AP NEWS
Press release content from Globe Newswire. The AP news staff was not involved in its creation.
PRESS RELEASE: Paid content from Globe Newswire
Press release content from Globe Newswire. The AP news staff was not involved in its creation.

Wheeler Real Estate Investment Trust, Inc. Announces 2018 Fourth Quarter and Year-End Financial Results

February 26, 2019

VIRGINIA BEACH, Va., Feb. 26, 2019 (GLOBE NEWSWIRE) -- Wheeler Real Estate Investment Trust, Inc. (NASDAQ:WHLR) (“WHLR” or the “Company”) today reported operating and financial results for the three and twelve months ending December 31, 2018.

Three Months Ended Twelve Months Ended December 31, December 31, 2018 2017 2018 2017 --------- --------- --------- --------- Net loss per common share $ (1.66 ) $ (1.22 ) $ (3.17 ) $ (2.54 ) FFO per common share and common unit (0.05 ) (0.56 ) 0.42 0.19 AFFO per common share and common unit 0.15 0.18 0.73 1.31

2018 FOURTH QUARTER HIGHLIGHTS(all comparisons to the same prior year period unless otherwise noted)

-- Paid down the Revere Term Loan with proceeds from the sale of the Monarch Bank Building for a contract price of $1.8 million, resulting in a gain of $151 thousand and proceeds of $299 thousand. -- Extended the Bulldog Investors Senior Convertible Notes to June 2019 with monthly principal and interest payments of $234 thousand. -- Extended the First National Bank and Lumber River loans for a total of $4.5 million in indebtedness, and extended the debt maturities to 2020. -- Paid $575 thousand on the Revere Term Loan from proceeds generated through the Riversedge North refinancing of $1.8 million, which extended the debt maturity to 2023. -- Recognized impairment charges of $5.5 million on goodwill, $3.9 million on land held for sale and $1.7 million on the Sea Turtle notes receivable. -- On December 20, 2018 the company suspended fourth quarter dividends on shares of its Series A Preferred Stock, Series B Convertible Preferred Stock and Series D Cumulative Convertible Preferred Stock, totaling approximately $3.0 million. -- Net loss attributable to WHLR’s common stock, $0.01 par value per share (“Common Stock”) shareholders of $15.8 million, or ($1.66) per share. -- Total revenue from continuing operations increased by 12.39% or $1.8 million. -- Property Net Operating Income (“NOI”) from continuing operations increased by 11.97% to approximately $11.2 million. -- Adjusted Funds from Operations (“AFFO”) of $0.15 per share of the Company’s Common Stock and common unit (“Common Unit”) in our operating partnership, Wheeler REIT, L.P.

2018 YEAR-TO-DATE HIGHLIGHTS

-- Backfilled 3 former Southeastern Grocers locations, which we recaptured in its bankruptcy proceeding, with two Low Country Grocers (Piggly Wiggly’s) at Ladson Crossing and South Park with rents that commenced in the third quarter 2018 and a third Piggly Wiggly at St. Matthews with rents commencing in the first quarter of 2019. -- Received approval on all Southeastern Grocers lease modifications by the bankruptcy court, representing 543 thousand square feet. -- Executed a lease termination fee of $980 thousand with Farm Fresh at Berkley Shopping Center. -- Reduced the KeyBank Credit Line to $52.1 million from $68.0 million at December 31, 2017. -- Reduced the Revere Term Loan to $1.1 million from $6.8 million at December 31, 2017. -- Sold 4 properties for a total of $11.6 million, resulting in a gain of $3.4 million and net proceeds of $6.3 million which were used to deleverage the balance sheet. -- Recorded a lease termination expense of $250 thousand to allow a space to be available for a high credit grocery store tenant at JANAF. -- Net loss attributable to Wheeler’s Common Stock shareholders of $29.3 million, or ($3.17) per share. -- Total revenue from continuing operations increased by 12.26% or $7.2 million. -- NOI from continuing operations increased by 15.05% to approximately $46.4 million. -- AFFO of $0.73 per share of the Company’s Common Stock and Common Unit. -- Reinvested $5.1 million in our properties through tenant improvements and capital expenditures.

SUBSEQUENT EVENTS

-- On January 11, 2019, the Company completed the sale of Jenks Plaza for a contract price of $2.20 million, resulting in a gain of $388 thousand with net proceeds of $1.84 million. Net proceeds were used to pay $323 thousand on the Revere Term Loan and $1.51 million on the First National Bank Line of Credit reducing the First National Bank Line of Credit to $1.42 million. -- On February 7, 2019, the Company completed the sale of a 1.28-acre parcel of non-income producing land at Harbor Pointe for a contract price of $550 thousand, resulting in net proceeds of $496 thousand. Net proceeds were used to pay off the associated debt and $30 thousand on the Revere Term Loan. Approximately 5 acres of land remain at Harbor Pointe. -- In January 2019, the Company extended the promissory notes at Perimeter Square extending the maturity dates to March 2019 from December 2018 and extended the maturity date on the Revere Term Loan to April 2019 from February 2019. -- Reduced the Revere Term Loan to $505 thousand, $200 thousand from monthly principal payments from operating cash and $353 thousand from sales proceeds noted above. -- Reduced the Bulldog Investors Senior Convertible Notes by $450 thousand to $919 thousand from $1.4 million through monthly principal payments from operating cash.

BALANCE SHEET

-- Cash and cash equivalents totaled $3.5 million at December 31, 2018, compared to $3.7 million at December 31, 2017. -- Total debt was $369.6 million at December 31, 2018 (including debt associated with assets held for sale), compared to $371.5 million at September 30, 2018. Our total debt at December 31, 2017 was $313.8 million. The increase in debt is primarily a result of $65.4 million in debt associated with the JANAF acquisition. -- WHLR’s weighted-average interest rate was 4.8% with a term of 4.31 years at December 31, 2018 (including debt associated with assets held for sale). This compares to an interest rate of 4.6% and a term of 4.81 years at December 31, 2017. -- Net investment properties as of December 31, 2018 totaled at $441.4 million (including assets held for sale), compared to $384.3 million as of December 31, 2017. -- Refinanced six properties off of the KeyBank Credit Line and the loan encumbering LaGrange for a total of $20.3 million, and extended debt maturities out 5 years to 2023. -- Paid down the Revere Term Loan, which matures in April 2019 with monthly principal payments of $100,000. The loan bears interest at 10.0%. The loan was paid down to $1.1 million, using the following sources: $4.3 million through property sales proceeds, $150 thousand through property refinancings and $1.3 million from operating cash. -- In conjunction with the JANAF acquisition, the Company issued and sold 1,363,636 shares of Series D Preferred Stock, in a public offering. Each share of Series D Preferred Stock was sold to investors at an offering price of $16.50 per share. Net proceeds from the public offering totaled $21.2 million, which includes the impact of the underwriters’ selling commissions, legal, accounting and other professional fees.

DIVIDENDS

-- For the quarter ended December 31, 2018, the Company had undeclared dividends of approximately $3.0 million to our holders of shares of our Series A Preferred Stock, Series B Preferred Stock, and Series D Preferred Stock. -- For the year ended December 31, 2018, the Company declared dividends of approximately $9.8 million and had undeclared dividends of $3.0 million to our holders of shares of our Series A Preferred Stock, Series B Preferred Stock, and Series D Preferred Stock.

OPERATIONS AND LEASING

-- The Company’s real estate portfolio is 89.4% leased. -- Q4-2018 Leasing Activity -- Executed 29 lease renewals totaling 131,600 square feet at a weighted-average increase of $0.53 per square foot, representing an increase of 4.83% over prior rates. -- Signed 8 new leases totaling approximately 56,579 square feet with a weighted-average rate of $10.38 per square foot. -- YTD 2018 Leasing Activity -- Executed 119 lease renewals totaling 693,970 square feet at a weighted-average increase of $0.52 per square foot, representing an increase of 6.05% over prior rates. -- Signed 55 new leases totaling approximately 290,986 square feet with a weighted-average rate of $9.06 per square foot. -- The Company’s gross leasable area (“GLA”), which is subject to leases that expire over the next twelve months, including month-to month leases declined to approximately 7.08% at December 31, 2018, compared to 9.39% at December 31, 2017. At December 31, 2018, 50.75% of this expiring GLA is subject to renewal options. -- Southeastern Grocers -- The Company modified thirteen leases with Southeastern Grocers anchor tenants and recaptured four locations. These modifications primarily include a combination of increases and decreases to lease term and rental rates, as well as deferred landlord contributions for remodels. The Company recaptured Ladson Crossing, St. Matthews, South Park, and Tampa Festival in the second quarter of 2018. The Cypress Shopping Center lease expired on March 31, 2018. As part of the negotiated recaptures the Company received $246 thousand during the year ended December 31, 2018. The remaining lease modifications were approved by the Southeastern Grocers’ bankruptcy court in the second quarter 2018. The initial annualized base rent impact of these modifications and recaptures is approximately $2.5 million. Three of these locations have been backfilled and two of these locations had rents commence in 2018 with the third location commencing rent in February 2019. These backfills reduce the impact on the Company’s annualized base rent to $1.9 million.

SAME STORE RESULTS

-- Same-store NOI for the three months ended December 31, 2018 compared to December 31, 2017, declined by (8.30%) and (10.62%) on a cash basis. The same-store pool for the 3 months ended December 31, 2018, was comprised of 4.9 million square feet that the Company owned as of January 1, 2017. Same-store results were driven by a 5.78% decrease in property revenues, a result of a full quarter of Southeastern Grocers recaptures and rent modifications accompanied by anchor lease expirations at South Lake and Walnut Hill, the impact of a full quarter of the lease termination at Berkley Shopping Center and loss of rents on the Monarch Bank Building and Shoppes at Eagle Harbor sold in 2018. Same Store property expenses decreased 1.17% as a result of lower insurance expenses. -- Same-store NOI for the year ended December 31, 2018 compared to December 31, 2017, declined by (4.01%) and (6.20%) on a cash basis. Same-store results for the year ended December 31, 2018, were driven, by a decrease of 2.66% in property revenues as a result of the impact of over half a year of Southeastern Grocers recaptures and rent modifications accompanied by anchor lease expirations at South Lake, Fort Howard and Walnut Hill, full year of rent modifications at Devine and loss of rents on the Monarch Bank Building and Shoppes at Eagle Harbor both sold in 2018, offset by $980 thousand in lease termination fees on Farm Fresh at Berkley Shopping Center. Property expenses increased 1.19% as a result of increased real estate taxes and utilities a direct result of vacant anchor space partially offset by a decrease in insurance expense. The tenant provision for credit losses decreased 12.25% primarily resulting from increased collections on accounts receivable.

ACQUISITIONS

-- As previously disclosed, the Company acquired JANAF, a retail shopping center located in Norfolk, Virginia, for a purchase price of $85.65 million in January 2018.

DISPOSITIONS

-- Sold Chipotle ground lease at Conyers Crossing for a contract price of $1.3 million, resulting in a gain of $1.0 million with net proceeds of $1.2 million. -- Sold an undeveloped land parcel at Laskin Road for a contract price of $2.9 million, resulting in a $903 thousand gain with net proceeds of $2.7 million. -- Sold Shoppes at Eagle Harbor for a contract price of $5.7 million, resulting in a $1.3 million gain with net proceeds of $2.1 million. -- Sold Monarch Bank Building for a contract price of $1.8 million, resulting in a $151 thousand gain with net proceeds of $299 thousand.

SUPPLEMENTAL INFORMATIONFurther details regarding Wheeler Real Estate Investment Trust, Inc.’s operations and financials for the period ended December 31, 2018, including a supplemental presentation, are available at https://ir.whlr.us/.

CONFERENCE CALL DIAL-IN AND WEBCAST INFORMATION:The Company will host a conference call and webcast on Wednesday, February 27, 2019 at 10:00 am Eastern Time to review its financial performance and operating results for the quarter ended December 31, 2018.

Conference Call and Webcast:U.S. & Canada Toll Free: (877) 407-3101 / International: (201) 493-6789Webcast: www.whlr.us via the Investor Relations Section

Replay:U.S. & Canada Toll Free: (877) 660-6853 / International: (201) 612-7415Conference ID#: 13679474Available February 27, 2019 (one hour after the end of the conference call) to March 27, 2019 at 10:00 am Eastern Time.

ABOUT WHEELER REAL ESTATE INVESTMENT TRUST, INC.Headquartered in Virginia Beach, VA, Wheeler Real Estate Investment Trust, Inc. is a fully-integrated, self-managed commercial real estate investment company focused on owning and operating income-producing retail properties with a primary focus on grocery-anchored centers. Wheeler’s portfolio contains well-located, potentially dominant retail properties in secondary and tertiary markets that generate attractive, risk-adjusted returns, with a particular emphasis on grocery-anchored retail centers. For additional information about the Company, please visit: www.whlr.us.

A copy of Wheeler’s Annual Report on Form 10-K, which includes the Company’s consolidated financial statements and management’s discussion & analysis of financial condition and results of operations, will be available upon filing via the U.S. Securities and Exchange Commission website ( www.sec.gov ) or through Wheeler’s website at www.whlr.us.

DEFINITIONSFFO, AFFO, Pro Forma AFFO, Property NOI, EBITDA and Adjusted EBITDA are non-GAAP financial measures within the meaning of the rules of the Securities and Exchange Commission. Wheeler considers FFO, AFFO, Pro Forma AFFO, Property NOI, EBITDA and Adjusted EBITDA to be important supplemental measures of its operating performance and believes it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO when reporting their results. FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. Because FFO excludes depreciation and amortization unique to real estate and gains and losses from property dispositions, the Company believes that it provides a performance measure that, when compared year-over-year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, development activities and interest costs, providing perspective not immediately apparent from the closest GAAP measurement, net income.

Management believes that the computation of FFO in accordance with NAREIT’s definition includes certain items that are not indicative of the operating performance of the Company’s real estate assets. These items include, but are not limited to, nonrecurring expenses, legal settlements, legal and professional fees, and acquisition costs. Management uses AFFO, which is a non- GAAP financial measure, to exclude such items. Management believes that reporting AFFO and Pro Forma AFFO in addition to FFO is a useful supplemental measure for the investment community to use when evaluating the operating performance of the Company on a comparative basis. Management also believes that Property NOI, EBITDA and Adjusted EBITDA represent important supplemental measures for securities analysts, investors and other interested parties, as they are often used in calculating net asset value, leverage and other financial metrics used by these parties in the evaluation of REITs.

FORWARD LOOKING STATEMENTSThis press release may contain “forward-looking” statements as defined in the Private Securities Litigation Reform Act of 1995. When the Company uses words such as “may,” “will,” “intend,” “should,” “believe,” “expect,” “anticipate,” “project,” “estimate” or similar expressions that do not relate solely to historical matters, it is making forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause the actual results to differ materially from the Company’s expectations discussed in the forward-looking statements. The Company’s expected results may not be achieved, and actual results may differ materially from expectations. Specifically, the Company’s statements regarding future generation of financial returns from its portfolio are forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control, are difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release.

Additional factors are discussed in the Company’s filings with the U.S. Securities and Exchange Commission, which are available for review at www.sec.gov. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.

INVESTOR CONTACT:Mary JensenInvestor Relations(757) 627-9088 mjensen@whlr.us

Wheeler Real Estate Investment Trust, Inc. and SubsidiariesConsolidated Statements of Operations(in thousands, except share and per share data)

Three Months Ended Years Ended December 31, December 31, 2018 2017 2018 2017 ----------- ----------- ----------- ----------- REVENUE: Rental revenues $ 12,589 $ 10,891 $ 50,952 $ 44,156 Asset management fees 46 120 189 927 Commissions 38 141 140 899 Tenant reimbursements 3,258 2,905 12,595 11,032 Development and other revenues 136 239 1,833 1,521 --------- - --------- - --------- - --------- - Total Revenue 16,067 14,296 65,709 58,535 --------- - --------- - --------- - --------- - OPERATING EXPENSES: Property operations 4,669 3,922 18,473 15,389 Non-REIT management and leasing services 16 (598 ) 75 927 Depreciation and amortization 6,151 5,776 27,094 26,231 Impairment of goodwill 5,486 — 5,486 — Provision for credit losses 99 2,378 434 2,821 Impairment of notes receivable 1,739 5,261 1,739 5,261 Corporate general & administrative 1,749 2,509 8,228 7,364 Other operating expenses — — 250 — --------- - --------- - --------- - --------- - Total Operating Expenses 19,909 19,248 61,779 57,993 Gain on disposal of properties 151 — 2,463 1,021 --------- - --------- - --------- - --------- - Operating (Loss) Income (3,691 ) (4,952 ) 6,393 1,563 Interest income 1 363 4 1,443 Interest expense (5,288 ) (4,168 ) (20,228 ) (17,165 ) --------- - --------- - --------- - --------- - Net Loss from Continuing Operations Before Income Taxes (8,978 ) (8,757 ) (13,831 ) (14,159 ) Income tax expense (benefit) 32 38 (40 ) (137 ) --------- - --------- - --------- - --------- - Net Loss from Continuing Operations (8,946 ) (8,719 ) (13,871 ) (14,296 ) --------- - --------- - --------- - --------- - Discontinued Operations (Loss) income from discontinued operations (3,938 ) — (3,938 ) 16 Gain on disposal of properties — — 903 1,502 --------- - --------- - --------- - --------- - Net (Loss) Income from Discontinued Operations (3,938 ) — (3,035 ) 1,518 --------- - --------- - --------- - --------- - Net Loss (12,884 ) (8,719 ) (16,906 ) (12,778 ) Less: Net loss attributable to noncontrolling interests (336 ) (519 ) (406 ) (684 ) --------- - --------- - --------- - --------- - Net Loss Attributable to Wheeler REIT (12,548 ) (8,200 ) (16,500 ) (12,094 ) Preferred Stock dividends - declared (169 ) (2,496 ) (9,790 ) (9,969 ) Preferred Stock dividends - undeclared (3,037 ) — (3,037 ) — --------- - --------- - --------- - --------- - Net Loss Attributable to Wheeler REIT Common Shareholders $ (15,754 ) $ (10,696 ) $ (29,327 ) $ (22,063 ) - ------- - - ------- - - ------- - - ------- - Loss per share from continuing operations (basic and $ (1.25 ) $ (1.22 ) $ (2.85 ) $ (2.70 ) diluted) (Loss) income per share from discontinued operations (0.41 ) — (0.32 ) 0.16 Total loss per share $ (1.66 ) $ (1.22 ) $ (3.17 ) $ (2.54 ) - ------- - - ------- - - ------- - - ------- - Weighted-average number of shares: Basic and Diluted 9,484,185 8,739,455 9,256,234 8,654,240 --------- - --------- - --------- - --------- -

Wheeler Real Estate Investment Trust, Inc. and SubsidiariesConsolidated Balance Sheets(in thousands, except par value and share data)

December 31, 2018 2017 ----------- ----------- ASSETS: Investment properties, net $ 433,142 $ 375,199 Cash and cash equivalents 3,544 3,677 Restricted cash 14,455 8,609 Rents and other tenant receivables, net 5,539 5,619 Notes receivable, net 5,000 6,739 Goodwill — 5,486 Assets held for sale 8,982 9,135 Above market lease intangible, net 7,346 8,778 Deferred costs and other assets, net 30,073 34,432 --------- - --------- - Total Assets $ 508,081 $ 457,674 - ------- - - ------- - LIABILITIES: Loans payable, net $ 360,117 $ 307,375 Liabilities associated with assets held for sale 4,632 792 Below market lease intangible, net 10,045 9,616 Accounts payable, accrued expenses and other liabilities 12,077 10,579 Dividends payable — 5,480 --------- - --------- - Total Liabilities 386,871 333,842 --------- - --------- - Commitments and contingencies — — Series D Cumulative Convertible Preferred Stock (no par value, 4,000,000 shares authorized, 3,600,636 and 2,237,000 shares issued and outstanding; $91.98 million and 76,955 53,236 $55.93 million aggregate liquidation preference, respectively) --------- - --------- - EQUITY: Series A Preferred Stock (no par value, 4,500 shares authorized, 562 shares issued 453 453 and outstanding) Series B Convertible Preferred Stock (no par value, 5,000,000 authorized, 1,875,748 and 1,875,848 shares issued and outstanding, respectively; $46.90 million aggregate 41,000 40,915 liquidation preference) Common Stock ($0.01 par value, 18,750,000 shares authorized, 9,511,464 and 8,744,189 95 87 shares issued and outstanding, respectively) Additional paid-in capital 233,697 226,978 Accumulated deficit (233,184 ) (204,925 ) --------- - --------- - Total Shareholders’ Equity 42,061 63,508 Noncontrolling interests 2,194 7,088 --------- - --------- - Total Equity 44,255 70,596 --------- - --------- - Total Liabilities and Equity $ 508,081 $ 457,674 - ------- - - ------- -

Wheeler Real Estate Investment Trust, Inc. and Subsidiaries Reconciliation of Funds From Operations (FFO)(unaudited, in thousands)

Three Months Ended December 31, Same Stores New Stores Total Year Over Year Changes 2018 2017 2018 2017 2018 2017 $ % ----------- ---------- --------- ---- ----------- ---------- ---------- ---------- Net loss $ (12,852 ) $ (8,719 ) $ (32 ) $ — $ (12,884 ) $ (8,719 ) $ (4,165 ) (47.77 )% Depreciation and amortization of real 4,855 5,776 1,296 — 6,151 5,776 375 6.49 % estate assets Impairment of 5,486 — — — 5,486 — 5,486 100.00 % goodwill Impairment of land 3,938 — — — 3,938 — 3,938 100.00 % Gain on disposal of (151 ) — — — (151 ) — (151 ) (100.00 )% properties --------- - -------- - ------- - --- --------- - -------- - -------- - ------- -- FFO $ 1,276 $ (2,943 ) $ 1,264 $ — $ 2,540 $ (2,943 ) $ 5,483 186.31 % - ------- - - ------ - - ----- - - - - ------- - - ------ - - ------ - ------- --

Years Ended December 31, Same Stores New Stores Total Year Over Year Changes 2018 2017 2018 2017 2018 2017 $ % ----------- ----------- --------- ---- ----------- ----------- ---------- ---------- Net loss $ (16,696 ) $ (12,778 ) $ (210 ) $ — $ (16,906 ) $ (12,778 ) $ (4,128 ) (32.31 )% Depreciation and amortization of real 22,386 26,231 4,708 — 27,094 26,231 863 3.29 % estate assets Impairment of goodwill 5,486 — — — 5,486 — 5,486 100.00 % Impairment of land 3,938 — — — 3,938 — 3,938 100.00 % Gain on disposal of (2,463 ) (1,021 ) — — (2,463 ) (1,021 ) (1,442 ) (141.23 )% properties Gain on disposal of properties-discontinued (903 ) (1,502 ) — — (903 ) (1,502 ) 599 39.88 % operations --------- - --------- - ------- - --- --------- - --------- - -------- - ------- -- FFO $ 11,748 $ 10,930 $ 4,498 $ — $ 16,246 $ 10,930 $ 5,316 48.64 % - ------- - - ------- - - ----- - - - - ------- - - ------- - - ------ - ------- --

Wheeler Real Estate Investment Trust, Inc. and Subsidiaries Reconciliation of Funds From Operations (FFO)(unaudited, in thousands)

Three Months Ended Years Ended December 31, December 31, 2018 2017 2018 2017 ----------- ---------- ----------- ----------- Net Loss $ (12,884 ) $ (8,719 ) $ (16,906 ) $ (12,778 ) Depreciation and amortization of real estate assets 6,151 5,776 27,094 26,231 Impairment of goodwill 5,486 — 5,486 — Impairment of land 3,938 — 3,938 — Gain on disposal of properties (151 ) — (2,463 ) (1,021 ) Gain on disposal of properties-discontinued operations — — (903 ) (1,502 ) --------- - -------- - --------- - --------- - FFO 2,540 (2,943 ) 16,246 10,930 Preferred stock dividends-declared (169 ) (2,496 ) (9,790 ) (9,969 ) Preferred stock dividends-undeclared (3,037 ) — (3,037 ) — Preferred stock accretion adjustments 169 204 678 809 --------- - -------- - --------- - --------- - FFO available to common shareholders and common unitholders (497 ) (5,235 ) 4,097 1,770 Impairment of notes receivable 1,739 5,261 1,739 5,261 Acquisition and development costs (46 ) 269 300 1,101 Capital related costs 168 195 576 663 Other non-recurring and non-cash expenses (1) — 117 103 294 Share-based compensation 213 135 940 870 Straight-line rent (244 ) (146 ) (1,197 ) (712 ) Loan cost amortization 681 578 2,363 3,087 Accrued interest income — 774 — 415 (Below) above market lease amortization (274 ) 5 (695 ) 453 Recurring capital expenditures and tenant improvement (285 ) (245 ) (1,143 ) (941 ) reserves --------- - -------- - --------- - --------- - AFFO $ 1,455 $ 1,708 $ 7,083 $ 12,261 - ------- - - ------ - - ------- - - ------- - Weighted Average Common Shares 9,484,185 8,739,455 9,256,234 8,654,240 Weighted Average Common Units 259,054 639,555 389,421 702,168 --------- - -------- - --------- - --------- - Total Common Shares and Units 9,743,239 9,379,010 9,645,655 9,356,408 --------- - -------- - --------- - --------- - FFO per Common Share and Common Units $ (0.05 ) $ (0.56 ) $ 0.42 $ 0.19 - ------- - - ------ - - ------- - - ------- - AFFO per Common Share and Common Units $ 0.15 $ 0.18 $ 0.73 $ 1.31 - ------- - - ------ - - ------- - - ------- -

(1) Other non-recurring expenses are described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2018.

Wheeler Real Estate Investment Trust, Inc. and SubsidiariesReconciliation of Property Net Operating Income(unaudited, in thousands)

Three Months Ended December 31, Same Store New Store Total 2018 2017 2018 2017 2018 2017 ----------- ----------- ---------- ---- ----------- ----------- (in thousands) Net Loss $ (12,852 ) $ (8,719 ) $ (32 ) $ — $ (12,884 ) $ (8,719 ) Adjustments: Net Loss from Discontinued Operations 3,938 — — — 3,938 — Income tax benefit (32 ) (38 ) — — (32 ) (38 ) Interest expense 4,542 4,168 746 — 5,288 4,168 Interest income (1 ) (363 ) — — (1 ) (363 ) Gain on disposal of properties (151 ) — — — (151 ) — Corporate general & administrative 1,729 2,509 20 — 1,749 2,509 Impairment of notes receivable 1,739 5,261 — — 1,739 5,261 Provision for credit losses- non-tenant — 2,364 — — — 2,364 Impairment of goodwill 5,486 — — — 5,486 — Depreciation and amortization 4,855 5,776 1,296 — 6,151 5,776 Non-REIT management and leasing services 16 (598 ) — — 16 (598 ) Development income — (83 ) — — — (83 ) Asset management and commission revenues (84 ) (261 ) — — (84 ) (261 ) --------- - --------- - -------- - --- --------- - --------- - Property Net Operating Income $ 9,185 $ 10,016 $ 2,030 $ — $ 11,215 $ 10,016 - ------- - - ------- - - ------ - - - - ------- - - ------- - Property revenues $ 13,146 $ 13,952 $ 2,837 $ — $ 15,983 $ 13,952 Property expenses 3,876 3,922 793 — 4,669 3,922 Provision for credit losses- tenant 85 14 14 — 99 14 --------- - --------- - -------- - --- Property Net Operating Income $ 9,185 $ 10,016 $ 2,030 $ — $ 11,215 $ 10,016 - ------- - - ------- - - ------ - - - - ------- - - ------- - Years Ended December 31, Same Store New Store Total 2018 2017 2018 2017 2018 2017 ----------- ----------- ---------- ---- ----------- ----------- (in thousands) Net Loss $ (16,696 ) $ (12,778 ) $ (210 ) $ — $ (16,906 ) $ (12,778 ) Adjustments: Net Loss (Income) from Discontinued 3,035 (1,518 ) — — 3,035 (1,518 ) Operations Income tax expense 40 137 — — 40 137 Interest expense 17,379 17,165 2,849 — 20,228 17,165 Interest income (4 ) (1,443 ) — — (4 ) (1,443 ) Gain on disposal of properties (2,463 ) (1,021 ) — — (2,463 ) (1,021 ) Other operating expenses — — 250 — 250 — Corporate general & administrative 8,136 7,364 92 — 8,228 7,364 Impairment of notes receivable 1,739 5,261 — — 1,739 5,261 Provision for credit losses- non-tenant (77 ) 2,364 — — (77 ) 2,364 Impairment of goodwill 5,486 — — — 5,486 — Depreciation and amortization 22,386 26,231 4,708 — 27,094 26,231 Non-REIT management and leasing services 75 927 — — 75 927 Development income — (537 ) — — — (537 ) Asset management and commission revenues (329 ) (1,826 ) — — (329 ) (1,826 ) --------- - --------- - -------- - --- --------- - --------- - Property Net Operating Income $ 38,707 $ 40,326 $ 7,689 $ — $ 46,396 $ 40,326 - ------- - - ------- - - ------ - - - - ------- - - ------- - Property revenues $ 54,680 $ 56,172 $ 10,700 $ — $ 65,380 $ 56,172 Property expenses 15,572 15,389 2,901 — 18,473 15,389 Provision for credit losses- tenant 401 457 110 — 511 457 --------- - --------- - -------- - --- Property Net Operating Income $ 38,707 $ 40,326 $ 7,689 $ — $ 46,396 $ 40,326 - ------- - - ------- - - ------ - - - - ------- - - ------- -

Wheeler Real Estate Investment Trust, Inc. and SubsidiariesReconciliation of Earnings Before Interest, Taxes, Depreciation and Amortization - EBITDA(unaudited, in thousands)

Three Months Ended Years Ended December 31, December 31, 2018 2017 2018 2017 ----------- ---------- ----------- ----------- Net Loss $ (12,884 ) $ (8,719 ) $ (16,906 ) $ (12,778 ) Add back: Depreciation and amortization(1) 5,877 5,781 26,399 26,684 Interest Expense (2) 5,288 4,168 20,228 17,174 Income tax (benefit) expense (32 ) (38 ) 40 137 --------- - -------- - --------- - --------- - EBITDA (1,751 ) 1,192 29,761 31,217 Adjustments for items affecting comparability: Acquisition and development costs (46 ) 269 300 1,101 Capital related costs 168 195 576 663 Other non-recurring and non-cash expenses(3) — 117 103 294 Impairment of goodwill 5,486 — 5,486 — Impairment of notes receivable 1,739 5,261 1,739 5,261 Impairment of land-discontinued operations 3,938 — 3,938 — Gain on disposal of properties (151 ) — (2,463 ) (1,021 ) Gain on disposal of properties-discontinued — — (903 ) (1,502 ) operations --------- - -------- - --------- - --------- - Adjusted EBITDA $ 9,383 $ 7,034 $ 38,537 $ 36,013 - ------- - - ------ - - ------- - - ------- -

(1) Includes above (below) market lease amortization.(2) Includes loan cost amortization and amounts associated with discontinued operations.(3) Other non-recurring expenses are described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the period ended December 31, 2018.

All contents © copyright 2019 The Associated Press. All rights reserved.