NewLake Capital Reports Increasing Revenue With Solid Tenants

Only one tenant is behind on rent.

After the markets closed on Wednesday, NewLake Capital Partners, Inc. (OCTQX: NLCP) announced its financial results for the second quarter ended June 30, 2023. The real estate lender reported that the second quarter revenue increased 8.2% to $11.4 million.

NewLake also reported that its quarterly net income was $5.8 million, while the funds from operations (FFO) totaled $9.5 million, and the adjusted funds from operations were $9.9 Million.

The company gave AFFO guidance for the full year 2023 of $39.8 to $40.8 million, an increase of 4.1% over AFFO for the same period the prior year, assuming the midpoint of that range.

“We are pleased with our second quarter financial results, which were in line with the guidance we provided last quarter,” said CEO Anthony Coniglio. “We maintained our quarterly dividend of $0.39 per share and in the first six months of this year we have repurchased 105,679 shares in the open market through our $10.0 million stock repurchase program. We continue to believe our focus on properties in limited license jurisdictions with quality property level cash flows was the right strategic focus for our business and we are providing guidance for full year 2023 AFFO of $39.8 to $40.8 million. With over $40 million of cash and $89 million available under our credit facility, we are well positioned to take advantage of quality opportunities as they arise.”

At the end of the quarter, NewLake owned 32 properties, including one that is classified as held for sale, located in 12 states. The top five tenants are Curaleaf, Cresco Labs, Trulieve, Columbia Care & Calypso – in that order.

NewLake did report that one tenant, Revolutionary Clinics, failed to pay contractual rent under one lease agreement. The company said it is currently in discussion with the tenant to negotiate a resolution, which could include rent deferrals or other concessions. NewLake said it has a security deposit of approximately three months of contractual rent, of which the company applied $630 thousand towards the outstanding rent during the six months that ended June 30, 2023.

As of June 30, 2023, the company reported it had approximately $1.0 million in borrowings under the Revolving Credit Facility and $89.0 million in funds available to be drawn, subject to sufficient collateral in the borrowing base.

Debra Borchardt

Debra Borchardt is the Co-Founder, and Executive Editor of GMR. She has covered the cannabis industry for several years at Forbes, Seeking Alpha and TheStreet. Prior to becoming a financial journalist, Debra was a Vice President at Bear Stearns where she held a Series 7 and Registered Investment Advisor license. Debra has a Master's degree in Business Journalism from New York University.

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