AMERICOLD REALTY TRUST - FORM 8-K - EX-99.2 - EXHIBIT 99.2

Attached files

file	filename
EX-99.1 - EXHIBIT 99.1 - AMERICOLD REALTY TRUST	q42017-pressrelease.htm
8-K - 8-K - AMERICOLD REALTY TRUST	americold-form8xk4q17earni.htm

Tacoma, WA Facility

Earnings Press Release and Supplemental Financial Information

Fourth Quarter and Year Ended December 31, 2017




Financial Supplement		Fourth Quarter 2017



Table of Contents


Highlights
Company Profile	3
Earnings Release	4

Financial Information
Consolidated Balance Sheet	11
Consolidated Statement of Income	12
Reconciliation of Net Earnings to FFO, Core FFO, and AFFO	13
Reconciliation of Net Earnings to EBITDA and Core EBITDA	14
Debt Detail and Maturities	15

Operations Overview
Revenue and Contribution by Segment	16
Overall Occupancy Trend	17
Warehouse Portfolio	18
Fixed Commitment and Lease Maturity Schedules	20
Maintenance Capital Expenditures and Maintenance Expense	22

Total Global Warehouse Performance
Same-store Financial Performance	23
Same-store Key Operating Metrics	27

Capital Deployment
Current Development Projects	29

Notes and Definitions	30




Financial Supplement		Fourth Quarter 2017

Corporate Profile

We are the world’s largest owner and operator of temperature-controlled warehouses. We are organized as a self-administered and self-managed REIT with proven operating, development and acquisition expertise. As of December 31, 2017, we operated a global network of 158 temperature-controlled warehouses encompassing approximately 934 million cubic feet, with 140 warehouses in the United States, six warehouses in Australia, seven warehouses in New Zealand, two warehouses in Argentina and three warehouses in Canada. In addition, we hold a minority interest in the China JV, as described in Note 3 of the Consolidated Financial Statements included in Item 8 of our 2017 Annual Report on Form 10-K, which owns or operates 13 temperature-controlled warehouses located in China.

Corporate Headquarters

10 Glenlake Parkway South Tower, Suite 600

Atlanta, Georgia 30328

Telephone: (678) 441-1400

Website: www.americold.com

Senior Management

Fred Boehler: Chief Executive Officer, President and Trustee

Marc Smernoff: Chief Financial Officer and Executive Vice President

Andrea Darweesh: Chief Human Resources Officer and Executive Vice President

Thomas Musgrave: Chief Information Officer and Executive Vice President

James C. Snyder, Jr.: Chief Legal Officer and Executive Vice President

Thomas Novosel: Chief Accounting Officer and Senior Vice President

Board Members

Jeffrey M. Gault: Chairman of the Board of Trustees

James R. Heistand: Lead Independent Trustee

Fred Boehler: Chief Executive Officer, President and Trustee

George J. Alburger, Jr.: Trustee

Bradley J. Gross: Trustee

Joel A. Holsinger: Trustee

Michelle M. MacKay: Trustee

Mark R. Patterson: Trustee

Andrew P. Power: Trustee

Investor Relations

To request more information or to be added to our e-mail distribution list, please visit our website: www.americold.com

(Please proceed to the Investor Relations section)



Analyst Coverage

Firm	Analyst Name	Contact
Baird Equity Research	David B. Rodgers	216-737-7341
Bank of America Merrill Lynch	Joshua Dennerlein	646-855-1681
Goldman Sachs	Andrew Rosivach	212-902-2796
J.P. Morgan	Michael W. Mueller	212-622-6689
RBC	Michael Carroll	440-715-2649
SunTrust Robinson Humphrey	Ki Bin Kim	212-303-4124

Stock Listing Information

The stock of Americold Realty Trust is traded on the New York Stock Exchange under the symbol "COLD".




Financial Supplement		Fourth Quarter 2017

AMERICOLD REALTY TRUST ANNOUNCES FOURTH QUARTER AND FULL YEAR 2017 RESULTS

- Global Warehouse Segment Revenue Grows 6.0% Year-Over-Year -

- Completed Initial Public Offering -

- Declared First Quarter 2018 Dividend -

Atlanta, GA, March 28, 2018 - Americold Realty Trust (NYSE: COLD) (the "Company"), the world’s largest owner and operator of temperature-controlled warehouses, today announced financial and operating results for the quarter and year ended December 31, 2017. The Company completed its initial public offering on January 23, 2018 and the results detailed below reflect the pre-IPO entity, except where noted.

“We are extremely pleased with our full year 2017 results, which showed strong year over year growth including Global Warehouse segment revenue and segment contribution (NOI) increasing 6.0% and 10.9%, respectively. With the successful completion of our initial public offering in January 2018, we are now the first publicly traded owner-operator dedicated to temperature-controlled infrastructure. Our portfolio of mission critical assets, focused management, and customer-centric operating platform provide a meaningful competitive advantage as we focus on creating long-term shareholder value through the execution of our internal and external growth strategy,” stated Fred Boehler, President and Chief Executive Officer of Americold Realty Trust.

Full Year Highlights


•	Total revenue increased 3.6% to $1.54 billion of which Global Warehouse segment revenue grew 6.0% to $1.15 billion, both over prior year


•	Total contribution (NOI) increased 8.2% to $374.1 million; of which Global Warehouse segment contribution (NOI) was up 10.9% to $348.3 million, both over prior year


•	Net loss of $0.6 million compared to net income of $4.9 million for the prior year


•	Core EBITDA of $287.1 million, a 9.9% increase over prior year


•	Adjusted Funds from Operations (“AFFO”) of $94.6 million, a 33.0% increase over prior year


•	Global Warehouse segment same store revenue grew 6.1% to $1.12 billion, with segment contribution (NOI) improving 9.8% to $346.9 million, both over prior year


•	Same store occupancy for the Global Warehouse segment expanded 110 basis points, over prior year to 78.3%


•	Opened a new 6.8 million refrigerated cubic foot facility in Clearfield, Utah, and commenced construction on two development projects, a 5.2 million refrigerated cubic foot facility in Middleboro, MA and a 15.7 million refrigerated cubic foot automated high-rise expansion of an existing facility in suburban Chicago

Highlights Subsequent to Year End


•	Completed initial public offering (“IPO”) in January 2018, generating net proceeds of $494 million to the Company through the issuance of 33.4 million common shares of beneficial interest


•	Closed new $925 million senior secured credit facility


•	Declared a pro-rata dividend of $0.13958 per common share payable on April 16, 2018 to shareholders of record on March 30, 2018, representing a full quarterly dividend of $0.1875 per share, which equates to $0.75 per share on an annual basis




Financial Supplement		Fourth Quarter 2017

Fourth Quarter and Full Year 2017 Financial Results

Total revenue for the fourth quarter 2017 was $401.7 million, a 1.8% increase from the same quarter of the prior year. For the full-year 2017, total revenue grew to $1.54 billion, an increase of 3.6% to 2016.

For the fourth quarter of 2017, the Company reported net income of $8.0 million, compared to net income of $12.4 million, for the same quarter of the prior year. For the full year 2017, the Company reported a net loss of $0.6 million, compared to net income of $4.9 million, for the prior year.

Total contribution (NOI) for the fourth quarter 2017 was $100.4 million, compared to total contribution (NOI) of $101.0 million for the same quarter of the prior year. The Company's fourth quarter 2016 revenues and contribution (NOI) were favorably impacted by the timing of revenue recognition associated with certain annual customer contractual volume commitments totaling approximately $5 million. Excluding this impact, total contribution (NOI) improved $4.4 million, or 4.4% for the same quarter of the prior year. For the full year 2017, total contribution (NOI) was $374.1 million, an 8.2 % increase over 2016.

Core EBITDA was $78.7 million for the fourth quarter of 2017, compared to $82.0 million for the same quarter of the prior year. Fourth quarter 2016 Core EBITDA benefited from the same volume commitment revenue related items mentioned above, and approximately $2.0 million of other income related to business interruption insurance proceeds. Excluding these favorable items recorded in the fourth quarter of 2016, Core EBITDA improved $3.7 million, or 4.9% from the same quarter of the prior year. For the full year 2017, Core EBITDA grew to $287.1 million, a 9.9% increase over 2016.

For the fourth quarter of 2017, Core Funds from Operations (“Core FFO”) was $32.7 million, compared to $31.5 million for same quarter of the prior year. For the full year 2017, Core FFO was $106.1 million, compared to $69.2 million for the prior year.

For the fourth quarter of 2017, AFFO was $24.0 million, compared to $28.3 million for same quarter of the prior year. For the full year 2017, AFFO was $94.6 million, compared to $71.1 million for the prior year. AFFO excludes certain expenses and income items that do not represent core expenses and income streams and the full definition and reconciliation can be found in the Company’s supplemental financial information.

Fourth Quarter and Full Year 2017 Global Warehouse Segment Results

For full year 2017, the Global Warehouse segment were $1.15 billion, a 6.0% increase over 2016. Segment contribution (NOI) was $348.3 million, or 30.4% of segment revenue for full year 2017, compared to $314.0 million, or 29.1% of revenue, for the prior year. This represents 10.9% improvement in segment profitability over 2016 and an expansion of 130 basis points in segment margin year-over-year.

For the fourth quarter of 2017, the Global Warehouse segment reported revenue of $297.6 million, a 2.3% increase over the fourth quarter of 2016. Segment contribution (NOI) was $93.9 million, or 31.6% of segment revenue for the fourth quarter, compared to $92.2 million, or 31.7% of revenue, for the same quarter of the prior year. This represents a 1.9% improvement in segment contribution (NOI) over the fourth quarter of 2016. Normalizing for the portion of the revenue recognition associated with certain annual customer contractual volume commitments associated with our global warehouse segment, approximately $4.0 million,




Financial Supplement		Fourth Quarter 2017

the year over year improvement in revenue and contribution (NOI) would have been 3.7% and 6.4%, respectively. Additionally, normalized contribution (NOI) margin would have expanded 100 basis points to 31.7% from 30.7%.

The Company ended 2017 with 146 total facilities in its Global Warehouse segment portfolio. Of the 146 total facilities, 139 meet the Company’s definition of facilities with at least 24 months of consecutive "normalized operations" and are reported as "same store". The remaining seven facilities are in various stages of operations and are classified as "non-same store".

The tables below summarize the fourth quarter and full year 2017 Global Warehouse full segment and same store metrics compared to the same period a year ago:



Global Warehouse - Total	Three Months Ended December 31,						Change		Year Ended December 31,						Change
Dollars in thousands	2017			2016			Change		2017			2016			Change
Global Warehouse revenues:
Rent and storage	$	131,695		$	128,664		2.4	%	$	501,604		$	476,800		5.2	%
Warehouse services	165,903			162,330			2.2	%	644,058			604,067			6.6	%
Total Warehouse revenues	297,598			290,994			2.3	%	1,145,662			1,080,867			6.0	%
Global Warehouse contribution (NOI)	$	93,930		$	92,175		1.9	%	$	348,328		$	314,045		10.9	%
Global Warehouse margin	31.6		%	31.7		%	-10 bps		30.4		%	29.1		%	130 bps

Units in thousands except per pallet data
Global Warehouse rent and storage:
Occupancy
Average occupied pallets	2,625			2,595			1.2	%	2,509			2,470			1.6	%
Average physical pallet positions	3,232			3,213			0.6	%	3,216			3,231			(0.5	)%
Occupancy percentage	81.2		%	80.8		%	40 bps		78.0		%	76.4		%	160 bps
Same store rent and storage revenues per occupied pallet	$	50.16		$	49.58		1.2	%	$	199.96		$	193.04		3.6	%
Global Warehouse services:
Throughput pallets	6,951			7,018			(1.0	)%	27,626			27,123			1.9	%
Same store warehouse services revenues per throughput pallet	$	23.87		$	23.13		3.2	%	23.31			22.27			4.7	%



Global Warehouse - Same Store	Three Months Ended December 31,						Change		Year Ended December 31,						Change
Dollars in thousands	2017			2016			Change		2017			2016			Change
Global Warehouse same store revenues:
Rent and storage	$	128,825		$	126,323		2.0	%	$	491,174		$	465,528		5.5	%
Warehouse services	162,633			159,556			1.9	%	631,287			591,994			6.6	%
Total same store revenues	291,458			285,879			2.0	%	1,122,461			1,057,522			6.1	%
Global Warehouse same store contribution (NOI)	$	93,234		$	92,278		1.0	%	$	346,879		$	315,809		9.8	%
Global Warehouse same store margin	32.0		%	32.3		%	-30 bps		30.9		%	29.9		%	100 bps

Units in thousands except per pallet data
Global Warehouse same store rent and storage:
Occupancy
Average occupied pallets	2,559			2,556			0.1	%	2,447			2,414			1.4	%
Average physical pallet positions	3,128			3,126			0.1	%	3,124			3,125			—	%
Occupancy percentage	81.8		%	81.8		%	0 bps		78.3		%	77.2		%	110 bps
Same store rent and storage revenues per occupied pallet	$	50.34		$	49.41		1.9	%	$	200.75		$	192.87		4.1	%
Global Warehouse same store services:
Throughput pallets	6,799			6,895			(1.4	)%	27,038			26,562			1.8	%
Same store warehouse services revenues per throughput pallet	$	23.92		$	23.14		3.4	%	$	23.34		$	22.29		4.7	%




Financial Supplement		Fourth Quarter 2017

Fixed Commitment Rent and Storage Revenue

At the end of 2017, annualized committed rent and storage revenue was $196.4 million, which represented 39.2% of our total Warehouse segment rent and storage revenue for the twelve months ended December 31, 2017.

Real Estate Portfolio

During the first quarter of 2017, the Company acquired a 9.6 million refrigerated cubic foot facility in San Antonio, TX which is fully leased to one customer under a long-term triple net lease. During the fourth quarter of 2017 the Company completed the construction of and began operations in its 6.8 million refrigerated cubic foot facility in Clearfield, UT.

During the third quarter of 2017, the Company commenced construction on a new 5.2 million refrigerated cubic foot facility based in Middleboro, MA and began construction of the 15.7 million refrigerated cubic foot high-rise expansion of one its suburban Chicago facilities, located in Rochelle, IL, which will incorporate state-of-art automation capabilities. These facilities are expected to be completed in the third and fourth quarter of 2018, respectively.

Total capital spend on these acquisitions and growth projects totaled $93.8 million for the full year 2017.

During 2017, the Company sold three facilities, two of which were idle. The two idle facilities were Norfolk, VA and West Point, MS. The third facility, Gloucester East Main, MA, maintained operations through its sale in the fourth quarter. During the third quarter, the Company exited a facility that it had leased in New Zealand.

Capital and Balance Sheet Activity

Subsequent to year-end, in January 2018, the Company completed its IPO and issued 33.4 million common shares of beneficial interest at $16.00 per share, including the full exercise of the underwriters’ option to purchase additional shares, raising aggregate net proceeds to the Company of approximately $494 million after deducting the underwriting discount and offering expenses.

In connection with the IPO, the Company closed on its new $925 million senior secured credit facility, consisting of a five-year, $525 million senior secured term loan A facility and a three-year, $400 million senior secured revolving credit facility. The credit facility has a $400 million accordion option, bringing total potential capacity to $1.325 billion. Borrowings under the entire facility bore interest at a floating rate of one-month LIBOR plus 250 basis points at origination. The spread varies between 235 and 300 basis points based on a leverage grid.

In the first quarter 2018, the Company utilized a portion of the net proceeds from the IPO, together with proceeds from the new senior secured facilities to repay $807 million outstanding under the Company’s senior secured Term Loan B facility and revolving credit facility. The Company also repaid $20.5 million of construction loan debt and canceled the commitment for future funding on those loans. In February 2018, the Company repaid $50 million on its outstanding senior term loan A facility, at which point the Company’s lender group increased its aggregate revolving credit commitments on the Company’s existing $400 million senior revolving credit facility by $50 million to $450 million.




Financial Supplement		Fourth Quarter 2017

At March 23, 2018, the Company had total liquidity of $609 million, including cash and capacity on the Company’s revolving credit facility. The Company had total debt outstanding of approximately $1.57 billion, with a weighted average effective interest rate of 5.52% and a weighted average remaining term of 4.4 years. The Company has no material debt maturities during the remainder of 2018 and 2019.

Dividend

On March 15, 2018, the Company’s Board of Trustees declared a pro-rata dividend of $0.13958 per common share for the first quarter of 2018, payable on April 16, 2018 to shareholders of record on March 30, 2018, representing $0.1875 per share for a full quarter.

Investor Webcast and Conference Call

The Company will hold a webcast and conference call on Wednesday, March 28, 2018 at 5:00 p.m. Eastern Time to discuss fourth quarter and full year 2017 results. A live webcast of the call will be available via the Investors section of Americold Realty Trust's website at www.americold.com. To listen to the live webcast, please go to the site at least five minutes prior to the scheduled start time in order to register, download and install any necessary audio software. Shortly after the call, a replay of the webcast will be available for 90 days on the Company’s website.

The conference call can also be accessed by dialing 1-877-407-4018 or 1-201-689-8471. The telephone replay can be accessed by dialing 1-844-512-2921 or 1-412-317-6671 and providing the conference ID# 13677103. The telephone replay will be available starting shortly after the call until April 11, 2018.

The Company’s supplemental package will be available prior to the conference call in the Investor Relations section of the Company’s website at http://ir.americold.com.

About the Company

Americold is the world’s largest owner and operator of temperature-controlled warehouses. Based in Atlanta, Georgia, Americold owns and operates 158 temperature-controlled warehouses, with approximately 934 million cubic feet of storage, in the United States, Australia, New Zealand, Canada, and Argentina. Americold’s facilities are an integral component of the supply chain connecting food producers, processors, distributors and retailers to consumers. Americold serves over 2,600 customers and employs approximately 11,000 associates worldwide.

Non-GAAP Financial Measures

This press release contains non-GAAP financial measures, including FFO, core FFO, AFFO, EBITDA and Core EBITDA and same store segment revenue and contribution. A reconciliation from U.S. GAAP net income available to common stockholders to FFO, a reconciliation from FFO to core FFO and AFFO, and definitions of FFO, and core FFO are included within the supplemental. A reconciliation from U.S. GAAP net income available to common stockholders to EBITDA, Core EBITDA, a definition of Core EBITDA and definitions of net debt to Core EBITDA are included within the supplemental.




Financial Supplement		Fourth Quarter 2017

Forward-Looking Statements

This document contains statements about future events and expectations that constitute forward-looking statements. Forward-looking statements are based on our beliefs, assumptions and expectations of our future financial and operating performance and growth plans, taking into account the information currently available to us. These statements are not statements of historical fact. Forward-looking statements involve risks and uncertainties that may cause our actual results to differ materially from the expectations of future results we express or imply in any forward-looking statements, and you should not place undue reliance on such statements. Factors that could contribute to these differences include adverse economic or real estate developments in our geographic markets or the temperature-controlled warehouse industry; general economic conditions; risks associated with the ownership of real estate and temperature-controlled warehouses in particular; defaults or non-renewals of contracts with customers; potential bankruptcy or insolvency of our customers; uncertainty of revenues, given the nature of our customer contracts; increased interest rates and operating costs; our failure to obtain necessary outside financing; risks related to, or restrictions contained in, our debt financing; decreased storage rates or increased vacancy rates; difficulties in identifying properties to be acquired and completing acquisitions; risks related to expansions of existing properties and developments of new properties, including failure to meet budgeted or stabilized returns in respect thereof; acquisition risks, including the failure of such acquisitions to perform in accordance with projections; difficulties in expanding our operations into new markets, including international markets; our failure to maintain our status as a REIT; uncertainties and risks related to natural disasters and global climate change; possible environmental liabilities, including costs, fines or penalties that may be incurred due to necessary remediation of contamination of properties presently or previously owned by us; financial market fluctuations; actions by our competitors and their increasing ability to compete with us; labor and power costs; changes in real estate and zoning laws and increases in real property tax rates; the competitive environment in which we operate; our relationship with our employees, including the occurrence of any work stoppages or any disputes under our collective bargaining agreements; liabilities as a result of our participation in multi-employer pension plans; the cost and time requirements as a result of our operation as a publicly traded REIT; the concentration of ownership by Yucaipa, the GS Entities and the Fortress Entity; changes in foreign currency exchange rates; and the impact of anti-takeover provisions in our constituent documents and under Maryland law, which could make an acquisition of us more difficult, limit attempts by our shareholders to replace our trustees and affect the price of our common shares.

Words such as “anticipates,” “believes,” “continues,” “estimates,” “expects,” “goal,” “objectives,” “intends,” “may,” “opportunity,” “plans,” “potential,” “near-term,” “long-term,” “projections,” “assumptions,” “projects,” “guidance,” “forecasts,” “outlook,” “target,” “trends,” “should,” “could,” “would,” “will” and similar expressions are intended to identify such forward-looking statements. Examples of forward-looking statements included in this documents include, among others, statements about our expected expansion and development pipeline and our targeted return on invested capital on expansion and development opportunities. We qualify any forward-looking statements entirely by these cautionary factors. Other risks, uncertainties and factors, including those discussed under “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2017 and our other reports filed with the Securities and Exchange Commission, could cause our actual results to differ materially from those projected in any forward-looking statements we make. We assume no obligation to update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.




Financial Supplement		Fourth Quarter 2017

Contacts:

Americold Realty Trust

Investor Relations

Telephone: 678-459-1959

Email: investor.relations@americold.com




Financial Supplement		Fourth Quarter 2017



Americold Realty Trust and Subsidiaries
Consolidated Balance Sheets
(In thousands, except shares and per share amounts)
	December 31,
	2017			2016
Assets
Property, plant, and equipment:
Land	$	389,443		$	384,855
Buildings and improvements	1,865,727			1,765,991
Machinery and equipment	555,453			532,855
	2,810,623			2,683,701
Accumulated depreciation and depletion	(1,010,903		)	(923,686		)
Property, plant, and equipment – net	1,799,720			1,760,015
Capitalized leases:
Buildings and improvements	16,827			16,827
Machinery and equipment	59,389			41,831
	76,216			58,658
Accumulated depreciation	(41,051		)	(34,607		)
Capitalized leases – net	35,165			24,051
Cash and cash equivalents	48,873			22,834
Restricted cash	21,090			40,096
Accounts receivable – net of allowance of $4,961 and $4,072 at December 31, 2017and 2016, respectively	200,354			199,751
Identifiable intangible assets – net	26,645			24,254
Goodwill	188,169			186,805
Investments in partially owned entities	15,942			22,396
Other assets	59,287			47,429
Total assets	$	2,395,245		$	2,327,631
Liabilities, Series B Preferred Shares and shareholders’ deficit
Liabilities:
Borrowings under revolving line of credit	$	—		$	28,000
Accounts payable and accrued expenses	241,259			210,469
Construction loan - net of deferred financing costs of $179 at December 31, 2017	19,492			—
Mortgage notes and term loans - net of discount and deferred financing costs of $31,996 and $35,916, in the aggregate, at December 31, 2017 and 2016, respectively	1,721,958			1,652,425
Sale-leaseback financing obligations	121,516			123,616
Capitalized lease obligations	38,124			27,932
Unearned revenue	19,196			17,863
Pension and postretirement benefits	16,756			21,799
Deferred tax liability - net	21,940			23,055
Multi-Employer pension plan withdrawal liability	9,134			—
Total liabilities	2,209,375			2,105,159
Commitments and Contingencies
Preferred shares of beneficial interest, $0.01 par value – authorized 375,000 Series B Cumulative Convertible Voting and Participating Preferred Shares; aggregate liquidation preference of $375,000; 375,000 shares issued and outstanding at December 31, 2017 and 2016	372,794			371,927
Shareholders’ deficit:
Preferred shares of beneficial interest, $0.01 par value – authorized 1,000 Series A Cumulative Non-Voting Preferred Shares; aggregate liquidation preference of $125; 125 shares issued and outstanding at December 31, 2017 and 2016	—			—
Common shares of beneficial interest, $0.01 par value – authorized 250,000,000 shares; 69,370,609 shares issued and outstanding at December 31, 2017 and 2016	694			694
Paid-in capital	394,082			392,591
Accumulated deficit and distributions in excess of net earnings	(581,470		)	(532,196		)
Accumulated other comprehensive loss	(230		)	(10,544		)
Total shareholders’ deficit	(186,924		)	(149,455		)
Total liabilities, Series B Preferred Shares and shareholders’ deficit	$	2,395,245		$	2,327,631




Financial Supplement		Fourth Quarter 2017



Consolidated Statements of Operations
(In thousands, except per share amounts)
	Three Months Ended December 31,						Year Ended December 31,
	2017			2016			2017			2016
Revenues:
Rent, storage, and warehouse services revenues	$	297,598		$	290,994		$	1,145,662		$	1,080,867
Third-party managed services	63,628			64,390			242,189			252,411
Transportation services	38,405			36,969			146,070			147,004
Other revenues	2,089			2,209			9,666			9,717
Total revenues	401,720			394,562			1,543,587			1,489,999
Operating expenses:
Rent, storage, and warehouse services cost of operations	203,669			198,817			797,334			766,822
Third-party managed services cost of operations	60,485			59,916			229,364			237,597
Transportation services cost of operations	35,188			33,114			133,120			132,586
Cost of operations related to other revenues	2,011			1,764			9,664			7,349
Depreciation, depletion, and amortization	29,545			29,817			116,741			118,571
Selling, general and administrative	26,855			28,080			104,640			100,238
Impairment of long-lived assets	700			9,820			9,473			9,820
Multi-Employer pension plan withdrawal expense	—			—			9,167			—
Total operating expenses	358,453			361,328			1,409,503			1,372,983

Operating income	43,267			33,234			134,084			117,016

Other (expense) income:
(Loss) income from partially owned entities	(21		)	977			(1,363		)	(128		)
Impairment of partially owned entities	—			—			(6,496		)	—
Interest expense	(29,665		)	(29,274		)	(114,898		)	(119,552		)
Interest income	289			177			1,074			708
Loss on debt extinguishment and modification	—			—			(986		)	(1,437		)
Foreign currency exchange gain (loss)	279			2,930			(3,591		)	464
Other (expense) income, net	(237		)	1,312			918			2,142
Income (loss) before income tax and gain (loss) from sale of real estate, net of tax	13,912			9,356			8,742			(787		)
Income tax (expense) benefit:
Current	(5,317		)	213			(13,051		)	(6,465		)
Deferred	(721		)	(2,812		)	3,658			586
Total income tax expense	(6,038		)	(2,599		)	(9,393		)	(5,879		)
Income (loss) before gain (loss) from sale of real estate, net of tax	7,874			6,757			(651		)	(6,666		)
Gain from sale of real estate, net of tax	126			5,602			43			11,598
Net income (loss)	$	8,000		$	12,359		$	(608	)	$	4,932
Less distributions on preferred shares of beneficial interest - Series A	(8		)	(8		)	(16		)	(16		)
Less distributions on preferred shares of beneficial interest - Series B	(7,110		)	(7,110		)	(28,436		)	(28,436		)
Less accretion on preferred shares of beneficial interest – Series B	(210		)	(229		)	(867		)	(936		)
Net income (loss) attributable to common shares of beneficial interest	$	672		$	5,012		$	(29,927	)	$	(24,456	)

Weighted average common shares outstanding – basic	70,051			69,923			70,022			69,890
Weighted average common shares outstanding – diluted	109,918			106,272			70,022			69,890

Net income (loss) per common share of beneficial interest - basic	$	0.01		$	0.07		$	(0.43	)	$	(0.35	)
Net income (loss) per common share of beneficial interest - diluted	$	0.01		$	0.05		$	(0.43	)	$	(0.35	)

Distributions declared per common share of beneficial interest	$	0.07		$	0.14		$	0.29		$	0.29




Financial Supplement		Fourth Quarter 2017



Reconciliation of Net Earnings to FFO, Core FFO, and AFFO
(In thousands)
	Three Months Ended December 31,						Year Ended December 31,
	2017			2016			2017			2016
Net income (loss)	$	8,000		$	12,359		$	(608	)	$	4,932
Adjustments:
Real estate related depreciation	22,041			21,694			86,478			85,645
Net (gain) loss on sale of depreciable real estate	(126		)	(5,394		)	(43		)	(11,104		)
Impairment charges on certain real estate assets	700			9,820			9,473			9,820
Real estate depreciation on China JV	302			196			1,183			1,268
Funds from operations	30,917			38,675			96,483			90,561
Less distributions on preferred shares of beneficial interest	(7,118		)	(7,118		)	(28,452		)	(28,452		)
Funds from operations attributable to common shareholders	$	23,799		$	31,557		$	68,031		$	62,109
Adjustments:
Net (gain) loss on sale of non-real estate assets	(168		)	375			(599		)	464
Severance and reduction in workforce costs (a)	85			279			516			900
Terminated site operations costs (b)	502			(186		)	2,677			6
Strategic alternative costs (c)	3,770			2,335			8,136			4,666
Litigation settlements	—			89			—			89
Impairment of partially owned entities (d)	—			—			6,496			—
Loss on debt extinguishment and modification	—			—			986			1,437
Inventory asset impairment	—			—			2,108			—
Foreign currency exchange (gain) loss	(279		)	(2,930		)	3,591			(464		)
Excise tax settlement	4,984			—			4,984			—
Multi-Employer pension plan withdrawal expense	—			—			9,167			—
Core FFO applicable to common shareholders	$	32,693		$	31,519		$	106,093		$	69,207
Adjustments:
Amortization of loan costs and debt discounts	2,215			1,964			8,604			7,193
Amortization of below/above market leases	37			37			151			196
Straight-line net rent	3			(55		)	101			(564		)
Deferred income taxes expense (benefit)	721			2,812			(3,658		)	(586		)
Stock-based compensation expense (e)	598			4,486			2,358			6,436
Non-real estate depreciation and amortization	7,505			8,123			30,264			32,926
Non-real estate depreciation and amortization on China JV	155			104			609			762
Recurring maintenance capital expenditures (f)	(19,915		)	(20,651		)	(49,906		)	(44,445		)
Adjusted FFO applicable to common shareholders	$	24,012		$	28,339		$	94,616		$	71,125



(a)	Represents one-time severance from prior management team and reduction in workforce costs associated with exiting or selling non-strategic warehouses.
(b)	Represents repair expenses incurred to return leased sites to their original physical state at lease inception in connection with the termination of the applicable underlying lease. These terminations were part of our strategic efforts to exit or sell non-strategic warehouses as opposed to ordinary course lease expirations. Repair and maintenance expenses associated with our ordinary course operations are reflected as operating expenses on our statement of operations.
(c)	Represents one-time operating costs associated with our review of strategic alternatives prior to the IPO.
(d)	For 2017, represents an impairment charge related to our investment in the China JV based on a determination that the recorded investment was no longer recoverable from the projected future cash distributions we expect to receive from the China JV.
(e)	Represents stock-based compensation expense related to equity awards under our pre-IPO equity incentive plans.
(f)	Recurring maintenance capital expenditures include capital expenditures made to extend the life of, and provide future economic benefit from, our existing temperature-controlled warehouse network and its existing supporting personal property and information technology.




Financial Supplement		Fourth Quarter 2017



Reconciliation of Net Earnings to EBITDA and Core EBITDA
(In thousands)
	Three Months Ended December 31,						Year Ended December 31,
	2017			2016			2017			2016
Net income (loss)	$	8,000		$	12,359		$	(608	)	$	4,932
Adjustments:
Depreciation, depletion and amortization	29,545			29,817			116,741			118,571
Interest expense	29,665			29,274			114,898			119,552
Income tax expense	6,038			2,599			9,393			5,879
EBITDA	$	73,248		$	74,049		$	240,424		$	248,934
Adjustments:
Severance and reduction in workforce costs (a)	85			279			516			900
Terminated site operations cost (b)	502			(186		)	2,677			6
Strategic alternative costs (c)	3,770			2,335			8,136			4,666
Litigation settlements	—			89			—			89
Loss from partially owned entities	21			(977		)	1,363			128
Non-recurring impairment of partially owned entities (d)	—			—			6,496			—
Impairment of inventory and long-lived assets	700			9,820			11,581			9,820
Loss (gain) on foreign currency exchange	(279		)	(2,930		)	3,591			(464		)
Stock-based compensation expense (e)	598			4,486			2,358			6,436
Loss on debt extinguishment and modification	—			—			986			1,437
Loss (gain) on real estate and other asset disposals	65			(5,000		)	(150		)	(10,590		)
Multi-Employer pension plan withdrawal expense	—			—			9,167			—
Core EBITDA	$	78,710		$	81,965		$	287,145		$	261,362



(a)	Represents one-time severance from prior management team and reduction in workforce costs associated with exiting or selling non-strategic warehouses.
(b)	Represents repair expenses incurred to return leased sites to their original physical state at lease inception in connection with the termination of the applicable underlying lease. These terminations were part of our strategic efforts to exit or sell non-strategic warehouses as opposed to ordinary course lease expirations. Repair and maintenance expenses associated with our ordinary course operations are reflected as operating expenses on our statement of operations.
(c)	Represents one-time operating costs associated with our review of strategic alternatives prior to the IPO.
(d)	Represents an impairment charge related to our investment in the China JV based on a determination that the recorded investment was no longer recoverable from the projected future cash distributions we expect to receive from the China JV. We did not receive any cash distributions from the China JV since the formation of the joint venture.
(e)	Represents stock-based compensation expense related to equity awards under our pre-IPO equity incentive plans.




Financial Supplement		Fourth Quarter 2017

Debt Detail and Maturities

			Effective interest rate ⁷ as of December 31, 2017	Outstanding principal amount at
	Stated maturity date	Contractual interest rate ⁵	Effective interest rate ⁷ as of December 31, 2017	December 31, 2017			December 31, 2016
2010 Mortgage Loans cross-collateralized and cross-defaulted by 46 warehouses:				(In thousands)
Component A-1	1/2021	3.86%	4.40%	$	56,941		$	73,619
Component A-2-FX	1/2021	4.96%	5.38%	150,334			150,334
Component A-2-FL ¹	1/2021	LIBOR + 1.51%	3.45%	48,654			74,899
Component B	1/2021	6.04%	6.48%	60,000			60,000
Component C	1/2021	6.82%	7.28%	62,400			62,400
Component D	1/2021	7.45%	7.92%	82,600			82,600
2013 Mortgage Loans cross-collateralized and cross-defaulted by 15 warehouses:
Senior note	5/2023	3.81%	4.14%	194,223			200,252
Mezzanine A	5/2023	7.38%	7.55%	70,000			70,000
Mezzanine B	5/2023	11.50%	11.75%	32,000			32,000
ANZ Term Loans secured by mortgages in properties owned by relevant subsidiaries:
Australian Term Loan ²	6/2020	BBSY + 1.40%	4.51%	158,645			146,789
New Zealand Term Loan ³	6/2020	BKBM + 1.40%	5.12%	31,240			30,615
Senior Secured Term Loan B Facility secured by stock pledge in qualified subsidiaries	12/2022	LIBOR + 3.75% with 1% floor or ABR + 2.75% with 2% floor	5.79%	806,918			704,833
Total principal amount of mortgage notes and term loans				1,753,955			1,688,341
Less deferred financing costs				(25,712		)	(28,473		)
Less debt discount				(6,285		)	(7,443		)
Total mortgage notes and term loans, net of deferred financing costs and debt discount				$	1,721,958		$	1,652,425
2015 Senior Secured Revolving Credit Facility secured by stock pledge in qualified subsidiaries	12/2018 ⁴	LIBOR + 3.00% or ABR + 2.00%	3.92%	$	—		$	28,000
Construction Loans:
Warehouse Clearfield, UT secured by mortgage	2/2019	LIBOR + 3.25% or prime rate + 2.25%	5.18%	$	19,671		$	—
Less deferred financing costs				(179		)	—
				$	19,492		$	—
Warehouse Middleboro, MA secured by mortgage	8/2020	LIBOR +2.75% or ABR +1.75%	—	$	—		$	—


(1)	Component A-2-FL of the 2010 Mortgage Loans has a variable interest rate equal to one-month LIBOR plus 1.51%, with one-month-LIBOR subject to a floor of 1.00% per annum. In addition, we maintain an interest rate cap on the variable rate tranche that caps one-month LIBOR at 6.0%. The variable interest rate at December 31, 2017 was 2.98% per annum.


(2)	As of December 31, 2017, the outstanding balance was AUD$203.0 million and the variable interest rate was 3.10% per annum (1.70% BBSY plus 1.40% margin) of which 75% is fixed via an interest rate swap at 4.06% per annum (2.66% BBSY plus 1.40% margin).


(3)	As of December 31, 2017, the outstanding balance was NZD$44.0 million and the variable interest rate was 3.22% per annum (1.82% BKBM plus 1.40% margin), of which 75% is fixed via an interest rate swap at 4.93% per annum (3.53% BKBM plus 1.40% margin).


(4)	Prior to the IPO we have the option to extend the stated maturity date of our Senior Secured Revolving Credit Facility to December 1, 2019, subject to certain conditions.


(5)	References in this table to LIBOR are references to one-month LIBOR and references to BBSY and BKBM are to Australian Bank Bill Swap Bid Rate and New Zealand Bank Bill Reference Rate, respectively.


(6)	Unused line, letter of credit and financing fees increase the stated interest rate.


(7)	The effective interest rate includes effects of amortization of the deferred financing costs and debt discount. The weighted average effective interest rate for total debt was 5.68% and 5.67% as of December 31, 2017 and 2016, respectively.




Financial Supplement		Fourth Quarter 2017

Operations Overview



Revenue and Contribution by Segment
(In thousands)
	Three Months Ended December 31,						Year Ended December 31,
	2017			2016			2017			2016
Segment revenues:
Warehouse	$	297,598		$	290,994		$	1,145,662		$	1,080,867
Third-Party Managed	63,628			64,390			242,189			252,411
Transportation	38,405			36,969			146,070			147,004
Quarry	2,089			2,209			9,666			9,717
Total revenues	401,720			394,562			1,543,587			1,489,999

Segment contribution:
Warehouse	93,930			92,175			348,328			314,045
Third-Party Managed	3,143			4,474			12,825			14,814
Transportation	3,217			3,855			12,950			14,418
Quarry	77			447			2			2,368
Total segment contribution	100,367			100,951			374,105			345,645

Reconciling items:
Depreciation, depletion, and amortization	(29,545		)	(29,817		)	(116,741		)	(118,571		)
Impairment of long-lived assets	(306		)	(9,820		)	(9,473		)	(9,820		)
Multi-Employer pension plan withdrawal expense	(394		)	—			(9,167		)	—
Selling, general and administrative	(26,855		)	(28,080		)	(104,640		)	(100,238		)
Income (Loss) from partially owned entities	(21		)	977			(1,363		)	(128		)
Impairment of partially owned entities	—			—			(6,496		)	—
Interest expense	(29,665		)	(29,274		)	(114,898		)	(119,552		)
Interest income	289			177			1,074			708
Loss on debt extinguishment and modification	—			—			(986		)	(1,437		)
Foreign currency exchange gain (loss)	279			2,930			(3,591		)	464
Other income, net	(237		)	1,312			918			2,142
Income (loss) before income tax and gain (loss) from sale of real estate, net of tax	$	13,912		$	9,356		$	8,742		$	(787	)

We view and manage our business through three primary business segments—warehouse, third-party managed and transportation. Our core business is our warehouse segment, where we provide temperature-controlled warehouse storage and related handling and other warehouse services. In our warehouse segment, we collect rent and storage fees from customers to store their frozen and perishable food and other products within our real estate portfolio. We also provide our customers with handling and other warehouse services related to the products stored in our buildings that are designed to optimize their movement through the cold chain, such as the placement of food products for storage and preservation, the retrieval of products from storage upon customer request, blast freezing, case-picking, kitting and repackaging and other recurring handling services.

Under our third-party managed segment, we manage warehouses on behalf of third parties and provide warehouse management services to several leading food retailers and manufacturers in customer-owned facilities, including some of our largest and longest-standing customers. We believe using our third-party management services allows our customers to increase efficiency, reduce costs, reduce supply-chain risks and focus on their core businesses. We also believe that providing third-party management services to many of our key customers underscores our ability to offer a complete and integrated suite of services across the cold chain.

In our transportation segment, we broker and manage transportation of frozen and perishable food and other products for our customers. Our transportation services include consolidation services (i.e., consolidating a customer’s products with those of other customers for more efficient shipment), freight under management services (i.e., arranging for and overseeing transportation of customer inventory) and dedicated transportation services, each designed to improve efficiency and reduce transportation and logistics costs to our customers. We provide these transportation services at cost plus a service fee or, in the case of our consolidation services, we charge a fixed fee.

We also operate a limestone quarry on the land we own around our Carthage, Missouri warehouse, which contains substantial limestone deposits. We do not view the operation of the quarry as an integral part of our business.




Financial Supplement		Fourth Quarter 2017

Average Physical Occupancy(1)

(1)

We define average physical occupancy as the average number of occupied pallets divided by the estimated number of average physical pallet positions in our warehouses for the applicable period. We estimate the number of physical pallet positions by taking into account actual racked space and by estimating unracked space on an as-if racked basis. We base this estimate on the total cubic feet of each room within the warehouse that is unracked divided by the volume of an assumed rack space that is consistent with the characteristics of the relevant warehouse. On a warehouse by warehouse basis, rack space generally ranges from two to three feet depending upon the type of facility and the nature of the customer goods stored therein. The number of our pallet positions is reviewed and updated quarterly, taking into account changes in racking configurations and room utilization.

Historically, providers of temperature-controlled warehouse space have offered storage services to customers on an as-utilized, on-demand basis. We have entered into fixed storage commitments with certain of our customers which give us, among other things, additional clarity around the expected occupancy of our warehouses. As of December 31, 2017, we had entered into contracts featuring fixed storage commitments or leases with 86 of our customers in our warehouse segment. Customers with fixed storage provisions commit to occupy a certain number of pallets at a designated storage rate for the applicable portion of their contractual term, whether the customer elects to physically store goods in a warehouse or not. As a result, certain pallets in our warehouses may generate storage revenue pursuant to fixed storage commitments despite not being physically occupied. We refer to economic occupancy as the aggregate number of physically occupied pallets and any additional pallets otherwise contractually committed for a given period. To the extent that a customer with a fixed storage provision elects not to utilize all of its committed pallets in a particular warehouse, we have the flexibility to deploy those pallets to facilitate shorter-term customers that desire space on an as-utilized, on demand basis.




Financial Supplement		Fourth Quarter 2017

Warehouse Portfolio



Country / Region	# of warehouses	Cubic feet (in millions)	% of total cubic feet		Pallet positions (in thousands)	Average physical occupancy ⁽¹⁾		Revenues ⁽²⁾ (in millions)		Applicable segment contribution (NOI) ⁽²⁾⁽³⁾ (in millions)		Total customers ⁽⁴⁾
Owned / Leased ⁽⁵⁾
United States
Central	34	220.6	25	%	874.3	75	%	$	233.7	$	78.3	837
East	23	165.9	19	%	534.4	77	%	247.3		65.7		738
Southeast	37	176.5	20	%	575.6	77	%	205.8		57.2		658
West	38	235.0	27	%	992.8	79	%	256.8		97.6		746
United States Total / Average	132	798.0	91	%	2,977.1	77	%	$	943.7	$	298.8	2,315
International
Australia	5	47.6	5	%	142.7	94	%	$	156.4	$	37.2	86
New Zealand	7	22.8	3	%	72.9	85	%	32.5		9.3		96
Argentina	2	9.7	1	%	21.6	83	%	13.2		3.0		29
International Total / Average	14	80.2	9	%	237.2	90	%	$	202.0	$	49.5	202
Owned / Leased Total / Average	146	878.2	100	%	3,214.3	78	%	$	1,145.7	$	348.3	2,428
Third-Party Managed
United States	8	41.5	74	%	—	—		$	214.6	$	8.7	4
Australia ⁽⁶⁾	1	—	—	%	—	—		9.2		2.5		1
Canada	3	14.3	26	%	—	—		18.4		1.6		2
Third-Party Managed Total / Average	12	55.8	100	%	—	—		$	242.2	$	12.8	6
Portfolio Total / Average	158	933.9	100	%	3,215.0	78	%	$	1,387.9	$	361.2	2,429

(1)

We define average physical occupancy as the average number of occupied pallets divided by the estimated number of average physical pallet positions in our warehouses for the year ended December 31, 2017. We estimate the number of physical pallet positions by taking into account actual racked space and by estimating unracked space on an as-if racked basis. We base this estimate on the total cubic feet of each room within the warehouse that is unracked divided by the volume of an assumed rack space that is consistent with the characteristics of the relevant warehouse. On a warehouse by warehouse basis, rack space generally ranges from two to three feet depending upon the type of facility and the nature of the customer goods stored therein. The number of our pallet positions is reviewed and updated quarterly, taking into account changes in racking configurations and room utilization.


(2)	Year ended December 31, 2017.

(3)

We use the term “segment contribution (NOI)” to mean a segment’s revenues less its cost of operations (excluding any depreciation, depletion and amortization, impairment charges and corporate-level selling, general and administrative expenses). The applicable segment contribution (NOI) from our owned and leased warehouses and our third-party managed warehouses is included in our warehouse segment contribution (NOI) and third-party managed segment contribution (NOI), respectively.


(4)	We serve some of our customers in multiple geographic regions and in multiple facilities within geographic regions. As a result, the total number of customers that we serve is less than the total number of customers reflected in the table above that we serve in each geographic region.


(5)	As of December 31, 2017, we owned 110 of our U.S. warehouses and ten of our international warehouses, and we leased 22 of our U.S. warehouses and four of our international warehouses. As of December 31, 2017, seven of our owned facilities were located on land that we lease pursuant to long-term ground leases.


(6)	Constitutes non-refrigerated, or “ambient,” warehouse space. This facility contains 330,527 square feet of ambient space.




Financial Supplement		Fourth Quarter 2017


(1)	Retail reflects a broad variety of product types from retail customers.


(2)	Packaged foods reflects a broad variety of temperature-controlled meals and foodstuffs.


(3)	Distributors reflects a broad variety of product types from distributor customers.




Financial Supplement		Fourth Quarter 2017

Fixed Commitment and Lease Maturity Schedule

The following table sets forth a summary schedule of the expirations for any defined contracts featuring fixed storage commitments and leases in effect as of December 31, 2017. The information set forth in the table assumes no exercise of extension options under these contracts and leases.



Contract Expiration Year	Number of Contracts	Annualized Committed Rent & Storage Revenue(1) (in thousands)		% of Total Warehouse Rent & Storage Segment Revenue for the Twelve Months Ended December 31, 2017		Total Warehouse Segment Revenue Generated by Contracts with Fixed Commitments & Leases for the Twelve Months Ended December 31, 2017 (in thousands)		Annualized Committed Rent & Storage Revenue at Expiration(2) (in thousands)
Month-to-Month	37	$	30,463	6.1	%	$	107,162	$	30,463
2018	40	37,807		7.5	%	88,896		37,915
2019	21	35,997		7.2	%	108,774		36,545
2020	21	24,093		4.8	%	65,068		25,038
2021	6	3,514		0.7	%	13,959		3,729
2022	13	42,737		8.5	%	53,216		43,317
2023	2	2,795		0.6	%	2,470		3,077
2024	1	424		0.1	%	690		463
2025	—	—		—	%	—		—
2026	2	5,779		1.2	%	10,378		5,779
2027	2	4,579		0.9	%	7,448		4,992
2028	—	—		—	%	—		—
2029	2	8,191		1.6	%	20,730		9,862
Total	147	$	196,379	39.2	%	$	478,790	$	201,178


(1)	Represents monthly fixed storage commitments and lease rental payments under the relevant expiring defined contract and lease as of December 31, 2017, plus the weighted average monthly warehouse services revenues attributable to these contracts and leases for the twelve months ended December 31, 2017, multiplied by 12.


(2)	Represents annualized monthly revenues from fixed storage commitments and lease rental payments under the defined contracts and relevant expiring leases as of December 31, 2017 based upon the monthly revenues attributable thereto in the last month prior to expiration, multiplied by 12.




Financial Supplement		Fourth Quarter 2017

The following table sets forth a summary schedule of the expirations of our facility leased warehouses and other leases pursuant to which we lease space to third parties in our warehouse portfolio, in each case, in place as of December 31, 2017.



Lease Expiration Year	No. of Leases Expiring	Annualized Rent(1) (in thousands)		% of Total Warehouse Rent & Storage Segment Revenue for the Twelve Months Ended December 31, 2017		Leased Square Footage (in thousands)	% Leased Square Footage		Annualized Rent at Expiration(2) (in thousands)
Month-to-Month	16	$	2,667	0.5	%	245	10.7	%	$	2,667
2018	9	1,482		0.3	%	188	8.2	%	1,489
2019	6	1,730		0.3	%	369	16.2	%	1,793
2020	6	3,294		0.7	%	353	15.5	%	3,432
2021	3	890		0.2	%	420	18.4	%	1,323
2022	2	989		0.2	%	144	6.3	%	989
2023	2	2,795		0.6	%	493	21.6	%	3,077
2024	1	424		0.1	%	70	3.1	%	463
2025	—	—		—		—	—		—
2026 and thereafter	—	—		—		—	—		—
Total	45	$	14,271	2.8	%	2,282	100		$	15,233


(1)	Represents monthly rental payments under the relevant leases as of December 31, 2017, multiplied by 12.


(2)	Represents monthly rental payments under the relevant leases in the calendar year of expiration, multiplied by 12.

These leases had a weighted average remaining term of 32 months as of December 31, 2017.

•

Month-to-Month Warehouse Rate Agreements. Month-to-month warehouse rate agreements are agreements that establish storage fee rates on products stored in our warehouses and rates for value-added services on an as-utilized, on-demand basis, typically pursuant to terms set forth on a standardized warehouse receipt and related rate schedule, but that do not require the customer to use our network or for us to reserve space for these customers. Our standard terms and conditions afford us favorable contractual protections and are not subject to negotiation with customers that enter into month-to-month warehouse rate agreements. Month-to-month customer relationships




Financial Supplement		Fourth Quarter 2017

Recurring Maintenance Capital Expenditures and Repair and Maintenance Expenses

We utilize a strategic approach to recurring maintenance capital expenditures and repair and maintenance expenses to maintain the high quality and operational efficiency of our warehouses and ensure that our warehouses meet the “mission-critical” role they serve in the cold chain.

Recurring Maintenance Capital Expenditures

The following table sets forth our recurring maintenance capital expenditures for the years ended December 31, 2017, 2016 and 2015.



	Year ended December 31,
	2017		2016		2015
	(In thousands, except per cubic foot amounts)
Real estate	$	44,102	$	36,153	$	34,011
Personal property	1,890		3,213		3,678
Information technology	3,914		5,079		3,996
Total recurring maintenance capital expenditures	$	49,906	$	44,445	$	41,685

Total recurring maintenance capital expenditures per cubic foot	$	0.053	$	0.047	$	0.043

Repair and Maintenance Expenses

The following table sets forth our repair and maintenance expenses for the years ended December 31, 2017, 2016 and 2015.



	Year ended December 31,
	2017		2016		2015
	(In thousands, except per cubic foot amounts)
Real estate	$	21,467	$	20,956	$	18,843
Personal property	31,254		30,888		31,257
Total repair and maintenance expenses	$	52,721	$	51,844	$	50,100

Repair and maintenance expenses per cubic foot	$	0.056	$	0.055	$	0.052

Growth and Expansion Capital Expenditures

The following table sets forth our growth and expansion capital expenditures for the years ended December 31, 2017, 2016 and 2015.



	Year ended December 31,
	2017		2016		2015
	(In thousands)
Expansion and development initiatives	$	99,878	$	27,529	$	8,532
Information technology	5,973		4,649		4,031
Total growth and expansion capital expenditures	$	105,851	$	32,178	$	12,563




Financial Supplement		Fourth Quarter 2017

Total Global Warehouse Performance

The following table presents the operating results of our warehouse segment for the years ended December 31, 2017 and 2016.



	Year ended December 31,									Change
	2017 actual			2017 constant currency⁽¹⁾			2016 actual			Actual		Constant currency
	(Dollars in thousands)
Rent and storage	$	501,604		$	501,168		$	476,800		5.2	%	5.1	%
Warehouse services	644,058			640,805			604,067			6.6	%	6.1	%
Total warehouse segment revenues	1,145,662			1,141,973			1,080,867			6.0	%	5.7	%

Power	72,408			72,376			71,999			0.6	%	0.5	%
Other facilities costs ⁽²⁾	104,713			104,596			102,032			2.6	%	2.5	%
Labor	509,951			507,715			484,822			5.2	%	4.7	%
Other services costs⁽³⁾	110,262			109,898			107,969			2.1	%	1.8	%
Total warehouse segment cost of operations	797,334			794,585			766,822			4.0	%	3.6	%
Warehouse segment contribution (NOI)	$	348,328		$	347,388		$	314,045		10.9	%	10.6	%

Warehouse rent and storage contribution (NOI) ⁽⁴⁾	$	324,483		$	324,196		$	302,769		7.2	%	7.1	%
Warehouse services contribution (NOI) ⁽⁵⁾	$	23,845		$	23,192		$	11,276		111.5	%	105.7	%

Total warehouse segment margin	30.4		%	30.4		%	29.1		%	130 bps		130 bps
Rent and storage margin⁽⁶⁾	64.7		%	64.7		%	63.5		%	120 bps		120 bps
Warehouse services margin⁽⁷⁾	3.7		%	3.6		%	1.9		%	180 bps		170 bps

The following table presents the operating results of our warehouse segment for the quarters ended December 31, 2017 and 2016.



	Three Months ended December 31,									Change
	2017 actual			2017 constant currency⁽¹⁾			2016 actual			Actual		Constant currency
	(Dollars in thousands)
Rent and storage	$	131,695		$	131,817		$	128,664		2.4	%	2.5	%
Warehouse services	165,903			165,364			162,330			2.2	%	1.9	%
Total warehouse segment revenues	297,598			297,181			290,994			2.3	%	2.1	%

Power	16,939			16,957			16,975			(0.2	)%	(0.1	)%
Other facilities costs ⁽²⁾	26,878			26,930			24,423			10.1	%	10.3	%
Labor	132,123			131,744			128,778			2.6	%	2.3	%
Other services costs⁽³⁾	27,728			27,688			28,643			(3.2	)%	(3.3	)%
Total warehouse segment cost of operations	203,668			203,319			198,819			2.4	%	2.3	%
Warehouse segment contribution (NOI)	$	93,930		$	93,862		$	92,175		1.9	%	1.8	%

Warehouse rent and storage contribution (NOI) ⁽⁴⁾	$	87,878		$	87,930		$	87,266		0.7	%	0.8	%
Warehouse services contribution (NOI) ⁽⁵⁾	$	6,052		$	5,932		$	4,909		23.3	%	20.8	%

Total warehouse segment margin	31.6		%	31.6		%	31.7		%	-10 bps		-10 bps
Rent and storage margin⁽⁶⁾	66.7		%	66.7		%	67.8		%	-110 bps		-110 bps
Warehouse services margin⁽⁷⁾	3.6		%	3.6		%	3.0		%	60 bps		60 bps




Financial Supplement		Fourth Quarter 2017


(1)	The adjustments from our U.S. GAAP operating results to calculate our operating results on a constant currency basis are the effect of changes in foreign currency exchange rates relative to the comparable prior period.


(2)	Includes real estate rent expense of $15.1 million and $16.7 million for the year ended December 31, 2017 and 2016, respectively.


(3)	Includes non-real estate rent expense of $14.0 million and $12.0 million for the year ended December 31, 2017 and 2016, respectively.


(4)	Calculated as rent and storage revenues less power and other facilities costs.


(5)	Calculated as warehouse services revenues less labor and other services costs.


(6)	Calculated as warehouse rent and storage contribution (NOI) divided by warehouse rent and storage revenues.


(7)	Calculated as warehouse services contribution (NOI) divided by warehouse services revenues.




Financial Supplement		Fourth Quarter 2017

Same Store Analysis

The following table presents revenues, cost of operations, contribution (NOI) and margins for our same stores and non-same stores with a reconciliation to the total financial metrics of our warehouse segment for the year and the quarter ended December 31, 2017 and 2016.



	Year ended December 31,									Change
	2017 actual			2017 constant currency⁽¹⁾			2016 actual			Actual		Constant currency
Same store revenues:	(Dollars in thousands)
Rent and storage	$	491,174		$	490,725		$	465,528		5.5	%	5.4	%
Warehouse services	631,287			627,995			591,994			6.6	%	6.1	%
Total same store revenues	1,122,461			1,118,720			1,057,522			6.1	%	5.8	%
Same store cost of operations:
Power	70,101			70,076			68,974			1.6	%	1.6	%
Other facilities costs	99,448			99,339			94,153			5.6	%	5.5	%
Labor	498,978			496,689			473,325			5.4	%	4.9	%
Other services costs	107,055			106,679			105,261			1.7	%	1.3	%
Total same store cost of operations	$	775,582		$	772,783		$	741,713		4.6	%	4.2	%

Same store contribution (NOI)	$	346,879		$	345,937		$	315,809		9.8	%	9.5	%
Same store rent and storage contribution (NOI)⁽²⁾	$	321,625		$	321,310		$	302,401		6.4	%	6.3	%
Same store services contribution (NOI)⁽³⁾	$	25,254		$	24,627		$	13,408		88.4	%	83.7	%

Total same store margin	30.9		%	30.9		%	29.9		%	100 bps		100 bps
Same store rent and storage margin⁽⁴⁾	65.5		%	65.5		%	65.0		%	50 bps		50 bps
Same store services margin⁽⁵⁾	4.0		%	3.9		%	2.3		%	170 bps		160 bps

Non-same store revenues:
Rent and storage	$	10,430		$	10,443		$	11,272		(7.5	)%	(7.4	)%
Warehouse services	12,771			12,810			12,073			5.8	%	6.1	%
Total non-same store revenues	23,201			23,253			23,345			(0.6	)%	(0.4	)%
Non-same store cost of operations:
Power	2,307			2,300			3,025			(23.7	)%	(24.0	)%
Other facilities costs	5,265			5,257			7,879			(33.2	)%	(33.3	)%
Labor	10,973			11,026			11,497			(4.6	)%	(4.1	)%
Other services costs	3,207			3,219			2,708			18.4	%	18.9	%
Total non-same store cost of operations	$	21,752		$	21,802		$	25,109		(13.4	)%	(13.2	)%

Non-same store contribution (NOI)	$	1,449		$	1,451		$	(1,764	)	(182.1	)%	(182.3	)%
Non-same store rent and storage contribution (NOI)⁽²⁾	$	2,858		$	2,886		$	368		676.6	%	684.2	%
Non-same store services contribution (NOI)⁽³⁾	$	(1,409	)	$	(1,435	)	$	(2,132	)	(33.9	)%	(32.7	)%

Total warehouse segment revenues	$	1,145,662		$	1,141,973		$	1,080,867		6.0	%	5.7	%
Total warehouse cost of operations	$	797,334		$	794,585		$	766,822		4.0	%	3.6	%
Total warehouse segment contribution	$	348,328		$	347,388		$	314,045		10.9	%	10.6	%



(1)	The adjustments from our U.S. GAAP operating results to calculate our operating results on a constant currency basis is the effect of changes in foreign currency exchange rates relative to the comparable prior period.
(2)	Calculated as rent and storage revenues less power and other facilities costs.
(3)	Calculated as warehouse services revenues less labor and other services costs.
(4)	Calculated as same store rent and storage contribution (NOI) divided by same store rent and storage revenues.
(5)	Calculated as same store warehouse services contribution (NOI) divided by same store warehouse services revenues.




Financial Supplement		Fourth Quarter 2017



	Quarter ended December 31,									Change
	2017 actual			2017 constant currency⁽¹⁾			2016 actual			Actual		Constant currency
Same store revenues:	(Dollars in thousands)
Rent and storage	$	128,825		$	128,947		$	126,323		2.0	%	2.1	%
Warehouse services	162,633			162,093			159,556			1.9	%	1.6	%
Total same store revenues	291,458			291,040			285,879			2.0	%	1.8	%
Same store cost of operations:
Power	16,467			16,485			16,279			1.2	%	1.3	%
Other facilities costs	25,416			25,468			22,946			10.8	%	11.0	%
Labor	129,386			129,007			126,189			2.5	%	2.2	%
Other services costs	26,955			26,915			28,187			(4.4	)%	(4.5	)%
Total same store cost of operations	$	198,224		$	197,875		$	193,601		2.4	%	2.2	%

Same store contribution (NOI)	$	93,234		$	93,165		$	92,278		1.0	%	1.0	%
Same store rent and storage contribution (NOI)⁽²⁾	$	86,942		$	86,994		$	87,098		(0.2	)%	(0.1	)%
Same store services contribution (NOI)⁽³⁾	$	6,292		$	6,171		$	5,180		21.5	%	19.1	%

Total same store margin	32.0		%	32.0		%	32.3		%	-30 bps		-30 bps
Same store rent and storage margin⁽⁴⁾	67.5		%	67.5		%	68.9		%	-140 bps		-140 bps
Same store services margin⁽⁵⁾	3.9		%	3.8		%	3.2		%	70 bps		60 bps

Non-same store revenues:
Rent and storage	$	2,870		$	2,870		$	2,341		22.6	%	22.6	%
Warehouse services	3,270			3,271			2,774			17.9	%	17.9	%
Total non-same store revenues	6,140			6,141			5,115			20.0	%	20.1	%
Non-same store cost of operations:
Power	472			472			696			(32.2	)%	(32.2	)%
Other facilities costs	1,462			1,462			1,477			(1.0	)%	(1.0	)%
Labor	2,737			2,737			2,589			5.7	%	5.7	%
Other services costs	773			773			456			69.5	%	69.5	%
Total non-same store cost of operations	$	5,444		$	5,444		$	5,218		4.3	%	4.3	%

Non-same store contribution (NOI)	$	696		$	697		$	(103	)	(775.7	)%	(776.7	)%
Non-same store rent and storage contribution (NOI)⁽²⁾	$	936		$	936		$	168		457.1	%	457.1	%
Non-same store services contribution (NOI)⁽³⁾	$	(240	)	$	(239	)	$	(271	)	(11.4	)%	(11.8	)%

Total warehouse segment revenues	$	297,598		$	297,181		$	290,994		2.3	%	2.1	%
Total warehouse cost of operations	$	203,668		$	203,319		$	198,819		2.4	%	2.3	%
Total warehouse segment contribution	$	93,930		$	93,862		$	92,175		1.9	%	1.8	%



(1)	The adjustments from our U.S. GAAP operating results to calculate our operating results on a constant currency basis is the effect of changes in foreign currency exchange rates relative to the comparable prior period.
(2)	Calculated as rent and storage revenues less power and other facilities costs.
(3)	Calculated as warehouse services revenues less labor and other services costs.
(4)	Calculated as same store rent and storage contribution (NOI) divided by same store rent and storage revenues.
(5)	Calculated as same store warehouse services contribution (NOI) divided by same store warehouse services revenues.




Financial Supplement		Fourth Quarter 2017

Same-store Key Operating Metrics

The following table provides certain operating metrics to explain the drivers of our same store performance.



	Year Ended December 31,						Change
Units in thousands except per pallet data	2017			2016			Change
Same store rent and storage:
Occupancy⁽¹⁾
Average occupied pallets	2,447			2,414			1.4	%
Average physical pallet positions	3,124			3,125			—	%
Occupancy percentage	78.3		%	77.2		%	110 bps
Same store rent and storage revenues per occupied pallet	$	200.75		$	192.87		4.1	%
Constant currency same store rent and storage revenues per occupied pallet	$	200.56		$	192.87		4.0	%

Same store warehouse services:
Throughput pallets	27,038			26,562			1.8	%
Same store warehouse services revenues per throughput pallet	$	23.34		$	22.29		4.7	%
Constant currency same store warehouse services revenues per throughput pallet	$	23.22		$	22.29		4.2	%

Non-same store rent and storage:
Occupancy
Average occupied pallets	62			56			9.6	%
Average physical pallet positions	91			106			(14.3	)%
Occupancy percentage	67.8		%	53.0		%

Non-same store warehouse services:
Throughput pallets	584			567			2.9	%



	Three Months Ended December 31,						Change
Units in thousands except per pallet data	2017			2016			Change
Same store rent and storage:
Occupancy⁽¹⁾
Average occupied pallets	2,559			2,556			0.1	%
Average physical pallet positions	3,128			3,126			0.1	%
Occupancy percentage	81.8		%	81.8		%	0 bps
Same store rent and storage revenues per occupied pallet	$	50.34		$	49.41		1.9	%
Constant currency same store rent and storage revenues per occupied pallet	$	50.39		$	49.41		2.0	%

Same store warehouse services:
Throughput pallets	6,799			6,895			(1.4	)%
Same store warehouse services revenues per throughput pallet	$	23.92		$	23.14		3.4	%
Constant currency same store warehouse services revenues per throughput pallet	$	23.84		$	23.14		3.0	%

Non-same store rent and storage:
Occupancy
Average occupied pallets	66			39			71.5	%
Average physical pallet positions	103			87			19.0	%
Occupancy percentage	63.9		%	44.3		%

Non-same store warehouse services:
Throughput pallets	151			123			23.1	%

(1) We define average physical occupancy as the average number of occupied pallets divided by the estimated number of average physical pallet positions in our warehouses for the applicable period. We estimate the number of physical pallet positions by taking into account actual




Financial Supplement		Fourth Quarter 2017

racked space and by estimating unracked space on an as-if racked basis. We base this estimate on a formula utilizing the total cubic feet of each room within the warehouse that is unracked divided by the volume of an assumed rack space that is consistent with the characteristics of the relevant warehouse. On a warehouse by warehouse basis, rack space generally ranges from two to three feet depending upon the type of facility and the nature of the customer goods stored therein. The number of our pallet positions is reviewed and updated quarterly, taking into account changes in racking configurations and room utilization.

Average occupancy at our same stores was 78.3% for the year ended December 31, 2017, an increase of 110 bps compared to 77.2% for the year ended December 31, 2016. This growth was primarily the result of an increase of 1.4% in average occupied pallets. The increase in our average occupied pallets primarily resulted from new business and incremental business with existing customers at our domestic and Australian operations, partially offset by a slight decline in the average occupied pallets in our New Zealand and Argentina operations. Same store rent and storage revenues per occupied pallet increased 4.1% year-over-year, primarily driven by rate increases and a greater proportion of occupancy by customers that paid higher average rates per pallet. On a constant currency basis, the increase in our same store rent and storage revenues per occupied pallet was approximately the same as the change in same store rent and storage revenues per occupied pallet including the effect of foreign currency fluctuations. This was attributable to the fact that the increase in same store rent and storage revenues from our domestic operations was substantially higher than the increase in same store rent and storage revenues from our foreign operations.

Throughput pallets at our same stores were 27.0 million pallets for the year ended December 31, 2017, an increase of 1.8% from 26.6 million pallets for the year ended December 31, 2016. This increase was largely the result of new and incremental occupancy and throughput from our domestic and Australian customers. Same store warehouse services revenues per throughput pallet increased 4.7% year-over-year primarily as a result of an increase in higher priced repackaging, blast freezing, and case-picking warehouse services and, in part, a favorable net effect of foreign currency translation as the increase in warehouse services revenues from our foreign operations was greater than the increase from the same revenues stream at our domestic operations. On a constant currency basis, our same store services revenues per throughput pallet increased 4.2% period-over-period.




Financial Supplement		Fourth Quarter 2017

Growth and Development Projects

Completed in the Fourth Quarter 2017

Opportunity

Type

Facility

Type

Cubic Feet

(in millions)

Pallet Positions

(in thousands)

Cost of Expansion /

Development

Completion

Date

Facility

Total cost to date

(in millions) (1)

Return on

Invested Capital

Clearfield, UT

Expansion

Distribution

6.8

20.7

12-15%

Q4 2017


(1)	Cost to date as of December 31, 2017. There could be residual cost associated with finishing the property.



			Under Construction		Costs of Expansion / Development (in millions)						Budgeted Stabilized Return on Invested Capital	Target Completion Date
Facility	Opportunity Type	Facility Type	Cubic Feet (in millions) (1)	Pallet Positions (in thousands) (1)	Cost to Date		Estimate to Completion (2)		Estimated Cost (2)		Budgeted Stabilized Return on Invested Capital	Target Completion Date
Middleboro, MA	Development	Production Advantaged	5.2	28	12		12		24		8-12%	Q3 2018
Rochelle, IL	Expansion	Distribution	15.7	58	21		58		79		12-15%	Q4 2018
Total			20.9	86	$	33	$	70	$	103


(1)	Cubic feet and pallet positions are estimates while the facilities are under construction.


(2)	Reflects management’s estimate of cost of completion as of December 31, 2017.




Financial Supplement		Fourth Quarter 2017

Notes and Definitions

We calculate funds from operations, or FFO, in accordance with the standards established by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT. NAREIT defines FFO as net income or loss determined in accordance with U.S. GAAP, excluding extraordinary items as defined under U.S. GAAP and gains or losses from sales of previously depreciated operating real estate assets, plus specified non-cash items, such as real estate asset depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. We believe that FFO is helpful to investors as a supplemental performance measure because it excludes the effect of depreciation, amortization and gains or losses from sales of real estate, all of which are based on historical costs, which implicitly assumes that the value of real estate diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, FFO can facilitate comparisons of operating performance between periods and among other equity REITs.

We calculate core funds from operations, or Core FFO, as FFO adjusted for the effects of gain or loss on the sale of non-real estate assets, severance and reduction in workforce costs, terminated site operations costs, expenses related to our review of the strategic alternatives for our company prior to the IPO, litigation settlements, non-recurring impairment charges arising from our joint venture in China, or the China JV, and impairment of partially owned entities, loss on debt extinguishment and modification, inventory asset impairment charges, foreign currency exchange gain or loss, excise tax settlement and multi-employer pension plan withdrawal expense. We believe that Core FFO is helpful to investors as a supplemental performance measure because it excludes the effects of certain items which can create significant earnings volatility, but which do not directly relate to our core business operations. We believe Core FFO can facilitate comparisons of operating performance between periods, while also providing a more meaningful predictor of future earnings potential.

However, because FFO and Core FFO add back real estate depreciation and amortization and do not capture the level of recurring maintenance capital expenditures necessary to maintain the operating performance of our properties, both of which have material economic impacts on our results from operations, we believe the utility of FFO and Core FFO as a measure of our performance may be limited.

We calculate adjusted funds from operations, or Adjusted FFO, as Core FFO adjusted for the effects of amortization of loan costs, debt discounts and above or below market leases, straight-line rent, provision or benefit from deferred income taxes, stock-based compensation expense from grants of stock options and restricted stock units under our equity incentive plans, non-real estate depreciation, depletion or amortization (including in respect of the China JV), and recurring maintenance capital expenditures. We believe that Adjusted FFO is helpful to investors as a meaningful supplemental comparative performance measure of our ability to make incremental capital investments in our business and to assess our ability to fund distribution requirements from our operating activities.

FFO, Core FFO and Adjusted FFO are used by management, investors and industry analysts as supplemental measures of operating performance of equity REITs. FFO, Core FFO and Adjusted FFO should be evaluated along with U.S. GAAP net income and net income per diluted share (the most directly comparable U.S. GAAP measures) in evaluating our operating performance. FFO, Core FFO and Adjusted FFO do not represent net income or cash flows from operating activities in accordance with U.S. GAAP and are not indicative of our results of operations or cash flows from operating activities as disclosed in our consolidated statements of operations included elsewhere in this report on Form 10-K. FFO, Core FFO and Adjusted FFO should be considered as supplements, but not alternatives, to our net income or cash flows from operating activities as indicators of our operating performance. Moreover, other REITs may not calculate FFO in accordance with the NAREIT definition or may interpret the NAREIT definition differently than we do. Accordingly, our FFO may not be comparable to FFO as calculated by other REITs. In addition, there is no industry definition of Core FFO or Adjusted FFO and, as a result, other REITs may also calculate Core FFO or Adjusted FFO, or other similarly-captioned metrics, in a manner different than we do. The table above reconciles FFO, Core FFO and Adjusted FFO to net income, which is the most directly comparable financial measure calculated in accordance with U.S. GAAP.

We calculate EBITDA as earnings before interest expense, taxes, depreciation, depletion and amortization. EBITDA is a measure commonly used in our industry, and we present EBITDA to enhance investor understanding of our operating performance. We believe that EBITDA provides investors and analysts with a measure of operating results unaffected by differences in capital structures, capital investment cycles and useful life of related assets among otherwise comparable companies.

We also calculate our Core EBITDA as EBITDA adjusted for impairment charges on intangible and long-lived assets, gain or loss on depreciable real property asset disposals, severance and reduction in workforce costs, terminated site operations costs, expenses related to our review of the strategic alternatives for our company prior to this offering, litigation settlements, loss on debt extinguishment and modification, stock-based compensation expense, foreign currency exchange gain or loss, loss on partially owned entities, impairment of partially owned entities, and multi-employer pension plan withdrawal expense. We believe that the presentation of Core EBITDA provides a measurement of our operations that is meaningful to investors because it excludes the effects of certain items that are otherwise included in EBITDA but which we do not believe are indicative of our core business operations. EBITDA and Core EBITDA are not measurements of financial performance under U.S. GAAP, and our EBITDA and Core EBITDA may not be comparable to similarly titled measures of other companies. You should not consider our EBITDA and Core EBITDA as alternatives to net income or cash flows from operating activities determined in accordance with U.S. GAAP. Our calculations of EBITDA and Core EBITDA have limitations as analytical tools, including:


•	these measures do not reflect our historical or future cash requirements for recurring maintenance capital expenditures or growth and expansion capital expenditures;


•	these measures do not reflect changes in, or cash requirements for, our working capital needs;


•	these measures do not reflect the interest expense, or the cash requirements necessary to service interest or principal payments, on our indebtedness;


•	these measures do not reflect our tax expense or the cash requirements to pay our taxes; and


•	although depreciation, depletion and amortization are non-cash charges, the assets being depreciated, depleted and amortized will often have to be replaced in the future and these measures do not reflect any cash requirements for such replacements.

We use EBITDA and Core EBITDA as measures of our operating performance and not as measures of liquidity. The table above reconciles EBITDA and Core EBITDA to net income, which is the most directly comparable financial measure calculated in accordance with U.S. GAAP.

AMERICOLD REALTY TRUST - FORM 8-K - EX-99.2 - EXHIBIT 99.2 - March 28, 2018

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AMERICOLD REALTY TRUST Reports