Exhibit 99.2

 

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Supplemental Operating and Financial Data

for the year ended December 31, 2013


Table of Contents

 

     Page  

Company Overview

     3   

Financial and Portfolio Overview

     4   

Financial Summary

  

Consolidated Balance Sheets

     5   

Consolidated and Combined Statements of Operations

     6   

Reconciliation of Non-GAAP Measures

     7   

Debt Summary

     8   

Portfolio Summary

  

Acquisitions and Development Projects

     9   

Property Summary

     10   

Top Ten Tenants by Annualized Base Rent

     11   

Leasing Summary

     11   

Definitions

     12   

Forward-Looking Statements

This document contains forward-looking statements that are based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. These risks include, without limitation: adverse economic or real estate developments in the retail industry or the markets in which Wheeler Real Estate Investment Trust operates; defaults on or non-renewal of leases by tenants; increased interest rates and operating costs; decreased rental rates or increased vacancy rates; Wheeler Real Estate Investment Trust’s failure to obtain necessary outside financing on favorable terms or at all; changes in the availability of additional acquisition opportunities; Wheeler Real Estate Investment Trust’s inability to successfully complete real estate acquisitions or successfully operate acquired properties and Wheeler Real Estate Investment Trust’s failure to qualify or maintain its status as a REIT. For a further list and description of such risks and uncertainties that could impact Wheeler Real Estate Investment Trust’s future results, performance or transactions, see the reports filed by Wheeler Real Estate Investment Trust with the Securities and Exchange Commission, including its final prospectus relating to its initial public offering, quarterly reports on Form 10-Q and annual reports on Form 10-K. Wheeler Real Estate Investment Trust disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

 

Wheeler Real Estate Investment Trust | Supplemental Operating and Financial Data    2


Company Overview

Headquartered in Virginia Beach, VA, Wheeler Real Estate Investment Trust, Inc. (“Wheeler” or the “Company”) specializes in owning, acquiring, financing, developing, renovating, leasing and managing income producing assets, such as community centers, neighborhood centers, strip centers and free-standing retail properties. Wheeler’s portfolio contains strategically selected properties, primarily leased by nationally and regionally recognized retailers of consumer goods and located in the Northeastern, Mid-Atlantic, Southeast and Southwest regions of the United States. Wheeler trades publicly on the Nasdaq under the symbol “WHLR”.

Corporate Headquarters

Wheeler Real Estate Investment Trust Inc.

Riversedge North

2529 Virginia Beach Boulevard

Virginia Beach, VA 23452

Phone: (757) 627-9088

Toll Free: (866) 203-4864

Email: info@whlr.us

Website: www.whlr.us

Executives Management

Jon S. Wheeler - Chairman & CEO

Steven M. Belote - CFO

Robin A. Hanisch - Secretary

 

Board of Directors      
Jon S. Wheeler, Chairman    Sanjay Madhu   
Christopher J. Ettel    Carl B. McGowan, Jr.   
David Kelly    Ann L. McKinney   
William W. King    Jeffrey M. Zwerdling   
Corporate Counsel    Transfer Agent and Registrar   

Kaufman & Canoles, P.C.

Two James Center

1021 East Cary Street, Suite 1400

Richmond, Virginia 23219

Phone: (804) 771-5700

  

Computershare Trust Company, N.A.

250 Royall Street

Canton, MA 02021

www.computershare.com

  

Investor Relations Contact

The Equity Group Inc.

800 Third Avenue, 36th Floor

New York, NY 10022

Adam Prior, Senior Vice President

Phone: (212) 836-9606, aprior@equityny.com

Terry Downs, Associate

Phone: (212) 836-9615, tdowns@equityny.com

 

Wheeler Real Estate Investment Trust | Supplemental Operating and Financial Data    3


Financial and Portfolio Overview

For the Year Ended December 31, 2013

 

Financial Results

  

Net loss attributable to Wheeler REIT common stockholders

   ($ 3,801,672

Net loss per basic and diltued share

   ($ 0.82

Funds from operations (FFO)

   ($ 908,269

FFO per common share and common unit

   $ 0.14   

Core FFO

   $ 2,214,731   

Core FFO per common share and common unit

   $ 0.34   

Assets

  

Investment Properties, net (less accumulated depreciation and amortization)

   $ 101,772,335   

Total Assets

   $ 125,370,266   

Total liabilities to Investment Properties, net

     98.0

Debt to Total Assets

     75.4

Market Capitalization

  

Common shares outstanding

     7,121,000   

OP units outstanding

     2,072,352   

Total common shares and OP units

     6,514,021   

Range of closing prices for the fourth quarter 2013

   $ 3.83-4.48   

Closing price at fourth quarter end

   $ 4.28   

Preferred shares

     1,809   

Total debt

   $ 94,562,503   

Market capitalization

   $ 30,477,880   

Debt/market capitalization

     310.3

Portfolio Summary

  

Total Gross Leasable Area (GLA)

     1,294,572 sq. ft.   

Occupancy Rate

     94.0

Annualized Base Rent

   $ 11,749,798   

Total number of leases signed or renewed - 2013

     28   

Total sq. ft. leases signed or renewed - 2013

     171,706 sq. ft.  

 

Wheeler Real Estate Investment Trust | Supplemental Operating and Financial Data    4


Wheeler Real Estate Investment Trust, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

 

     December 31,
2013
    December 31,
2012
 

ASSETS:

    

Investment properties, net

   $ 101,772,335     $ 43,345,665  

Cash and cash equivalents

     1,155,083       2,053,192  

Rents and other tenant receivables, net

     1,594,864       761,114  

Deferred costs and other assets, net

     20,847,984       6,527,906  
  

 

 

   

 

 

 

Total Assets

   $ 125,370,266     $ 52,687,877  
  

 

 

   

 

 

 

LIABILITIES:

    

Loans payable

   $ 94,562,503     $ 31,843,503  

Below market lease intangible, net

     2,674,566       3,673,019  

Accounts payable, accrued expenses and other liabilities

     2,526,388       938,896  
  

 

 

   

 

 

 

Total Liabilities

     99,763,457       36,455,418  
  

 

 

   

 

 

 

Commitments and contingencies

     —          —     

EQUITY:

    

Series A preferred stock (no par value, 500,000 shares authorized, 1,809 and no shares issued and outstanding, respectively)

     1,458,050       —     

Common stock ($0.01 par value, 75,000,000 and 15,000,000 shares authorized, 7,121,000 and 3,301,502 shares issued and outstanding, respectively

     71,210       33,015  

Additional paid-in capital

     28,169,693       14,097,453  

Accumulated deficit

     (11,298,253 )     (5,443,099 )
  

 

 

   

 

 

 

Total Shareholders’ Equity

     18,400,700       8,687,369  

Noncontrolling interests

     7,206,109       7,545,090  
  

 

 

   

 

 

 

Total Equity

     25,606,809       16,232,459  
  

 

 

   

 

 

 

Total Liabilities and Equity

   $ 125,370,266     $ 52,687,877  
  

 

 

   

 

 

 

 

Wheeler Real Estate Investment Trust | Supplemental Operating and Financial Data    5


Wheeler Real Estate Investment Trust, Inc. and Subsidiaries

Condensed Consolidated and Combined Statements of Operations

 

     Three Months Ended
December 31,
   

Year-End

December 31,

 
     2013     2012     2013     2012  

TOTAL REVENUES

   $ 3,484,144      $ 929,593      $ 8,707,492      $ 2,433,979   
  

 

 

   

 

 

   

 

 

   

 

 

 

OPERATING EXPENSES:

        

Property operations

     745,111        186,912        1,713,957        519,220   

Depreciation and amortization

     1,262,058        265,700        3,466,957        822,152   

Provision for credit losses

     36,908        25,000        106,828        25,000   

Corporate general & administrative

     530,873        519,497        5,297,166        1,307,151   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Operating Expenses

     2,574,950        997,109        10,584,908        2,673,523   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income (Loss)

     909,194        (67,516     (1,877,416     (239,544

Interest expense

     (909,864     (372,617     (2,497,810     (966,113
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Loss

     (670     (440,133     (4,375,226     (1,205,657

Less: Net income (loss) attributable to noncontrolling interests

     235,292        (43,880     (714,972     (43,880
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Loss Attributable to Wheeler REIT

     (235,962     (396,253     (3,660,254     (1,161,777

Preferred stock dividends

     (39,869     —          (141,418     —     
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Loss Attributable to Wheeler REIT Common Shareholders

   $ (275,831   $ (396,253   $ (3,801,672   $ (1,161,777
  

 

 

   

 

 

   

 

 

   

 

 

 

Loss per share:

        

Basic and Diluted

   $ (0.04   $ (0.12   $ (0.82   $ (0.35
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted-average number of shares:

        

Basic and Diluted

     7,121,000        3,301,502        4,620,600        3,301,502   
  

 

 

   

 

 

   

 

 

   

 

 

 

 

Wheeler Real Estate Investment Trust | Supplemental Operating and Financial Data    6


Wheeler Real Estate Investment Trust, Inc. and Subsidiaries

Reconciliation of Non-GAAP Measures

 

FFO and Core FFO    Three Months Ended
December 31,
   

Year-End

December 31,

 
     2013     2012     2013     2012  

Net Loss

   $ (670   $ (440,133   $ (4,375,226   $ (1,205,657

Depreciation of real estate assets

     1,262,058        265,700        3,466,957        822,152   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total FFO

     1,261,388      $ (174,433   $ (908,269   $ (383,505

Acquisition fees

     677,000        —          2,102,000        —     

Legal and accounting costs for acquisitions

     138,000        —          754,000        567,000   

Perimeter legal settlement accrual

     —          —          267,000        —     

Harp’s legal settlement accrual

     (856,000     —          —          —     
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Core FFO

   $ 1,220,388      $ (174,433   $ 2,214,731      $ 183,495   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total FFO per common share and common unit

   $ 0.14      $ (0.03   $ (0.14   $ (0.07
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Core FFO per common share and common unit

   $ 0.13      $ (0.03   $ 0.34      $ 0.04   
  

 

 

   

 

 

   

 

 

   

 

 

 
Property Net Operating Income    Three Months Ended
December 31,
   

Year-End

December 31,

 
     2013     2012     2013     2012  

Property Revenues

   $ 3,484,144      $ 929,593      $ 8,707,492      $ 2,433,979   

Property Expenses

     745,111        186,912        1,713,957        519,220   
  

 

 

   

 

 

   

 

 

   

 

 

 

Property Net Operating Income

     2,739,033        742,681        6,993,535        1,914,759   
  

 

 

   

 

 

   

 

 

   

 

 

 

Depreciation and amortization

     1,262,058        265,700        3,466,957        822,152   

Provision for credit losses

     36,908        25,000        106,828        25,000   

Corporate general & administrative

     530,873        519,497        5,297,166        1,307,151   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Other Operating Expenses

     1,829,839        810,197        8,870,951        2,154,303   
  

 

 

   

 

 

   

 

 

   

 

 

 

Interest Expense

     909,864        372,617        2,497,810        966,113   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Loss

   $ (670   $ (440,133   $ (4,375,226   $ (1,205,657
  

 

 

   

 

 

   

 

 

   

 

 

 
EBITDA    Three Months Ended
December 31,
    Year-End
December 31,
 
     2013     2012     2013     2012  

Net Loss

   $ (670   $ (440,133   $ (4,375,226   $ (1,205,657

Add back: Depreciation and amortization

     1,262,058        265,700        3,466,957        822,152   

                  Interest Expense

     909,864        372,617        2,497,810        966,113   
  

 

 

   

 

 

   

 

 

   

 

 

 

EBITDA

   $ 2,171,252      $ 198,184      $ 1,589,541      $ 582,608   
  

 

 

   

 

 

   

 

 

   

 

 

 

 

Wheeler Real Estate Investment Trust | Supplemental Operating and Financial Data    7


Debt Summary

For the Year Ended December 31, 2013

Loans Payable: $94.6 million

Weighted Average Interest Rate: 5.31%

Total Debt Maturities to Total Assets: 75.4%

 

Maturities by Year

   Amount      % Total Maturities  

2014

   $ 6,423,955         6.8

2015

     16,072,979         17.0

2016

     13,823,136         14.6

2017

     2,586,427         2.7

2018

     16,553,214         17.5

Thereafter

     39,102,792         41.4
  

 

 

    

 

 

 

Total principal maturities

   $ 94,562,503         100.0

 

                         December 31,  
Property/Description    Monthly Payment      Interest Rate     Debt Maturity      2013      2012  

Shoppes at Eagle Harbor

   $ 24,692         4.34     March 2018       $ 3,905,321       $ —     

Lumber River Plaza

   $ 18,414         5.65     May 2015         2,973,987         3,050,117   

Monarch Bank Building

   $ 9,473         4.15     December 2017         1,483,230         1,533,346   

Perimeter Square

   $ 28,089         6.38     June 2016         4,417,812         4,537,456   

Riversedge North

   $ 13,556         6.00     January 2019         2,061,790         2,098,138   

Walnut Hill Plaza

   $ 25,269         6.75     April 2014         3,464,465         3,528,232   

Harps at Harbor Point

   $ 18,122         3.99     December 2015         3,335,628         3,416,550   

Twin City Commons

   $ 17,827         4.86     January 2023         3,330,108         3,375,000   

Shoppes at TJ Maxx

   $ 33,880         3.88     May 2020         6,409,077         —     

Bixby Commons

     Interest only         2.77     June 2018         6,700,000         —     

Bank Line of Credit

     Interest only         4.50     May 2014         2,000,000         —     

Forrest Gallery

   $ 50,973         5.40     September 2023        9,075,000         —     

Jenks Reasors

     Interest only         4.25     September 2016         8,550,000         —     

Tampa Festival

   $ 50,797         5.56     September 2023         8,859,888         —     

Starbucks/Verizon

   $ 7,405         6.50     April 2023         621,197         —     

Winslow Plaza

     Interest only         5.22     December 2015         5,000,000         —     

Senior convertible notes

     Interest only         9.00     December 2018         6,000,000         —     

Senior non-convertible notes

     Interest only         9.00     December 2015         4,000,000         —     

South Carolina Food Lions Note

     Interest only         5.25     January 2024         12,375,000         —     

Shoppes at Eagle Harbor

   $ 30,863         6.20     February 2013         —           3,904,664   

Shoppes at TJ Maxx

     Interest only         6.00     April 2013         —           6,400,000   
          

 

 

    

 

 

 

Total Loans Payable

           $ 94,562,503       $ 31,843,503   
          

 

 

    

 

 

 

 

Wheeler Real Estate Investment Trust | Supplemental Operating and Financial Data    8


Acquisitions and Development Projects

For the year ended December 31, 2013

Acquisitions

 

Property

  

Location

   Year Built/
Renovated
   Total GLA
(sq. ft.)
     Acquisition
Date
   Price Sq.
Ft
     Acquisition
Value
 

Bixby Commons

   Bixby, OK    2012      75,000       June 11    $ 141.33       $ 10.6 mil   

Forrest Gallery

   Tullahoma, TN    1987      214,451       Aug. 29    $ 53.63       $ 11.5 mil   

Jenks Plaza

   Jenks, OK    2007      7,800       Dec. 17    $ 224.36       $ 1.8 mil   

Jenks Reasor’s

   Jenks, OK    2011      81,000       Sept. 25    $ 140.74       $ 11.4 mil   

Starbucks/Verizon

   Virginia Beach, VA    1985/2012      5,600       Oct. 21    $ 250.00       $ 1.4 mil   

Tampa Festival

   Tampa, FL    1965/2009/2012      137,987       Aug. 26    $ 86.24       $ 11.9 mil   

Winslow Plaza

   Sicklerville, NJ    1990/2009      40,695       Dec. 19    $ 162.18       $ 6.6 mil   

Portfolio (5 Grocery-Anchored Shopping Centers)

            Dec. 23    $ 60.76       $ 15.8 mil   
        

 

 

       

 

 

    

 

 

 

Clover Plaza

   Clover, SC    1990      45,575            

South Square

   Lancaster, SC    1992      44,350            

St. George’s Plaza

   St. George, SC    1982      59,279            

Waterway Plaza

   Little River, SC    1991      49,750            

Westland Square

   West Columbia, SC    1986/1994      62,735            
        

 

 

       

 

 

    

 

 

 

Total

           824,222          $ 86.14       $ 71.0 mil   
        

 

 

       

 

 

    

 

 

 

Development Projects

(as of December 31, 2013)

 

Property

   Location    GLA    Estimated    % GLA
Committed
         Completion    Carrying
Cost
   Cost to
Complete
  

n/a

                 

 

Wheeler Real Estate Investment Trust | Supplemental Operating and Financial Data    9


Portfolio Summary

(as of December 31, 2013)

 

Property

  

Location

   Year Built/
Renovated
  Net
Rentable
Square Feet
     Number
of
Tenants
   Percentage
Leased
    Annualized
Base Rent
     Annualized
Base Rent
per Leased
Sq. Foot
 

Amscot

   Tampa, FL    2004     2,500       1      100.0   $ 101,395       $ 40.56   

Bixby Commons

   Bixby, OK    2012     75,000       1      100.0     768,500         10.25   

Clover Plaza

   Clover, SC    1990     45,575       10      100.0     352,765         7.74   

Forrest Gallery

   Tullahoma, TN    1987     214,451       24      90.5     1,143,267         5.89   

Harps

   Grove, OK    2012     31,500       1      100.0     364,432         11.57   

Jenks Plaza

   Jenks, OK    2007     7,800       5      100.0     143,611         18.41   

Jenks Reasors

   Jenks, OK    2011     81,000       1      100.0     912,000         11.26   

Lumber River Village

   Lumberton, NC    1985/1997-98

(expansion)/
2004

    66,781       12      100.0     526,846         7.89   

Monarch Bank

   Virginia Beach, VA    2002     3,620       1      100.0     250,757         69.27   

Perimeter Square

   Tulsa, OK    1982-1983     58,277       8      95.7     708,055         12.70   

Riversedge North

   Virginia Beach, VA    2007     10,550       1      100.0     291,372         27.62   

Shoppes at TJ Maxx

   Richmond, VA    1982/1999     93,552       15      88.8     922,490         11.11   

South Square

   Lancaster, SC    1992     44,350       5      89.9     317,309         7.96   

Starbucks/ Verizon

   Virginia Beach, VA    1985/2012     5,600       2      100.0     198,854         35.51   

St. George Plaza

   St. George, SC    1982     59,279       6      85.8     357,175         7.03   

Surrey Plaza

   Hawkinsville, GA    1993     42,680       5      100.0     292,486         6.85   

Tampa Festival

   Tampa, FL    1965/2009/
2012
    137,987       22      100.0     1,222,859         8.86   

Eagle Harbor

   Carrollton, VA    2009     23,303       6      94.5     416,261         18.91   

Twin City Commons

   Batesburg-Leesville, SC    1998/2002     47,680       5      100.0     450,796         9.45   

Walnut Hill Plaza

   Petersburg, VA    1959/2006/
2008
    89,907       11      82.7     575,462         7.74   

Waterway Plaza

   Little River, SC    1991     49,750       9      97.6     436,965         9.00   

Westland Square

   West Columbia, SC    1986/1994     62,735       6      83.1     414,086         7.94   

Winslow Plaza

   Sicklerville, NJ    1990/2009     40,695       16      94.1     582,055         15.20   
       

 

 

    

 

  

 

 

   

 

 

    

 

 

 

Total

          1,294,572       173      94.0   $ 11,749,798       $ 9.65   
       

 

 

    

 

  

 

 

   

 

 

    

 

 

 

 

Wheeler Real Estate Investment Trust | Supplemental Operating and Financial Data    10


Top Ten Tenants by Annualized Base Rent

(as of December 31, 2013)

Total Tenants : 173

 

Tenants   

Total Net
Rentable

Square Feet

    

% of Total Net

Rentable
Square Feet

   

Annualized
Base Rent

($ in 000s)

     % of Total
Annualized
Base Rent
   

Base Rent

Per Leased

Square Foot

 

1. Food Lion

     179,798         13.89   $ 1,161         9.88   $ 6.46   

2. Reasor’s Foods

     81,000         6.26     912         7.76     11.26   

3. Associated Wholesale Grocers

     75,000         5.79     769         6.54     10.25   

4. Family Dollar

     57,427         4.44     359         3.06     6.25   

5. Kroger

     48,780         3.77     279         2.37     5.72   

6. Winn Dixie

     45,600         3.52     239         2.03     5.24   

7. Bi-Lo

     41,980         3.24     357         3.04     8.50   

8. Peebles

     32,680         2.52     173         1.47     5.29   

9. TJ Maxx

     32,400         2.50     294         2.50     9.07   

10. Harvey’s Supermarket

     29,000         2.24     187         1.59     6.45   
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 
     623,665         48.17   $ 4,730         40.24   $ 7.58   
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Leasing Summary

(as of December 31, 2013)

Gross Leasable Area: 1,294,572 square feet

Total Square Footage Leased: 1,217,124 square feet

Occupancy Rate: 94.0%

Lease Expiration Schedule

 

Year

   Number of
Expiring
Leases
     Total Expiring
Net Rentable
Square Footage
     % of Total Expiring
Net Rentable
Square Footage
    Expiring
Base Rent
(in 000s)
     % of Total
Base Rent
    Expiring Base
Rent Per Leased
Square Foot
 

Available

     —           77,448         5.98   $ —           —        $ —     

2014

     27         58,991         4.56     682         5.80     11.56   

2015

     31         144,564         11.17     1,350         11.49     9.34   

2016

     34         172,378         13.32     1,613         13.73     9.36   

2017

     27         179,382         13.86     1,800         15.32     10.03   

2018

     25         316,536         24.45     2,365         20.13     7.47   

2019

     11         72,219         5.58     700         5.96     9.69   

2020

     6         17,774         1.37     351         2.99     19.75   

2021

     1         41,980         3.24     357         3.04     8.5   

2022

     3         12,985         1.00     275         2.34     21.18   

2023 and thereafter

     8         200,315         15.47     2,257         19.20     11.31   
     

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 
        1,294,572         100.00   $ 11,750         100.00   $ 9.65   
     

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

 

Wheeler Real Estate Investment Trust | Supplemental Operating and Financial Data    11


Definitions

Funds from Operations (FFO): an alternative measure of a REITs operating performance, specifically as it relates to results of operations and liquidity. FFO is a measurement that is not in accordance with accounting principles generally accepted in the United States (“GAAP”). Wheeler computes FFO in accordance with standards established by the Board of Governors of NAREIT in its March 1995 White Paper (as amended in November 1999 and April 2002). As defined by NAREIT, FFO represents net income (computed in accordance with GAAP), excluding gains (or losses) from sales of property, plus real estate related depreciation and amortization (excluding amortization of loan origination costs) and after adjustments for unconsolidated partnerships and joint ventures.

Most industry analysts and equity REITs, including Wheeler, consider FFO to be an appropriate supplemental measure of operating performance because, by excluding gains or losses on dispositions and excluding depreciation, FFO is a helpful tool that can assist in the comparison of the operating performance of a company’s real estate between periods, or as compared to different companies. Management uses FFO as a supplemental measure to conduct and evaluate the business because there are certain limitations associated with using GAAP net income alone as the primary measure of our operating performance. Historical cost accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time, while historically real estate values have risen or fallen with market conditions.

Core FFO: Management believes that the computation of FFO in accordance with NAREIT’s definition includes certain items that are not indicative of the operating performance of the Company’s real estate assets. These items include, but are not limited to, non-recurring expenses, legal settlements and acquisition costs. Management uses Core FFO, which is a non-GAAP financial measure, to exclude such items. Management believes that reporting Core FFO in addition to FFO is a useful supplemental measure for the investment community to use when evaluating the operating performance of the Company on a comparative basis.

Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA): another widely-recognized non-GAAP financial measure that the Company believes, when considered with financial statements prepared in accordance with GAAP, is useful to investors and lenders in understanding financial performance and providing a relevant basis for comparison among other companies, including REITs. While EBITDA should not be considered as a substitute for net income attributable to the Company’s common shareholders, net operating income, cash flow from operating activities, or other income or cash flow data prepared in accordance with GAAP, the Company believes that EBITDA may provide additional information with respect to the Company’s performance or ability to meet its future debt service requirements, capital expenditures and working capital requirements. The Company computes EBITDA by excluding interest expense, net loss attributable to noncontrolling interest, and depreciation and amortization, from income from continuing operations.

Net Operating Income (NOI): Wheeler believes that NOI is a useful measure of the Company’s property operating performance. The Company defines NOI as property revenues (rental and other revenues) less property and related expenses (property operation and maintenance and real estate taxes). Because NOI excludes general and administrative expenses, depreciation and amortization, interest expense, interest income, provision for income taxes, gain or loss on sale or capital expenditures and leasing costs, it provides a performance measure, that when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate properties and the impact to operations from trends in occupancy rates, rental rates and operating costs, providing perspective not immediately

 

Wheeler Real Estate Investment Trust | Supplemental Operating and Financial Data    12


apparent from net income. The Company uses NOI to evaluate its operating performance since NOI allows the Company to evaluate the impact of factors, such as occupancy levels, lease structure, lease rates and tenant base, have on the Company’s results, margins and returns. NOI should not be viewed as a measure of the Company’s overall financial performance since it does not reflect general and administrative expenses, depreciation and amortization, involuntary conversion, interest expense, interest income, provision for income taxes, gain or loss on sale or disposition of assets, and the level of capital expenditures and leasing costs necessary to maintain the operating performance of the Company’s properties. Other REITs may use different methodologies for calculating NOI, and accordingly, the Company’s NOI may not be comparable to that of other REITs.

 

Wheeler Real Estate Investment Trust | Supplemental Operating and Financial Data    13