EX-99.2 3 ex992-afinsupplementalinfo.htm EX-99.2 AFIN SUPPLEMENTAL Document

EXHIBIT 99.2






American Finance Trust, Inc.
Supplemental Information
Quarter ended December 31, 2020 (unaudited)

1

American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
Table of Contents
ItemPage
Non-GAAP Definitions3
Key Metrics6
Consolidated Balance Sheets8
Consolidated Statements of Operations9
Non-GAAP Measures10
Debt Overview12
Future Minimum Lease Rents13
Top Ten Tenants14
Diversification by Property Type15
Diversification by Geography16
Lease Expirations17
Please note that totals may not add due to rounding.
Forward-looking Statements:
This supplemental package of American Finance Trust, Inc. (the "Company") includes “forward looking statements.” These forward-looking statements involve risks and uncertainties that could cause the outcome to be materially different. In addition, words such as “may,” “will,” “seeks,” “anticipates,” “believes,” “estimates,” “expects,” “plans,” “intends,” “should” or similar expressions indicate a forward-looking statement, although not all forward-looking statements include these words. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of the Company’s control, which could cause actual results to differ materially from the results contemplated by the forward-looking statements. These risks and uncertainties include the potential adverse effects of the ongoing global COVID-19 pandemic, including actions taken to contain or treat COVID-19, on the Company, the Company’s tenants and the global economy and financial markets, as well as those set forth in the Risk Factors section of the Company’s most recent Annual Report on Form 10-K for the year ended December 31, 2019 filed February 27, 2020 and all other filings filed with the Securities and Exchange Commission after that date. Further, forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, unless required by law.
Accounting Treatment of Rent Deferrals/Abatements  
The majority of the concessions granted to the Company's tenants as a result of the COVID-19 pandemic are rent deferrals or temporary rent abatements with the original lease term unchanged and collection of deferred rent deemed probable. The Company’s revenue recognition policy requires that it must be probable that the Company will collect virtually all of the lease payments due and does not provide for partial reserves, or the ability to assume partial recovery. In light of the COVID-19 pandemic, the FASB and SEC agreed that for leases where the total lease cash flows will remain substantially the same or less than those after the COVID-19 related effects, companies may choose to forgo the evaluation of the enforceable rights and obligations of the original lease contract as a practical expedient and account for rent concessions as if they were part of the enforceable rights and obligations of the parties under the existing lease contract. As a result, rental revenue used to calculate Net Income and NAREIT FFO has not been, and the Company does not expect it to be, significantly impacted by these types of deferrals. In addition, since the Company currently believes that these deferral amounts are collectable, they have been excluded from the increase in straight-line rent for AFFO purposes the amounts recognized under GAAP relating to these types of rent deferrals. Conversely, for abatements where contractual rent has been reduced, the reduction is reflected over the remaining lease term for accounting purposes but represents a permanent reduction and the Company has, accordingly, reduced its AFFO.



2

American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
Non-GAAP Financial Measures
This section discusses non-GAAP financial measures we use to evaluate our performance, including Funds from Operations ("FFO"), Adjusted Funds from Operations ("AFFO"), Adjusted Earnings before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA"), Net Operating Income ("NOI") and Cash Net Operating Income ("Cash NOI"). While NOI is a property-level measure, AFFO is based on total Company performance and therefore reflects the impact of other items not specifically associated with NOI such as, interest expense, general and administrative expenses and operating fees to related parties. Additionally, NOI as defined herein, does not reflect an adjustment for straight-line rent but AFFO does. A description of these non-GAAP measures and reconciliations to the most directly comparable GAAP measure, which is net income (loss), is provided below. Adjustments for unconsolidated partnerships and joint ventures are calculated to exclude the proportionate share of the non-controlling interest to arrive at FFO, AFFO and NOI attributable to stockholders.
Caution on Use of Non-GAAP Measures
FFO, AFFO, Adjusted EBITDA, NOI and Cash NOI should not be construed to be more relevant or accurate than the current GAAP methodology in calculating net income or in its applicability in evaluating our operating performance. The method utilized to evaluate the value and performance of real estate under GAAP should be construed as a more relevant measure of operational performance and considered more prominently than the non-GAAP measures.
Other REITs may not define FFO in accordance with the current National Association of Real Estate Investment Trusts ("NAREIT"), an industry trade group, definition (as we do), or may interpret the current NAREIT definition differently than we do, or may calculate AFFO differently than we do. Consequently, our presentation of FFO and AFFO may not be comparable to other similarly-titled measures presented by other REITs.
We consider FFO and AFFO useful indicators of our performance. Because FFO and AFFO calculations exclude such factors as depreciation and amortization of real estate assets and gains or losses from sales of operating real estate assets (which can vary among owners of identical assets in similar conditions based on historical cost accounting and useful-life estimates), FFO and AFFO presentations facilitate comparisons of operating performance between periods and between other REITs in our peer group.
As a result, we believe that the use of FFO and AFFO, together with the required GAAP presentations, provide a more complete understanding of our performance, including relative to our peers and a more informed and appropriate basis on which to make decisions involving operating, financing, and investing activities. However, FFO and AFFO are not indicative of cash available to fund ongoing cash needs, including the ability to pay cash dividends. Investors are cautioned that FFO and AFFO should only be used to assess the sustainability of our operating performance excluding these activities, as they exclude certain costs that have a negative effect on our operating performance during the periods in which these costs are incurred.
Funds from Operations and Adjusted Funds from Operations
Funds from Operations
Due to certain unique operating characteristics of real estate companies, as discussed below, NAREIT, an industry trade group, has promulgated a performance measure known as FFO, which we believe to be an appropriate supplemental measure to reflect the operating performance of a REIT. FFO is not equivalent to net income or loss as determined under GAAP.
We calculate FFO, a non-GAAP measure, consistent with the standards established over time by the Board of Governors of NAREIT, as restated in a White Paper and approved by the Board of Governors of NAREIT effective in December 2018 (the “White Paper”). The White Paper defines FFO as net income or loss computed in accordance with GAAP, excluding depreciation and amortization related to real estate, gains and losses from sales of certain real estate assets, gain and losses from change in control and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity. Adjustments for consolidated partially-owned entities (including our Operating Partnership) and equity in earnings of unconsolidated affiliates are made to arrive at our proportionate share of FFO attributable to our stockholders. Our FFO calculation complies with NAREIT’s definition.
The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, and straight-line amortization of intangibles, which implies that the value of a real estate asset diminishes predictably over time. We believe that, because real estate values historically rise and fall with market conditions, including inflation, interest rates, unemployment and consumer spending, presentations of operating results for a REIT using historical accounting for depreciation and certain other items may be less informative. Historical accounting for real estate involves the use of GAAP. Any other method of accounting for real estate such as the fair value method cannot be construed to be any more accurate or relevant than the comparable methodologies of real estate valuation found in GAAP. Nevertheless, we believe that the use of FFO, which excludes the impact of real estate related depreciation and amortization, among other things, provides a more complete understanding of our performance to investors and to management, and when compared year over year, reflects the impact on our operations from trends in occupancy rates, rental rates, operating costs, general and administrative expenses, and interest costs, which may not be immediately apparent from net income.
3

American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
Adjusted Funds from Operations
In calculating AFFO, we start with FFO, then we exclude certain income or expense items from AFFO that we consider to be more reflective of investing activities, such as non-cash income and expense items and the income and expense effects of other activities that are not a fundamental attribute of our day to day operating business plan, such as amounts related to litigation arising out of AFIN's 2017 merger with American Realty Capital - Retail Centers of America, Inc. (the "Merger"). These amounts include legal costs incurred as a result of the litigation, portions of which have been and may in the future be reimbursed under insurance policies maintained by us. Insurance reimbursements are deducted from AFFO in the period of reimbursement. We believe that excluding the litigation costs and subsequent insurance reimbursements related to litigation arising out of the Merger helps to provide a better understanding of the operating performance of our business. Other income and expense items also include early extinguishment of debt and unrealized gains and losses, which may not ultimately be realized, such as gains or losses on derivative instruments and gains and losses on investments. In addition, by excluding non-cash income and expense items such as amortization of above-market and below-market leases intangibles, amortization of deferred financing costs, straight-line rent, and share-based compensation related to restricted shares and the multi-year outperformance agreement from AFFO, we believe we provide useful information regarding those income and expense items which have a direct impact on our ongoing operating performance.
In calculating AFFO, we exclude certain expenses which under GAAP are characterized as operating expenses in determining operating net income (loss). All paid and accrued merger, acquisition and transaction related fees and certain other expenses negatively impact our operating performance during the period in which expenses are incurred or properties are acquired will also have negative effects on returns to investors but are not reflective of our on-going performance. In addition, legal fees and expense associated with COVID-19-related lease disputes involving certain tenants negatively impact our operating performance but are not reflective of our on-going performance. Further, under GAAP, certain contemplated non-cash fair value and other non-cash adjustments are considered operating non-cash adjustments to net income (loss). In addition, as discussed above, we view gains and losses from fair value adjustments as items which are unrealized and may not ultimately be realized and not reflective of ongoing operations and are therefore typically adjusted for when assessing operating performance. Excluding income and expense items detailed above from our calculation of AFFO provides information consistent with management's analysis of our operating performance. Additionally, fair value adjustments, which are based on the impact of current market fluctuations and underlying assessments of general market conditions but can also result from operational factors such as rental and occupancy rates, may not be directly related or attributable to our current operating performance. By excluding such changes that may reflect anticipated and unrealized gains or losses, we believe AFFO provides useful supplemental information. By providing AFFO, we believe we are presenting useful information that can be used to better assess the sustainability of our ongoing operating performance without the impact of transactions or other items that are not related to the ongoing performance of our portfolio of properties. AFFO presented by us may not be comparable to AFFO reported by other REITs that define AFFO differently. Furthermore, we believe that in order to facilitate a clear understanding of our operating results, AFFO should be examined in conjunction with net income (loss) as presented in our consolidated financial statements. AFFO should not be considered as an alternative to net income (loss) as an indication of our performance or to cash flows as a measure of our liquidity or ability to pay dividends.
Adjusted Earnings before Interest, Taxes, Depreciation and Amortization, Net Operating Income and Cash Net Operating Income.
We believe that Adjusted EBITDA, which is defined as earnings before interest, taxes, depreciation and amortization adjusted for acquisition and transaction-related expenses, other non-cash items such as expense related to our multi-year outperformance agreement with the Advisor and including our pro-rata share from unconsolidated joint ventures, is an appropriate measure of our ability to incur and service debt. Adjusted EBITDA should not be considered as an alternative to cash flows from operating activities, as a measure of our liquidity or as an alternative to net income as an indicator of our operating activities. Other REITs may calculate Adjusted EBITDA differently and our calculation should not be compared to that of other REITs.
NOI is a non-GAAP financial measure used by us to evaluate the operating performance of our real estate. NOI is equal to total revenues, excluding contingent purchase price consideration, less property operating and maintenance expense. NOI excludes all other items of expense and income included in the financial statements in calculating net income (loss). We believe NOI provides useful and relevant information because it reflects only those income and expense items that are incurred at the property level and presents such items on an unleveraged basis. We use NOI to assess and compare property level performance and to make decisions concerning the operations of the properties. Further, we believe NOI is useful to investors as a performance measure because, when compared across periods, NOI reflects the impact on operations from trends in occupancy rates, rental rates, operating expenses and acquisition activity on an unleveraged basis, providing perspective not immediately apparent from net income (loss). NOI excludes certain items included in calculating net income (loss) in order to provide results that are more closely related to a property's results of operations. For example, interest expense is not necessarily linked to the operating performance of a real estate asset. In addition, depreciation and amortization, because of historical cost accounting and useful life estimates, may distort operating performance at the property level. NOI presented by us may not be comparable to NOI reported by other REITs that define NOI differently. We believe that in order to facilitate a clear understanding of our operating results, NOI should be examined in conjunction
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American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
with net income (loss) as presented in our consolidated financial statements. NOI should not be considered as an alternative to net income (loss) as an indication of our performance or to cash flows as a measure of our liquidity or our ability to pay dividends.
Cash NOI, is a non-GAAP financial measure that is intended to reflect the performance of our properties. We define Cash NOI as NOI excluding amortization of above/below market lease intangibles and straight-line adjustments that are included in GAAP lease revenues. We believe that Cash NOI is a helpful measure that both investors and management can use to evaluate the current financial performance of our properties and it allows for comparison of our operating performance between periods and to other REITs. Cash NOI should not be considered as an alternative to net income, as an indication of our financial performance, or to cash flows as a measure of liquidity or our ability to fund all needs. The method by which we calculate and present Cash NOI may not be directly comparable to the way other REITs present Cash NOI.

5

American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
Key Metrics
As of and for the three months ended December 31, 2020
Financial Results (Amounts in thousands, except per share data, ratios and percentages)
Revenue from tenants
$77,237 
Net loss attributable to common stockholders
$(8,603)
Basic and diluted net loss per share attributable to common stockholders
$(0.08)
Cash NOI [1]
$58,714 
Adjusted EBITDA [1]
$52,723 
AFFO attributable to common stockholders [1]
$26,073 
Dividends declared on common stock [2]
$— 
Balance Sheet and Capitalization (Amounts in thousands, except per share data, ratios and percentages)
Gross asset value [3]
$4,247,334 
Net debt [4] [5]
$1,706,629 
Total consolidated debt [5]
$1,809,489 
Total assets
$3,607,967 
Liquidity [6]
$228,903 
Common shares outstanding as of December 31, 2020108,837 
Net debt to gross asset value
40.2 %
Net debt to adjusted EBITDA [1] (annualized based on quarterly results)
8.1 x
Weighted-average interest rate cost [7]
3.8 %
Weighted-average debt maturity (years) [8]
4.8 
Interest Coverage Ratio [9]
3.0 x
Real Estate PortfolioSingle-Tenant PortfolioMulti-Tenant PortfolioTotal Portfolio
Portfolio Metrics:
Real estate investments, at cost (in billions)
$2.6 $1.4 $4.0 
Number of properties
887 33 920 
Square footage (in millions)
12,093 7,162 19,255 
Annualized straight-line rent (in millions) [10]
$196.8 $83.5 $280.3 
Annualized Straight-line rent per leased square foot$16.4 $13.8 $15.5 
Occupancy [11]
99.4 %84.7 %93.9 %
Weighted-average remaining lease term (years) [12]
10.5 4.7 8.8 
% investment grade [13]
61.5 %N/AN/A
% of anchor tenants in multi-tenant portfolio that are investment grade [13] [14]
N/A31.2 %N/A
% of leases with rent escalators [15]
85.8 %58.4 %77.7 %
Average annual rent escalator [15]
1.3 %1.1 %1.3 %
__________
[1]This Non-GAAP metric is reconciled below.
[2]In August, 2020, the Company's board of directors approved a change to the Company's dividend policy from a monthly basis to a paying dividends on a quarterly basis in arrears on the 15th day of each month following a fiscal quarter. As a result, no dividend was declared in the fourth quarter of 2020. This change affected the frequency of dividend payments only and did not impact the annualized dividend rate on Class A common stock of $0.85.
[3]Defined as total assets plus accumulated depreciation and amortization as of December 31, 2020.
[4]Represents total debt outstanding less cash and cash equivalents.
[5]Excludes the effect of deferred financing costs, net and mortgage premiums, net.
[6]Liquidity includes cash and cash equivalents of $102.9 million as of December 31, 2020, and $126.0 million available for future borrowings under the Company's credit facility. The Company's credit facility currently requires the Company to maintain a combination of cash, cash equivalents and amounts available for future borrowings under the Credit Facility of not less than $100.0 million, which could limit Company's ability to incur additional indebtedness and use cash that would otherwise be available to the Company.
[7]Weighted based on the outstanding principal balance of the debt as of December 31, 2020.
[8]Weighted based on the outstanding principal balance of the debt as of December 31, 2020 and does not reflect any changes to maturity dates subsequent to December 31, 2020. The Company has the right to extend the maturity date to April 2023.
6

American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
[9]The interest coverage ratio is calculated by dividing adjusted EBITDA by cash paid for interest (interest expense less amortization of deferred financing costs, net, change in accrued interest and amortization of mortgage premiums on borrowings) for the quarter ended December 31, 2020. Adjusted EBITDA and cash paid for interest are Non-GAAP metrics and are reconciled below.
[10]Calculated using the most recent available lease terms as of December 31, 2020.
[11]Only includes leases which have commenced and were taken possession by the tenant as of December 31, 2020.
[12]The weighted-average remaining lease term (years) is based on annualized straight-line rent.
[13]As used herein, investment grade includes both actual investment grade ratings of the tenant or guarantor, if available, or implied investment grade. Implied investment grade may include actual ratings of tenant parent, guarantor parent (regardless of whether or not the parent has guaranteed the tenant's obligation under the lease) or by using a proprietary Moody's analytical tool, which generates an implied rating by measuring a company's probability of default. The term “parent" for these purposes includes any entity, including any governmental entity, owning more than 50% of the voting stock in a tenant. Ratings information is as of December 31, 2020. The weighted averages are based on straight-line rent. Single-tenant portfolio tenants are 50.4% actual investment grade rated and 11.1% implied investment grade rated.
[14]Anchor tenants are defined as tenants that occupy over 10,000 square feet of one of the Company's multi-tenant properties. Anchor tenants are 20.2% actual investment grade rated and 11% implied investment grade rated.
[15]Based on annualized straight-line rent as of December 31, 2020. Contractual rent increases include fixed percent or actual increases, or CPI-indexed increases.

7

American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
Consolidated Balance Sheets
Amounts in thousands, except share and per share data
December 31,
20202019
(Unaudited)
ASSETS 
Real estate investments, at cost:
Land
$723,316 $685,889 
Buildings, fixtures and improvements
2,830,508 2,681,485 
Acquired intangible lease assets
454,245 448,175 
Total real estate investments, at cost
4,008,069 3,815,549 
Less: accumulated depreciation and amortization
(639,367)(529,052)
Total real estate investments, net
3,368,702 3,286,497 
Cash and cash equivalents102,860 81,898 
Restricted cash10,537 17,942 
Deposits for real estate investments137 85 
Deferred costs, net16,663 17,467 
Straight-line rent receivable66,581 46,976 
Operating lease right-of-use assets18,546 18,959 
Prepaid expenses and other assets (including $1,939 and $503 due from related parties as of December 31, 2020 and 2019, respectively)23,941 19,188 
Assets held for sale— 1,176 
Total assets
$3,607,967 $3,490,188 
LIABILITIES AND EQUITY  
Mortgage notes payable, net $1,490,798 $1,310,943 
Credit facility280,857 333,147 
Below-market lease liabilities, net78,674 84,041 
Accounts payable and accrued expenses (including $273 and $1,153 due to related parties as of December 31, 2020 and 2019, respectively)25,210 26,817 
Operating lease liabilities19,237 19,318 
Derivative liabilities, at fair value123 — 
Deferred rent and other liabilities9,794 10,392 
Dividends payable
3,675 3,300 
Total liabilities
1,908,368 1,787,958 
7.50% Series A cumulative redeemable perpetual preferred stock, $0.01 par value, liquidation preference $25.00 per share, 8,796,000 shares authorized, 7,842,008 and 6,917,230 issued and outstanding as of December 31, 2020 and 2019, respectively 79 69 
7.375% Series C cumulative redeemable perpetual preferred stock, $0.01 par value, liquidation preference $25.00 per share, 3,680,000 shares authorized and 3,535,700 issued and outstanding as of December 31, 2020 and none authorized, issued, or outstanding as of December 31, 201935 — 
Common stock, $0.01 par value per share, 300,000,000 shares authorized, 108,837,209 and 108,475,266 shares issued and outstanding as of December 31, 2020 and 2019, respectively1,088 1,085 
Additional paid-in capital2,723,678 2,615,089 
Accumulated other comprehensive loss(123)— 
Distributions in excess of accumulated earnings(1,055,680)(932,912)
Total stockholders' equity
1,669,077 1,683,331 
Non-controlling interests30,522 18,899 
Total equity
1,699,599 1,702,230 
Total liabilities and equity
$3,607,967 $3,490,188 

8

American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
Consolidated Statements of Operations
Amounts in thousands, except share and per share data
 Three Months Ended
December 31,
2020
September 30,
2020
June 30,
2020
March 31, 2020
(Unaudited)(Unaudited)(Unaudited)(Unaudited)
Revenue from tenants$77,237 $78,489 $74,934 $74,564 
 Operating expenses:   
Asset management fees to related party7,088 6,918 6,918 6,905 
Property operating expense13,247 14,226 12,541 12,282 
Impairment of real estate investments1,408 — 11,502 — 
Acquisition, transaction and other costs241 1,507 721 452 
Equity-based compensation3,343 3,235 3,247 3,211 
General and administrative4,179 3,312 6,864 5,328 
Depreciation and amortization32,730 34,951 35,443 34,335 
Total operating expenses62,236 64,149 77,236 62,513 
  Operating income (loss) before gain on sale of real estate investments15,001 14,340 (2,302)12,051 
Gain on sale/exchange of real estate investments— 2,178 2,838 1,440 
Operating income15,001 16,518 536 13,491 
Other (expense) income:
Interest expense(19,689)(20,871)(18,801)(19,106)
Other income20 871 61 72 
Loss on non-designated derivatives(9)— — — 
Total other expense, net(19,678)(20,000)(18,740)(19,034)
Net loss (4,677)(3,482)(18,204)(5,543)
   Net loss attributable to non-controlling interests10 20 
  Allocation for preferred stock (3,931)(3,619)(3,619)(3,619)
Net loss attributable to common stockholders$(8,603)$(7,091)$(21,803)$(9,153)
Basic and Diluted Net Loss Per Share:
Net loss per share attributable to common stockholders — Basic and Diluted$(0.08)$(0.07)$(0.20)$(0.08)
Weighted-average shares outstanding Basic
108,436,329 108,429,315 108,386,013 108,364,082 
Weighted-average shares outstanding Diluted
108,436,329 108,429,315 108,386,013 108,364,082 
__________
[1]For the three months ended December 31, 2020, September 30, 2020, June 30, 2020 and March 31, 2020, includes litigation costs related to the Merger of $0.1 million, $0.2 million, $0.3 million and $0.3 million, respectively.
[2]For the three months ended December 31, 2020, September 30, 2020, June 30, 2020 and March 31, 2020, includes equity-based compensation expense related to the Company's restricted common shares of $0.4 million, $0.3 million, $0.3 million and $0.2 million, respectively.

9

American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
Non-GAAP Measures
Amounts in thousands
 Three Months Ended
December 31,
2020
September 30,
2020
June 30,
2020
March 31, 2020
(Unaudited)(Unaudited)(Unaudited)(Unaudited)
EBITDA:
Net loss$(4,677)$(3,482)$(18,204)$(5,543)
Depreciation and amortization32,730 34,951 35,443 34,335 
Interest expense19,689 20,871 18,801 19,106 
   EBITDA47,742 52,340 36,040 47,898 
Impairment of real estate investments1,408 — 11,502 — 
Acquisition, transaction and other costs [1]
241 1,507 721 452 
Equity-based compensation [2]
3,343 3,235 3,247 3,211 
Gain on sale/exchange of real estate investments— (2,178)(2,838)(1,440)
Other income(20)(871)(61)(72)
Loss on non-designated derivatives— — — 
   Adjusted EBITDA 52,723 54,033 48,611 50,049 
Asset management fees to related party7,088 6,918 6,918 6,905 
General and administrative4,179 3,312 6,864 5,328 
   NOI63,990 64,263 62,393 62,282 
   Amortization of market lease and other intangibles, net
(1,216)(1,652)(2,289)(992)
Straight-line rent(4,060)(7,743)(5,442)(2,265)
Cash NOI $58,714 $54,868 $54,662 $59,025 
Cash Paid for Interest:
   Interest expense$19,689 $20,871 $18,801 $19,106 
   Amortization of deferred financing costs, net and change in accrued interest
(2,362)(2,782)(990)(1,712)
   Amortization of mortgage premiums and discounts on borrowings
456 521 589 560 
Total cash paid for interest$17,783 $18,610 $18,400 $17,954 
__________
[1]For the three months ended December 31, 2020, September 30, 2020, June 30, 2020 and March 31, 2020, includes litigation costs related to the Merger of $0.1 million, $0.2 million, $0.3 million and $0.3 million, respectively.
[2]For the three months ended December 31, 2020, September 30, 2020, June 30, 2020 and March 31, 2020, includes equity-based compensation expense related to the Company's restricted common shares of $0.4 million, $0.3 million, $0.3 million and$0.2 million, respectively.


10

American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
Non-GAAP Measures
Amounts in thousands, except per share data
 Three Months Ended
December 31,
2020
September 30,
2020
June 30, 2020March 31, 2020
(Unaudited)(Unaudited)(Unaudited)(Unaudited)
Funds from operations (FFO):
Net loss attributable to common stockholders (in accordance with GAAP)$(8,603)$(7,091)$(21,803)$(9,153)
Impairment of real estate investments1,408 — 11,502 — 
Depreciation and amortization32,730 34,951 35,443 34,335 
Gain on sale/exchange of real estate investments — (2,178)(2,838)(1,440)
Proportionate share of adjustments for non-controlling interest to arrive at FFO(54)(51)(71)(52)
FFO attributable to common stockholders 25,481 25,631 22,233 23,690 
Acquisition, transaction and other costs [1]
241 1,507 721 452 
Litigation cost reimbursements related to the Merger [2]
— — — (9)
Legal fees and expenses — COVID-19 lease disputes [3]
11 16 242 — 
Amortization of market lease and other intangibles, net(1,216)(1,652)(2,289)(992)
Straight-line rent(4,060)(7,743)(5,442)(2,265)
Straight-line rent (rent deferral agreements) [4]
358 2,209 2,082 — 
Amortization of mortgage premiums and discounts on borrowings(456)(521)(589)(560)
Loss on non-designated derivatives— — — 
Equity-based compensation [5]
3,343 3,235 3,247 3,211 
Amortization of deferred financing costs, net and change in accrued interest2,362 2,782 990 1,712 
Proportionate share of adjustments for non-controlling interest to arrive at AFFO— (1)(2)
AFFO attributable to common stockholders$26,073 $25,465 $21,194 $25,237 
Weighted-average common shares outstanding (in thousands) 108,436 108,429 108,386 108,364 
Net loss per share attributable to common stockholders — Basic and Diluted $(0.08)$(0.07)$(0.20)$(0.08)
FFO per common share$0.23 $0.24 $0.21 $0.22 
AFFO per common share$0.24 $0.23 $0.20 $0.23 
Dividends declared [6]
$— $23,065 $23,058 $29,831 
__________
[1]Primarily includes prepayment costs incurred in connection with early debt extinguishment as well as litigation costs related to the Merger.
[2]Included in "Other income" in the Company's consolidated statement of operations.
[3]Reflects legal costs incurred related to disputes with tenants due to store closures or other challenges resulting from COVID-19. The tenants involved in these disputes had not recently defaulted on their rent and, prior to the second and third quarters of 2020, had recently exhibited a pattern of regular payment. Based on the tenants involved in these matters, their history of rent payments, and the impact of the pandemic on current economic conditions, the Company views these costs as COVID-19-related and separable from its ordinary general and administrative expenses related to tenant defaults. The Company engaged counsel in connection with these issues separate and distinct from counsel the Company typically engages for tenant defaults. The amount reflects what the Company believes to be only those incremental legal costs above what the Company typically incurs for tenant-related dispute issues. The Company may continue to incur these COVID-19 related legal costs in the future.
[4]Represents the amount of deferred rent pursuant to lease negotiations which qualify for FASB relief for which rent was deferred but not reduced. These amounts are included in the straight-line rent receivable on the Company's consolidated balance sheet but are considered to be earned revenue attributed to the current period for purposes of AFFO as they are expected to be collected. For rent abatements (including those qualified for FASB relief), where contractual rent has been reduced, the reduction is reflected over the remaining lease term for accounting purposes but represents a permanent reduction and the Company has, accordingly reduced its AFFO.
[5]Includes expense related to the amortization of the Company's restricted common shares and LTIP Units related to its multi-year outperformance agreement for all periods presented.
[6]Represents dividends declared to common stockholders. In August, 2020, the Company's board of directors approved a change to the Company's dividend policy from a monthly basis to a paying dividends on a quarterly basis in arrears on the 15th day of each month following a fiscal quarter. As a result, no dividend was declared in the fourth quarter of 2020. This change affected the frequency of dividend payments only and did not impact the annualized dividend rate on Class A common stock of $0.85.
11

American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
Debt Overview
As of December 31, 2020
Amounts in thousands, except ratios and percentages
Year of MaturityNumber of Encumbered Properties
Weighted-Average Debt Maturity (Years) [3]
Weighted-Average Interest Rate [3][4]
Total Outstanding Balance [5]
Percent
Non-Recourse Debt
2021102 0.06 5.3 %$110,471 
2022 — — — %2,311 
2023 — — — %2,643 
20243.2 5.0 %22,287 
2025370 4.5 3.7 %845,771 
Thereafter 262 7.2 4.2 %545,149 
Total Non-Recourse Debt  735 5.2 4.0 %1,528,632 84 %
Recourse Debt [1]
   Credit Facility [2]
2.3 2.8 %280,857 
Total Recourse Debt2.3 2.8 %280,857 16 %
Total Debt4.8 3.8 %$1,809,489 100 %
__________
[1]Recourse debt is debt that is guaranteed by the Company.
[2]The maturity date of the Company's credit facility is April 2022. The Company has the right to extend the maturity date to April 2023.
[3]Weighted based on the outstanding principal balance of the debt.
[4]As of December 31, 2020, the Company’s total combined debt was 82.6% fixed rate or swapped to a fixed rate and 17.4% floating rate.
[5]Excludes the effect of deferred financing costs, net and mortgage premiums and discounts.


12

American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
Future Minimum Base Lease Rents Due to the Company
As of December 31, 2020
Amounts in thousands
Future Minimum
Base Rent Payments
[1]
2021$268,535 
2022259,400 
2023246,195 
2024228,959 
2025210,543 
Thereafter1,307,238 
Total$2,520,870 
__________
[1]Represents future minimum base rent payments on a cash basis due to the Company over the next five years and thereafter. These amounts exclude contingent rent payments, as applicable, that may be collected from certain tenants based on provisions related to sales thresholds and increases in annual rent based on exceeding certain economic indexes among other items.

13

American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
Top Ten Tenants (by annualized straight-line rent)
As of December 31, 2020
Amounts in thousands, except percentages
Tenant / Lease GuarantorProperty TypeTenant Industry
Annualized SL Rent [1]
SL Rent Percent
Remaining Lease Term [2]
Investment Grade [3]
Sanofi USOfficePharmaceuticals$17,143 %12.0 Yes
Truist BankRetailRetail Banking16,875 %8.6 Yes
FreseniusRetailHealthcare14,525 %7.7 Yes
Mountain ExpressRetailGas/Convenience13,237 %17.7 No
AmeriColdDistributionRefrigerated Warehousing12,720 %6.7 Yes
Tenants 6 - 10VariousVarious36,952 13 %10.6 3 of 5 - Yes
Subtotal    111,452 40 %10.6 
     
Remaining portfolio    168,798 60 %
     
Total Portfolio$280,250 100 %
__________
[1]Calculated using the most recent available lease terms as of December 31, 2020.
[2]Based on annualized straight-line rent as of December 31, 2020.
[3]The top ten tenants are 67.0% actual investment grade rated and 7.9% implied investment grade rated (see page 6 for definition of Investment Grade).

14

American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
Diversification by Property Type
As of December 31, 2020
Amounts in thousands, except percentages
Total Portfolio
Property Type
Annualized SL Rent [1]
SL Rent PercentSquare FeetSq. ft. Percent
Retail (including Power and Lifestyle Centers)
$224,894 80 %13,462 70 %
Industrial and Distribution 28,857 10 %4,351 23 %
Office 26,499 10 %1,442 %
Total $280,250 100 %19,255 100 %
Retail Properties
Tenant Type
Annualized SL Rent [1]
SL Rent Percent
Square Feet [2]
Sq. ft. Percent
Single-Tenant:
Service-oriented [3]
$118,035 52 %4,007 32 %
Traditional retail [4]
 23,363 10 %2,238 18 %
Multi-Tenant:
Experiential/e-commerce defensive [5]
41,393 19 %2,410 20 %
Other traditional retail 42,103 19 %3,654 30 %
Total $224,894 100 %12,309 100 %
__________
[1]Calculated using the most recent available lease terms as of December 31, 2020.
[2]Represents total rentable square feet of retail properties occupied as of December 31, 2020.
[3]Includes single-tenant retail properties leased to tenants in the retail banking, restaurant, grocery, pharmacy, gas/convenience, fitness, healthcare, and auto services sectors.
[4]Includes single-tenant retail properties leased to tenants in the discount retail, home improvement, furniture, specialty retail, auto retail, sporting goods sectors, wireless/electronics, department stores and home improvement.
[5]Represents multi-tenant properties leased to tenants in the restaurant, discount retail, entertainment, salon/beauty, and grocery sectors, among others.




15

American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
Diversification by Geography
As of December 31, 2020
Amounts in thousands, except percentages
Total Portfolio
Region
Annualized SL Rent [1]
SL Rent PercentSquare FeetSq. ft. Percent
Alabama $14,839 5.3 %1,398 7.2 %
Alaska409 0.1 %0.1 %
Arizona352 0.1 %22 0.1 %
Arkansas2,387 0.9 %88 0.5 %
California228 0.1 %0.1 %
Colorado776 0.3 %52 0.3 %
Connecticut1,640 0.6 %84 0.4 %
Delaware176 0.1 %0.1 %
District of Columbia236 0.1 %0.1 %
Florida19,545 7.0 %1,199 6.1 %
Georgia28,642 10.2 %1,950 10.0 %
Idaho331 0.1 %14 0.1 %
Illinois10,476 3.7 %749 3.8 %
Indiana2,169 0.8 %92 0.5 %
Iowa2,662 0.9 %166 0.9 %
Kansas2,994 1.1 %264 1.4 %
Kentucky10,498 3.7 %663 3.4 %
Louisiana6,524 2.3 %344 1.8 %
Maine202 0.1 %12 0.1 %
Maryland1,069 0.4 %29 0.2 %
Massachusetts6,069 2.2 %591 3.1 %
Michigan8,870 3.2 %494 2.6 %
Minnesota10,662 3.8 %761 3.9 %
Mississippi5,815 2.1 %252 1.3 %
Missouri5,707 2.0 %486 2.5 %
Montana1,243 0.4 %45 0.2 %
Nebraska495 0.2 %12 0.1 %
Nevada6,268 2.2 %408 2.1 %
New Hampshire127 — %0.1 %
New Jersey18,655 6.7 %817 4.2 %
New Mexico629 0.2 %47 0.2 %
New York2,351 0.8 %171 0.9 %
North Carolina17,340 6.2 %1,514 7.9 %
North Dakota1,222 0.4 %170 0.9 %
Ohio17,574 6.3 %1,017 5.3 %
Oklahoma9,621 3.4 %834 4.3 %
Pennsylvania9,042 3.2 %540 2.8 %
Rhode Island2,419 0.9 %149 0.8 %
South Carolina16,480 5.9 %1,602 8.3 %
South Dakota339 0.1 %47 0.2 %
Tennessee4,442 1.6 %316 1.6 %
Texas13,448 4.8 %839 4.4 %
Utah1,087 0.4 %41 0.3 %
Virginia 3,859 1.4 %212 1.1 %
West Virginia1,876 0.7 %99 0.5 %
Wisconsin7,137 2.5 %566 2.9 %
Wyoming1,318 0.5 %66 0.3 %
Total 280,250 100.0 %19,255 100.0 %
__________
[1] Calculated using the most recent available lease terms as of December 31, 2020.  
16

American Finance Trust, Inc.
Supplemental Information
Quarter Ended December 31, 2020 (Unaudited)
Lease Expirations
As of December 31, 2020
Amounts in thousands, except ratios and percentages
Year of ExpirationNumber of Leases Expiring
Annualized SL Rent [1]
Annualized SL Rent PercentLeased Square FeetPercent of Leased Square Feet Expiring
(In thousands)(In thousands)
2021105$14,252 5.1 %1,228 6.8 %
20228410,551 3.8 %1,031 5.7 %
202311016,718 6.0 %1,193 6.6 %
202410718,131 6.5 %1,403 7.8 %
202512422,720 8.1 %1,719 9.5 %
20266520,041 7.2 %1,359 7.5 %
20279834,769 12.4 %3,648 20.2 %
20287911,268 4.0 %849 4.7 %
202913423,142 8.3 %1,308 7.2 %
20304911,497 4.0 %865 4.8 %
20315012,248 4.4 %558 3.1 %
20322421,500 7.7 %949 5.2 %
2033374,717 1.7 %180 1.0 %
2034152,125 0.8 %126 0.7 %
2035123,735 1.3 %91 0.5 %
2036343,242 1.2 %197 1.1 %
Thereafter (>2036)35349,594 17.4 %1,392 7.6 %
Total1,480$280,250 100.0 %18,096 100.0 %
__________
[1]Calculated using the most recent available lease terms as of December 31, 2020.


17