Medalist Diversified Inc (MDRR) 2019 Q4 法說會逐字稿

Good morning. Welcome to Medalist Diversified REIT fourth quarter and fiscal year 2019 earnings call and update. On March 4, the company issued a press release that provided an overview of its results. Today's conference is being recorded and will be available online. (Operator Instructions)

早安.歡迎參加 Medalist Diversified REIT 2019 年第四季和財政年度財報電話會議和最新動態。 3 月 4 日，該公司發布了一份新聞稿，概述了其業績。今天的會議正在錄製中，並將在網路上發布。 （操作員說明）

Before the call begins, we would like to remind everyone that various remarks about future expectations, plans and prospects constitute forward-looking statements for purposes of Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995.

在電話會議開始之前，我們想提醒大家，有關未來預期、計畫和前景的各種言論均構成前瞻性陳述，符合 1995 年《私人證券訴訟改革法案》中的安全港條款。

Medalist cautions that these forward-looking statements are subject to risk and uncertainties that may cause actual results to differ materially from those indicated including risks described in the company's filing with the SEC. Any forward-looking statements made on this conference call speak only as of today's date, Monday, March 9, 2020. And Medalist does not intend to update any of these forward-looking statements to reflect events or circumstances that would occur after today's date.

Medalist 警告說，這些前瞻性陳述存在風險和不確定性，可能導致實際結果與所示結果有重大差異，包括該公司向 SEC 提交的文件中所述的風險。本次電話會議中所做的任何前瞻性聲明僅截至今天（2020 年 3 月 9 日星期一）。Medalist 不打算更新任何這些前瞻性聲明以反映今天之後將發生的事件或情況。

With that I would like to turn the call over to Chairman and CEO, Tim Messier. Please go ahead.

我想將電話轉給董事長兼執行長 Tim Messier。請繼續。

Hey. Good morning, everyone. And thanks for getting on the call. As Moore said, we are -- this is an earnings call. However, I will start by listing some of the great fundamentals of our company at this time.

嘿。大家，早安。感謝您接聽電話。正如摩爾所說，我們——這是一次財報電話會議。不過，我將先列出我們公司目前的一些重要基本面。

In the fourth quarter, we doubled the size of the company with three great assets: shopping center; a very attractive hotel in Clemson, South Carolina; and a flex property in Greenville, South Carolina, which adds to our already attractive portfolio of three other properties. So, in the fourth quarter we had six properties creating earnings and revenues for us.

在第四季度，我們將公司規模擴大了一倍，擁有三大資產：購物中心；南卡羅來納州克萊姆森市一家非常有魅力的飯店；以及位於南卡羅來納州格林維爾的靈活房產，這增加了我們已經具有吸引力的其他三個房產組合。因此，在第四季度，我們有六處房產為我們創造了收益和收入。

And with that I'd like to turn it over to Brent Winn to talk about our earnings and then we'll ask any questions regarding that as we move along. I will say that you have access to me. After this call, you may call me on 804-344-4435. Brent?

接下來，我想將其交給 Brent Winn 來討論我們的收入，然後我們將在進展過程中提出任何相關問題。我會說你可以訪問我。打完電話後，您可以撥打 804-344-4435 給我打電話。布倫特？

Good morning. As Tim mentioned, like to start off with some major, kind of, bigger picture items. During the fourth quarter of 2019, our portfolio size doubled from 3 to 6 properties which increased our assets by $30 million over December 31, 2018, assets.

早安.正如蒂姆所提到的，喜歡從一些主要的、更大的項目開始。 2019 年第四季度，我們的投資組合規模從 3 處房產增加了一倍至 6 處房產，這使我們的資產比 2018 年 12 月 31 日的資產增加了 3,000 萬美元。

During the fourth quarter, our revenues increased 66.8% over the fourth quarter 2018 to $3.1 million and that was due to the three acquisitions that closed in which we had the benefit of all three properties during the fourth quarter.

第四季度，我們的營收比 2018 年第四季成長 66.8%，達到 310 萬美元，這是由於我們在第四季度完成了三項收購，從所有三項資產中受益。

During the fourth quarter, we also saw a decrease in non-recurring expenses, primarily non-cash share based compensation items and a loss on impairment. Our net loss for the quarter was $734,000 compared to [$1.5] million in the quarter ended December 31, 2018.

在第四季度，我們也看到非經常性費用減少，主要是非現金股份補償項目和減損損失。我們本季的淨虧損為 734,000 美元，而截至 2018 年 12 月 31 日的季度淨虧損為 150 萬美元。

As a REIT, we have very heavy non-cash depreciation and amortization items. So, we will be talking primarily going forward about net losses but when adjusted for those non-cash items, we will start to see stronger cash flow going forward. This leads into AFFO, which is a supplemental financial measure that we use.

作為房地產投資信託基金，我們有非常重的非現金折舊和攤提項目。因此，我們將主要討論未來的淨虧損，但當對這些非現金項目進行調整時，我們將開始看到未來更強勁的現金流。這導致了 AFFO，這是我們使用的補充財務措施。

During the fourth quarter ended December 31, 2019, our AFFO increased by $823,000 to $380,000 over the fourth quarter 2018. This is a $0.08 per common share.

截至 2019 年 12 月 31 日的第四季度，我們的 AFFO 比 2018 年第四季增加了 823,000 美元，達到 380,000 美元。相當於每股普通股 0.08 美元。

For the full year, our net loss was $3.8 million compared to $2.9 million of prior year. Again, this is a function of non-recurring expenses and heavy depreciation, amortization costs.

全年淨虧損為 380 萬美元，上一年為 290 萬美元。同樣，這是非經常性費用和高額折舊、攤提成本的函數。

Looking at our AFFO and FFO, as I said, our AFFO increased significantly but our funds from operations also increased substantially from $769,000 negative in 2018 fourth quarter to $287,000 positive in the fourth quarter 2019. Over $1 million increase.

看看我們的AFFO 和FFO，正如我所說，我們的AFFO 大幅增加，但我們的營運資金也大幅增加，從2018 年第四季的769,000 美元負值增加到2019 年第四季的287,000 美元正值。增加超過100 萬美元。

So going forward, we plan to add one to two properties in the near term, which will create more cash flow and be accretive to the REIT. We do not have a prediction of when they will close but we expect them to close in the first half of the year. Don't know -- we don't have a closing date yet.

因此，展望未來，我們計劃在短期內增加一到兩處房產，這將創造更多現金流並為房地產投資信託基金帶來增值。我們無法預測它們何時關閉，但我們預計它們將在今年上半年關閉。不知道——我們還沒有截止日期。

Our plans for the future are to grow significantly buying properties in the southeast where cap rates are 7% to 9%, much higher yields in the primary cities in the secondary tertiary markets of the southeast.

我們未來的計畫是大幅增加在東南部購買房產，資本化率為7%至9%，東南部二、三線市場主要城市的收益率要高得多。

With that, I'll open it up for questions regarding our earnings.

接下來，我將開放詢問有關我們收入的問題。

Ben Zucker, Aegis Capital.

本·扎克，安吉斯資本。

Good morning, guys. Thanks for taking my questions. And congratulations on what I view as a pretty strong quarter end definitely a nice turnaround and jump in the business and the underlying metrics.

早上好傢伙。感謝您回答我的問題。恭喜我認為相當強勁的季度末，這絕對是業務和基本指標的良好轉變和跳躍。

I guess just to kind of kick off. You guys now own two hotels. Could you talk about maybe the seasonality factors and how that might have played into both the fourth quarter results, but then also kind of your outlook and your expectations looking out for 2020?

我想只是為了開始。你們現在擁有兩家飯店。您能否談談季節性因素以及它對第四季度業績的影響，以及您對 2020 年的展望和期望？

Sure. These limited-service hotels we've owned, that we own now and have owned in the past usually in November and December and sometimes in January, the seasonality where business travel is lower, and group travel is lower. So, we always have to allow for that.

當然。我們現在和過去擁有的這些有限服務酒店通常在十一月和十二月，有時在一月，商務旅行和團體旅行較低的季節性。所以，我們總是必須考慮到這一點。

We have some seasonality in the two hotels in November and December. We expect revenue to pick up going into the fourth quarter and certainly into the second quarter. In both situations, there are group trips and other activities in the areas where our hotels are located and we should see revenues pick up significantly, like I said in the first and second quarter.

11 月和 12 月這兩家酒店有一些季節性。我們預計第四季營收將會回升，當然第二季也是如此。在這兩種情況下，我們酒店所在的地區都會有團體旅行和其他活動，我們應該會看到收入大幅增長，就像我在第一季和第二季所說的那樣。

Got you. And then just real quickly staying on the topic of hotels. I -- notwithstanding the seasonality you're talking about. Have you seen any kind of change or potential change in demand that could be attributable to the coronavirus yet or is it still too early to tell?

明白你了。然後很快就回到飯店這個話題。我——儘管你談論的是季節性。您是否已經看到任何可能由冠狀病毒引起的需求變化或潛在變化，還是現在下結論還為時過早？

We have not seen any change in demand as a result of that. We've checked with our hotel managers. They are booking rooms really on every other day basis, and we have not seen any problems with that yet.

我們沒有看到需求因此有任何變化。我們已經與酒店經理核實過。他們實際上每隔一天就會預訂房間，我們還沒有看到任何問題。

Understood. On your lease expiration schedule, I believe you had some leases that were set to expire in 2020. How are just -- from a high level, how are those conversations shaping out with tenants thus far? Are there any updates there that you could provide?

明白了。在你們的租約到期時間表上，我相信你們有一些租約將於 2020 年到期。從高層來看，到目前為止與租戶的對話進展如何？您可以提供任何更新嗎？

We have not contacted those tenants yet. We usually wait till six months before, prior to their expirations. And so that's our strategy. We use outside leasing agents to handle our leasing arrangements, but we usually wait until six months prior to a tenant maturity.

我們還沒有聯絡那些租戶。我們通常會等到六個月前，也就是到期前。這就是我們的策略。我們使用外部租賃代理來處理我們的租賃安排，但我們通常會等到租戶到期前六個月。

Understood. And then you started touching on the deployment talking about maybe closing some more assets in the first half. Could you maybe talk about the types of assets that you guys are looking at? I know the market will always be the southeast, but is there anything like -- do you think you might do a foray into multifamily, or do you think you'll be sticking with big companies' retails [trip] centers? Just want to maybe get a flavor for what you guys are looking at in your pipeline?

明白了。然後你開始談到部署，談論可能在上半年關閉更多資產。您能談談你們正在關注的資產類型嗎？我知道市場永遠是東南部，但有沒有類似的情況——你認為你可能會進軍多戶住宅，還是你認為你會堅持大公司的零售[旅行]中心？只是想了解你們在管道中看到的東西嗎？

Well, we love multifamily. It's a little expensive right now. We are building a strategy on purchasing multifamily.

嗯，我們喜歡多戶家庭。現在有點貴。我們正在製定購買多戶住宅的策略。

The two properties we have on our radar. One is a flex property 90,000 square feet located in Chesapeake, Virginia, in a great area of Chesapeake where there's a lot of economic activities. And other properties are shopping center in Newport News, Virginia, on a heavily traveled road or Warwick Boulevard in Newport News. The main anchors there are AutoZone and Food Lion.

我們雷達上的兩個屬性。其中之一是位於弗吉尼亞州切薩皮克的一處佔地 90,000 平方英尺的靈活房產，位於切薩皮克的一個偉大地區，那裡有很多經濟活動。其他物業包括弗吉尼亞州紐波特紐斯交通繁忙的道路上的購物中心或紐波特紐斯的沃里克大道。那裡的主要主播是 AutoZone 和 Food Lion。

And then just touching back, bringing that all back home to kind of the current events, which is on everyone's mind, I think of the coronavirus. How are you viewing the rush or patience towards deploying capital? And I'm asking that because obviously debt costs continue to get very favorable. So, the opportunity to lock in some ultra-cheap, long-term debt is probably better than it's been in recent history right now. But there's also still some uncertainty.

然後回過頭來，把這一切帶回時事上，這是每個人都在想的，我想到了冠狀病毒。您如何看待資本部署的匆忙或耐心？我這麼問是因為顯然債務成本繼續變得非常有利。因此，鎖定一些超便宜的長期債務的機會可能比近期歷史上的任何時候都要好。但也仍存在一些不確定性。

So are you guys maybe a little bit more cautious and trying to wait and see with how everything plays out or do you think you're really going to be still just trying to lock in the properties that you're looking at right now and take advantage of the low cost debt markets?

那麼，你們可能會更加謹慎一點，並嘗試等待，看看一切會如何發展，或者您認為您真的會仍然只是試圖鎖定您現在正在查看的房產並採取行動嗎？低成本債務市場的優勢？

[We will say free asset] question, I mean, right now the latest numbers we've seen a way sub 4% on most assets. I would say right now we could get 3.5 to 3 and 3.25 on a shopping center, neighborhood shopping center, flex property, or hotels, multifamily, I think it's around 3.10, all for 10 years fixed, very, very cheap debt.

[我們會說免費資產]問題，我的意思是，目前我們看到的大多數資產的最新數據都低於 4%。我想說，現在我們可以得到 3.5 到 3 和 3.25 的購物中心、鄰裡購物中心、彈性房產或酒店、多戶住宅，我認為大約是 3.10，全部都是 10 年固定的、非常非常便宜的債務。

We have not seen a lot of handwringing regarding the coronavirus in the southeast. Activities are still going on. The Atlantic Coast Conference, ACC tournament for basketball is still on for this week. We have a Furniture Mart which is a huge event in the Greensboro area that will benefit our Hampton Inn. That is -- no one has canceled there. So, we haven't seen any real worry about the coronavirus in our area as of yet.

我們還沒有看到東南部地區對冠狀病毒有太多的擔憂。活動仍在繼續。大西洋海岸聯盟、ACC 籃球錦標賽本週仍在進行。我們有一個家具市場，這是格林斯伯勒地區的一個大型活動，將使我們的漢普頓酒店受益。也就是說——沒有人在那裡取消。因此，到目前為止，我們還沒有看到我們地區對冠狀病毒有任何真正的擔憂。

So we're very fortunate in that regard in my opinion. And we can keep our fingers crossed and we will.

所以我認為我們在這方面非常幸運。我們可以祈禱，我們會的。

Great. Well, listen, I appreciate the clarity there. I look forward to reviewing the 10-K filing when that comes out. And again, just want to say congratulations. I think the sequential jump in earnings has certainly kind of showing the value of the properties you've been assembling.

偉大的。好吧，聽著，我很欣賞那裡的清晰度。我期待在 10-K 文件發布後對其進行審查。再次，只想說恭喜。我認為收入的連續成長肯定在某種程度上顯示了你所組裝的房產的價值。

Thank you, Ben.

謝謝你，本。

Jon Wheeler, Wheeler Real Estate Investment

喬恩‧惠勒，惠勒房地產投資

Good morning, guys. It's Jon Wheeler. How y'all doing this morning?

早上好傢伙。這是喬恩·惠勒。今天早上你們好嗎？

Very well.

很好。

Want to touch base. I had a couple questions that I'd like to ask online and offline as well. Could you repeat your telephone number, Tim?

想要接觸基地。我有幾個問題想在線上和離線詢問。提姆，你能重複一下你的電話號碼嗎？

Sure. 804-344-4435.

當然。 804-344-4435。

4435. All right. Thank you, I appreciate it. I was looking at some of the financials on the SEC website, and again I would agree with the previous caller, congratulations on doubling the size of the portfolio from three to six.

4435.好吧。謝謝你，我很感激。我在 SEC 網站上查看了一些財務數據，我再次同意先前來電者的觀點，並祝賀您將投資組合規模從 3 倍增加到 6 倍。

My first question is -- and again it may be more of an offline question, but it looks like you're paying based upon fourth quarter, the $0.08. If you just annualized those times four quarters assuming that was the number, you're paying out $0.50 a share annualized and you only earned $0.08 in fourth quarter.

我的第一個問題是——這可能更像是一個線下問題，但看起來你是根據第四季度的 0.08 美元支付的。如果你只是將這四個季度的時間進行年化，假設這就是數字，那麼你將每年支付每股 0.50 美元，而第四季度你只賺了 0.08 美元。

So my question is, when you do the math on that you're paying out about 36% more than what you're earning. And I'd like you to comment on that because it seems a pretty aggressive. For example, if you're earning $0.08 and you're paying out $0.125, if you could address that first question?

所以我的問題是，如果你計算一下，你支付的費用比你的收入多出大約 36%。我希望你對此發表評論，因為這看起來相當激進。例如，如果您賺取 0.08 美元並支付 0.125 美元，您是否可以解決第一個問題？

Sure. The two hotels had seasonality issues in the November and December. If they perform the way they normally do through the year we've been very close to covering or over covering our dividend.

當然。這兩家酒店在 11 月和 12 月都遇到了季節性問題。如果他們全年表現正常，我們就非常接近或超額支付我們的股息。

So, you think that you could bridge, if you use fourth quarter's results as a benchmark metric, you could bridge that 36% on a quarterly basis. So Q1 over Q4 of last year?

所以，你認為你可以彌補，如果你使用第四季度的結果作為基準指標，你可以按季度彌補 36％。那麼第一季比去年第四季呢？

Q1 over Q4. Q1 last year has nothing to do with the financials today.

Q1 超過 Q4。去年第一季與今天的財務狀況無關。

Oh, no no. I'm talking about - I'm sorry. I'm talking about Q1 of '20 when you report. Based on what your statement was, if you earned $0.08 a share.

哦，不不。我說的是——對不起。當你報告時，我正在談論 20 年第一季。根據您的陳述，如果您每股賺取 0.08 美元。

It should be much close to recovering our dividend in Q1 than we were in Q4 because we expect the hotels to perform better. Q2, we expect them to perform better than Q1. So, we are getting very close to either covering or over [double] of quarters.

第一季的股息應該比第四季更接近收回股息，因為我們預計酒店的業績會更好。 Q2，我們預期他們的表現會比 Q1好。因此，我們非常接近覆蓋或超過[雙]個季度。

Okay. That's good to hear. Tell me about -- you're diversified REIT and the market traditionally -- I know you are NASDAQ, the market traditionally discounts diversified REITs. And I heard this morning that not only you in office, or warehouse, retail, and hotels, but you mentioned apartments. If you did that that would be four different property types. Are you running financials individually on each product type internally and then have a consolidated statement with currently those three different product types combined?

好的。聽起來還不錯。告訴我——你們是多元化的房地產投資信託基金和傳統市場——我知道你們是納斯達克，市場傳統上對多元化的房地產投資信託基金打折。今天早上我聽說你不僅在辦公室、倉庫、零售店和飯店，而且還提到了公寓。如果你這樣做，那將是四種不同的財產類型。您是否在內部分別對每種產品類型進行財務分析，然後將目前這三種不同產品類型組合在一起形成綜合報表？

That's correct. Look, this strategy is born out of Bill Elliott's experience in the commercial real estate space. Our strategy is to build a portfolio workforce necessity real estate comprised of four property types. And those four property types reflect industrial, limited-service hotels, multifamily, and neighborhood retail, not large shopping malls.

這是正確的。看，這個策略源自於 Bill Elliott 在商業房地產領域的經驗。我們的策略是建立一個由四種房地產類型組成的勞動力必需房地產投資組合。這四種物業類型反映的是工業、有限服務酒店、多戶住宅和鄰裡零售，而不是大型購物中心。

Okay.

好的。

We have managed and owned that property since we started as a private equity company and not REIT.

自從我們作為一家私募股權公司（而不是房地產投資信託基金）成立以來，我們就一直管理和擁有該財產。

Okay, thank you. So, tell me about external management. When a company is externally managed as a real estate investment trust, publicly traded real estate investment trusts, like the diversified REITs, they're discounted. When you're externally managed, my experience is the stock is discounted. And when I look at where the 52-week high the stock was versus where it is today, it looks like you're down 72%, if you look at 52 weeks ago versus today. So, if you could address external management and stock price as well.

好的謝謝。那麼，請告訴我有關外部管理的資訊。當一家公司作為房地產投資信託進行外部管理時，公開交易的房地產投資信託（如多元化的房地產投資信託基金）會打折。當你由外部管理時，我的經驗是股票會打折。當我比較該股的 52 週高點與今天的情況時，如果你比較 52 週前與今天的情況，看起來你下跌了 72%。所以，如果你也能解決外部管理和股價問題。

You know what, I'll address that offline, Jon. You could call me back on my number. We'll talk about that.

你知道嗎，我會在線下解決這個問題，喬恩。你可以用我的號碼回電給我。我們會討論這個。

Our fundamentals are very strong. If the [REIT] wants to discount us because we're diversified, that's their option. But you may call me back on that question.

我們的基礎非常強大。如果[房地產投資信託基金]因為我們多元化而想要給我們打折，那是他們的選擇。但你可以就這個問題回電給我。

Okay. Good, good. I will. Okay. I'll hold my comments there. But I think I have some more hardline questions that will need direct answers. And being a stockholder I'm sure you'll be transparent with me.

好的。好好。我會。好的。我會在那裡保留我的評論。但我認為我有一些更尖銳的問題需要直接回答。身為股東，我相信你會對我保持透明。

Sure, absolutely.

當然，絕對。

Thank you all. Appreciate it.

謝謝你們。欣賞它。

With no more further questions in the queue, I would like to turn the conference back over to Mr. Messier for additional closing remarks.

由於隊列中沒有更多問題，我想將會議轉回梅西耶先生進行補充閉幕發言。

Again, thanks, everyone, for getting on the call this morning. We are very happy with our earnings. We're very excited about the future. Again, we plan to add properties as we move along. We plan to grow.

再次感謝大家今天早上撥電話。我們對我們的收入感到非常滿意。我們對未來感到非常興奮。同樣，我們計劃在前進過程中添加屬性。我們計劃成長。

We have an extremely strong team of people working with us. And we're very happy where the company is now. And we thank you for being all this morning.

我們有一支非常強大的團隊與我們合作。我們對公司現在的處境感到非常高興。我們感謝您整個上午的光臨。

Ladies and gentlemen, that does conclude our conference for today. Thank you so much for your participation. Have a wonderful day. You may now disconnect.

女士們、先生們，今天的會議到此結束。非常感謝您的參與。祝你有美好的一天。您現在可以斷開連線。