EL SEGUNDO, Calif., Feb. 20, 2019 (GLOBE NEWSWIRE) -- Landmark Infrastructure Partners LP (the “Partnership,” “we,” “us” or “our”) (Nasdaq: LMRK) today announced its fourth quarter financial results.

Highlights

  • Net loss attributable to common unitholders of $0.21 per diluted unit, FFO of $0.01 per diluted unit and AFFO of $0.35 per diluted unit, an increase in AFFO per diluted unit of 9% from the fourth quarter of 2017;
  • Amended and restated its five-year revolving credit facility with initial borrowing commitments of $450 million;
  • Entered into an agreement with the City of Lancaster, CA, to develop and deploy Landmark’s FlexGridTM solution;
  • Amended our Omnibus Agreement, extending the general & administrative expense reimbursement arrangement through November 2021; and
  • Announced a quarterly distribution of $0.3675 per common unit.

2018 Highlights

  • Reported 2018 rental revenue of $64.8 million, a 23% increase year-over-year;
  • Reported 2018 net income attributable to common unitholders of $3.97 per diluted unit, FFO of $0.96 per diluted unit, and AFFO of $1.34 per diluted unit;
  • Formed a joint venture with Brookfield Asset Management (the “JV”) to invest in core infrastructure assets;
  • Entered into an agreement with Dallas Area Rapid Transit (“DART”) to develop a smart media communications platform which includes the deployment of kiosks and Landmark’s FlexGridTM solution; and
  • Completed acquisitions with total consideration of approximately $136 million in 2018.

Fourth Quarter 2018 Results
Rental revenue for the quarter ended December 31, 2018 increased 2% to $14.7 million compared to the fourth quarter of 2017 and declined 16% compared to the third quarter of 2018.  The sequential decline in rental revenue in the fourth quarter is due to the contribution of assets to the JV in September 2018, as the JV is accounted for as an equity method investment and the revenue generated in the venture is not consolidated into the Partnership’s results.  Net loss for the fourth quarter of 2018 was $2.2 million, compared to net income of $9.3 million in the fourth quarter of 2017.  Net loss attributable to common unitholders per diluted unit in the fourth quarter of 2018 was $0.21, compared to net income attributable to common unitholders per diluted unit of $0.31 in the fourth quarter of 2017.  FFO for the fourth quarter of 2018 was $0.01 per diluted unit, compared to FFO per diluted unit of $0.48 in the fourth quarter of 2017.  Net loss and FFO in the fourth quarter of 2018 included a $4.2 million unrealized loss on our interest rate swaps, while net income and FFO in the fourth quarter of 2017 included a $1.8 million unrealized gain on our interest rate swaps and an income tax benefit of $3.2 million.  AFFO for the fourth quarter of 2018 increased to $0.35 per diluted unit, an increase of 9% from the fourth quarter of 2017.

For the full year ended December 31, 2018, the Partnership reported rental revenue of $64.8 million compared to $52.6 million during the full year ended December 31, 2017.  The growth in revenue was primarily attributable to acquisitions made during the course of 2017 and 2018, partially offset by the impact of the contribution of assets to the JV in September of 2018.  For the full year ended December 31, 2018 we generated net income of $115.8 million compared to $19.3 million during the year ended December 31, 2017.  Net income attributable to common unitholders for the full year ended December 31, 2018 was $3.97 per diluted unit compared to $0.53 per diluted unit for the year ended December 31, 2017.   For the full year ended December 31, 2018 we generated FFO of $0.96 per diluted unit and AFFO of $1.34 per diluted unit, compared to FFO of $1.18 per diluted unit and AFFO of $1.26 per diluted unit during the full year ended December 31, 2017.  Net income for 2018 included a gain on sale of assets of $99.9 million.

“We are very pleased with our fourth quarter results.  We made further progress with our development initiatives, refinanced our revolving line of credit and ended the year well positioned for 2019.  We continue to believe that our development activities will drive the Partnership’s near-term and long-term growth,” said Tim Brazy, Chief Executive Officer of the Partnership’s general partner.

Quarterly Distributions
On January 25, 2019, the Board of Directors of the Partnership’s general partner declared a cash distribution of $0.3675 per common unit, or $1.47 per common unit on an annualized basis, for the quarter ended December 31, 2018.  The distribution was paid on February 14, 2019 to common unitholders of record as of February 4, 2019.

On January 22, 2019, the Board of Directors of the Partnership’s general partner declared a quarterly cash distribution of $0.4571 per Series C preferred unit, which was paid on February 15, 2019 to Series C preferred unitholders of record as of February 1, 2019. 

On January 22, 2019, the Board of Directors of the Partnership’s general partner declared a quarterly cash distribution of $0.49375 per Series B preferred unit, which was paid on February 15, 2019 to Series B preferred unitholders of record as of February 1, 2019.

On December 20, 2018, the Board of Directors of the Partnership’s general partner declared a quarterly cash distribution of $0.5000 per Series A preferred unit, which was paid on January 15, 2019 to Series A preferred unitholders of record as of January 2, 2019.

Recent Acquisitions
In the full year 2018, the Partnership acquired a total of 231 assets for total consideration of approximately $136 million. The acquisitions were immediately accretive to the Partnership’s distributable cash flow, funded primarily with borrowings under the Partnership’s existing Facility and the issuance of common units.

At-The-Market (“ATM”) Equity Programs
Through its At-The-Market (“ATM”) issuance programs, the Partnership issued 27,830 common units and 24,747 Series A preferred units for gross proceeds of approximately $0.5 million and $0.6 million, respectively, for the full year 2018.

Conference Call Information
The Partnership will hold a conference call on Wednesday, February 20, 2019, at 12:00 p.m. Eastern Time (9:00 a.m. Pacific Time) to discuss its fourth quarter 2018 financial and operating results.  The call can be accessed via a live webcast at https://edge.media-server.com/m6/p/4p2soroi, or by dialing 877-930-8063 in the U.S. and Canada.  Investors outside of the U.S. and Canada should dial 253-336-7764.  The passcode for both numbers is 3186638.

A webcast replay will be available approximately two hours after the completion of the conference call through February 20, 2020 at https://edge.media-server.com/m6/p/4p2soroi.  The replay is also available through March 1, 2019 by dialing 855-859-2056 or 404-537-3406 and entering the access code 3186638.

About Landmark Infrastructure Partners LP
The Partnership owns and manages a portfolio of real property interests and infrastructure assets that the Partnership leases to companies in the wireless communication, outdoor advertising and renewable power generation industries. 

Non-GAAP Financial Measures
FFO, is a non-GAAP financial measure of operating performance of an equity REIT in order to recognize that income-producing real estate historically has not depreciated on the basis determined under GAAP.  We calculate FFO in accordance with the standards established by the National Association of Real Estate Investment Trust (“NAREIT”).  FFO represents net income (loss) excluding real estate related depreciation and amortization expense, real estate related impairment charges, gains (or losses) on real estate transactions, adjustments for unconsolidated joint venture, and distributions to preferred unitholders and noncontrolling interests.

FFO is generally considered by industry analysts to be the most appropriate measure of performance of real estate companies.  FFO does not necessarily represent cash provided by operating activities in accordance with GAAP and should not be considered an alternative to net earnings as an indication of the Partnership's performance or to cash flow as a measure of liquidity or ability to make distributions.  Management considers FFO an appropriate measure of performance of an equity REIT because it primarily excludes the assumption that the value of the real estate assets diminishes predictably over time, and because industry analysts have accepted it as a performance measure.  The Partnership's computation of FFO may differ from the methodology for calculating FFO used by other equity REITs, and therefore, may not be comparable to such other REITs.

Adjusted Funds from Operations ("AFFO") is a non-GAAP financial measure of operating performance used by many companies in the REIT industry.  AFFO adjusts FFO for certain non-cash items that reduce or increase net income in accordance with GAAP.  AFFO should not be considered an alternative to net earnings, as an indication of the Partnership's performance or to cash flow as a measure of liquidity or ability to make distributions. Management considers AFFO a useful supplemental measure of the Partnership's performance.  The Partnership's computation of AFFO may differ from the methodology for calculating AFFO used by other equity REITs, and therefore, may not be comparable to such other REITs.  We calculate AFFO by starting with FFO and adjusting for general and administrative expense reimbursement, acquisition-related expenses, unrealized gain (loss) on derivatives, straight line rent adjustments, unit-based compensation, amortization of deferred loan costs and discount on secured notes, deferred income tax expense, amortization of above and below market rents, loss on early extinguishment of debt, repayments of receivables, adjustments for investment in unconsolidated joint venture, adjustments for drop-down assets and foreign currency transaction loss.  The GAAP measures most directly comparable to FFO and AFFO is net income.

We define EBITDA as net income before interest expense, income taxes, depreciation and amortization, adjustments for investment in unconsolidated joint venture, and we define Adjusted EBITDA as EBITDA before unrealized and realized gain or loss on derivatives, loss on early extinguishment of debt, gain or loss on sale of real property interests, straight line rent adjustments, amortization of above and below market rents, impairments, acquisition-related expenses, unit-based compensation, repayments of investments in receivables, foreign currency transaction loss, and the capital contribution to fund our general and administrative expense reimbursement.  We define distributable cash flow as Adjusted EBITDA less cash interest expense, cash interest expense from unconsolidated joint venture, current cash income tax expense, distributions to preferred unitholders, distributions to noncontrolling interest holders, and maintenance capital expenditures.  Distributable cash flow will not reflect changes in working capital balances.  We believe that to understand our performance further, EBITDA, Adjusted EBITDA and distributable cash flow should be compared with our reported net income (loss) and net cash provided by operating activities in accordance with GAAP, as presented in our consolidated financial statements.

EBITDA, Adjusted EBITDA and distributable cash flow are non-GAAP supplemental financial measures that management and external users of our financial statements, such as industry analysts, investors, lenders and rating agencies, may use to assess:

  • our operating performance as compared to other publicly traded limited partnerships, without regard to historical cost basis or, in the case of Adjusted EBITDA, financing methods;
  • the ability of our business to generate sufficient cash to support our decision to make distributions to our unitholders;
  • our ability to incur and service debt and fund capital expenditures; and
  • the viability of acquisitions and the returns on investment of various investment opportunities.

We believe that the presentation of EBITDA, Adjusted EBITDA and distributable cash flow provides information useful to investors in assessing our financial condition and results of operations.  The GAAP measures most directly comparable to EBITDA, Adjusted EBITDA and distributable cash flow are net income (loss) and net cash provided by operating activities.  EBITDA, Adjusted EBITDA and distributable cash flow should not be considered as an alternative to GAAP net income (loss), net cash provided by operating activities or any other measure of financial performance or liquidity presented in accordance with GAAP.  Each of EBITDA, Adjusted EBITDA and distributable cash flow has important limitations as analytical tools because they exclude some, but not all, items that affect net income (loss) and net cash provided by operating activities, and these measures may vary from those of other companies.  You should not consider EBITDA, Adjusted EBITDA and distributable cash flow in isolation or as a substitute for analysis of our results as reported under GAAP.  As a result, because EBITDA, Adjusted EBITDA and distributable cash flow may be defined differently by other companies in our industry, EBITDA, Adjusted EBITDA and distributable cash flow as presented below may not be comparable to similarly titled measures of other companies, thereby diminishing their utility.  For a reconciliation of EBITDA, Adjusted EBITDA and distributable cash flow to the most comparable financial measures calculated and presented in accordance with GAAP, please see the “Reconciliation of EBITDA, Adjusted EBITDA and Distributable Cash Flow” table below.

Forward-Looking Statements
This release contains forward-looking statements within the meaning of federal securities laws.  These statements discuss future expectations, contain projections of results of operations or of financial condition or state other forward-looking information.  You can identify forward-looking statements by words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “project,” “could,” “may,” “should,” “would,” “will” or other similar expressions that convey the uncertainty of future events or outcomes.  These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond the Partnership’s control and are difficult to predict.  These statements are often based upon various assumptions, many of which are based, in turn, upon further assumptions, including examination of historical operating trends made by the management of the Partnership.  Although the Partnership believes that these assumptions were reasonable when made, because assumptions are inherently subject to significant uncertainties and contingencies, which are difficult or impossible to predict and are beyond its control, the Partnership cannot give assurance that it will achieve or accomplish these expectations, beliefs or intentions.  Examples of forward-looking statements in this press release include expected acquisition opportunities from our sponsor.  When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements contained in the Partnership’s filings with the U.S. Securities and Exchange Commission (the “Commission”), including the Partnership’s annual report on Form 10-K for the year ended December 31, 2018 and Current Report on Form 8-K filed with the Commission on February 20, 2019.  These risks could cause the Partnership’s actual results to differ materially from those contained in any forward-looking statement.

CONTACT:Marcelo Choi
 Vice President, Investor Relations
 (213) 788-4528
 ir@landmarkmlp.com
  


Landmark Infrastructure Partners LP
Consolidated Statements of Operations
In thousands, except per unit data
(Unaudited)

  Three Months Ended December 31,  Year Ended December 31, 
  2018  2017  2018  2017 
Revenue                
Rental revenue $14,714  $14,482  $64,765  $52,625 
Expenses                
Property operating  272   147   1,147   394 
General and administrative  1,208   1,019   4,731   5,286 
Acquisition-related   2,818   280   3,287   1,287 
Amortization  3,604   3,711   16,152   13,537 
Impairments  579      1,559   848 
Total expenses  8,481   5,157   26,876   21,352 
Other income and expenses                
Interest and other income  362   419   1,642   1,587 
Interest expense  (4,687)  (5,468)  (24,273)  (18,399)
Loss on early extinguishment of debt  (157)     (157)   
Unrealized gain (loss) on derivatives  (4,198)  1,786   1,010   1,675 
Equity income from unconsolidated joint venture        59    
Gain (loss) on sale of real property interests  (155)  (5)  99,884   (5)
Foreign currency transaction loss  (6)     (6)   
Total other income and expenses  (8,841)  (3,268)  78,159   (15,142)
Income (loss) before income tax (benefit) expense  (2,608)  6,057   116,048   16,131 
Income tax (benefit) expense  (436)  (3,217)  227   (3,145)
Net income (loss)  (2,172)  9,274   115,821   19,276 
Less: Net income attributable to noncontrolling interests  7   8   27   19 
Net income (loss) attributable to limited partners  (2,179)  9,266   115,794   19,257 
Less: Distributions to preferred unitholders  (2,888)  (2,001)  (10,630)  (6,673)
Less: General Partner's incentive distribution rights  (197)  (193)  (784)  (488)
Net income (loss) attributable to common and subordinated unitholders $(5,264) $7,072  $104,380  $12,096 
Net income (loss) per common and subordinated unit                
Common units – basic $(0.21) $0.31  $4.25  $0.54 
Common units – diluted $(0.21) $0.31  $3.97  $0.53 
Subordinated units – basic and diluted $  $0.28  $(0.78) $0.50 
Weighted average common and subordinated units outstanding                
Common units – basic  25,283   19,940   24,626   19,701 
Common units – diluted  25,283   23,075   26,967   22,836 
Subordinated units – basic and diluted     3,135   387   3,135 
Other Data                
Total leased tenant sites (end of period)  1,831   2,157   1,831   2,157 
Total available tenant sites (end of period)  1,920   2,239   1,920   2,239 
                 


Landmark Infrastructure Partners LP
Consolidated Balance Sheets
In thousands, except per unit data
(Unaudited)

  December 31, 2018  December 31, 2017 
Assets        
Land $128,302  $114,385 
Real property interests  517,423   596,422 
Construction in progress  29,556   7,574 
Total land and real property interests  675,281   718,381 
Accumulated amortization of real property interests  (39,069)  (37,817)
Land and net real property interests  636,212   680,564 
Investments in receivables, net  18,348   20,782 
Investment in unconsolidated joint venture  65,670    
Cash and cash equivalents  4,108   9,188 
Restricted cash  3,672   18,672 
Rent receivables, net  4,292   4,141 
Due from Landmark and affiliates  1,390   629 
Deferred loan costs, net  5,552   3,589 
Deferred rent receivable  5,251   4,252 
Derivative asset  4,590   3,159 
Other intangible assets, net  20,839   17,984 
Assets held for sale (AHFS)  7,846    
Other assets  8,843   5,039 
Total assets $786,613  $767,999 
Liabilities and equity        
Revolving credit facility $155,000  $304,000 
Secured notes, net  223,685   187,249 
Accounts payable and accrued liabilities  7,435   4,978 
Other intangible liabilities, net  9,291   12,833 
Liabilities associated with AHFS  397    
Prepaid rent  5,418   4,581 
Derivative liabilities  402    
Total liabilities  401,628   513,641 
Commitments and contingencies        
Mezzanine equity        
Series C cumulative redeemable convertible preferred units, 2,000,000 and zero units
  issued and outstanding at December 31, 2018 and 2017, respectively
  47,308    
Equity        
Series A cumulative redeemable preferred units, 1,593,149 and 1,568,402 units
  issued and outstanding at December 31, 2018 and 2017, respectively
  37,207   36,604 
Series B cumulative redeemable preferred units, 2,463,015 units
  issued and outstanding at December 31, 2018 and 2017, respectively
  58,936   58,936 
Common units, 25,327,801 and 20,146,458 units issued and outstanding at
  December 31, 2018 and 2017, respectively
  411,158   288,527 
Subordinated units, zero and 3,135,109 units issued and outstanding
  at December 31, 2018 and 2017, respectively
     19,641 
General Partner  (167,019)  (150,519)
Accumulated other comprehensive income (loss)  (2,806)  968 
Total limited partners' equity  337,476   254,157 
Noncontrolling interests  201   201 
Total equity  337,677   254,358 
Total liabilities, mezzanine equity and equity $786,613  $767,999 
 


Landmark Infrastructure Partners LP
Real Property Interest Table

    Available Tenant Sites (1)   Leased Tenant Sites          
Real Property Interest Number of
Infrastructure
Locations (1)
 Number Average
Remaining
Property
Interest
(Years)
   Number Average
Remaining
Lease
Term
(Years) (2)
 Tenant
Site

Occupancy
Rate (3)
 Average
Monthly
Effective Rent
Per Tenant
Site (4)(5)
 Quarterly
Rental
Revenue (6)
(In thousands)
 Percentage
of
Quarterly

Rental
Revenue (6)
Tenant Lease Assignment with Underlying Easement                      
Wireless Communication 726 918 72.7 (7) 864 27.8      $5,156 35%
Outdoor Advertising 531 631 80.5 (7) 615 17.6       4,150 28%
Renewable Power Generation 24 56 28.6 (7) 56 29.3       432 3%
Subtotal 1,281 1,605 78.6 (7) 1,535 23.8      $9,738 66%
Tenant Lease Assignment only (8)                      
Wireless Communication 122 176 48.2   158 17.8      $994 7%
Outdoor Advertising 32 35 63.1   34 14.2       225 2%
Renewable Power Generation 6 6 48.6   6 27.6       57 —%
Subtotal 160 217 50.8   198 17.5      $1,276 9%
Tenant Lease on Fee Simple                      
Wireless Communication 19 29 99.0 (7) 29 18.7      $1,213 8%
Outdoor Advertising 50 54 99.0 (7) 54 7.8       906 6%
Renewable Power Generation 13 15 99.0 (7) 15 30.9       1,581 11%
Subtotal 82 98 99.0 (7) 98 14.4      $3,700 25%
Total 1,523 1,920 72.9 (9) 1,831 22.6      $14,714 100%
Aggregate Portfolio                      
Wireless Communication 867 1,123 68.8   1,051 26.0 94% $1,927 $7,363 50%
Outdoor Advertising 613 720 80.8   703 16.7 98%  2,535  5,281 36%
Renewable Power Generation 43 77 37.3   77 29.6 100%  8,960  2,070 14%
Total 1,523 1,920 72.9 (9) 1,831 22.6 95% $2,458 $14,714 100%

__________________
(1)   “Available Tenant Sites” means the number of individual sites that could be leased. For example, if we have an easement on a single rooftop, on which three different tenants can lease space from us, this would be counted as three “tenant sites,” and all three tenant sites would be at a single infrastructure location with the same address.
(2)   Assumes the exercise of all remaining renewal options of tenant leases. Assuming no exercise of renewal options, the average remaining lease terms for our wireless communication, outdoor advertising, renewable power generation and aggregate portfolios as of December 31, 2018 were 3.8, 8.5, 17.6 and 5.9 years, respectively.
(3)   Represents the number of leased tenant sites divided by the number of available tenant sites.
(4)   Occupancy and average monthly effective rent per tenant site are shown only on an aggregate portfolio basis by industry.
(5)   Represents total monthly revenue excluding the impact of amortization of above and below market lease intangibles divided by the number of leased tenant sites.
(6)   Represents GAAP rental revenue recognized under existing tenant leases for the three months ended December 31, 2018.  Excludes interest income on receivables.
(7)   Fee simple ownership and perpetual easements are shown as having a term of 99 years for purposes of calculating the average remaining term.
(8)   Reflects “springing lease agreements” whereby the cancellation or nonrenewal of a tenant lease entitles us to enter into a new ground lease with the property owner (up to the full property interest term) and a replacement tenant lease. The remaining lease assignment term is, therefore, equal to or longer than the remaining lease term. Also represents properties for which the “springing lease” feature has been exercised and has been replaced by a lease for the remaining lease term.
(9)   Excluding perpetual ownership rights, the average remaining property interest term on our tenant sites is approximately 64 years.



Landmark Infrastructure Partners LP
Reconciliation of Funds from Operations (FFO) and Adjusted Funds from Operations (AFFO)
In thousands, except per unit data
(Unaudited)

  Three Months Ended December 31,  Year Ended December 31, 
  2018  2017  2018  2017 
Net income (loss) $(2,172) $9,274  $115,821  $19,276 
Adjustments:                
Amortization expense  3,604   3,711   16,152   13,537 
Impairments  579      1,559   848 
(Gain) loss on sale of real property interests  155   5   (99,884)  5 
Adjustments for investment in unconsolidated joint venture  923      923    
Distributions to preferred unitholders  (2,888)  (2,001)  (10,630)  (6,673)
Distributions to noncontrolling interests  (7)  (8)  (27)  (19)
FFO $194  $10,981  $23,914  $26,974 
Adjustments:                
General and administrative expense reimbursement  764   491   2,833   3,516 
Acquisition-related expenses  2,818   280   3,287   1,287 
Unrealized gain on derivatives  4,198   (1,786)  (1,010)  (1,675)
Straight line rent adjustments  58   (54)  235   (358)
Unit-based compensation        70   105 
Amortization of deferred loan costs and discount on secured notes  805   719   3,809   2,237 
Deferred income tax expense (benefit)  (215)  (3,215)  205   (3,215)
Amortization of above- and below-market rents, net  (218)  (262)  (1,226)  (1,226)
Loss on early extinguishment of debt  157      157    
Repayments of receivables  193   275   1,108   1,180 
Adjustments for investment in unconsolidated joint venture  30      36    
Foreign currency transaction loss  6      6    
AFFO $8,790  $7,429  $33,424  $28,825 
                 
FFO per common unit - diluted $0.01  $0.48  $0.96  $1.18 
AFFO per common unit - diluted $0.35  $0.32  $1.34  $1.26 
Weighted average common units outstanding - diluted  25,283   23,075   25,013   22,836 
                 


Landmark Infrastructure Partners LP
Reconciliation of EBITDA, Adjusted EBITDA and Distributable Cash Flow
In thousands
(Unaudited)

  Three Months Ended December 31,  Year Ended December 31, 
  2018  2017  2018  2017 
Reconciliation of EBITDA and Adjusted EBITDA to Net Income                
Net income (loss) $(2,172) $9,274  $115,821  $19,276 
Interest expense  4,687   5,468   24,273   18,399 
Amortization expense  3,604   3,711   16,152   13,537 
Income tax expense (benefit)  (436)  (3,217)  227   (3,145)
Adjustments for investment in unconsolidated joint venture  1,694      1,747    
EBITDA $7,377  $15,236  $158,220  $48,067 
Impairments  579      1,559   848 
Acquisition-related  2,818   280   3,287   1,287 
Unrealized (gain) loss on derivatives  4,198   (1,786)  (1,010)  (1,675)
Loss on early extinguishment of debt  157      157    
(Gain) loss on sale of real property interests  155   5   (99,884)  5 
Unit-based compensation        70   105 
Straight line rent adjustments  58   (54)  235   (358)
Amortization of above- and below-market rents, net  (218)  (262)  (1,226)  (1,226)
Repayments of investments in receivables  193   275   1,108   1,180 
Adjustments for investment in unconsolidated joint venture  (50)     (50)   
Foreign currency transaction loss  6      6    
Deemed capital contribution to fund general and administrative expense reimbursement(1)  764   491   2,833   3,516 
Adjusted EBITDA $16,037  $14,185  $65,305  $51,749 
Reconciliation of EBITDA, Adjusted EBITDA and Distributable Cash Flow to Net Cash Provided by Operating Activities                
Net cash provided by operating activities $187  $6,985  $31,256  $28,473 
Unit-based compensation        (70)  (105)
Unrealized gain (loss) on derivatives  (4,198)  1,786   1,010   1,675 
Loss on early extinguishment of debt  (157)     (157)   
Amortization expense  (3,604)  (3,711)  (16,152)  (13,537)
Amortization of above- and below-market rents, net  218   262   1,226   1,226 
Amortization of deferred loan costs and discount on secured notes  (805)  (719)  (3,809)  (2,237)
Receivables interest accretion  3      3   7 
Impairments  (579)     (1,559)  (848)
Gain (loss) on sale of real property interests  (155)  (5)  99,884   (5)
Allowance for doubtful accounts  (83)  (136)  (60)  (215)
Equity income from unconsolidated joint venture        59    
Foreign currency transaction loss  (6)     (6)   
Working capital changes  7,007   4,812   4,196   4,842 
Net income (loss) $(2,172) $9,274  $115,821  $19,276 
Interest expense  4,687   5,468   24,273   18,399 
Amortization expense  3,604   3,711   16,152   13,537 
Income tax (benefit) expense  (436)  (3,217)  227   (3,145)
Adjustments for investment in unconsolidated joint venture  1,694      1,747    
EBITDA $7,377  $15,236  $158,220  $48,067 
Less:                
Gain on sale of real property interests        (99,884)   
Unrealized gain on derivatives     (1,786)  (1,010)  (1,675)
Straight line rent adjustment     (54)     (358)
Amortization of above- and below-market rents, net  (218)  (262)  (1,226)  (1,226)
Adjustments for investment in unconsolidated joint venture  (50)     (50)   
Add:                
Impairments  579      1,559   848 
Acquisition-related  2,818   280   3,287   1,287 
Unrealized loss on derivatives  4,198          
Loss on sale of real property interests  155   5      5 
Loss on early extinguishment of debt  157      157    
Unit-based compensation        70   105 
Straight line rent adjustment  58      235    
Repayments of investments in receivables  193   275   1,108   1,180 
Foreign currency transaction loss  6      6    
Deemed capital contribution to fund general and administrative expense reimbursement (1)  764   491   2,833   3,516 
Adjusted EBITDA $16,037  $14,185  $65,305  $51,749 
Less:                
Expansion capital expenditures  (2,812)  (43,577)  (157,675)  (166,839)
Cash interest expense  (3,882)  (4,749)  (20,464)  (16,162)
Cash interest expense from unconsolidated joint venture  (691)     (738)   
Cash income tax expense        (22)  (70)
Distributions to preferred unitholders  (2,888)  (2,001)  (10,630)  (6,673)
Distributions to noncontrolling interest holders  (7)  (8)  (27)  (19)
Add:                
Borrowings and capital contributions to fund expansion capital expenditures  2,812   43,577   157,675   166,839 
Cash income tax benefit  221   2       
Distributable cash flow $8,790  $7,429  $33,424  $28,825 

__________________
(1)   Under the omnibus agreement that we entered into with Landmark at the closing of our IPO and amended on January 30, 2019, we agreed to reimburse Landmark for expenses related to certain general and administrative services that Landmark will provide to us in support of our business, subject to a quarterly cap equal to 3% of our revenue during the current calendar quarter. This cap on expenses will last until the earlier to occur of: (i) the date on which our revenue for the immediately preceding four consecutive fiscal quarters exceeded $120 million and (ii) November 19, 2021. The full amount of general and administrative expenses incurred will be reflected in our income statements, and to the extent such general and administrative expenses exceed the cap amount, the amount of such excess will be reimbursed by Landmark and reflected in our financial statements as a capital contribution from Landmark rather than as a reduction of our general and administrative expenses, except for expenses that would otherwise be allocated to us, which are not included in our general and administrative expenses.



Landmark Infrastructure Partners LP
Reconciliation of Operations, EBITDA, Adjusted EBITDA and Distributable Cash Flow
In thousands, except per unit data (Unaudited)

  Three Months Ended December 31, 
  2018  2017 
Revenue:        
Rental revenue $14,714  $14,482 
Expenses:        
Property operating  272   147 
General and administrative  1,208   1,019 
Acquisition-related  2,818   280 
Amortization  3,604   3,711 
Impairments  579    
Total expenses  8,481   5,157 
Other income and expenses        
Interest and other income  362   419 
Interest expense  (4,687)  (5,468)
Loss on early extinguishment of debt  (157)   
Unrealized gain (loss) on derivatives  (4,198)  1,786 
Loss on sale of real property interests  (155)  (5)
Foreign currency transaction loss  (6)   
Total other income and expenses  (8,841)  (3,268)
Income (loss) before income tax benefit  (2,608)  6,057 
Income tax benefit  (436)  (3,217)
Net income (loss) $(2,172) $9,274 
Add:        
Interest expense  4,687   5,468 
Amortization expense  3,604   3,711 
Income tax benefit  (436)  (3,217)
Adjustments for investment in unconsolidated joint venture  1,694    
EBITDA $7,377  $15,236 
Less:        
Unrealized gain on derivatives     (1,786)
Straight line rent adjustments     (54)
Amortization of above- and below-market rents  (218)  (262)
Adjustments for investment in unconsolidated joint venture  (50)   
Add:        
Impairments  579    
Acquisition-related expenses  2,818   280 
Unrealized loss on derivatives  4,198    
Loss on sale of real property interests  155   5 
Loss on early extinguishment of debt  157    
Straight line rent adjustments  58    
Repayments of investments in receivables  193   275 
Foreign currency transaction loss  6    
Deemed capital contribution to fund general and administrative expense reimbursement (1)  764   491 
Adjusted EBITDA $16,037  $14,185 
Less:        
Expansion capital expenditures  (2,812)  (43,577)
Cash interest expense  (3,882)  (4,749)
Cash interest expense from unconsolidated joint venture  (691)   
Distributions to preferred unitholders  (2,888)  (2,001)
Distributions to noncontrolling interest holders  (7)  (8)
Add:        
Borrowings and capital contributions to fund expansion capital expenditures  2,812   43,577 
Cash income tax benefit  221   2 
Distributable cash flow $8,790  $7,429 
Annualized quarterly distribution per unit $1.47  $1.47 
Distributions to common unitholders  9,292   7,328 
Distributions to Landmark Dividend – subordinated units     1,152 
Distributions to the General Partner – incentive distribution rights     180 
Total distributions $9,292  $8,660 
Shortfall of distributable cash flow over the quarterly distribution $(502) $(1,231)
Coverage ratio (2)  0.95x  0.86x

__________________
(1)   Under the omnibus agreement that we entered into with Landmark at the closing of the IPO and amended on January 30, 2019, we agreed to reimburse Landmark for expenses related to certain general and administrative services that Landmark will provide to us in support of our business, subject to a quarterly cap equal to 3% of our revenue during the current calendar quarter. This cap on expenses will last until the earlier to occur of: (i) the date on which our revenue for the immediately preceding four consecutive fiscal quarters exceeded $120 million and (ii) November 19, 2021. The full amount of general and administrative expenses incurred will be reflected in our income statements, and to the extent such general and administrative expenses exceed the cap amount, the amount of such excess will be reimbursed by Landmark and reflected in our financial statements as a capital contribution from Landmark rather than as a reduction of our general and administrative expenses, except for expenses that would otherwise be allocated to us, which are not included in our general and administrative expenses.
(2)   Coverage ratio is calculated as the distributable cash flow for the quarter divided by the distributions to the common and subordinated unitholders on the weighted average units outstanding.



Landmark Infrastructure Partners LP
Reconciliation of Operations, EBITDA, Adjusted EBITDA and Distributable Cash Flow
In thousands, except per unit data (Unaudited)

  Year Ended December 31, 
  2018  2017 
Revenue:        
Rental revenue $64,765  $52,625 
Expenses:        
Property operating  1,147   394 
General and administrative  4,731   5,286 
Acquisition-related  3,287   1,287 
Amortization  16,152   13,537 
Impairments  1,559   848 
Total expenses  26,876   21,352 
Other income and expenses        
Interest and other income  1,642   1,587 
Interest expense  (24,273)  (18,399)
Loss on early extinguishment of debt  (157)   
Unrealized gain on derivatives  1,010   1,675 
Equity income from unconsolidated joint venture  59    
Gain (loss) on sale of real property interests  99,884   (5)
Foreign currency transaction loss  (6)   
Total other income and expenses  78,159   (15,142)
Income before income tax expense (benefit)  116,048   16,131 
Income tax expense (benefit)  227   (3,145)
Net income $115,821  $19,276 
Add:        
Interest expense  24,273   18,399 
Amortization expense  16,152   13,537 
Income tax expense (benefit)  227   (3,145)
Adjustments for investment in unconsolidated joint venture  1,747    
EBITDA $158,220  $48,067 
Less:        
Gain on sale of real property interests  (99,884)   
Unrealized gain on derivatives  (1,010)  (1,675)
Straight line rent adjustments     (358)
Amortization of above- and below-market rents  (1,226)  (1,226)
Adjustments for investment in unconsolidated joint venture  (50)   
Add:        
Impairments  1,559   848 
Acquisition-related expenses  3,287   1,287 
Loss on sale of real property interests     5 
Loss on early extinguishment of debt  157    
Straight line rent adjustments  235    
Unit-based compensation  70   105 
Repayments of investments in receivables  1,108   1,180 
Foreign currency transaction loss  6    
Deemed capital contribution to fund general and administrative expense reimbursement (1)  2,833   3,516 
Adjusted EBITDA $65,305  $51,749 
Less:        
Expansion capital expenditures  (157,675)  (166,839)
Cash interest expense  (20,464)  (16,162)
Cash interest expense from unconsolidated joint venture  (738)   
Cash income tax expense  (22)  (70)
Distributions to preferred unitholders  (10,630)  (6,673)
Distributions to noncontrolling interest holders  (27)  (19)
Add:        
Borrowings and capital contributions to fund expansion capital expenditures  157,675   166,839 
Distributable cash flow $33,424  $28,825 
Annualized quarterly distribution per unit $1.47  $1.43 
Distributions to common unitholders  36,200   28,222 
Distributions to Landmark Dividend – subordinated units  569   4,491 
Distributions to the General Partner – incentive distribution rights  386   443 
Total distributions $37,155  $33,156 
Shortfall of distributable cash flow over the quarterly distribution $(3,731) $(4,331)
Coverage ratio (2)  0.90x  0.87x

__________________
(1)   Under the omnibus agreement that we entered into with Landmark at the closing of the IPO and amended on January 30, 2019, we agreed to reimburse Landmark for expenses related to certain general and administrative services that Landmark will provide to us in support of our business, subject to a quarterly cap equal to 3% of our revenue during the current calendar quarter. This cap on expenses will last until the earlier to occur of: (i) the date on which our revenue for the immediately preceding four consecutive fiscal quarters exceeded $120 million and (ii) November 19, 2021. The full amount of general and administrative expenses incurred will be reflected in our income statements, and to the extent such general and administrative expenses exceed the cap amount, the amount of such excess will be reimbursed by Landmark and reflected in our financial statements as a capital contribution from Landmark rather than as a reduction of our general and administrative expenses, except for expenses that would otherwise be allocated to us, which are not included in our general and administrative expenses.
(2)   Coverage ratio is calculated as the distributable cash flow for the year divided by the distributions to the common and subordinated unitholders on the weighted average units outstanding.