Global Self Storage : Reports Record Third Quarter 2021 Results

November 15, 2021

Global Self Storage Reports Record Third Quarter 2021 Results

Strong Pricing Power and Lease-up Performance Drove Record Revenues, FFO and AFFO; Together with Expansion of Capital Resources, Positions Company for Continued Growth

MILLBROOK, NY / ACCESSWIRE / November 15, 2021 /Global Self Storage, Inc.(NASDAQ:SELF), a real estate investment trust that owns, operates, manages, acquires, and redevelops self-storage properties, reported results for the third quarter ended September 30, 2021. All comparisons are to the same year-ago period unless otherwise noted.

Q3 2021 Highlights

Total revenues increased 16.4% to a record $2.7 million. Total expenses decreased 1.8% to $1.9 million.

Net income increased to $0.6 million or $0.06 per fully diluted share.

Funds from operations (FFO) increased 59.3% to a record $957,000 or $0.09 per diluted share.

Adjusted FFO (AFFO) increased 59.1% to a record $1.0 million or $0.10 per diluted share (see definition of FFO and AFFO, both non-GAAP terms, and their reconciliation to GAAP, below).

Same-store revenues increased 13.8% to a record $2.1 million.

Same-store net operating income (NOI) increased 20.5% to a record $1.4 million, as described below (see definition of same-store NOI, a non-GAAP term, and its reconciliation to GAAP, below).

Same-store occupancy at September 30, 2021 increased to 94.3% from 93.5% at September 30, 2020.

Same-store average tenant duration of stay at September 30, 2021 was approximately

3.2 years, up from approximately 3.0 years as of September 30, 2020. Maintained quarterly dividend of $0.065 per share.

Capital resources at September 30, 2021 totaled approximately $20.5 million.

First Nine Months 2021 Highlights

Total revenues increased 13.6% to a record $7.7 million. Total expenses decreased 3.2% to $5.9 million.

Net income increased $1.9 million to $1.9 million or $0.19 per fully diluted share.

Funds from operations (FFO) increased 59.9% to a record $2.3 million or $0.24 per diluted share.

Adjusted FFO (AFFO) increased 58.0% to a record $2.5 million or $0.25 per diluted share.

Same-store revenues increased 9.9% to a record $6.1 million.

Same-store net operating income (NOI) increased 13.8% to a record $3.8 million, as described below.

Same-store occupancy at September 30, 2021 increased to 94.3% from 93.5% at September 30, 2020.

Same-store average tenant duration of stay at September 30, 2021 was approximately

3.2 years, up from approximately 3.0 years as of September 30, 2020. Maintained quarterly dividend of $0.065 per share.

Management Commentary

"In Q3, our strong pricing power and lease-up performance drove another quarter of record revenues, FFO and AFFO," stated Global Self Storage president and CEO, Mark C. Winmill. "In fact, we once again led our peer group of public self-storage REITs in FFO and AFFO growth.

"We believe this exceptional performance was driven by our approach to the market that enabled us to capture the increasing demand for storage units, with this primarily driven by the migration trend of people moving from urban to suburban areas, as well as overall population growth.

"We strengthened our capital resources during the quarter by extending and increasing our revolving credit facility from $10 million to $15 million, as well as by raising aggregate gross proceeds of approximately $6.9 million in a public offering in June 2021. This brought our capital resources to total approximately $20.5 million at quarter end. This was comprised of $2.8 million in cash, cash equivalents and restricted cash, $2.7 million in marketable securities, and $15.0 million available for withdrawal under our revolving credit facility.

"These financial resources mean we are well positioned to fund and engage in a variety of growth opportunities, such as existing property expansion, acquisitions or joint ventures. In fact, we are currently evaluating additional expansion opportunities at certain properties in our portfolio.

"We see attractive self-storage acquisition opportunities in our target markets that could benefit from our successful management techniques. These proprietary techniques allow us to consider properties where other buyers would likely not be ableto achieve the same level of performance. This approach gives us a competitive edge in an increasingly active acquisition environment for self-storage properties.

"Looking ahead in 2022, we believe our specialized approach to self-storage will support accretive acquisitions and drive continued FFO and AFFO growth.IBISWorld recently reported that the U.S. self-storage market should grow at a 2.2 percent compound annual growth rate to reach $44.5 billion by 2024. Given the market's current positive outlook, we believe we are well positioned for continued growth during the remainder of 2021."

Dividend

On September 1, 2021, the company declared a quarterly dividend of $0.065 per share, consistent with the quarterly dividend for the year-ago period and previous quarter.

Q3 Financial Summary

Total revenues increased 16.4% to $2.7 million in the third quarter of 2021, as compared to $2.3 million in the same period last year. The increase was primarily attributable to the Millbrook, NY and West Henrietta, NY expansions, and increases in rental rates and occupancy at the company's wholly-owned stores.

Total operating expenses in the third quarter of 2021 decreased 1.8% to $1.9 million, compared to $2.0 million in the same period last year. The improvement was primarily due to a decrease in depreciation and amortization expense.

Net income was $629,000 or $0.06 per diluted share in the third quarter of 2021, as compared to $337,000 or $0.04 per diluted share in the same period last year.

As of September 30, 2021, the company's capital resources totaled approximately $20.5 million, comprised of $2.8 million in cash, cash equivalents and restricted cash, $2.7 million of marketable securities, and $15.0 million currently available for withdrawal under the company's revolving credit facility.

Q3 Same-Store Results

At September 30, 2021, Global Self Storage owned nine same-store properties and three non-same-store properties, and managed one third-party owned property.

For the third quarter of 2021, same-store revenues increased 13.8% to $2.1 million compared to $1.9 million in the same period last year. This increase was due primarily to consistent rent collections, despite the COVID-19 pandemic, and increased rental rates.

Same-store cost of operations in the third quarter increased 2.9% to $739,000, compared to $718,000 in the same period last year. This increase in same-store cost of operations was due primarily to increased landscaping expenses for the period.

Same-store NOI increased 20.5% to $1.4 million in the third quarter of 2021, compared to $1.2 million in the same period last year. The increase was primarily due to the increase in revenues.

Same-store occupancy at September 30, 2021 increased to 94.3% from 93.5% at September 30, 2020.

Same-store average duration of tenant stay at September 30, 2021 was 3.2 years, up from approximately 3.0 years as of September 30, 2020.

For a reconciliation of net income to same-store NOI see, "Reconciliation of GAAP Net Income to Same-Store Net Operating Income," below.

Q3 Operating Results

Net income in the third quarter of 2021 was $629,000 or $0.06 per diluted share, compared

to $337,000 or $0.04 per diluted share in the third quarter of 2020.

General and administrative expenses increased 5.4% to $595,000 in the third quarter of 2021, compared to $564,000 in the same period last year. The increase was primarily attributable to increases in stock-based compensation for 2021 due to restricted stock grants, expenses related to the company's annual meeting of stockholders, and increased premiums for E&O/D&O insurance.

Business development costs increased to $1,800 in the third quarter of 2021 compared to business development costs of $417 in the same period last year. The increase is primarily attributable to more activities related to capital raising, store acquisitions, and third-party management marketing expenses.

Interest expense for the third quarter of 2021 decreased to $257,000 from $291,000 in the year-ago period. This decrease was attributable to a lower amount of funds drawn and fluctuating interest expense on funds drawn on the company's revolving credit facility.

FFO in the third quarter of 2021 increased 59.3% to $957,000 or $0.09 per diluted share, compared to FFO of $601,000 or $0.06 per diluted share in the same period last year.

AFFO in the third quarter of 2021 increased 59.1% to $1.0 million or $0.10 per diluted share, compared to AFFO of $637,000 or $0.07 per diluted share in the same period last year.

First Nine Months 2021 Financial Summary

Total revenues increased 13.6% to $7.7 million in the first nine months of 2021, as compared to $6.8 million in the same period last year. The increase was primarily attributable to the West Henrietta, NY acquisition, increases in rental rates at the company's other wholly-owned stores, and to a lesser extent, the company's Millbrook, NY and West Henrietta, NY expansions.

Total operating expenses in the first nine months of 2021 decreased 3.2% to $5.9 million, compared to $6.1 million in the same period last year. The improvement was primarily attributable to a decrease in depreciation and amortization expense.

Net income was $1.9 million or $0.19 per diluted share in the first nine months of 2021, as compared to net loss of $41,000 or $(0.00) per diluted share in the same period last year.

First Nine Months 2021 Same-Store Results

For the first nine months of 2021, same-store revenues increased 9.9% to $6.1 million compared to $5.5 million in the same period last year. These increases were due primarily to consistent rent collections, despite the COVID-19 pandemic, and increased rental rates.

Same-store cost of operations in the first nine months of 2021 increased 3.8% to $2.3 million, compared to $2.2 million in the same period last year. This increase in same-store cost of operations was due primarily to increased landscaping expenses resulting from snow removal.

Same-store NOI increased 13.8% to $3.8 million in the first nine months of 2021, compared to $3.4 million in the same period last year. The increase was primarily due to the increase

in revenues.

Same-store occupancy at September 30, 2021 increased to 94.3% from 93.5% at September 30, 2020.

Same-store average duration of tenant stay at September 30, 2021 was 3.2 years, up from approximately 3.0 years as of September 30, 2020.

For a reconciliation of net income to same-store NOI see, "Reconciliation of GAAP Net Income to Same-Store Net Operating Income," below.

First Nine Months 2021 Operating Results

Net income in the first nine months of 2021 was $1.9 million or $0.19 per diluted share, compared to net loss of $41,000 or $(0.00) per diluted share in the first nine months of 2020.

General and administrative expenses decreased 1.0% to $1.80 million in the first nine months of 2021, compared to $1.82 million in the same period last year. The decrease was primarily attributable to a decrease in certain professional fees.

Business development costs were $6,600 in the first nine months of 2021 compared to business development costs of $10,500 in the same period last year. The decrease is primarily attributable to less expenses related to third-party management marketing, store acquisition, and capital raising expenses.

Interest expense for the first nine months of 2021 decreased to $829,000 from $891,000 in the same period last year.

FFO in the first nine months of 2021 increased 59.9% to $2.3 million or $0.24 per diluted share, compared to FFO of $1.5 million or $0.16 per diluted share in the same period last year.

AFFO in the first nine months of 2021 increased 58.0% to $2.5 million or $0.25 per diluted share, compared to AFFO of $1.6 million or $0.17 per diluted share in the same period last year.

Q3 and First Nine Months 2021 FFO and AFFO (unaudited)

	For the Three Months	For the Nine Months
	Ended September 30,	Ended September 30,
	2021			2020		2021			2020
Net income (loss)	$ 629,062		$	337,124		$ 1,901,608		$	(41,444
Eliminate items excluded from
FFO:
Unrealized gain on marketable	(81,992 )		(245,571 )	(791,189 )		(27,402
equity securities
Depreciation and amortization	409,763			509,219		1,221,938			1,527,901
FFO attributable to common	956,833			600,772		2,332,357			1,459,055
stockholders