46,437 Unamortized debt costs 29,017 29,760 Gross Debt 4,566,300 4,450,000 Total Cash (5,524) (9,062) Net Debt $ 4,560,776 $ 4,440,938 NNN REIT, Inc. Debt Summary As of March 31, 2025 (dollars in thousands) (unaudited) Unsecured Debt Principal Principal,Net ofUnamortizedDiscount StatedRate EffectiveRate Maturity Date Line of credit payable $ 116,300 $ 116,300 SOFR + 87.5 bps 5.185 % April 2028 Unsecured notes payable: 2025 400,000 399,928 4.000 % 4.029 % November 2025 2026 350,000 349,237 3.600 % 3.733 % December 2026 2027 400,000 399,534 3.500 % 3.548 % October 2027 2028 400,000 398,852 4.300 % 4.388 % October 2028 2030 400,000 399,317 2.500 % 2.536 % April 2030 2033 500,000 489,806 5.600 % 5.905 % October 2033 2034 500,000 494,232 5.500 % 5.662 % June 2034 2048 300,000 296,240 4.800 % 4.890 % October 2048 2050 300,000 294,596 3.100 % 3.205 % April 2050 2051 450,000 442,273 3.500 % 3.602 % April 2051 2052 450,000 440,339 3.000 % 3.118 % April 2052 Total 4,450,000 4,404,354 Total unsecured debt(1) $ 4,566,300 $ 4,520,654 Debt costs $ (43,820) Accumulated amortization 14,803 Debt costs, net of accumulated amortization (29,017) Notes payable, net of unamortized discount and unamortized debt costs $ 4,375,337 (1) Unsecured debt has a weighted average interest rate of 4.1% and a weighted average maturity of 11.6 years. NNN REIT, Inc.Debt Summary – ContinuedAs of March 31, 2025(unaudited) Credit Metrics March 31,2025 December 31, 2024 Gross Debt / Gross Assets 41.0 % 40.7 % Net Debt / EBITDAre (last quarter annualized) 5.5 5.6 EBITDAre / fixed charges 4.2 4.2 Credit Facility and Notes Covenants The following is a summary of key financial covenants for the Company's unsecured credit facility and notes, as defined and calculated per the terms of the facility's credit agreement and the notes' governing documents, respectively, which are included in the Company's filings with the Commission. These calculations, which are not based on U.S. GAAP measurements, are presented to investors to show that as of March 31, 2025, the Company believes it is in compliance with the covenants. Key Covenants Required March 31,2025 Unsecured Bank Credit Facility: Maximum leverage ratio < 0.60 0.38 Minimum fixed charge coverage ratio > 1.50 4.27 Maximum secured indebtedness ratio < 0.40 — Unencumbered asset value ratio > 1.67 2.71 Unencumbered interest ratio > 1.75 4.19 Unsecured Notes: Limitation on incurrence of total debt ≤ 60% 40 % Limitation on incurrence of secured debt ≤ 40% — Debt service coverage ratio ≥ 1.5 4.2 Maintenance of total unencumbered assets ≥ 150% 248 % NNN REIT, Inc.Property PortfolioAs of March 31, 2025 Top 20 Lines of Trade % of ABR As of March 31, Lines of Trade 2025(1) 2024(2) 1. Automotive service 17.9 % 16.3 % 2. Convenience stores 16.8 % 16.2 % 3. Restaurants – limited service 8.3 % 8.5 % 4. Family entertainment centers 7.1 % 6.7 % 5. Restaurants – full service 7.1 % 8.6 % 6. Recreational vehicle dealers, parts and accessories 5.0 % 4.6 % 7. Health and fitness 4.0 % 4.4 % 8. Theaters 3.9 % 4.1 % 9. Equipment rental 3.2 % 2.9 % 10. Automotive parts 2.5 % 2.4 % 11. Wholesale clubs 2.4 % 2.5 % 12. Drug stores 2.1 % 2.3 % 13. Home improvement 2.0 % 2.2 % 14. Medical service providers 1.9 % 1.8 % 15. Pet supplies and services 1.6 % 1.1 % 16. Furniture 1.3 % 2.0 % 17. Consumer electronics 1.3 % 1.3 % 18. General merchandise 1.2 % 1.4 % 19. Travel plazas 1.2 % 1.3 % 20. Home furnishings 1.1 % 1.3 % Other 8.1 % 8.1 % Total 100.0 % 100.0 % Top 10 States State % of ABR(1) State % of ABR(1) 1. Texas 19.0 % 6. Tennessee 3.7 % 2. Florida 8.7 % 7. North Carolina 3.7 % 3. Illinois 5.0 % 8. Indiana 3.6 % 4. Georgia 4.5 % 9. Virginia 3.4 % 5. Ohio 4.2 % 10. Arizona 3.2 % Based on ABR of: (1) $874,301,000 as of March 31, 2025. (2) $831,010,000 as of March 31, 2024. NNN REIT, Inc.Property Portfolio – ContinuedAs of March 31, 2025 Top 20 Tenants Tenant # of Properties % of ABR(1) 1. 7-Eleven 146 4.5 % 2. Mister Car Wash 121 4.0 % 3. Dave & Buster's 34 3.8 % 4. Camping World 48 3.8 % 5. GPM Investments (convenience stores) 148 2.8 % 6. Flynn Restaurant Group (Taco Bell/Arby's) 204 2.6 % 7. AMC Theatres 20 2.6 % 8. BJ's Wholesale Club 13 2.4 % 9. Kent Distributors (convenience stores) 49 2.3 % 10. LA Fitness 25 2.3 % 11. Mavis Tire Express Services 140 2.2 % 12. Couche Tard (Pantry) 91 2.1 % 13. Walgreens 49 1.8 % 14. Chuck E. Cheese 51 1.8 % 15. Sunoco 53 1.7 % 16. Casey's General Stores (convenience stores) 62 1.6 % 17. United Rentals 49 1.6 % 18. Tidal Wave Auto Spa 35 1.4 % 19. Super Star Car Wash 33 1.3 % 20. Lifetime Fitness 3 1.3 % Other 2,267 52.1 % Total 3,641 100.0 % Lease Expirations(2) % ofABR(1) # ofProperties Gross LeasableArea(3) % ofABR(1) # ofProperties Gross LeasableArea(3) 2025 2.5 % 107 608,000 2031 6.9 % 187 2,633,000 2026 4.1 % 201 1,966,000 2032 5.2 % 191 1,873,000 2027 7.3 % 219 3,311,000 2033 4.6 % 136 1,411,000 2028 5.7 % 254 2,277,000 2034 5.6 % 179 2,332,000 2029 4.5 % 142 2,081,000 Thereafter 49.0 % 1,772 15,637,000 2030 4.6 % 169 2,202,000 (1) Based on ABR of $874,301,000 as of March 31, 2025. (2) As of March 31, 2025, the weighted average remaining lease term is 9.9 years. (3) Square feet. SOURCE NNN REIT, Inc. WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM? 440k+ Newsrooms & Influencers 9k+ Digital Media Outlets 270k+ Journalists Opted In

NNN REIT, Inc. Announces First Quarter 2025 Results and Maintains 2025 Guidance

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