EX-99.2

EX-99.2 3 nnn-ex99_2.htm EX-99.2 EX-99.2

Exhibit 99.2

ANNUAL SUPPLEMENTAL DATA

As of December 31, 2024

TABLE OF CONTENTS


	PAGE
Financial Summary
Income Statement Summary	4
Funds From Operations (FFO)	5
Core Funds From Operations (Core FFO)	6
Adjusted Funds From Operations (AFFO)	7
Other Information	8
EBITDA	8
Balance Sheet Summary	9
Debt Summary	10
Credit Metrics	11
Credit Facility and Note Covenants	11
Long-Term Dividend History	12
Transaction Summary
Property Acquisitions	13
Property Dispositions	13
Property Portfolio
Lease Expirations	14
Top 20 Lines of Trade	15
Top 10 States	15
Portfolio By Region	16
Top Tenants	17
Same Store Rental Income	18
Leasing Data	18
Other Property Portfolio Data	19
Earnings Guidance	19

Statements in this annual supplemental data that are not strictly historical are “forward-looking” statements. These statements generally are characterized by the use of terms such as "believe," "expect," "intend," "may," "estimated," or other similar words or expressions. Forward-looking statements involve known and unknown risks, which may cause the company’s actual future results to differ materially from expected results. These risks include, among others, general economic conditions, including inflation, local real estate conditions, changes in interest rates, increases in operating costs, the preferences and financial condition of the company's tenants, the availability of capital, risks related to the company's status as a real estate investment trust ("REIT") and the potential impacts of an epidemic or pandemic on the company's business operations, financial results and financial position and on the world economy. Additional information concerning these and other factors that could cause actual results to differ materially from these forward-looking statements is contained from time to time in the company’s Securities and Exchange Commission (the “Commission”) filings, including, but not limited to, the company’s Annual Report on Form 10-K for the year ended December 31, 2024.

Copies of each filing may be obtained from the company or the Commission. Such forward-looking statements should be regarded solely as reflections of the company’s current operating plans and estimates. Actual operating results may differ materially from what is expressed or forecast in this press release. NNN REIT, Inc. undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date these statements were made.

    INCOME STATEMENT SUMMARY

   

(dollars in thousands, except per share data)

(unaudited)


	Quarter Ended							Year Ended
	December 31,							December 31,
	2024			2023				2024			2023
Revenues:
Rental income	$	218,348		$	215,178			$	867,468		$	826,090
Interest and other income from real estate transactions		134			1,053				1,798			2,021
		218,482			216,231				869,266			828,111
Operating expenses:
General and administrative		8,705			10,530				44,287			43,746
Real estate		11,142			8,237				32,317			28,378
Depreciation and amortization		63,194			60,079				249,681			238,625
Leasing transaction costs		24			76				99			299
Impairment losses – real estate, net of recoveries		3,724			2,315				6,632			5,990
Executive retirement costs		42			2,569				668			3,454
		86,831			83,806				333,684			320,492
Gain on disposition of real estate		12,083			7,263				42,290			47,485
Earnings from operations		143,734			139,688				577,872			555,104
Other expenses (revenues):
Interest and other income		(1,040	)		(383	)			(2,980	)		(1,134	)
Interest expense		46,880			43,389				184,017			163,898
		45,840			43,006				181,037			162,764
Net earnings	$	97,894		$	96,682			$	396,835		$	392,340

Weighted average shares outstanding:
Basic		186,449,345			181,425,202				183,688,562			181,200,040
Diluted		186,833,150			181,932,133				184,043,841			181,689,723

Net earnings per share:
Basic	$	0.52		$	0.53			$	2.16		$	2.16
Diluted	$	0.52		$	0.53		(1)	$	2.15		$	2.16		(1)


(1)	During the quarter ended December 31, 2023, one tenant was reclassified to accrual basis for accounting purposes due to their improved qualitative and quantitative credit factors, which resulted in an increase of accrued rent in the amount of $5,573. Excluding such, net earnings per common share would have been $0.50 and $2.13 for the quarter and year ended December 31, 2023, respectively.

    FUNDS FROM OPERATIONS ("FFO")(1)

   

(dollars in thousands, except per share data)

(unaudited)


	Quarter Ended							Year Ended
	December 31,							December 31,
	2024			2023				2024			2023
Net earnings	$	97,894		$	96,682			$	396,835		$	392,340
Real estate depreciation and amortization		63,154			59,978				249,324			238,229
Gain on disposition of real estate		(12,083	)		(7,263	)			(42,290	)		(47,485	)
Impairment losses – depreciable real estate, net of recoveries		3,724			2,315				6,632			5,990
Total FFO adjustments		54,795			55,030				213,666			196,734
FFO	$	152,689		$	151,712			$	610,501		$	589,074

FFO per share:
Basic	$	0.82		$	0.84			$	3.32		$	3.25
Diluted	$	0.82		$	0.83		(2)	$	3.32		$	3.24		(2)


(1)	FFO is a non-GAAP financial measure. Please reference the Earnings Release for the quarter and year ended December 31, 2024 for the company's definition and explanation of how the company utilizes this metric.
(2)	During the quarter ended December 31, 2023, one tenant was reclassified to accrual basis for accounting purposes due to their improved qualitative and quantitative credit factors, which resulted in an increase of accrued rent in the amount of $5,573. Excluding such, FFO per common share would have been $0.80 and $3.21 for the quarter and year ended December 31, 2023, respectively.

    CORE FUNDS FROM OPERATIONS ("Core FFO")(1) 

   

(dollars in thousands, except per share data)

(unaudited)


	Quarter Ended					Year Ended
	December 31,					December 31,
	2024		2023			2024		2023
Net earnings	$	97,894	$	96,682		$	396,835	$	392,340
Total FFO adjustments		54,795		55,030			213,666		196,734
FFO		152,689		151,712			610,501		589,074

Executive retirement costs		42		2,569			668		3,454
Total Core FFO adjustments		42		2,569			668		3,454
Core FFO	$	152,731	$	154,281		$	611,169	$	592,528

Core FFO per share:
Basic	$	0.82	$	0.85		$	3.33	$	3.27
Diluted	$	0.82	$	0.85	(2)	$	3.32	$	3.26	(2)


(1)	Core FFO is a non-GAAP financial measure. Please reference the Earnings Release for the quarter and year ended December 31, 2024 for the company's definition and explanation of how the company utilizes this metric.
(2)	During the quarter ended December 31, 2023, one tenant was reclassified to accrual basis for accounting purposes due to their improved qualitative and quantitative credit factors, which resulted in an increase of accrued rent in the amount of $5,573. Excluding such, Core FFO would have been $0.82 and $3.23 for the quarter and year ended December 31, 2023, respectively.

    ADJUSTED FUNDS FROM OPERATIONS ("AFFO")(1)

   

(dollars in thousands, except per share data)

(unaudited)


	Quarter Ended						Year Ended
	December 31,						December 31,
	2024			2023			2024			2023
Net earnings	$	97,894		$	96,682		$	396,835		$	392,340
Total FFO adjustments		54,795			55,030			213,666			196,734
Total Core FFO adjustments		42			2,569			668			3,454
Core FFO		152,731			154,281			611,169			592,528

Straight-line accrued rent, net of reserves		(302	)		(5,957	)		(294	)		(7,453	)
Net capital lease rent adjustment		58			75			222			319
Below-market rent amortization		(144	)		(82	)		(495	)		(431	)
Stock based compensation expense		2,775			2,592			11,816			10,846
Capitalized interest expense		(1,061	)		(1,912	)		(5,805	)		(4,286	)
Total AFFO adjustments		1,326			(5,284	)		5,444			(1,005	)
AFFO	$	154,057		$	148,997		$	616,613		$	591,523

AFFO per share:
Basic	$	0.83		$	0.82		$	3.36		$	3.26
Diluted	$	0.82		$	0.82		$	3.35		$	3.26


(1)	AFFO is a non-GAAP financial measure. Please reference the Earnings Release for the quarter and year ended December 31, 2024 for the company's definition and explanation of how the company utilizes this metric.

    OTHER INFORMATION

   

(dollars in thousands)

(unaudited)


	Quarter Ended						Year Ended
	December 31,						December 31,
	2024			2023			2024			2023
Rental income from operating leases(1)	$	212,565		$	209,037		$	846,653		$	805,136
Earned income from direct financing leases(1)	$	115		$	133		$	468		$	560
Percentage rent(1)	$	189		$	241		$	1,536		$	1,631

Real estate expenses reimbursed from tenants(1)	$	5,479		$	5,767		$	18,811		$	18,763
Real estate expenses		(11,142	)		(8,237	)		(32,317	)		(28,378	)
Real estate expenses, net of tenant reimbursements	$	(5,663	)	$	(2,470	)	$	(13,506	)	$	(9,615	)

Amortization of debt costs	$	1,455		$	1,295		$	5,993		$	4,943
Scheduled debt principal amortization (excluding maturities)	$	—		$	—		$	—		$	173		(2)
Non-real estate depreciation expense	$	43		$	105		$	370		$	409


(1)	For the quarters ended December 31, 2024 and 2023, the aggregate of such amounts is $218,348 and $215,178, respectively, and $867,468 and $826,090, for the year ended December 31, 2024 and 2023, respectively, and is classified as rental income on the income statement summary.
(2)	In April 2023, NNN repaid the remaining mortgages payable principal balance of $9,774.

    EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION FOR REAL ESTATE ("EBITDA")(1)

   

(dollars in thousands)

(unaudited)


	Quarter Ended						Year Ended
	December 31,						December 31,
	2024			2023			2024			2023
Net earnings	$	97,894		$	96,682		$	396,835		$	392,340
Interest expense		46,880			43,389			184,017			163,898
Depreciation and amortization		63,194			60,079			249,681			238,625
Gain on disposition of real estate		(12,083	)		(7,263	)		(42,290	)		(47,485	)
Impairment losses – real estate, net of recoveries		3,724			2,315			6,632			5,990
EBITDA	$	199,609		$	195,202		$	794,875		$	753,368


(1)	EBITDA is non-GAAP financial measure. Please reference the Earnings Release for the quarter and year ended December 31, 2024 for the company's definition and explanation of how the company utilizes this metric.

    BALANCE SHEET SUMMARY

   

(dollars in thousands)

(unaudited)


	December 31, 2024		December 31, 2023
Assets:
Real estate portfolio, net of accumulated depreciation and amortization	$	8,746,168	$	8,535,851
Cash and cash equivalents		8,731		1,189
Restricted cash and cash held in escrow		331		3,966
Receivables, net of allowance of $617 and $669, respectively		2,975		3,649
Accrued rental income, net of allowance of $4,156 and $4,168, respectively		34,005		34,611
Debt costs, net of accumulated amortization of $27,002 and $23,952, respectively		8,958		3,243
Other assets		71,560		79,459
Total assets	$	8,872,728	$	8,661,968

Liabilities:
Line of credit payable	$	—	$	132,000
Notes payable, net of unamortized discount and unamortized debt costs		4,373,803		4,228,544
Accrued interest payable		29,699		34,374
Other liabilities		106,951		109,593
Total liabilities		4,510,453		4,504,511

Total equity		4,362,275		4,157,457

Total liabilities and equity	$	8,872,728	$	8,661,968

Common shares outstanding		187,540,929		182,474,770

Gross leasable area, Property Portfolio (square feet)		36,557,000		35,966,000

    DEBT SUMMARY

   

As of December 31, 2024

(dollars in thousands)

(unaudited)


Unsecured Debt	Principal		Principal, Net of Unamortized Discount			Stated Rate			Effective Rate			Maturity Date
Line of credit payable	$	—	$	—		SOFR + 87.5bps				—		April 2028

Unsecured notes payable:
2025		400,000		399,900			4.000	%		4.029	%	November 2025
2026		350,000		349,128			3.600	%		3.733	%	December 2026
2027		400,000		399,490			3.500	%		3.548	%	October 2027
2028		400,000		398,778			4.300	%		4.388	%	October 2028
2030		400,000		399,286			2.500	%		2.536	%	April 2030
2033		500,000		489,579			5.600	%		5.905	%	October 2033
2034		500,000		494,112			5.500	%		5.662	%	June 2034
2048		300,000		296,219			4.800	%		4.890	%	October 2048
2050		300,000		294,561			3.100	%		3.205	%	April 2050
2051		450,000		442,228			3.500	%		3.602	%	April 2051
2052		450,000		440,282			3.000	%		3.118	%	April 2052
Total		4,450,000		4,403,563

Total unsecured debt(1)	$	4,450,000	$	4,403,563

Debt costs			$	(43,820	)
Accumulated amortization				14,060
Debt costs, net of accumulated amortization				(29,760	)
Notes payable, net of unamortized discount and unamortized debt costs			$	4,373,803

(1) Unsecured debt has a weighted average interest rate of 4.1% and a weighted average maturity of 12.1 years.

    CREDIT METRICS (1)

   

Ratings: Moody's Baa1; S&P BBB+


	2020			2021			2022			2023			2024
Debt / Total assets (gross book)		34.4	%		39.9	%		40.4	%		42.0	%		40.5	%
Debt + preferred / Total assets (gross book)		38.4	%		39.9	%		40.4	%		42.0	%		40.5	%
Debt / EBITDA (last quarter annualized)		5.0			5.2			5.4			5.5			5.5
Debt + preferred / EBITDA (last quarter annualized)		5.6			5.2			5.4			5.5			5.5
EBITDA / Interest expense (cash)		4.6			4.7			4.7			4.5			4.2
EBITDA / Fixed charges (cash)		4.0			4.3			4.7			4.5			4.2

(1) Debt amounts used in calculations are net of cash balances.

    CREDIT FACILITY AND NOTES COVENANTS

   

The following is a summary of key financial covenants for the company's unsecured credit facility and notes, as defined and calculated per the terms of the facility's credit agreement and the notes' governing documents, respectively, which are included in the company's filings with the Commission. These calculations, which are not based on U.S. GAAP measurements, are presented to investors to show that as of December 31, 2024, the company believes it is in compliance with the covenants.


Key Covenants	Required	December 31, 2024
Unsecured Bank Credit Facility:
Maximum leverage ratio	< 0.60	0.37
Minimum fixed charge coverage ratio	> 1.50	4.28
Maximum secured indebtedness ratio	< 0.40	—
Unencumbered asset value ratio	> 1.67	2.70
Unencumbered interest ratio	> 1.75	4.23
Unsecured Notes:
Limitation on incurrence of total debt	≤ 60%	40.0%
Limitation on incurrence of secured debt	≤ 40%	—
Debt service coverage ratio	≥ 1.50	4.2
Maintenance of total unencumbered assets	≥ 150%	250%

    LONG-TERM DIVIDEND HISTORY

   

    PROPERTY ACQUISITIONS

   

(dollars in thousands)


	Year Ended December 31,
	2024			2023
Total dollars invested(1)	$	565,416		$	819,710
Number of Properties		75			165
Gross leasable area (square feet)(2)		1,486,000			1,281,000
Cap rate (3)		7.7	%		7.3	%
Weighted average lease term		18.5			18.8


(1)	Includes dollars invested in projects under construction or tenant improvements for each respective year.
(2)	Includes additional square footage from completed construction on existing Properties.
(3)	The cap rate is a weighted average, calculated as the initial cash annual base rent divided by the total purchase price of the Properties.

    PROPERTY DISPOSITIONS

   

(dollars in thousands)


	Year Ended December 31,
	2024								2023
	Occupied			Vacant		Total			Occupied			Vacant		Total
Number of properties		27			14		41			24			21		45
Gross leasable area (square feet)		640,000			209,000		849,000			177,000			116,000		293,000
Acquisition costs	$	117,556		$	30,276	$	147,832		$	69,790		$	25,036	$	94,826
Net book value	$	84,212		$	22,294	$	106,506		$	55,098		$	13,133	$	68,231
Net sale proceeds	$	115,923		$	32,735	$	148,658		$	97,822		$	17,894	$	115,716
Cap rate(1)		7.3	%		—		7.3	%		5.9	%		—		5.9	%


(1)	The cap rate is a weighted average, calculated as the cash annual base rent divided by the total gross proceeds received for the properties.

    LEASE EXPIRATIONS(1)

   


	% of Total(2)	# of Properties		Gross Leasable Area (3)			% of Total(2)	# of Properties		Gross Leasable Area (3)
2025	3.2%		132		874,000	2031	7.0%		184		2,655,000
2026	4.2%		204		1,981,000	2032	5.1%		183		1,804,000
2027	7.6%		231		3,401,000	2033	4.6%		134		1,398,000
2028	5.8%		255		2,306,000	2034	5.8%		182		2,398,000
2029	4.6%		143		2,083,000	Thereafter	47.7%		1,711		14,840,000
2030	4.4%		154		2,086,000


(1)	As of December 31, 2024, the weighted average remaining lease term is 9.9 years.
(2)	Based on the annual base rent of $860,562,000, which is the annualized base rent for all leases in place as of December 31, 2024.
(3)	Square feet.

    TOP 20 LINES OF TRADE

   


		As of December 31, 2024		As of December 31, 2023
	Lines of Trade	% of Total(1)	# of Properties	% of Total(2)	# of Properties
1.	Convenience stores	17.0%	678	16.4%	661
2.	Automotive service	16.9%	641	15.6%	629
3.	Restaurants – limited service	8.4%	618	8.5%	610
4.	Restaurants – full service	7.8%	399	8.7%	417
5.	Family entertainment centers	7.2%	98	6.4%	94
6.	Recreational vehicle dealers, parts and accessories	5.1%	70	4.6%	62
7.	Theaters	4.0%	33	4.1%	33
8.	Health and fitness	3.9%	31	4.5%	33
9.	Equipment rental	3.2%	105	3.0%	99
10.	Wholesale clubs	2.4%	13	2.5%	13
11.	Automotive parts	2.4%	139	2.5%	144
12.	Drug stores	2.2%	61	2.4%	66
13.	Home improvement	2.1%	48	2.2%	50
14.	Medical service providers	1.7%	82	1.7%	79
15.	General merchandise	1.4%	71	1.4%	72
16.	Furniture	1.3%	45	2.0%	75
17.	Pet supplies and services	1.3%	52	1.1%	51
18.	Consumer electronics	1.3%	16	1.4%	17
19.	Travel plazas	1.2%	24	1.3%	24
20.	Home furnishings	1.1%	12	1.3%	13
	Other	8.1%	332	8.4%	290
	Total	100.0%	3,568	100.0%	3,532


As a percentage of annual base rent, which is the annualized base rent for all leases in place.
	(1)	$860,562,000 as of December 31, 2024.
	(2)	$818,749,000 as of December 31, 2023.

    TOP 10 STATES

   


	State	% of Total(1)		State	% of Total(1)
1.	Texas	18.8%	6.	Tennessee	3.8%
2.	Florida	8.7%	7.	North Carolina	3.7%
3.	Illinois	5.1%	8.	Indiana	3.6%
4.	Georgia	4.5%	9.	Arizona	3.2%
5.	Ohio	4.2%	10.	Virginia	3.2%


As a percentage of annual base rent, which is the annualized base rent for all leases in place.
	(1)	$860,562,000 as of December 31, 2024.

    PORTFOLIO BY REGION

   

As a percentage of annual base rent - December 31, 2024


	Based on the annual base rent of $860,562,000, which is the annualized base rent for all leases in place as of December 31, 2024.

    TOP TENANTS

   

Creditworthy Retailers

▪

14.4% of annual base rent is from tenants with investment grade rated debt

▪

72.2% of annual base rent is from tenants that are publicly traded and/or have rated debt

▪

Top 20 tenants (48.0% of annual base rent) operate an average of 1,533 stores each

Top 20 Tenants


	Tenant	# of Properties	% of Total(1)
1.	7-Eleven	146	4.5%
2.	Mister Car Wash	121	4.1%
3.	Dave & Buster's	34	3.8%
4.	Camping World	48	3.8%
5.	GPM Investments (convenience stores)	148	2.8%
6.	Flynn Restaurant Group (Taco Bell/Arby's)	204	2.7%
7.	AMC Theatres	20	2.6%
8.	LA Fitness	26	2.5%
9.	BJ's Wholesale Club	13	2.4%
10.	Mavis Tire Express Services	140	2.2%
11.	Couche Tard (Pantry)	91	2.2%
12.	Kent Distributors (convenience stores)	38	2.1%
13.	Chuck E. Cheese	53	1.8%
14.	Walgreens	49	1.8%
15.	Sunoco	53	1.8%
16.	Casey's General Stores (convenience stores)	62	1.7%
17.	United Rentals	49	1.6%
18.	Tidal Wave Auto Spa	35	1.3%
19.	Super Star Car Wash	33	1.3%
20.	Lifetime Fitness	3	1.3%


(1)	Based on the annual base rent of $860,562,000, which is the annualized base rent for all leases in place as of December 31, 2024.

    SAME STORE RENTAL INCOME

   

(dollars in thousands)


Properties (Cash Basis) (1)
Number of properties		3,327
Year ended December 31, 2024 (2)	$	758,489
Year ended December 31, 2023 (2)	$	759,119
Change (in dollars)	$	(630	)
Change (percent) (3)		(0.1	)%


(1)	Includes all properties owned for current and prior year period excluding any properties under development or re-development.
(2)	Excludes any rent deferral payments from the COVID-19 rent deferral lease amendments.
(3)	Excluding impact of Frisch's Restaurants and Badcock Furniture bankruptcy, change would have been 0.8%

    LEASING DATA

   

(dollars in thousands)


Year Ended December 31, 2024	Renewals With Same Tenant(1)			Vacancy Re-Lease To New Tenant			Releasing Totals
Number of leases		94			57			151
New cash rents	$	25,400		$	8,216		$	33,616
Prior cash rents	$	25,924		$	11,868		$	37,792		(2)
Recovery rate		98.0	%		69.2	%		89.0	%
Tenant improvements	$	2,900		$	5,897		$	8,797


(1)	Long-term renewal rate for the period of 2010 through 2024 was 83.2%.
(2)	Represents 4.4% of total annualized base rent as of December 31, 2024.

    OTHER PROPERTY PORTFOLIO DATA

   

As of December 31, 2024

Tenant Financials


	# of Properties	% of Annual Base Rent (1)
Property level financial information	2,982	82%
Tenant corporate financials	2,773	79%


Rent Increases	% of Annual Base Rent (1)
	Annual	Five Year	Other	Total
CPI	37%	44%	1%	82%
Fixed	2%	11%	1%	14%
No increases	—	—	4%	4%
	39%	55%	6%	100%

Lease Structure - as a percentage of the company's annual base rent(1)

•

92.9% is from triple net leases

•

95.4% is from triple net leases or double net leases (with roof warranty)

•

30.8% is from master leases

•

98.1% is from leases containing future lease renewal options

•

0.5% is from leases containing purchase options


(1)	Based on the annual base rent of $860,562,000, which is the annualized base rent for all leases in place as of December 31, 2024.

    EARNINGS GUIDANCE

   

Guidance is based on current plans and assumptions and subject to risks and uncertainties more fully described in this press release and the company's reports filed with the Commission.


		2025 Guidance
Net earnings per share excluding any gains on disposition of real estate, impairment charges, and executive retirement costs		$1.97 - $2.02 per share
Real estate depreciation and amortization per share		$1.36 per share
Core FFO per share		$3.33 - $3.38 per share
AFFO per share		$3.39 - $3.44 per share
General and administrative expenses		$47 - $48 Million
Real estate expenses, net of tenant reimbursements		$15 - $16 Million
Acquisition volume		$500 - $600 Million
Disposition volume		$80 - $120 Million