Americold Earnings: Robust NOI Growth Driven by Rate Escalations and Higher Occupancy

No-moat-rated Americold Realty's strong first-quarter results were driven by pricing initiatives, rate escalations, higher economic occupancy, and incremental revenue from recently completed expansion and development projects. The firm reported adjusted funds from operations of $0.29 per share, 11.5% higher than the $0.26 in adjusted funds from operations during the first quarter of 2022. Core EBITDA, which is less prone to quarterly fluctuations, was reported at $133 million in the first quarter, up approximately 20% compared with the $111 million in core EBITDA during the first quarter of the previous year. Management has slightly increased its 2023 adjusted funds from operations guidance to $1.16-$1.26 per share on account of higher warehouse same-store net operating income growth, which was partially offset by lower transportation and managed NOI, higher SG&A expenses, and higher interest costs. We do not plan to change our $33 fair value estimate as we incorporate the first-quarter results.