AMERICOLD REALTY TRUST [COLD] Filings

10-Q 1 art-20240930.htm 10-Q art-20240930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☑	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended	September 30, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
			For the transition period from to ,

Commission File Number: 001-34723

AMERICOLD REALTY TRUST, INC.

(Exact name of registrant as specified in its charter)


Maryland		93-0295215
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification Number)

10 Glenlake Parkway,	Suite 600, South Tower
Atlanta	Georgia	30328
(Address of principal executive offices)		(Zip Code)

(678) 441-1400

(Registrant’s telephone number, including area code)

_________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading symbol(s)

Name of each exchange on which registered

Common Stock, $0.01 par value per share

COLD

New York Stock Exchange

(NYSE)

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.


Class						Outstanding at November 5, 2024
Common Stock, $0.01 par value per share						284,258,255

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter periods that the registrant was required to submit such files).

Yes

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act (check one):

Large accelerated filer

☐

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Yes

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934)

Yes

☐


TABLE OF CONTENTS
			Page
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements			4
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			32
Item 3. Quantitative and Qualitative Disclosures About Market Risk			72
Item 4. Controls and Procedures			74

PART II - OTHER INFORMATION
Item 1. Legal Proceedings			74
Item 1A. Risk Factors			74
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			75
Item 3. Defaults Upon Senior Securities			75
Item 4. Mine Safety Disclosures			75
Item 5. Other Information			75
Item 6. Exhibits			75

SIGNATURES			77

PART I - FINANCIAL INFORMATION

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains statements about future events and expectations that constitute forward-looking statements. Forward-looking statements are based on our beliefs, assumptions and expectations of our future financial and operating performance and growth plans, taking into account the information currently available to us. These statements are not statements of historical fact. Forward-looking statements involve risks and uncertainties that may cause our actual results to differ materially from the expectations of future results we express or imply in any forward-looking statements, and you should not place undue reliance on such statements. Factors that could contribute to these differences include the following:

•rising inflationary pressures, increased interest rates and operating costs;

•labor and power costs;

•labor shortages;

•our relationship with our associates, the occurrence of any work stoppages or any disputes under our collective bargaining agreements and employment related litigation;

•the impact of supply chain disruptions;

•risks related to rising construction costs;

•risks related to expansions of existing properties and developments of new properties, including failure to meet budgeted or stabilized returns within expected time frames, or at all, in respect thereof;

•uncertainty of revenues, given the nature of our customer contracts;

•acquisition risks, including the failure to identify or complete attractive acquisitions or failure to realize the intended benefits from our recent acquisitions;

•difficulties in expanding our operations into new markets;

•uncertainties and risks related to public health crises;

•a failure of our information technology systems, systems conversions and integrations, cybersecurity attacks or a breach of our information security systems, networks or processes;

•risks related to implementation of the new ERP system;

•defaults or non-renewals of significant customer contracts;

•risks related to privacy and data security concerns, and data collection and transfer restrictions and related foreign regulations;

•changes in applicable governmental regulations and tax legislation;

•risks related to current and potential international operations and properties;

•actions by our competitors and their increasing ability to compete with us;

•changes in foreign currency exchange rates;

•the potential liabilities, costs and regulatory impacts associated with our in-house trucking services and the potential disruptions associated with our use of third-party trucking service providers to provide transportation services to our customers;

•liabilities as a result of our participation in multi-employer pension plans;

•risks related to the partial ownership of properties, including our JV investments;

•risks related to natural disasters;

•adverse economic or real estate developments in our geographic markets or the temperature-controlled warehouse industry;

•changes in real estate and zoning laws and increases in real property tax rates;

•general economic conditions;

•risks associated with the ownership of real estate generally and temperature-controlled warehouses in particular;

•possible environmental liabilities;

•uninsured losses or losses in excess of our insurance coverage;

•financial market fluctuations;

•our failure to obtain necessary outside financing on attractive terms, or at all;

•risks related to, or restrictions contained in, our debt financings;

•decreased storage rates or increased vacancy rates;

•the potential dilutive effect of our common stock offerings, including our ongoing at the market program;

•the cost and time requirements as a result of our operation as a publicly traded REIT; and

•our failure to maintain our status as a REIT.

The risks included here are not exhaustive, and additional factors could adversely affect our business and financial performance, including factors and risks included in other sections of this Quarterly Report on Form 10-Q. Words such as “anticipates,” “believes,” “continues,” “estimates,” “expects,” “goal,” “objectives,” “intends,” “may,” “opportunity,” “plans,” “potential,” “near-term,” “long-term,” “projections,” “assumptions,” “projects,” “guidance,” “forecasts,” “outlook,” “target,” “trends,” “should,” “could,” “would,” “will” and similar expressions are intended to identify such forward-looking statements, although not all forward-looking statements may contain such words. We qualify any forward-looking statements entirely by these cautionary factors. Other risks, uncertainties and factors, including those discussed under “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2023, and other reports filed with the Securities and Exchange Commission, could cause our actual results to differ materially from those projected in any forward-looking statements we make. We assume no obligation to update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future, except to the extent required by law.

As used in this report, unless the context otherwise requires, references to “we,” “us,” “our” and “the Company” refer to Americold Realty Trust, Inc., a Maryland corporation, and its consolidated subsidiaries, including Americold Realty Operating Partnership, L.P., a Delaware limited partnership and the subsidiary through which we conduct our business, which we refer to as “our Operating Partnership” or “the Operating Partnership,” and references to “common stock” refer to our common stock, $0.01 par value per share.

In addition, unless otherwise stated herein, when we refer to “cubic feet” in one of our temperature-controlled facilities, we refer to refrigerated cubic feet (as opposed to total cubic feet, refrigerated and otherwise) therein.


Item 1. Financial Statements
Americold Realty Trust, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
(In thousands, except shares and per share amounts)
	September 30, 2024		December 31, 2023
Assets
Property, buildings, and equipment:
Land	$	825,965	$	820,831
Buildings and improvements	4,488,472		4,464,359
Machinery and equipment	1,593,267		1,565,431
Assets under construction	593,515		452,312
	7,501,219		7,302,933
Accumulated depreciation	(2,413,063)		(2,196,196)
Property, buildings, and equipment – net	5,088,156		5,106,737

Operating leases - net	224,866		247,302
Financing leases - net	98,595		105,164

Cash, cash equivalents, and restricted cash	61,271		60,392
Accounts receivable – net of allowance of $22,222 and $21,647 at September 30, 2024 and December 31, 2023, respectively	460,310		426,048
Identifiable intangible assets – net	874,105		897,414
Goodwill	792,786		794,004
Investments in and advances to partially owned entities	43,470		38,113
Other assets	241,690		194,078
Total assets	$	7,885,249	$	7,869,252

Liabilities and equity
Liabilities:
Borrowings under revolving line of credit	$	268,508	$	392,156
Accounts payable and accrued expenses	567,356		568,764
Senior unsecured notes and term loans – net of deferred financing costs of $14,568 and $10,578, in the aggregate, at September 30, 2024 and December 31, 2023, respectively	3,100,441		2,601,122
Sale-leaseback financing obligations	80,326		161,937
Financing lease obligations	88,869		97,177
Operating lease obligations	220,796		240,251
Unearned revenue	26,350		28,379
Deferred tax liability - net	130,924		135,797
Other liabilities	8,728		9,082
Total liabilities	4,492,298		4,234,665
Commitments and contingencies (Note 8 - Commitments and Contingencies)
Equity
Stockholders' equity
Common stock, 0.01 par value per share – 500,000,000 authorized shares; 284,257,368 and 283,699,120 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively	2,842		2,837
Paid-in capital	5,642,286		5,625,907
Accumulated deficit and distributions in excess of net earnings	(2,242,604)		(1,995,975)
Accumulated other comprehensive loss	(32,786)		(16,640)
Total stockholders’ equity	3,369,738		3,616,129
Noncontrolling interests	23,213		18,458
Total equity	3,392,951		3,634,587

Total liabilities and equity	$	7,885,249	$	7,869,252
See accompanying notes to Condensed Consolidated Financial Statements.


Americold Realty Trust, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations (Unaudited)
(In thousands, except per share amounts)
	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Revenues:
Rent, storage, and warehouse services	$	612,181	$	602,605	$	1,810,278	$	1,778,827
Transportation services	51,764		55,642		159,254		181,792
Third-party managed services	10,226		9,692		30,574		33,419
Total revenues	674,171		667,939		2,000,106		1,994,038
Operating expenses:
Rent, storage, and warehouse services cost of operations	413,557		424,773		1,209,992		1,253,326
Transportation services cost of operations	43,323		45,983		130,441		150,664
Third-party managed services cost of operations	8,073		8,063		24,136		29,311
Depreciation and amortization	89,362		89,728		271,106		259,644
Selling, general, and administrative	63,663		52,383		188,542		169,023
Acquisition, cyber incident, and other, net	26,014		13,931		44,025		48,313
Loss (gain) from sale of real estate	—		78		(3,514)		(2,259)
Total operating expenses	643,992		634,939		1,864,728		1,908,022

Operating income	30,179		33,000		135,378		86,016

Other income (expense):
Interest expense	(34,255)		(35,572)		(100,865)		(106,426)
Loss on debt extinguishment and termination of derivative instruments	(218)		(683)		(116,082)		(1,855)
Loss from investments in partially owned entities	(1,037)		(259)		(3,020)		(1,616)
Impairment of related party loan receivable	—		—		—		(21,972)
Loss on put option	—		—		—		(56,576)
Other, net	770		723		24,919		1,741
Loss from continuing operations before income taxes	(4,561)		(2,791)		(59,670)		(100,688)

Income tax (expense) benefit:
Current income tax	(1,936)		(1,981)		(5,168)		(5,881)
Deferred income tax	2,764		2,473		6,498		7,553
Total income tax benefit	828		492		1,330		1,672

Net loss:
Net loss from continuing operations	(3,733)		(2,299)		(58,340)		(99,016)
Gain (loss) from discontinued operations, net of tax	—		203		—		(10,453)
Net loss	$	(3,733)	$	(2,096)	$	(58,340)	$	(109,469)
Net loss attributable to noncontrolling interests	(4)		(8)		(242)		(95)
Net loss attributable to Americold Realty Trust, Inc.	$	(3,729)	$	(2,088)	$	(58,098)	$	(109,374)

Weighted average common stock outstanding – basic	284,861		278,137		284,729		273,217
Weighted average common stock outstanding – diluted	284,861		278,137		284,729		273,217

Net loss per common share from continuing operations - basic	$	(0.01)	$	(0.01)	$	(0.20)	$	(0.36)
Net loss per common share from discontinued operations - basic	—		—		—		(0.04)
Basic loss per share	$	(0.01)	$	(0.01)	$	(0.20)	$	(0.40)

Net loss per common share from continuing operations - diluted	$	(0.01)	$	(0.01)	$	(0.20)	$	(0.36)
Net loss per common share from discontinued operations - diluted	—		—		—		(0.04)
Diluted loss per share	$	(0.01)	$	(0.01)	$	(0.20)	$	(0.40)

See accompanying notes to Condensed Consolidated Financial Statements.


Americold Realty Trust, Inc. and Subsidiaries
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)
(In thousands)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Net loss	$	(3,733)	$	(2,096)	$	(58,340)	$	(109,469)
Other comprehensive (loss) income - net of tax:
Adjustment to accrued pension liability	(13)		(832)		(117)		(522)
Unrealized net gain (loss) on foreign currency	4,020		(10,467)		(7,185)		(4,145)
Unrealized net (loss) gain on cash flow hedges	(22,480)		12,381		(8,844)		22,176
Other comprehensive (loss) income - net of tax attributable to Americold Realty Trust, Inc.	(18,473)		1,082		(16,146)		17,509
Other comprehensive (loss) income attributable to noncontrolling interests	(104)		101		(121)		178
Total comprehensive loss	$	(22,310)	$	(913)	$	(74,607)	$	(91,782)

See accompanying notes to Condensed Consolidated Financial Statements.


Americold Realty Trust, Inc. and Subsidiaries
Condensed Consolidated Statements of Equity (Unaudited)
(In thousands, except share amounts)

	Common Stock					Accumulated Deficit and Distributions in Excess of Net Earnings		Accumulated Other Comprehensive (Loss) Income		Noncontrolling Interests

	Number of Shares	Par Value		Paid-in Capital
												Total
Balance - December 31, 2023	283,699,120	$	2,837	$	5,625,907	$	(1,995,975)	$	(16,640)	$	18,458	$	3,634,587
Net income	—	—		—		9,740		—		62		9,802
Other comprehensive income	—	—		—		—		12,106		51		12,157
Distributions on common stock, restricted stock and OP units	—	—		—		(62,743)		—		(233)		(62,976)
Stock-based compensation expense	—	—		4,849		—		—		1,770		6,619
Common stock issuance related to stock-based payment plans, net of shares withheld for employee taxes	276,843	3		(284)		—		—		—		(281)
Common stock issuance related to employee stock purchase plan	58,148	—		1,496		—				—		1,496
Balance - March 31, 2024	284,034,111	$	2,840	$	5,631,968	$	(2,048,978)	$	(4,534)	$	20,108	$	3,601,404
Net loss	—	—		—		(64,109)		—		(300)		(64,409)
Other comprehensive loss	—	—		—		—		(9,779)		(68)		(9,847)
Distributions on common stock, restricted stock and OP units	—	—		—		(62,948)		—		(290)		(63,238)
Stock-based compensation expense	—	—		3,771		—		—		2,293		6,064
Common stock issuance related to stock-based payment plans, net of shares withheld for employee taxes	45,026	—		(386)		—		—		—		(386)
Balance - June 30, 2024	284,079,137	$	2,840	$	5,635,353	$	(2,176,035)	$	(14,313)	$	21,743	$	3,469,588
Net loss	—	—		—		(3,729)		—		(4)		(3,733)
Other comprehensive loss	—	—		—		—		(18,473)		(104)		(18,577)
Distributions on common stock, restricted stock and OP units	—	—		—		(62,840)		—		(349)		(63,189)
Stock-based compensation expense	—	—		4,272		—		—		2,911		7,183
Common stock issuance related to stock-based payment plans, net of shares withheld for employee taxes	69,340	1		105		—		—		—		106
Common stock issuance related to employee stock purchase plan	72,441	1		1,572		—		—		—		1,573

Conversion of OP units to common stock	36,450	—		984		—		—		(984)		—
Balance - September 30, 2024	284,257,368	$	2,842	$	5,642,286	$	(2,242,604)	$	(32,786)	$	23,213	$	3,392,951


Americold Realty Trust, Inc. and Subsidiaries
Condensed Consolidated Statements of Equity (Unaudited)
(In thousands, except share amounts)

	Common Stock					Accumulated Deficit and Distributions in Excess of Net Earnings		Accumulated Other Comprehensive (Loss) Income		Noncontrolling Interests

	Number of Shares	Par Value		Paid-in Capital
												Total
Balance - December 31, 2022	269,814,956	$	2,698	$	5,191,969	$	(1,415,198)	$	(6,050)	$	14,459	$	3,787,878
Net loss	—	—		—		(2,562)		—		(9)		(2,571)
Other comprehensive loss	—	—		—		—		(11,687)		(35)		(11,722)
Distributions on common stock, restricted stock and OP units	—	—		—		(59,692)		—		(240)		(59,932)
Stock-based compensation expense	—	—		5,273		—		—		1,697		6,970
Common stock issuance related to stock-based payment plans, net of shares withheld for employee taxes	221,084	2		(801)		—		—		—		(799)
Common stock issuance related to employee stock purchase plan	60,393	1		1,452		—		—		—		1,453
Balance - March 31, 2023	270,096,433	$	2,701	$	5,197,893	$	(1,477,452)	$	(17,737)	$	15,872	$	3,721,277
Net loss	—	—		—		(104,724)		—		(78)		(104,802)
Other comprehensive income	—	—		—		—		28,114		112		28,226
Distributions on common stock, restricted stock and OP units	—	—		—		(59,696)		—		(225)		(59,921)
Stock-based compensation expense	—	—		3,476		—		—		1,163		4,639
Common stock issuance related to stock-based payment plans, net of shares withheld for employee taxes	15,035	—		340		—		—		—		340
Conversion of OP units to common stock	74,808	1		2,182		—		—		(2,183)		—
Balance - June 30, 2023	270,186,276	$	2,702	$	5,203,891	$	(1,641,872)	$	10,377	$	14,661	$	3,589,759
Net loss	—	—		—		(2,088)		—		(8)		(2,096)
Other comprehensive income	—	—		—		—		1,082		101		1,183
Distributions on common stock, restricted stock and OP units	—	—		—		(62,631)		—		(237)		(62,868)
Stock-based compensation expense	—	—		3,925		—		—		2,278		6,203
Common stock issuance related to stock-based payment plans, net of shares withheld for employee taxes	20,030	—		(43)		—		—		—		(43)
Common stock issuance related to employee stock purchase plan	65,802	1		1,593		—		—		—		1,594
Net proceeds from issuance of common stock	13,244,905	132		412,786		—		—		—		412,918
Balance - September 30, 2023	283,517,013	$	2,835	$	5,622,152	$	(1,706,591)	$	11,459	$	16,795	$	3,946,650

See accompanying notes to Condensed Consolidated Financial Statements.


Americold Realty Trust, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
	Nine Months Ended September 30,
	2024		2023
Operating activities:
Net loss	$	(58,340)	$	(109,469)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	271,106		259,644
Amortization of deferred financing costs and pension withdrawal liability	3,884		3,805
Loss on debt extinguishment and termination of derivative instruments	116,082		1,855
Loss from investments in partially owned entities	3,020		5,727
Stock-based compensation expense	19,866		17,812
Deferred income tax benefit	(6,498)		(7,553)
Gain from sale of real estate	(3,514)		(2,259)
(Gain) loss from other asset disposals	(945)		388
Impairment of indefinite and long-lived assets	2,953		—
Provision for doubtful accounts receivable	2,984		3,241
Impairment of related party loan receivable	—		21,972
Loss on put option	—		56,576
Loss on classification of Comfrio as held for sale	—		4,616
Non-cash lease expenses	28,289		32,346
Changes in operating assets and liabilities:
Accounts receivable	(35,900)		(2,436)
Accounts payable and accrued expenses	610		(39,175)
Other assets	(61,795)		(34,181)
Operating lease liabilities	(26,386)		(28,054)
Other	(6,144)		8,358
Net cash provided by operating activities	249,272		193,213

Investing activities:
Additions to property, buildings and equipment	(204,257)		(188,317)
Business combinations	—		(46,652)
Acquisitions of property, buildings and equipment	—		(43,577)
Investments in and advances to partially owned entities and other	(11,445)		(20,025)
Net payments for sale of business (discontinued operations)	—		(4,616)
Proceeds from sale of property, buildings and equipment	9,255		7,913
Proceeds from sale of investments in partially owned entities	—		36,896
Net cash used in investing activities	(206,447)		(258,378)

Financing activities:
Distributions paid on common stock, restricted stock units and noncontrolling interests	(189,181)		(179,562)
Proceeds from stock options exercised	2,777		1,734
Proceeds from employee stock purchase plan	3,069		3,047
Remittance of withholding taxes related to employee stock-based transactions	(3,338)		(2,236)
Proceeds from revolving line of credit	759,224		545,421
Repayment on revolving line of credit	(885,314)		(679,155)
Repayment of sale-leaseback financing obligations	(5,766)		(6,717)
Termination of sale-leaseback financing obligations	(190,954)		—
Repayment of financing lease obligations	(28,118)		(26,390)
Payment of debt issuance costs	(4,176)		—
Proceeds from issuance of senior unsecured notes	500,000		—
Net proceeds from issuance of common stock	—		412,918
Net cash (used in) provided by financing activities	(41,777)		69,060
Net increase in cash, cash equivalents and restricted cash	1,048		3,895
Effect of foreign currency translation on cash, cash equivalents and restricted cash	(169)		(3,127)
Cash, cash equivalents and restricted cash:
Beginning of period	60,392		53,063
End of period	$	61,271	$	53,831

See accompanying notes to Condensed Consolidated Financial Statements.


Americold Realty Trust, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (Unaudited) (Continued)
(In thousands)
	Nine Months Ended September 30,
	2024		2023
Supplemental disclosures of non-cash investing and financing activities:
Addition of property, buildings and equipment on accrual	$	29,522	$	37,823
Addition of property, buildings and equipment under financing lease obligations	$	20,341	$	23,786
Addition of property, buildings and equipment under operating lease obligations	$	1,309	$	6,049

Supplemental cash flow information:
Interest paid – net of amounts capitalized	$	109,986	$	116,411
Income taxes paid – net of refunds	$	5,916	$	5,480

	As of September 30,
Allocation of purchase price of property, buildings and equipment to:	2024		2023
Land	$	—	$	11,447
Buildings and improvements	—		22,300
Machinery and equipment	—		9,830
Cash paid for acquisitions of property, buildings and equipment	$	—	$	43,577

	As of September 30,
	2024		2023
Allocation of purchase price to business combinations:





Assets of discontinued operations - held for sale	$	—	$	86,085
Accounts payable and accrued expenses(1)	—		46,652
Liabilities of discontinued operations - held for sale	—		(86,085)
Total consideration	$	—	$	46,652

(1)Accounts payable and accrued expenses activity as of September 30, 2023 represents the relief of the remaining put option liability for Comfrio.

See accompanying notes to Condensed Consolidated Financial Statements.

Table of Contents

Americold Realty Trust, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

1. General

The Company

Americold Realty Trust, Inc. together with its subsidiaries (“ART”, “Americold”, the “Company”, “us” or “we”) is a Maryland corporation that operates as a real estate investment trust (“REIT”) for U.S. federal income tax purposes. The Company is a global leader in temperature-controlled storage, logistics, real estate and value added services, and is focused on the ownership, operation, acquisition and development of temperature-controlled warehouses. The Company operates 239 warehouses globally, with 195 in North America, 25 in Europe, 17 in Asia-Pacific, and 2 in South America as of September 30, 2024.

Our business includes three primary business segments: warehouse, transportation and third-party managed. We have minority interests in two joint ventures: SuperFrio (operates 35 temperature-controlled warehouses in Brazil) and RSA (operates two temperature-controlled warehouses in Dubai).

Basis of Presentation and Principles of Consolidation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”) for interim financial information, and with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). These unaudited Condensed Consolidated Financial Statements do not include all disclosures associated with the Company’s Consolidated Annual Financial Statements included in its 2023 Annual Report on Form 10-K as filed with the SEC, and, accordingly, should be read in conjunction with the referenced annual report. In the opinion of management, the Condensed Consolidated Financial Statements reflect all adjustments considered necessary for a fair presentation. Adjustments which are not considered normal or recurring in nature have been disclosed within Note 3 - Acquisition, cyber incident and other, net to these Condensed Consolidated Financial Statements. The accompanying Condensed Consolidated Financial Statements also include the accounts of the Company and its wholly owned subsidiaries where the Company exerts control. Intercompany balances and transactions have been eliminated. Operating results for the interim periods presented are not necessarily indicative of the results that may be expected for the full year. Investments in which the Company does not have control, and is not the primary beneficiary of a Variable Interest Entity (“VIE”), but where the Company exercises significant influence over the operating and financial policies of the investee, are accounted for using the equity method of accounting.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of (1) assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements and (2) revenues and expenses during the reporting period. Actual results could differ from those estimates.

Reclassifications

The Condensed Consolidated Statement of Cash Flows includes various reclassifications, all within Cash Provided by Operating Activities, to conform current and prior period presentation.

Americold Realty Trust, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

Recent Capital Markets Activity

Universal Shelf Registration Statement

On March 17, 2023, the Company and the Operating Partnership filed with the SEC an automatic shelf registration statement on Form S-3 (Registration No. 333-270664 and 333-270664-01) (as amended from time to time, the “Registration Statement”), registering an indeterminate amount of (i) the Company’s common stock, $0.01 par value per share, (ii) the Company’s preferred stock, $0.01 par value per share, (iii) depositary shares representing entitlement to all rights and preferences of fractions of the Company’s preferred shares of a specified series and represented by depositary receipts, (iv) warrants to purchase the Company’s common stock or preferred stock or depositary shares and (v) debt securities of the Operating Partnership, which may be fully and unconditionally guaranteed by the Company and certain subsidiaries of the Company. The Registration Statement was amended on September 3, 2024 to add certain direct and indirect subsidiaries of the Company as co-registrants to the Registration Statement, since each such co-registrant may be a guarantor of some or all of the debt securities of the Operating Partnership with respect to which offers and sales are registered under the Registration Statement.

At the Market (ATM) Equity Program

On March 17, 2023, the Company entered into an equity distribution agreement pursuant to which we could sell, from time to time, up to an aggregate sales price of $900.0 million of our common stock through an ATM Equity Program (the “Prior ATM Equity Program”). Sales of our common stock made pursuant to the Prior ATM Equity Program could be made in negotiated transactions or transactions that are deemed to be “at the market” offerings as defined in Rule 415 under the Securities Act, including sales made directly on the NYSE, or sales made to or through a market maker other than on an exchange, or as otherwise agreed between the applicable Agent and the Company. Sales could also be made on a forward basis pursuant to separate forward sale agreements.

During August 2023, we sold 13,244,905 common shares under the Prior ATM Equity Program for net proceeds of $412.6 million. The net proceeds from sales of our common stock pursuant to the Prior ATM Equity Program were used to repay a portion of the revolver borrowings.

On November 9, 2023, we entered into an equity distribution agreement that was substantially identical to and replaced the prior equity distribution agreement, pursuant to which we may sell, from time to time, up to an additional $900.0 million of our common shares through our ATM Equity Program (the “Current ATM Equity Program”). During the three and nine months ended September 30, 2024, we did not sell any shares of our common stock under the Current ATM Equity Program.

Project Orion

In February 2023, we announced our transformation program “Project Orion” designed to drive future growth and achieve our long-term strategic objectives, through investment in our technology systems and business processes across our global platform. The project includes the implementation of a new, best-in-class, cloud-based enterprise resource planning (“ERP”) software system. The primary goals of this project are to streamline standard processes, reduce manual work and incrementally improve our business analytics capabilities. Highlights of the project include implementing centralized customer billing operations, a global payroll and human capital management platform, next-generation warehouse maintenance capabilities, global procurement functionality and shared-service operations in certain international regions, among others. We expect the benefits of these initiatives to include revenue and margin improvements through pricing data and analytics and heightened customer contract

Americold Realty Trust, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

governance, finance and human resources cost reductions, information technology applications and infrastructure rationalization, reduced employee turnover, working capital efficiency and reduced IT maintenance capital expenditures. The activities associated with Project Orion are expected to be substantially complete within three years from the project’s start date. Since inception, the Company has incurred $138.3 million of implementation costs related to Project Orion, including expenses reported in “Acquisition, cyber incident, and other, net” on the Condensed Consolidated Statements of Operations and costs deferred in “Other assets” on the Condensed Consolidated Balance Sheets. The unamortized balance of the Project Orion deferred costs was $76.0 million as of September 30, 2024.

During the three months ended June 30, 2024, the Company deployed the first phase of Project Orion. The implementation costs deferred within “Other assets” on the Condensed Consolidated Balance Sheets are now being amortized through “Selling, general, and administrative” expense on the Condensed Consolidated Statements of Operations. The useful lives of the Company’s internal-use software and capitalized cloud computing implementation costs are generally three to five years. However, the useful lives of major information system installations, such as implementations of ERP systems and certain related software, are determined on an individual basis and may exceed five years depending on the estimated period of use. The Company has determined the useful life of the new ERP system to be ten years and is amortizing the costs associated with the ERP implementation on a straight line basis over such period. The amortization expense recognized during the three and nine months ended September 30, 2024 related to the Project Orion ERP implementation was $1.8 million and $2.4 million, respectively.

For further information regarding Project Orion, refer to the Consolidated Financial Statements included in our 2023 Annual Report on Form 10-K as filed with the SEC.

Cybersecurity Incident

On April 26, 2023, the Company became aware of a cybersecurity incident impacting a certain number of our systems and partially impacting operations for a limited period of time (the “Cyber Incident”). The Company engaged an external cyber security expert to initiate responses to contain and remediate the incident, and conduct a forensic investigation. Actions taken included preventative measures such as shutting down certain operating systems, supplementing existing security monitoring with additional scanning and other protective measures. The Company also notified law enforcement and its customers, informing them of both the incident and management’s efforts to minimize its impact on the Company’s daily operations. Technology information systems were reintroduced in a controlled phased approach and all locations successfully resumed operations at pre-cyberattack levels by June 30, 2023.

As noted above, the Company engaged a leading cybersecurity defense firm that completed a forensic investigation of the incident and provided recommended actions in response to the findings. The Company has completed many of the recommended remediation activities associated with the Cyber Incident. We continue to enhance our policies and procedures meant to assess, identify, and effectively manage cybersecurity risks, threats, and incidents.

Incremental charges recorded in conjunction with remediation and response efforts associated with the Cyber Incident have been recorded net of insurance recoveries within “Acquisition, cyber incident, and other, net” in the Condensed Consolidated Statements of Operations. This amount was primarily comprised of incremental internal labor costs, professional fees, customer claims, and related insurance deductibles.

Foreign Currency Related Transactions

Americold Realty Trust, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

Exchange rate adjustments resulting from foreign currency transactions are recognized in “Net loss” in the Condensed Consolidated Statements of Operations, whereas effects resulting from the translation of financial statements are recognized in “Unrealized net gain (loss) on foreign currency” in the Condensed Consolidated Statements of Comprehensive Income (Loss). Assets and liabilities of subsidiaries operating outside the United States with a functional currency other than U.S. dollars are translated into U.S. dollars using period-end exchange rates and income statement accounts are translated at weighted average exchange rates.

For the three months ended September 30, 2024 and 2023, the amount of foreign currency remeasurement recognized in the Condensed Consolidated Statements of Operations within “Other, net” was a loss of $0.3 million and a loss of $0.7 million, respectively. For the nine months ended September 30, 2024 and 2023, the amount of foreign currency remeasurement recognized in the Condensed Consolidated Statements of Operations within “Other, net” was a gain of $10.6 million and a loss of $0.5 million, respectively. The amount recognized for the nine months ended September 30, 2024 includes an adjustment related to our net investment hedges further described in Note 5 - Derivative Financial Instruments to these Condensed Consolidated Financial Statements.

For the three months ended September 30, 2024 and 2023 , the amount of foreign currency translation recognized in the Condensed Consolidated Statements of Comprehensive Income (Loss) within “Unrealized net gain (loss) on foreign currency” was a gain of $4.0 million and a loss of $10.5 million, respectively. For the nine months ended September 30, 2024 and 2023, the amount of foreign currency translation recognized in the Condensed Consolidated Statements of Comprehensive Income (Loss) within “Unrealized net gain (loss) on foreign currency” was a loss of $7.2 million and a loss of $4.1 million, respectively.

Loss on Debt Extinguishment

During the nine months ended September 30, 2024, the Company purchased eleven facilities in the Company’s lease portfolio that were previously accounted for as failed sale-leaseback financing obligations. Total cash outflows related to these purchases of $191.0 million are included within “Termination of sale-leaseback financing obligations” on the Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2024.

These purchases resulted in the recognition of a $115.1 million loss on debt extinguishment during the nine months ended September 30, 2024. These amounts are recognized within “Loss on debt extinguishment and termination of derivative instruments” on the Condensed Consolidated Statement of Operations included herein.

Recent Rules and Accounting Pronouncements

In March 2024, the Securities and Exchange Commission (the “SEC”) adopted the final rules that will require certain climate-related information in registration statements and annual reports. In April 2024, the SEC voluntarily stayed the new rules as a result of pending legal challenges. The new rules include a requirement to disclose material climate-related risks, descriptions of board oversight and risk management activities, the material impacts of these risks on a registrants’ strategy, business model and outlook, and any material climate-related targets or goals, as well as material effects of severe weather events and other natural conditions and greenhouse gas emissions. Prior to the stay, the new rules would have been effective for annual periods beginning January 1, 2025, except for the greenhouse gas emissions disclosure which would have been effective for annual periods beginning January 1, 2026. The Company is currently evaluating the impact of these rules on its disclosures.

Americold Realty Trust, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”), which is intended to enhance the transparency and decision usefulness of income tax disclosures. The amendments in ASU 2023-09 provide for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for the Company prospectively for all annual periods beginning after December 15, 2024. Early adoption is permitted. The Company is currently evaluating the impact of this standard on its disclosures.

In November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” (“ASU 2023-07”), which enhances the disclosures required for operating segments in the Company's annual and interim consolidated financial statements. ASU 2023-07 is effective retrospectively for fiscal years beginning after December 15, 2023 and for interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company expects that certain additional disclosures will be included in the Form 10-K as of December 31, 2024.

All other new accounting pronouncements that have been issued, but not yet effective are currently being evaluated and at this time are not expected to have a material impact on our financial position or results of operations.

2. Acquisitions & Discontinued Operations

Purchase of Comfrio Joint Venture

During 2020, the Company acquired 22% of equity ownership in Agrofundo Brazil II Fundode Investimento em Participações or the “Comfrio” joint venture. The joint venture agreement included a fair value call/put option that allowed the remaining 78% interest in Comfrio to be either purchased by or sold to the Company through either the exercise of the Company’s call option or the exercise of the general partner’s put option. Once the exercise of the put was deemed probable, the Company remeasured its equity interest, which was deemed to be nominal, and the fair value of the put option, which resulted in a loss of $56.6 million recognized within “Loss on put option” in our Condensed Consolidated Statement of Operations. The fair value of the put option was determined using inputs classified as Level 3 within the fair value hierarchy. In April 2023, the two parties received regulatory approval from the Brazilian government, and the acquisition closed on May 30, 2023.

Upon acquisition, the Company committed to a plan to sell Comfrio in its present condition and initiated a program to locate a buyer and complete the disposition. In August 2023, the Company sold the assets and liabilities of Comfrio. The Comfrio acquisition and disposition are further described in Note 3 - Business Combinations and Asset Acquisitions to the Consolidated Financial Statements in the Company’s 2023 Annual Report on Form 10-K as filed with the SEC.

The primary components of “Gain (loss) from discontinued operations, net of tax” in our Condensed Consolidated Statements of Operations during the three and nine months ended September 30, 2024 and 2023 are included in the table below (in thousands):

Americold Realty Trust, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
Results of discontinued operations	2024		2023		2024		2023
Revenue	$	—	$	15,234	$	—	$	29,471
Operating expenses	—		15,547		—		32,088
Estimated costs of disposal	—		616		—		4,616
Loss from partial investment pre-acquisition	—		—		—		4,111
Gain from sale of Comfrio	—		(1,082)		—		(1,082)
Pre-tax gain (loss)	—		153		—		(10,262)
Income tax benefit (expense)	—		50		—		(191)
Gain (loss) from discontinued operations, net of tax	$	—	$	203	$	—	$	(10,453)

During the fourth quarter of 2022, the Company entered into a loan agreement with Comfrio, in which Comfrio borrowed $25.0 million from Americold at a 10% annual fixed interest rate. During the nine months ended September 30, 2023, the Company fully impaired the remaining balance and recognized the entire loss within “Impairment of related party loan receivable” in our Condensed Consolidated Statements of Operations.

Sale of Outstanding Minority Ownership in LATAM JV

On May 30, 2023, the Company sold its 15% equity interest to our JV partner for total proceeds of $36.9 million and recognized a corresponding gain of $0.3 million in “Other, net,” in our Condensed Consolidated Statements of Operations.

3. Acquisition, Cyber Incident, and Other, Net

The components of the charges and credits included in “Acquisition, cyber incident, and other, net” in our Condensed Consolidated Statements of Operations are as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
Acquisition, cyber incident, and other, net	2024		2023		2024		2023
Project Orion expenses	$	21,595	$	3,215	$	41,393	$	7,703
Acquisition and integration related costs	2,288		648		4,639		4,837
Severance costs	1,392		3,263		6,256		9,471
Other, net	—		1,400		(833)		1,899
Cyber incident related costs, net of insurance recoveries	739		5,405		(7,430)		24,403
Total acquisition, cyber incident, and other, net	$	26,014	$	13,931	$	44,025	$	48,313

Project Orion expenses represent the non-capitalizable portion of our Project Orion costs. Project Orion is an investment in and transformation of our technology systems, business processes and customer solutions. The first phase of the project was deployed during the second quarter of 2024. See Note 1 - General to the Condensed Consolidated Financial Statements herein for further details on the overall project description and related amortization of deferred costs.

Acquisition related costs include costs associated with business transactions, whether consummated or not, such as advisory, legal, accounting, valuation and other professional or consulting fees. We also include integration

Americold Realty Trust, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

costs pre- and post-acquisition that reflect work being performed to facilitate merger and acquisition integration, such as work associated with information systems and other projects including spending to support future acquisitions, and primarily consist of professional services. We consider acquisition related costs to be corporate costs regardless of the segment or segments involved in the transaction.

Severance costs represent certain contractual and negotiated severance and separation costs from exited former executives, reduction in headcount due to synergies achieved through acquisitions or operational efficiencies and reduction in workforce costs associated with exiting or selling non-strategic warehouses or businesses.

Cyber incident related costs, net of insurance recoveries, represent the receipt of business interruption insurance proceeds and incremental costs associated with cyber incidents that occurred in November 2020 and more recently in April 2023, which is further described in Note 1 - General to the Condensed Consolidated Financial Statements herein.

4. Debt

The following table reflects a summary of our outstanding indebtedness as of September 30, 2024 and December 31, 2023 (in thousands):


	September 30, 2024		December 31, 2023
	Carrying Amount		Carrying Amount
Senior Unsecured Notes	$	2,285,189	$	1,777,925
Senior Unsecured Term Loans	829,820		833,775
Senior Unsecured Revolving Credit Facility	268,508		392,156
Total principal amount of indebtedness	$	3,383,517	$	3,003,856
Less: unamortized deferred financing costs	(14,568)		(10,578)
Total indebtedness, net of deferred financing costs	$	3,368,949	$	2,993,278

Public Senior Unsecured Notes Offering

On September 12, 2024, we completed an underwritten public offering of $500.0 million aggregate principal amount of the Operating Partnership’s senior unsecured 5.409% notes (the “Public Senior Unsecured Notes”) due September 12, 2034. The Public Senior Unsecured Notes were offered pursuant to the Registration Statement further described in Note 1 - General l to these Condensed Consolidated Financial Statements. The Public Senior Unsecured Notes are fully and unconditionally guaranteed, jointly and severally, by each of the Company, Americold Realty Operations, Inc., a wholly-owned subsidiary of the Company and a limited partner of the Operating Partnership, and certain subsidiaries of the Operating Partnership. The Public Senior Unsecured Notes bear interest at a rate of 5.409% per year, and interest is payable on March 12 and September 12 of each year, with the first payment occurring March 12, 2025.

In connection with the issuance of the Public Senior Unsecured Notes, we incurred approximately $5.9 million of debt issuance costs related to the issuance. The Company determined that the difference between amortizing such fees using the effective interest rate method and the straight line method was immaterial. Therefore, the fees will be recognized on a straight line basis over the term of the Public Senior Unsecured Notes as “Interest expense” on the Condensed Consolidated Statement of Operations. The proceeds from the issuance of the Public Senior

Americold Realty Trust, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

Unsecured Notes were used to repay a portion of borrowings previously outstanding.

The indenture governing the Public Senior Unsecured Notes and guarantees (which includes the base indenture, dated September 12, 2024, as supplemented by the first supplemental indenture, dated September 12, 2024, and which are together referred to herein as the "indenture") includes an optional redemption provision. Prior to June 12, 2034, the Public Senior Unsecured Notes may be redeemed at our option, in whole or in part, at a redemption price equal to the greater of (i) 100% of the principal amount of the Public Senior Unsecured Notes being redeemed, or (ii) a make-whole premium calculated in accordance with the indenture. On or after June 12, 2034, the Public Senior Unsecured Notes may be redeemed at our option, in whole or in part, at a redemption price equal to 100% of the principal amount of the Public Senior Unsecured Notes to be redeemed. In both cases, the prepayment amount must also include any unpaid interest accrued thereon to, but excluding, the redemption date.

The Public Senior Unsecured Notes require that we maintain at all times a minimum maintenance of total unencumbered assets value of not less than 150% of the aggregate principal amount of all outstanding unsecured debt of the Company, the Operating Partnership and their respective subsidiaries on a consolidated basis. The Public Senior Unsecured Notes also contain certain financial covenants required on a quarterly or occurrence basis, as defined in the offering prospectus, including:

•a maximum total indebtedness to total assets ratio of less than 0.60 to 1.00;

•a maximum total secured indebtedness to total assets ratio of less than 0.40 to 1.00; and

•a minimum interest coverage ratio of not less than1.50 to 1.00.

The indenture governing the Public Senior Unsecured Notes contains additional covenants customary for similar offerings, including, without limitation, that any subsidiary which becomes a co-borrower, guarantor or otherwise becomes obligated under our Senior Unsecured Term Loans or Senior Unsecured Revolving Credit Facility must also fully and unconditionally guarantee the Public Senior Unsecured Notes. The following table provides additional details of all Senior Unsecured Notes as of September 30, 2024 and December 31, 2023 (in thousands):


			September 30, 2024				December 31, 2023
	Stated Maturity Date	Contractual Interest Rate	Borrowing Currency		Carrying Amount (USD)		Borrowing Currency		Carrying Amount (USD)
Private Series A Notes	01/2026	4.68%	$	200,000	$	200,000	$	200,000	$	200,000
Private Series B Notes	01/2029	4.86%	$	400,000	400,000		$	400,000	400,000
Private Series C Notes	01/2030	4.10%	$	350,000	350,000		$	350,000	350,000
Private Series D Notes	01/2031	1.62%	€	400,000	445,434		€	400,000	441,560
Private Series E Notes	01/2033	1.65%	€	350,000	389,755		€	350,000	386,365
Public 5.409% Notes	09/2034	5.41%	$	500,000	500,000		—		—
Total Senior Unsecured Notes					$	2,285,189			$	1,777,925

The following table provides additional details of our Senior Unsecured Term Loans as of September 30, 2024 and December 31, 2023 (in thousands):

Americold Realty Trust, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)


		September 30, 2024					December 31, 2023
	Stated Maturity Date(2)	Contractual Interest Rate(1)	Borrowing Currency		Carrying Amount (USD)		Contractual Interest Rate(1)	Borrowing Currency		Carrying Amount (USD)
Tranche A-1	08/2025	SOFR + 0.94%	$	375,000	$	375,000	SOFR + 0.94%	$	375,000	$	375,000
Tranche A-2	01/2028	CORRA + 0.94%	C$	250,000	184,820		CDOR + 0.94%	C$	250,000	188,775
Delayed Draw Tranche A-3	01/2028	SOFR + 0.94%	$	270,000	270,000		SOFR + 0.94%	$	270,000	270,000
Total Senior Unsecured Term Loan Facility					$	829,820				$	833,775

(1) SOFR = one-month Adjusted Term SOFR; CDOR = one-month CDOR; CORRA = daily adjusted CORRA. Tranche A-1 and Tranche A-3 SOFR includes an adjustment of 0.10%, in addition to the margin. Tranche A-2 CORRA includes and adjustment of 0.30%, in addition to the margin. Refer to Note 5 - Derivative Financial Instruments for details of the related interest rate swaps.

(2) Note that the terms of debt agreement for Tranche A-1 includes an option for two one-year extensions.

The following table provides the details of our Senior Unsecured Revolving Credit Facility as of September 30, 2024 and December 31, 2023 (in thousands):


	September 30, 2024						December 31, 2023
Denomination of Draw	Contractual Interest Rate (1)			Borrowing Currency		Carrying Amount (USD)		Contractual Interest Rate(1)		Borrowing Currency		Carrying Amount (USD)
U.S. dollar	—			—		—		SOFR + 0.84%		$	34,000	$	34,000
Australian dollar	BBSW + 0.84%			A$	197,000	136,207		BBSW + 0.84%		A$	191,000	130,108
British pound sterling	SONIA + 0.84%			£	—	—		SONIA + 0.84%		£	78,000	99,302
Canadian dollar	CORRA + 0.84%			C$	35,000	25,875		CDOR + 0.84%		C$	35,000	26,429
Euro	EURIBOR + 0.84%			€	70,500	78,508		EURIBOR + 0.84%		€	67,500	74,513
New Zealand dollar	BKBM + 0.84%			NZD	44,000	27,918		BKBM + 0.84%		NZD	44,000	27,804
Total Senior Unsecured Revolving Credit Facility		$	268,508					$	392,156

(1) SOFR = daily adjusted SOFR; CDOR = one-month CDOR; CORRA = daily adjusted CORRA; EURIBOR = one-month Euro Interbank Offered Rate (EURIBOR); SONIA = Adjusted Sterling Overnight Interbank Average Rate; BBSW = Bank Bill Swap Rate; BKBM = Bank Bill Reference Rate. We have elected Daily SOFR for the entirety of our U.S. dollar denominated borrowings shown above, which includes an adjustment of 0.10%, in addition to the margin. Our British pound sterling borrowings bore interest tied to adjusted SONIA, which included an adjustment of 0.03% in addition to our margin. Our Canadian dollar borrowings bore interest tied to daily adjusted CORRA, which included an adjustment of 0.30% in addition to our margin.

Refer to Note 9 - Debt of the Consolidated Financial Statements in the Company’s 2023 Annual Report on Form 10-K as filed with the SEC for further details of our outstanding indebtedness. As of September 30, 2024, we were in compliance with all debt covenants.

5. Derivative Financial Instruments

Designated Non-derivative Financial Instruments

As of September 30, 2024, the Company designated A$197.0 million and €820.5 million of debt and accrued interest as a hedge of our net investment in the respective international subsidiaries. As of December 31, 2023, the Company designated £78.0 million, A$191.0 million and €817.5 million debt and accrued interest as a hedge of our net investment in the respective international subsidiaries. The remeasurement of these instruments is recorded in “Unrealized net (loss) gain on foreign currency” on the accompanying Condensed Consolidated Statements of Comprehensive Income (Loss).

Americold Realty Trust, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

During the three months ended June 30, 2024, the Company determined that its previous designation of £78.0 million of debt and accrued interest as a hedge of its net investment in its United Kingdom-based subsidiary did not qualify for hedge accounting, and the cumulative foreign exchange gain associated with this transaction of $10.4 million, previously classified within Accumulated Other Comprehensive Income, has been recorded as a gain on foreign exchange within “Other, net”on the Condensed Consolidated Statements of Operations for the nine months ended September 30, 2024 The Company has determined that the impacts of this adjustment are immaterial to the current and prior period interim and annual financial statements and disclosures. Furthermore, the Company fully paid off the balance of this revolving debt during the nine months ended September 30, 2024.

Derivative Financial Instruments

The Company is subject to volatility in interest rates due to variable-rate debt. To manage this risk, the Company periodically enters into interest rate swap agreements. These agreements involve the receipt of variable-rate amounts in exchange for fixed-rate interest payments over the life of the respective swap agreement without an exchange of the underlying notional amount. The Company’s objective for utilizing these derivative instruments is to reduce its exposure to fluctuations in cash flows due to changes in interest rates.

The following table includes the key provisions of the interest rate swaps outstanding as of September 30, 2024 and December 31, 2023 (fair value in thousands):


Notional	Fixed Base Interest Rate Swap	Effective Date	Expiration Date	Asset Fair Value as of September 30, 2024		Liability Fair Value as of September 30, 2024
$200 million	3.05%	12/29/2023	7/30/2027	$	1,275	$	—
$175 million	3.47%	11/30/2022	7/30/2027	—		871
$270 million	3.05%	11/01/2022	12/31/2027	1,749		—
C$250 million	3.59%	9/23/2022	12/31/2027	—		3,594
			Total	$	3,024	$	4,465


Notional	Fixed Base Interest Rate Swap	Effective Date	Expiration Date	Asset Fair Value as of December 31, 2023		Liability Fair Value as of December 31, 2023
$200 million	3.05%	12/29/2023	7/30/2027	$	3,687	$	—
$175 million	3.47%	11/30/2022	7/30/2027	788		—
$270 million	3.05%	11/01/2022	12/31/2027	5,106		—
C$250 million	3.59%	9/23/2022	12/31/2027	—		330
			Total	$	9,581	$	330

In addition, the Company is subject to volatility in foreign exchange rates due to its foreign-currency denominated intercompany loan. The Company implemented a cross-currency swap to manage the foreign currency exchange rate risk on its intercompany loan. This agreement effectively mitigates the Company’s exposure to fluctuations in cash flows due to foreign exchange rate risk. This agreement involves the receipt of fixed USD amounts in exchange for payment of fixed Australian Dollar amounts over the life of the intercompany loan. The entirety of the Company’s outstanding intercompany loan receivable balance of A$153.5 million was hedged under the cross-currency swap agreement at September 30, 2024 and December 31, 2023.

There have been no significant changes to our policy or strategy related to derivative financial instruments from what was disclosed in our 2023 Annual Report on Form 10-K. During the next twelve months, the Company estimates that an additional $0.2 million will be reclassified as a decrease to “Foreign currency exchange loss” (a

Americold Realty Trust, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

component of “Other, net” on the Condensed Consolidated Statements of Operations) and an additional $3.7 million will be reclassified as a decrease to “Interest expense” and a corresponding increase to operating cash flows.

The Company determines the fair value of its derivative instruments using a present value calculation with significant observable inputs classified as Level 2 of the fair value hierarchy. Derivative asset balances are recorded on the accompanying Condensed Consolidated Balance Sheets within “Other assets” and derivative liability balances are recorded on the accompanying Condensed Consolidated Balance Sheets within “Accounts payable and accrued expenses”.

The following table presents the fair value of the derivative financial instruments as of September 30, 2024 and December 31, 2023 (in thousands):


	Derivative Assets				Derivative Liabilities
	September 30, 2024		December 31, 2023		September 30, 2024		December 31, 2023
	(In thousands)
Designated derivatives
Foreign exchange contracts	$	5,015	$	5,899	$	—	$	—
Interest rate contracts	3,024		9,581