Americold Realty Trust, the world’s second largest operator of public refrigerated warehouses, reported strong operational results alongside an 11.9% decrease in revenues to $667.9 million and a net loss of $2.1 million during the third quarter of 2023. Global Warehouse segment revenue increased 0.6% to $602.6 million during the three-month period that ended on September 30, while segment net operating income rose 6.7% to $177.8 million.
George F. Chappelle, chief executive officer of the Atlanta, Georgia, USA-headquartered company, stated: “We are pleased with our third quarter results, where we delivered AFFO (adjusted funds from operations) per share of $0.32, an increase of 10.3% versus the prior year’s quarter. This performance was primarily driven by our global warehouse same store pool, which generated net operating income growth of 5.3%, on a constant currency basis. Our strong same-store pool results were the result of meaningful economic occupancy growth and our continued pricing initiatives. Our same store economic occupancy increased 345 basis points over prior year to 84.0%, a record-setting third quarter level.”
Additionally, during Q3 Americold derived 50.4% of rent and storage revenue from fixed commitment storage contracts, which marked another record-setting level. Lastly, in the face of a challenging throughput volume environment, progress was made in Services margins through aggressive variable cost management.
“During the quarter, we successfully raised $419 million in common equity by issuing 13.2 million shares at a weighted average price of $31.63 per share through our ATM program. This improved our balance sheet by reducing leverage and provides the fuel for growth in support of our development and M&A initiatives,” said the chief executive officer.
The company, which operates 243 temperature-controlled warehouses worldwide, announced an $85 million expansion of its Allentown, Pennsylvania facility during Q3. The investment was made to meet growing customer demand in key distribution markets.
“We continue to evaluate development opportunities across three primary areas of focus: expansion projects; customer-dedicated, build-to-suit developments; and our CPKC and DP World collaborations,” said Chappelle. “Also, today (November 2), we announced the strategic, tuck-in acquisition of Safeway Freezers, a temperature-controlled company located in Southern New Jersey, for a total investment of approximately $37 million. New Jersey is a strategic market for Americold, where we own 15 facilities.”
Other Q3 expansion highlights included completion of the acquisition of a cold storage facility in Brisbane (Ormeau), Australia for approximately A$36.1 million, and completed projects in Spearwood, Australia and Russellville, Arkansas for approximately A$63 million and $84 million respectively. The facilities consist of 3.3 million cubic feet and 20,000 pallet positions, and 13 million cubic feet and 42,000 pallet positions, respectively.
