EPR PROPERTIES Q3 FY2024 earnings call

• Entered into a new $1 billion revolving credit facility enhancing liquidity. - Investment strategy focuses on recycling sale proceeds and investing in experiential assets, including fitness & wellness. - Impact of Hurricanes Helene and Milton on Florida properties: two joint venture hotels on St. Petersburg Beach sustained damage, expected to be removed from portfolio with $12.1 million impairment charges. - Theater box office: Q3 Box Office totaled $2.7 billion, with expectations of recovery in Q4 and 2025 due to normalized release schedule. - Topgolf Callaway to spin off Topgolf, which is expected to be positive. - Investment in Iron Mountain Hot Springs in Colorado, a mortgage to potential fee ownership.

The company has two main segments. The Experiential portfolio comprises 283 properties with 52 operators, accounting for 93% of total investments, approximately $6.4 billion, and was 99% leased at quarter end. The Education portfolio has 69 properties with eight operators, and was 100% leased at quarter end. Total Investments were approximately $6.9 billion with 352 properties.

• Increased box office guidance for 2024 to between $8.3 billion and $8.7 billion from prior $8.2 billion to $8.5 billion. - Narrowed 2024 FFO as adjusted per share guidance to $4.80 to $4.92 from $4.76 to $4.96. - Narrowed investment spending guidance to $225 million to $275 million from $200 million to $300 million. - Increased disposition proceeds guidance to $70 million to $100 million from $60 million to $75 million. - Revised other income and expense guidance due to performance at Cartwright Indoor Water park and Hotel. - Equity and loss from JVs revised due to weather issues at St. Pete Beach properties.

• Hurricane impacts on Florida properties leading to significant damage and uncertainty in recovery. - Insurance and interest cost pressures affecting profitability. - Potential market challenges for theaters due to ongoing recovery and rate fluctuations.

Q: About box office projections and confidence in increased guide.

A: Confidence comes from more normalized number of titles released, with Q3 showing increase in box office compared to Q2 despite some individual title fluctuations.

Q: On Topgolf spin-off and exposure strategy.

A: Comfortable with current exposure, with Topgolf properties in major markets and expected strong performance post-spin-off.

Q: Thoughts on transaction market and pricing for opportunities.

A: Transaction market sees consistent pricing in eights, with disciplined capital deployment focusing on selective assets like the hot springs property.

Q: On St. Pete lodging assets and future investment in coastal Florida.

A: Decision to exit due to high insurance costs, interest rate issues, and lack of visibility on future insurance premiums; investment in hot springs is mortgage to potential fee ownership on a case-by-case basis.

Q: On asset sale plans in education portfolio and buyer pool.

A: Education portfolio has interest from both public and private players, with potential for recycling capital through selective sales for best value.