AMERICOLD REALTY TRUST ANNOUNCES THIRD QUARTER 2018 RESULTS

- Total Revenue Growth of 3.2% and Contribution (NOI) Growth of 9.3% -

- Global Warehouse Segment Revenue Growth of 2.3% and Contribution (NOI) Growth of 8.8% -

- Global Warehouse Segment Contribution (NOI) Margin Expands 190 Basis Points -

- Net Income of $24.5 Million -

- Core FFO of $0.30 and AFFO of $0.28 Per Diluted Common Share -

Atlanta, GA, November 8, 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 third quarter ended September 30, 2018.

“Our third quarter results were strong, including our Global Warehouse segment same store revenue and contribution (NOI) growth of 2.5% and 7.2%, respectively, further demonstrating the consistency of our business and our team’s excellent execution of our strategy. While we continue to benefit from a favorable customer mix, we are also capturing internal growth from our ongoing efforts to increase fixed commitment contracts and further productivity improvements. On the investment front, our new Clearfield, Utah facility reached stabilized occupancy levels and we delivered and commenced operations in our new Middleboro, Massachusetts build-to-suit facility. We continue to build our external growth pipeline and recently signed a letter-of-intent to build and operate three state-of-the-art automated facilities for a major customer.”

“We were very active on the capital markets front. We raised $232.0 million dollars in September in a well-received follow-on offering inclusive of a forward equity component which supports our growth initiatives. We received inaugural investment grade ratings from Fitch and Morningstar, and entered into agreements to recast and upsize our credit facility to $1.275 billion dollars while moving it to an unsecured structure. We also priced a $600 million unsecured debt private placement. The proceeds of the debt private placement will be used to repay existing indebtedness.”

“I am also excited to welcome the recent additions to our senior leadership team. Carlos Rodriguez has joined us in the role of Chief Operating Officer, Jay Harron has joined us in the role of Chief Investment Officer, and Scott Henderson has joined us in the role of SVP Capital Markets, Treasury and Investor Relations. Having delivered a dedicated build this quarter, progressed on our external growth, expanded our management team and made significant enhancements to our balance sheet, we believe we have laid the groundwork for further long term growth and shareholder value creation,” stated Fred Boehler, President and Chief Executive Officer of Americold Realty Trust.

Third Quarter2018 Highlights

• Total revenue increased 3.2% to $402.0 million; Global Warehouse segment revenue increased 2.3% to $297.2 million

• Total contribution (NOI) increased 9.3% to $101.5 million; Global Warehouse segment contribution (NOI) increased 8.8% to $93.6 million

• Net income of $24.5 million, or $0.17 per diluted common share

• Core EBITDA increased 7.6% to $76.8 million

• Core Funds from Operations ("Core FFO") of $43.9 million, or $0.30 per diluted common share

• Adjusted Funds from Operations (“AFFO”) of $41.4 million, or $0.28 per diluted common share

• Global Warehouse segment same store revenue grew 2.5% to $290.2 million, with segment contribution (NOI) improving 7.2% to $91.7 million

• Opened a new 4.4 million refrigerated cubic foot build-to-suit facility in Middleboro, MA

• Completed follow-on public offering of 42,849,000 common shares at $24.50 per share, of which 4,000,000 shares were issued and sold by the Company for net proceeds of $92.0 million and entered into a forward sale agreement for 6,000,000 shares

Highlights Subsequent to Quarter End

• Entered into an agreement to recast and upsize the $925 million secured credit facility to a $1.275 billion unsecured facility by increasing the revolver by $350 million, closing is subject to the completion of the private placement offering and is expected to close in early December

• Priced $600 million of senior unsecured notes in an institutional private placement, subject to the closing of the aforementioned credit facility in early December and customary closing conditions

• Received inaugural investment grade ratings from Fitch Ratings (BBB) and Morningstar (BBB), subject to the closing of the aforementioned debt transactions

Third Quarter2018 Total Company Financial Results

Total revenue for the third quarter ended September 30, 2018 was $402.0 million, a 3.2% increase from the same quarter of the prior year. This growth was largely driven by net new business, improvements in our commercial terms and contractual rate escalations, and the maturation of the Clearfield, Utah facility and opening of the build-to-suit facility in Middleboro, Massachusetts at the end of the third quarter within the Global Warehouse segment.

Selling, general and administrative expense in the third quarter totaled $28.5 million, as compared to $36.4 million in the same quarter of the prior year. During the third quarter of 2017, the Company recorded a one-time charge of $9.2 million representing multi employer pension plan withdrawal expense. Additionally, during the third quarter of 2017, the Company recorded a one-time charge of $2.1 million to repair a leased facility to its original condition prior to the lease expiration. These decreases year over year were partially offset by public company costs incurred in the current period.

For the third quarter of 2018, the Company reported net income of $24.5 million, or $0.17 per diluted share, compared to a net loss of $4.6 million for the same quarter of the prior year. Net income for the current quarter included a $3.7 million benefit related to refundable Alternative Minimum Tax credits that were not subject to limitation under the Tax Cuts and Jobs Act. Excluding this benefit, net income for the quarter would have been $20.8 million, or $0.14 per diluted share.

Total contribution (NOI) for the third quarter ended September 30, 2018 increased 9.3% to $101.5 million, compared to $92.8 million for the same quarter of the prior year.

Core EBITDA was $76.8 million for the third quarter of 2018, compared to $71.4 million for the same quarter of the prior year. This reflects a 7.6% increase over prior year driven by increased revenue, a more favorable customer mix, continued operating efficiency gains, despite incurring incremental SG&A related to public company expenses incurred in the third quarter of 2018.

For the third quarter of 2018, Core FFO was $43.9 million, or $0.30 per diluted share, compared to $25.7 million for same quarter of the prior year.

For the third quarter of 2018, AFFO was $41.4 million, or $0.28 per diluted share, compared to $24.1 million for same quarter of the prior year. AFFO excludes certain expenses and income items that do not represent core expenses and income streams.

Please see the Company's supplemental financial information for the definitions and reconciliations of non-GAAP financial measures to the most comparable GAAP financial measures.

Third Quarter2018 Global Warehouse Segment Results

For the third quarter of 2018, Global Warehouse segment revenues were $297.2 million, an increase of $6.6 million, or 2.3%, compared to $290.6 million for the third quarter of 2017. This growth was primarily driven by the same factors mentioned above.

Warehouse segment contribution (NOI) was $93.6 million, or 31.5% of segment revenue, for the third quarter of 2018, compared to $86.1 million, or 29.6% of segment revenue, for the prior year. This represents a 9.3% improvement in segment profitability over the third quarter of 2017 and an expansion of 190 basis points in segment margin period-over-period. The year-over-year profit growth was driven primarily by the aforementioned revenue trends, combined with continued leveraging of fixed expenses, and labor and other productivity improvements. The Company continues to generate productivity improvements with its ongoing focus on continuous improvement initiatives driven in part by further progression of its Americold Operating System ("AOS").

The Company ended the third quarter of 2018 with 144 total facilities in its Global Warehouse segment portfolio. Of the 144 total facilities, 137 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 following tables summarize the third quarter and nine months 2018 Global Warehouse full segment and same store metrics compared to the same periods a year ago:

Global Warehouse - Total	Three Months Ended September 30,						Change		Nine Months Ended September 30,						Change
Dollars in thousands	2018			2017					2018			2017
Global Warehouse revenues:
Rent and storage	$	130,044		$	127,819		1.7	%	$	381,104		$	369,909		3.0	%
Warehouse services	167,181			162,774			2.7	%	490,350			478,155			2.6	%
Total Warehouse revenues	$	297,225		$	290,593		2.3	%	$	871,454		$	848,064		2.8	%
Global Warehouse contribution (NOI)	$	93,638		$	86,074		8.8	%	$	274,043		$	254,399		7.7	%
Global Warehouse margin	31.5		%	29.6		%	190 bps		31.4		%	30.0		%	140 bps
Units in thousands except per pallet data
Global Warehouse rent and storage:
Occupancy
Average occupied pallets	2,438			2,492			(2.2	)%	2,422			2,470			(1.9	)%
Average physical pallet positions	3,166			3,220			(1.7	)%	3,196			3,214			(0.6	)%
Occupancy percentage	77.0		%	77.4		%	-40 bps		75.8		%	76.8		%	-100 bps
Total rent and storage revenues per occupied pallet	$53.33			$	51.28		4.0	%	$157.33			$	149.78		5.0	%
Global Warehouse services:
Throughput pallets	6,726			6,961			(3.4	)%	19,982			20,671			(3.3	)%
Total warehouse services revenues per throughput pallet	$	24.85		$	23.38		6.3	%	$	24.54		$	23.13		6.1	%

Global Warehouse - Same Store	Three Months Ended September 30,						Change		Nine Months Ended September 30,						Change
Dollars in thousands	2018			2017					2018			2017
Global Warehouse same store revenues:
Rent and storage	$	126,656		$	124,051		2.1	%	$	371,892		$	358,788		3.7	%
Warehouse services	163,516			159,000			2.8	%	479,724			467,394			2.6	%
Total same store revenues	$	290,172		$	283,051		2.5	%	$	851,616		$	826,182		3.1	%
Global Warehouse same store contribution (NOI)	$	91,676		$	85,498		7.2	%	$	271,256		$	252,976		7.2	%
Global Warehouse same store margin	31.6		%	30.2		%	140 bps		31.9		%	30.6		%	130 bps
Units in thousands except per pallet data
Global Warehouse same store rent and storage:
Occupancy
Average occupied pallets	2,368			2,402			(1.4	)%	2,350			2,388			(1.6	)%
Average physical pallet positions	3,075			3,089			(0.5	)%	3,083			3,084			—	%
Occupancy percentage	77.0		%	77.7		%	-70 bps		76.2		%	77.5		%	-130 bps
Same store rent and storage revenues per occupied pallet	$	53.49		$	51.65		3.6	%	$	158.25		$	150.23		5.3	%
Global Warehouse same store services:
Throughput pallets	6,566			6,798			(3.4	)%	19,499			20,189			(3.4	)%
Same store warehouse services revenues per throughput pallet	$	24.90		$	23.39		6.5	%	$	24.60		$	23.15		6.3	%

Fixed Commitment Rent and Storage Revenue

As of quarter ended September 30, 2018, 41.8% of rent and storage revenues are derived from customers with fixed commitment storage contracts, an increase of 210 basis points from the second quarter 2018 and 340 basis points over the third quarter of 2017.

Follow-On Public Offering

On September 18, 2018, the Company completed a follow-on public offering of its common shares in which the Company issued 4,000,000 of its common shares at $24.50 per share, and entered into a forward sale agreement for 6,000,000 shares to be settled within one year. In connection with the forward sale agreement, the forward purchaser or its affiliate borrowed and sold an aggregate of 6,000,000 common shares that were delivered in the offering. In connection with the issuance of 4,000,000 common shares issued by the Company, it received $92.0 million in net proceeds.The proceeds from the forward sale agreement will not be recognized until the forward sale agreement is settled.

Balance Sheet Activity and Liquidity

At September 30, 2018, the Company had total liquidity of approximately $644.1 million, including cash and capacity on its revolving credit facility. Total debt outstanding was $1.55 billion (including $160.9 million of capital leases/sale leasebacks), with a weighted average term of 3.9 years. The Company has no material debt maturities during the remainder of 2018 and all of 2019. At September 30, 2018, 63% of the Company's total debt outstanding was at a fixed rate and on a trailing twelve-month basis, its net debt to Core EBITDA was approximately 4.4x. The Company's weighted average effective interest rate on outstanding indebtedness was 5.53%.

Dividend

On September 11, 2018, the Company's Board of Trustees declared a dividend of $0.1875 per share for the third quarter of 2018, which was paid on October 15, 2018 to common shareholders of record on September 28, 2018.

Investor Webcast and Conference Call

The Company will hold a webcast and conference call on Thursday, November 8, 2018 at 5:00 p.m. Eastern Time to discuss third quarter2018 results. A live webcast of the call will be available via the Investor Relations 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 1-877-407-3982 or 1-201-493-6780. The telephone replay can be accessed by dialing 1-844-512-2921 or 1-412-317-6671 and providing the conference ID# 13684024. The telephone replay will be available starting shortly after the call until November 22, 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 156 temperature-controlled warehouses, with approximately 928 refrigerated 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 approximately 2,400 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, EBITDAre, 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 EBITDAre and Core EBITDA, a definition of Core EBITDA and definitions of net debt to Core EBITDA are included within the supplemental.

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 funds affiliated with The Yucaipa Companies, and The Goldman Sachs Group, Inc.; 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.

Contacts:

Americold Realty Trust

Investor Relations

Telephone: 678-459-1959

Email: investor.relations@americold.com

Americold Realty Trust and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands, except shares and per share amounts)
	September 30, 2018			December 31, 2017
	Unaudited
Assets
Property, plant, and equipment:
Land	$	384,971		$	389,443
Buildings and improvements	1,838,086			1,819,635
Machinery and equipment	579,325			552,677
Assets under construction	75,606			48,868
	2,877,988			2,810,623
Accumulated depreciation and depletion	(1,090,336		)	(1,010,903		)
Property, plant, and equipment – net	1,787,652			1,799,720
Capitalized leases:
Buildings and improvements	16,827			16,827
Machinery and equipment	47,388			59,389
	64,215			76,216
Accumulated depreciation	(25,118		)	(41,051		)
Capitalized leases – net	39,097			35,165
Cash and cash equivalents	226,807			48,873
Restricted cash	38,448			21,090
Accounts receivable – net of allowance of $5,725 and $5,309 at September 30, 2018 and December 31, 2017, respectively	209,268			200,006
Identifiable intangible assets – net	25,444			26,645
Goodwill	186,383			188,169
Investments in partially owned entities	15,952			15,942
Other assets	51,180			59,287
Total assets	$	2,580,231		$	2,394,897
Liabilities, Series B Preferred Shares and shareholders’ equity (deficit)
Liabilities:
Borrowings under revolving line of credit	$	—		$	—
Accounts payable and accrued expenses	249,715			241,259
Construction loan - net of deferred financing costs of $179 at December 31, 2017	—			19,492
Mortgage notes and term loans - net of unamortized discount and deferred financing costs of $13,571 and $31,997, in the aggregate, at September 30, 2018 and December 31, 2017, respectively	1,376,998			1,721,958
Sale-leaseback financing obligations	119,640			121,516
Capitalized lease obligations	41,231			38,124
Unearned revenue	19,471			18,848
Pension and postretirement benefits	14,297			16,756
Deferred tax liability - net	18,889			21,940
Multi-Employer pension plan withdrawal liability	8,987			9,134
Total liabilities	1,849,228			2,209,027
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; zero and 375,000 shares issued and outstanding at September 30, 2018 and December 31, 2017, respectively	—			372,794
Shareholders’ equity (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; zero and 125 shares issued and outstanding at September 30, 2018 and December 31, 2017, respectively	—			—
Common shares of beneficial interest, $0.01 par value – authorized 250,000,000 shares; 147,861,840 and 69,370,609 shares issued and outstanding at September 30, 2018 and December 31, 2017, respectively	1,479			694
Paid-in capital	1,349,761			394,082
Accumulated deficit and distributions in excess of net earnings	(612,795		)	(581,470		)
Accumulated other comprehensive loss	(7,442		)	(230		)
Total shareholders’ equity (deficit)	731,003			(186,924		)
Total liabilities, Series B Preferred Shares and shareholders’ equity	$	2,580,231		$	2,394,897

Americold Realty Trust and Subsidiaries
Condensed Consolidated Statements of Operations (Unaudited)
(In thousands, except per share amounts)
	Three Months Ended September 30,						Nine Months Ended September 30,
	2018			2017			2018			2017
Revenues:
Rent, storage, and warehouse services revenues	$	297,225		$	290,593		$	871,454		$	848,064
Third-party managed services	62,551			60,556			192,182			178,561
Transportation services	40,193			35,688			117,427			107,665
Other revenues	2,041			2,664			6,755			7,577
Total revenues	402,010			389,501			1,187,818			1,141,867
Operating expenses:
Rent, storage, and warehouse services cost of operations	203,587			204,519			597,411			593,665
Third-party managed services cost of operations	58,997			57,345			180,993			168,879
Transportation services cost of operations	36,045			32,597			106,099			97,932
Cost of operations related to other revenues	1,896			2,208			6,344			7,653
Depreciation, depletion, and amortization	29,403			28,875			87,861			87,196
Selling, general and administrative	28,517			36,432			87,947			84,736
Loss (gain) from sale of real estate	12			83			(8,372		)	83
Impairment of long-lived assets	—			—			747			8,773
Total operating expenses	358,457			362,059			1,059,030			1,048,917
Operating income	43,553			27,442			128,788			92,950
Other income (expense):
(Loss) income from investments in partially owned entities	(437		)	9			(324		)	(1,342		)
Impairment of investments in partially owned entities	—			—			—			(6,496		)
Interest expense	(22,834		)	(29,218		)	(70,258		)	(85,233		)
Interest income	877			218			2,610			785
Loss on debt extinguishment and modification	—			(386		)	(21,385		)	(986		)
Foreign currency exchange gain (loss)	734			(1,045		)	2,926			(3,870		)
Other income (expense), net	96			148			184			(1,061		)
Income (loss) before income tax benefit (expense)	21,989			(2,832		)	42,541			(5,253		)
Income tax benefit (expense):
Current	3,063			(2,124		)	672			(7,734		)
Deferred	(512		)	349			2,093			4,379
Total income tax benefit (expense)	2,551			(1,775		)	2,765			(3,355		)
Net income (loss)	$	24,540		$	(4,607	)	$	45,306		$	(8,608	)
Less distributions on preferred shares of beneficial interest - Series A	—			(8		)	(1		)	(8		)
Less distributions on preferred shares of beneficial interest - Series B	—			(7,108		)	(1,817		)	(21,326		)
Less accretion on preferred shares of beneficial interest - Series B	—			(218		)	—			(657		)
Net income (loss) attributable to common shares of beneficial interest	$	24,540		$	(11,941	)	$	43,488		$	(30,599	)
Weighted average common shares outstanding – basic	144,948			70,049			138,438			70,012
Weighted average common shares outstanding – diluted	147,626			70,049			141,191			70,012
Net income (loss) per common share of beneficial interest - basic	$	0.17		$	(0.17	)	$	0.31		$	(0.44	)
Net income (loss) per common share of beneficial interest - diluted	$	0.17		$	(0.17	)	$	0.31		$	(0.44	)

Reconciliation of Net Earnings (Loss) to NAREIT FFO, Core FFO, and AFFO
(In thousands)
	Three Months Ended September 30,						Nine Months Ended September 30,
	2018			2017			2018			2017
Net income (loss)	$	24,540		$	(4,607	)	$	45,306		$	(8,608	)
Adjustments:
Real estate related depreciation and depletion	21,903			21,530			65,842			64,437
Net loss (gain) on sale of depreciable real estate	—			83			(8,384		)	83
Net gain on asset disposals	(65		)	—			(65		)	—
Impairment charges on certain real estate assets	—			—			747			8,773
Real estate depreciation on China JV	292			326			804			881
NAREIT Funds from operations	46,670			17,332			104,250			65,566
Less distributions on preferred shares of beneficial interest	—			(7,109		)	(1,818		)	(21,334		)
NAREIT Funds from operations applicable to common shareholders	$	46,670		$	10,223		$	102,432		$	44,232
Adjustments:
Net gain on sale of non-real estate assets	(314		)	(236		)	(849		)	(431		)
Non-offering related shareholders equity issuance expenses (a)	605			—			1,845			—
Non-recurring public company implementation costs (b)	496			—			658			—
Acquisition, diligence and other pursuit costs	21			—			72			—
Stock-based compensation expense, IPO grants	845			—			2,775			—
Impairment of investments in partially owned entities (c)	—			—			—			6,496
Severance and reduction in workforce costs (d)	73			(18		)	11			(18		)
Terminated site operations costs (e)	—			2,506			139			2,624
Strategic alternative costs (f)	—			2,621			—			4,366
Loss on debt extinguishment and modification	—			386			21,385			986
Inventory asset impairment	—			—			—			2,108
Foreign currency exchange (gain) loss	(734		)	1,045			(2,926		)	3,870
Multiemployer pension obligation	—			9,167			—			9,167
Alternative Minimum Tax refund from Tax Cuts & Jobs Act	(3,745		)	—			(3,745		)	—
Core FFO applicable to common shareholders	$	43,917		$	25,694		$	121,797		$	73,400
Adjustments:
Amortization of deferred financing costs and debt discount	1,532			2,203			4,762			6,389
Amortization of below/above market leases	38			38			114			114
Straight-line net rent	(62		)	33			(93		)	98
Deferred income taxes expense (benefit)	512			(349		)	(2,093		)	(4,379		)
Stock-based compensation expense, excluding IPO grants	1,226			587			5,480			1,760
Non-real estate depreciation and amortization	7,499			7,345			22,019			22,759
Non-real estate depreciation and amortization on China JV	132			156			431			454
Recurring maintenance capital expenditures (g)	(13,377		)	(11,619		)	(31,323		)	(29,991		)
Adjusted FFO applicable to common shareholders	$	41,417		$	24,088		$	121,094		$	70,604
Reconciliation of weighted average and fully diluted shares:
Weighted average basic shares for net income calculation	144,948			n/a			138,438			n/a
Dilutive stock options and unvested restricted stock units	2,678			n/a			2,753			n/a
Weighted average dilutive shares for net income calculation	147,626			n/a			141,191			n/a
Common shares equivalents (f)	3,931			n/a			10,366			n/a
Fully diluted common shares outstanding at quarter-end (g)	151,557			n/a			151,557			n/a
NAREIT FFO - basic per share	$	0.32		n/a			$	0.74		n/a
NAREIT FFO - diluted per share	$	0.32		n/a			$	0.73		n/a
NAREIT FFO - fully diluted per share at quarter end (h)	$	0.31		n/a			$	0.68		n/a
Core FFO - basic per share	$	0.30		n/a			$	0.88		n/a
Core FFO - diluted per share	$	0.30		n/a			$	0.86		n/a
Core FFO - fully diluted per share at quarter end (h)	$	0.29		n/a			$	0.80		n/a
Adjusted FFO - basic per share	$	0.29		n/a			$	0.87		n/a
Adjusted FFO - diluted per share	$	0.28		n/a			$	0.86		n/a
Adjusted FFO - fully diluted per share at quarter end (h)	$	0.27		n/a			$	0.80		n/a

(a)	Represents one-time costs and professional fees associated with IPO and follow-on equity issuances.
(b)	Represents one-time costs associated with the implementation of financial reporting systems and processes needed to convert the organization to a public company.
(c)	Represents one-time severance from prior management team and reduction in workforce costs associated with exiting or selling non-strategic warehouses.
(d)	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.
(e)	Represents one-time operating costs associated with our review of strategic alternatives prior to the IPO.
(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.
(g)	Fully diluted common share equivalents outstanding at September 30, 2018.
(h)	Assumes i) all post-IPO commons shares were outstanding for the entire quarter, ii) the exercise of all outstanding stock options and conversion of all outstanding restricted stock units at the beginning of the quarter, and iii) the follow-on public offering of 4,000,000 was outstanding for the entire quarter.

Reconciliation of Net Earnings (Loss) to NAREIT EBITDAre and Core EBITDA
(In thousands)
	Three Months Ended September 30,						Nine Months Ended September 30,
	2018			2017			2018			2017
Net income (loss)	$	24,540		$	(4,607	)	$	45,306		$	(8,608	)
Adjustments:
Depreciation, depletion and amortization	29,403			28,875			87,861			87,196
Interest expense	22,834			29,218			70,258			85,233
Income tax (benefit) expense	(2,551		)	1,775			(2,765		)	3,355
Gain on disposal of depreciated property	—			—			(8,384		)	—
Adjustment to reflect share of EBITDAre of partially owned entities	265			587			1,414			1,783
NAREIT EBITDAre	$	74,491		$	55,848		$	193,690		$	168,959
Adjustments:
Severance and reduction in workforce costs	73			(18		)	11			(18		)
Terminated site operations cost	—			2,506			139			2,624
Non-offering related equity issuance expenses (a)	605			—			1,845			—
Non-recurring public company implementation costs (b)	496			—			658			—
Acquisition, diligence, and other pursuit costs	21			—			72			—
Strategic alternative costs(c)	—			2,621			—			4,366
Loss (income) from investments in partially owned entities	437			(9		)	324			1,342
Non-recurring impairment of investments in partially owned entities (d)	—			—			—			6,496
Impairment of inventory and long-lived assets	—			—			747			10,881
(Gain) loss on foreign currency exchange	(734		)	1,045			(2,926		)	3,870
Stock-based compensation expense	2,070			587			8,255			1,760
Loss on debt extinguishment and modification	—			386			21,385			986
Gain on other asset disposals	(379		)	(171		)	(687		)	(215		)
Reduction In EBITDAre from partially owned entities	(265		)	(587		)	(1,414		)	(1,783		)
Multiemployer pension obligation	—			9,167			—			9,167
Core EBITDA	$	76,815		$	71,375		$	222,099		$	208,435

(a) Represents one-time costs and professional fees associated with initial and follow-on equity issuances.

(b) Represents one-time costs associated with the implementation of financial reporting systems and processes needed to convert the organization to a public company.

(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.

Revenue and Contribution by Segment (Unaudited)
(In thousands)
	Three Months Ended September 30,						Nine Months Ended September 30,
	2018			2017			2018			2017
	(In thousands)
Segment revenues:
Warehouse	$	297,225		$	290,593		$	871,454		$	848,064
Third-Party Managed	62,551			60,556			192,182			178,561
Transportation	40,193			35,688			117,427			107,665
Quarry	2,041			2,664			6,755			7,577
Total revenues	402,010			389,501			1,187,818			1,141,867
Segment contribution:
Warehouse	93,638			86,074			274,043			254,399
Third-Party Managed	3,554			3,211			11,189			9,682
Transportation	4,148			3,091			11,328			9,733
Quarry	145			456			411			(76		)
Total segment contribution	101,485			92,832			296,971			273,738
Reconciling items:
Depreciation, depletion, and amortization	(29,403		)	(28,875		)	(87,861		)	(87,196		)
Selling, general and administrative expense	(28,517		)	(36,432		)	(87,947		)	(84,736		)
(Loss) gain from sale of real estate	(12		)	(83		)	8,372			(83		)
Impairment of long-lived assets	—			—			(747		)	(8,773		)
(Loss) income from investments in partially owned entities	(437		)	9			(324		)	(1,342		)
Impairment of investments in partially owned entities	—			—			—			(6,496		)
Interest expense	(22,834		)	(29,218		)	(70,258		)	(85,233		)
Interest income	877			218			2,610			785
Loss on debt extinguishment and modification	—			(386		)	(21,385		)	(986		)
Foreign currency exchange gain (loss)	734			(1,045		)	2,926			(3,870		)
Other income (expense), net	96			148			184			(1,061		)
Income (loss) before income tax benefit (expense)	$	21,989		$	(2,832	)	$	42,541		$	(5,253	)

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.

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, non-offering related IPO expenses, stock-based compensation expense for the IPO retention grants, severance and reduction in workforce costs, acquisition, diligence and other pursuit costs, loss on debt extinguishment and modification, and foreign currency exchange gain or loss. 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 in our quarterly report on Form 10-Q. 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 for Real Estate, or EBITDAre, in accordance with the standards established by the Board of Governors of NAREIT, defined as, earnings before interest expense, taxes, depreciation, depletion and amortization, gains or losses on disposition of depreciated property, including gains or losses on change of control, impairment write-downs of depreciated property and of investments in unconsolidated affiliates caused by a decrease in value of depreciated property in the affiliate, and adjustment to reflect share of EBITDAre of unconsolidated affiliates. EBITDAre is a measure commonly used in our industry, and we present EBITDAre to enhance investor understanding of our operating performance. We believe that EBITDAre 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 EBITDAre further 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, non-offering related IPO expenses, loss on debt extinguishment and modification, stock-based compensation expense, foreign currency exchange gain or loss, loss on partially owned entities, and reduction in EBITDAre from partially owned entities. 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 EBITDAre but which we do not believe are indicative of our core business operations. EBITDAre and Core EBITDA are not measurements of financial performance under U.S. GAAP, and our EBITDAre and Core EBITDA may not be comparable to similarly titled measures of other companies. You should not consider our EBITDAre and Core EBITDA as alternatives to net income or cash flows from operating activities determined in accordance with U.S. GAAP. Our calculations of EBITDAre 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 EBITDAre and Core EBITDA as measures of our operating performance and not as measures of liquidity.