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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 March 31, 2022
or
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

(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)
_________________________

    


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 x No ¨
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 x No ¨
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):
x 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 ¨ No ¨
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 No x
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 Shares of Beneficial Interest, $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 May 3, 2022
Common Stock, $0.01 par value per share 269,275,929


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
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
SIGNATURES
1


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:

the impact of supply chain disruptions, including, among others, the impact on labor availability, raw material availability, manufacturing and food production, construction materials and transportation;
uncertainties and risks related to public health crises, including the ongoing COVID-19 pandemic;
adverse economic or real estate developments in our geographic markets or the temperature-controlled warehouse industry;
rising interest rates and inflation in operating costs, including as a result of the ongoing COVID-19 pandemic;
labor and power costs;
labor shortages;
general economic conditions;
risks associated with the ownership of real estate generally and temperature-controlled warehouses in particular;
acquisition risks, including the failure to identify or complete attractive acquisitions or the failure of acquisitions to perform in accordance with projections and to realize anticipated cost savings and revenue improvements;
our failure to realize the intended benefits from our recent acquisitions and including synergies, or disruptions to our plans and operations or unknown or contingent liabilities related to our recent acquisitions;
risks related to expansions of existing properties and developments of new properties, including failure to meet target completion dates and budgeted or stabilized returns within expected time frames, or at all, in respect thereof;
a failure of our information technology systems, systems conversions and integrations, cybersecurity attacks or a breach of our information security systems, networks or processes could cause business disruptions or loss of confidential information;
risks related to privacy and data security concerns, and data collection and transfer restrictions and related foreign regulations;
defaults or non-renewals of significant customer contracts, including as a result of the ongoing COVID-19 pandemic;
uncertainty of revenues, given the nature of our customer contracts;
our failure to obtain necessary outside financing;
risks related to, or restrictions contained in, our debt financings;
decreased storage rates or increased vacancy rates;
risks related to current and potential international operations and properties;
difficulties in expanding our operations into new markets, including international markets;
risks related to the partial ownership of properties, including as a result of our lack of control over such investments and the failure of such entities to perform in accordance with projections;
our failure to maintain our status as a REIT;
possible environmental liabilities, including costs, fines or penalties that may be incurred due to necessary remediation of contamination of properties presently or previously owned by us;
2


financial market fluctuations;
actions by our competitors and their increasing ability to compete with us;
geopolitical conflicts, such as the ongoing conflict between Russia and Ukraine;
changes in applicable governmental regulations and tax legislation, including in the international markets;
additional risks with respect to the addition of European operations and properties;
changes in real estate and zoning laws and increases in real property tax rates;
our relationship with our associates, the occurrence of any work stoppages or any disputes under our collective bargaining agreements and employment related litigation;
liabilities as a result of our participation in multi-employer pension plans;
uninsured losses or losses in excess of our insurance coverage;
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;
the cost and time requirements as a result of our operation as a publicly traded REIT;
changes in foreign currency exchange rates;
the impact of anti-takeover provisions in our constituent documents and under Maryland law, which could make an acquisition of us more difficult, limit attempts by our shareholders to replace our trustees and affect the price of our common shares of beneficial interest, $0.01 par value per share, of our common shares; and
the potential dilutive effect of our common share offerings.
    
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. Examples of forward-looking statements included in this Quarterly Report on Form 10-Q include, among others, statements about our expected acquisitions and expected expansion and development pipeline and our targeted return on invested capital on expansion and development opportunities. 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, 2021, 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.

As used in this report, unless the context otherwise requires, references to “we,” “us,” “our,” “our Company” and “the Company” refer to Americold Realty Trust, a Maryland real estate investment trust, 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.”

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.

3


Americold Realty Trust and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
(In thousands, except shares and per share amounts)
March 31, 2022 December 31, 2021
Assets
Property, buildings and equipment:
Land $ 811,442  $ 807,495 
Buildings and improvements 4,163,054  4,152,763 
Machinery and equipment 1,361,741  1,352,399 
Assets under construction 512,694  450,153 
6,848,931  6,762,810 
Accumulated depreciation (1,708,031) (1,634,909)
Property, buildings and equipment – net 5,140,900  5,127,901 
Operating lease right-of-use assets 369,706  377,536 
Accumulated depreciation – operating leases (61,359) (57,483)
Operating leases – net 308,347  320,053 
Financing leases:
Buildings and improvements 13,557  13,552 
Machinery and equipment 141,443  146,341 
155,000  159,893 
Accumulated depreciation – financing leases (56,471) (58,165)
Financing leases – net 98,529  101,728 
Cash, cash equivalents and restricted cash 50,965  82,958 
Accounts receivable – net of allowance of $20,725 and $18,755 at March 31, 2022 and December 31, 2021, respectively
419,348  380,014 
Identifiable intangible assets – net 968,099  980,966 
Goodwill 1,068,479  1,072,980 
Investments in partially owned entities 43,526  37,458 
Other assets 109,676  112,139 
Total assets $ 8,207,869  $ 8,216,197 
Liabilities and equity
Liabilities:
Borrowings under revolving line of credit $ 513,824  $ 399,314 
Accounts payable and accrued expenses 535,617  559,412 
Mortgage notes, senior unsecured notes and term loans – net of unamortized deferred financing costs of $10,492 and $11,050, in the aggregate, at March 31, 2022 and December 31, 2021, respectively
2,422,570  2,443,806 
Sale-leaseback financing obligations 177,305  178,817 
Financing lease obligations 91,436  97,633 
Operating lease obligations 291,050  301,765 
Unearned revenue 28,349  26,143 
Pension and postretirement benefits 3,057  2,843 
Deferred tax liability – net 165,331  169,209 
Multi-employer pension plan withdrawal liability 8,091  8,179 
Total liabilities 4,236,630  4,187,121 
Commitments and contingencies (Note 7)
Equity
Shareholders’ equity:
Common shares of beneficial interest, $0.01 par value – 500,000,000 authorized shares; 268,672,465 and 268,282,592 shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively
2,687  2,683 
Paid-in capital 5,177,642  5,171,690 
Accumulated deficit and distributions in excess of net earnings (1,234,875) (1,157,888)
Accumulated other comprehensive income 15,926  4,522 
Total shareholders’ equity 3,961,380  4,021,007 
Noncontrolling interests:
Noncontrolling interests in operating partnership 9,859  8,069 
Total equity 3,971,239  4,029,076 
Total liabilities and equity $ 8,207,869  $ 8,216,197 
See accompanying notes to condensed consolidated financial statements.
4


Americold Realty Trust and Subsidiaries
Condensed Consolidated Statements of Operations (Unaudited)
(In thousands, except per share amounts)
Three Months Ended March 31,
2022 2021
Revenues:
Rent, storage and warehouse services $ 540,925  $ 485,451 
Third-party managed services 85,860  73,072 
Transportation services 78,910  76,272 
Total revenues 705,695  634,795 
Operating expenses:
Rent, storage and warehouse services cost of operations 394,667  339,270 
Third-party managed services cost of operations 82,359  68,690 
Transportation services cost of operations 70,381  69,569 
Depreciation and amortization 82,620  77,211 
Selling, general and administrative 57,602  45,052 
Acquisition, litigation and other, net 10,075  20,751 
Total operating expenses 697,704  620,543 
Operating income 7,991  14,252 
Other income (expense):
Interest expense (25,773) (25,956)
Loss on debt extinguishment, modifications and termination of derivative instruments (616) (3,499)
Other, net 245  176 
Loss before income tax benefit (18,153) (15,027)
Income tax (expense) benefit
Current (1,181) (1,211)
Deferred 1,889  2,002 
Total income tax benefit 708  791 
Net loss $ (17,445) $ (14,236)
Net (loss) income attributable to non controlling interests (38) 178 
Net loss attributable to Americold Realty Trust $ (17,407) $ (14,414)
Weighted average common shares outstanding – basic 269,164  252,938 
Weighted average common shares outstanding – diluted 269,164  252,938 
Net loss per common share of beneficial interest - basic $ (0.06) $ (0.06)
Net loss per common share of beneficial interest - diluted $ (0.06) $ (0.06)
See accompanying notes to condensed consolidated financial statements.

5


Americold Realty Trust and Subsidiaries
Condensed Consolidated Statements of Comprehensive Loss (Unaudited)
(In thousands)
Three Months Ended March 31,
2022 2021
Net loss $ (17,445) $ (14,236)
Other comprehensive income (loss) - net of tax:
Adjustment to accrued pension liability 67  381 
Change in unrealized net gain (loss) on foreign currency 11,186  (10,682)
Unrealized gain on cash flow hedge 151  1,021 
Other comprehensive income (loss) - net of tax attributable to Americold Realty Trust 11,404  (9,280)
Other comprehensive income (loss) attributable to noncontrolling interests 23  (12)
Total comprehensive loss $ (6,018) $ (23,528)
See accompanying notes to condensed consolidated financial statements.


6


Americold Realty Trust and Subsidiaries
Condensed Consolidated Statements of Equity (Unaudited)
(In thousands, except shares and per share amounts)
Common Shares of Beneficial Interest Accumulated Deficit and Distributions in Excess of Net Earnings Accumulated Other Comprehensive Income Noncontrolling Interests in Operating Partnership
Number of Shares Par Value Paid-in Capital
Total
Balance - December 31, 2021 268,282,592  $ 2,683  $ 5,171,690  $ (1,157,888) $ 4,522  $ 8,069  $ 4,029,076 
Net loss —  —  —  (17,407) —  (38) (17,445)
Other comprehensive income —  —  —   – 11,404  23  11,427 
Distributions on common shares, restricted stock and OP units —  —  —  (59,580) —  (180) (59,760)
Share-based compensation expense —  —  6,108  —  —  1,985  8,093 
Common share issuance related to share-based payment plans, net of shares withheld for employee taxes 318,729  (2,140) —  —  —  (2,137)
Common shares issuance related to employee stock purchase plan 71,144  1,984  —  —  —  1,985 
Balance - March 31, 2022 268,672,465  $ 2,687  $ 5,177,642  $ (1,234,875) $ 15,926  $ 9,859  $ 3,971,239 
Common Shares of Beneficial Interest Accumulated Deficit and Distributions in Excess of Net Earnings Accumulated Other Comprehensive Loss Noncontrolling Interests in Operating Partnership and Consolidated Joint Venture
Number of Shares Par Value Paid-in Capital
Total
Balance - December 31, 2020 251,702,603  $ 2,517  $ 4,687,823  $ (895,521) $ (4,379) $ 2,381  $ 3,792,821 
Net (loss) income —  —  —  (14,414) —  178  (14,236)
Other comprehensive loss —  —  —  (9,280) (12) (9,292)
Distributions on common shares, restricted stock and OP units —  —  —  (55,909) —  (120) (56,029)
Share-based compensation expense —  —  4,075  —  —  949  5,024 
Common share issuance related to share-based payment plans, net of shares withheld for employee taxes 816,915  (10,089) —  —  —  (10,081)
Balance - March 31, 2021 252,519,518  $ 2,525  $ 4,681,809  $ (965,844) $ (13,659) $ 3,376  $ 3,708,207 


See accompanying notes to condensed consolidated financial statements.
7


Americold Realty Trust and Subsidiaries
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
Three Months Ended March 31,
2022 2021
Operating activities:
Net loss $ (17,445) $ (14,236)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization 82,620  77,211 
Amortization of deferred financing costs and pension withdrawal liability 1,146  1,148 
Amortization of above/below market leases 508  39 
Loss on debt extinguishment, modifications and termination of derivative instruments 616  3,499 
Foreign exchange loss (325) (173)
Loss from investments in partially owned entities 2,112  700 
Share-based compensation expense 8,093  5,030 
Deferred income taxes (1,889) (2,002)
Gain on other asset disposals (165) (158)
Provision for doubtful accounts receivable 1,970  579 
Changes in operating assets and liabilities:
Accounts receivable (41,994) 16,519 
Accounts payable and accrued expenses (35,572) (38,446)
Other 15,911  (3,179)
Net cash provided by operating activities 15,586  46,531 
Investing activities:
Investment in partially owned entities (1,925) (1,642)
Proceeds from sale of property, buildings and equipment 98  327 
Business combinations, net of cash acquired 603  (41,956)
Additions to property, buildings and equipment (93,020) (100,466)
Net cash used in investing activities  (94,244) (143,737)
Financing activities:
Distributions paid on common shares, restricted stock units and noncontrolling interests in Operating Partnership (59,940) (54,956)
Proceeds from stock options exercised 575  4,345 
Proceeds from employee stock purchase plan 1,985  — 
Remittance of withholding taxes related to employee share-based transactions (3,226) (14,922)
Proceeds from revolving line of credit 115,000  43,489 
Repayment of sale-leaseback financing obligations (1,619) (1,453)
Repayment of financing lease obligations (4,695) (7,218)
Payment of debt issuance costs —  (3,045)
Repayment of term loan and mortgage notes (1,824) (201,770)
Net cash provided by financing activities 46,256  (235,530)
Net decrease in cash, cash equivalents and restricted cash (32,402) (332,736)
Effect of foreign currency translation on cash, cash equivalents and restricted cash 409  (624)
Cash, cash equivalents and restricted cash:
Beginning of period 82,958  621,051 
End of period $ 50,965  $ 287,691 
Supplemental disclosures of non-cash investing and financing activities:
Addition of property, buildings and equipment on accrual $ 52,931  $ 56,197 
Addition of property, buildings and equipment under financing lease obligations $ 5,717  $ 6,191 
Addition of property, buildings and equipment under operating lease obligations $ 1,828  $ 3,209 
Supplemental cash flow information:
Interest paid – net of amounts capitalized $ 38,751  $ 31,845 
Income taxes paid – net of refunds $ 2,252  $ 1,481 

See accompanying notes to condensed consolidated financial statements.
8


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Unaudited)





1. General
The Company
Americold Realty Trust, together with all of its consolidated subsidiaries (ART, Americold, the Company, us or we), is a real estate investment trust (REIT) organized under Maryland law. The Company is the world’s largest publicly traded REIT focused on the ownership, operation and development of temperature-controlled warehouses. The Company is organized as a self-administered and self-managed REIT with proven operating, acquisition and development experience.
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. (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 2021 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, all adjustments (all of which are normal and recurring in nature) considered necessary for a fair presentation have been included. The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries where the Company exerts control. Investments in which the Company does not have control, and is not considered to be 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. 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.
Use of Estimates
The preparation of financial statements in conformity with 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.
Summary of Significant Accounting Policies
The following disclosure regarding certain of our significant accounting policies should be read in conjunction with Note 2 to the consolidated financial statements included in our 2021 Annual Report on Form 10-K as filed with the SEC, which provides additional information with regard to the accounting policies set forth herein and other significant accounting policies.
Impairment of Long-Lived Assets
There were no impairment charges recorded during the three months ended March 31, 2022 or 2021.
9


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
Future Adoption of Accounting Standards
Reference Rate Reform

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848). This ASU contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. During the first quarter of 2020, the Company has elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. The Company continues to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur.
Significant Risks and Uncertainties
The COVID-19 pandemic has caused, and is likely to continue to cause severe economic, market and other disruptions worldwide, which could lead to future material impairments of our assets, increases in our allowance for credit losses and changes in judgments in determining the fair value of our assets. Conditions in the bank lending, capital and other financial markets may deteriorate, and our access to capital and other sources of funding may become constrained or more costly, which could materially and adversely affect the availability and terms of future borrowings, renewals, re-financings and other capital raises.
The Company is closely monitoring the impact of the ongoing COVID-19 pandemic and any variants on all aspects of its business in all geographies, including how it will impact its customers and business partners. The three months ended March 31, 2022 and the year ended December 31, 2021 were negatively impacted by COVID-19 related disruptions in (i) the food supply chain; (ii) our customers’ production of goods; (iii) the labor market impacting availability and cost; and (iv) the overall impact of inflation on the cost to provide our services. We expect that end-consumer demand for food will remain consistent over the long-term with historic levels overall but varying between retail and food service sectors. The consistent end consumer demand has negatively impacted holdings in our facilities as it remains steady while food production has remained challenged since the onset of the pandemic. We expect it will continue to do so until our customers are able to ramp production back up to pre-pandemic levels for an extended period of time in order to rebuild inventory in the supply chain. However, uncertainty still surrounds the impact of the pandemic and recovery ultimately depends on many factors. COVID-19 disruptions in certain markets where we or our customers operate continue to impact the food supply chain and our business. As a result, occupancy and throughput volume continue at lower than historical levels experienced prior to COVID-19. As the Company continues to protect its employees from the spread of COVID-19, it is incurring elevated labor related costs and incremental health and safety supplies costs relative to its pre-pandemic experience. We continue to expect to see inflationary impacts in the cost of providing our storage and services, but anticipate that these will be partially mitigated through price increases that have either taken effect or are expected to take effect in the near future. The Company is unable to predict the impact that the COVID-19 pandemic will have on its financial condition, results of operations and cash flows due to numerous uncertainties.
10


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
The extent to which COVID-19 impacts our operations will depend on future developments, which are highly uncertain and cannot be predicted with any degree of confidence, including the scope, severity, duration and geographies of the outbreak, the actions taken to contain the COVID-19 pandemic or mitigate its impact as requested or mandated by governmental authorities or otherwise voluntarily taken by individuals or businesses, the direct and indirect economic effects of the illness and containment measures, and supply chain disruption, among others. As a result, we cannot at this time predict the impact of the COVID-19 pandemic, but it could have a material adverse effect on our business, financial condition, liquidity, results of operations and prospects.
2. Business Combinations
Acquisitions Completed During 2021
There were no businesses acquired during the three months ended March 31, 2022. Total consideration paid for Liberty Freezers which was acquired during the three months ended March 31, 2021 was C$56.8 million, or $44.9 million, and the acquisition accounting was finalized this quarter. No material adjustments were made to the acquisition accounting during this period. The acquisition accounting for KMT Brrr!, Bowman Stores, ColdCo, Newark Facility Management and Lago Cold Stores, which were businesses acquired during 2021, remained preliminary as of March 31, 2022. No material adjustments were made to the preliminary acquisition accounting for these businesses during the three months ended March 31, 2022. We will continue to evaluate the preliminary fair values of the assets acquired and liabilities assumed until they are satisfactorily resolved and adjust our acquisition accounting accordingly and within the allowable measurement period (not to exceed one year from the date of acquisition as defined by ASC 805). For more detailed descriptions of these acquisitions refer to Note 3 of the consolidated financial statements in the Company’s 2021 Annual Report on Form 10-K as filed with the SEC.
3. Acquisition, Litigation and Other, net
The components of the charges and credits included in “Acquisition, litigation and other, net” in our Condensed Consolidated Statements of Operations are as follows (in thousands):
Three Months Ended March 31,
Acquisition, litigation and other, net 2022 2021
Acquisition and integration related costs $ 6,285  $ 13,475 
Litigation 1,200  — 
Severance costs 2,564  2,446 
Terminated site operations costs —  59 
Cyber incident related costs, net of insurance recoveries 26  4,771 
Total acquisition, litigation and other, net $ 10,075  $ 20,751 

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 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. Refer to Note 3 of the consolidated financial statements in the Company’s 2021 Annual Report on Form 10-K as filed with the SEC for further information regarding acquisitions completed during 2021.

11


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
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.

Terminated site operations costs relates to repair expenses incurred to return leased sites to their original physical state at lease inception in connection with the termination of the applicable underlying lease. These terminations were part of our strategic efforts to exit or sell non-strategic warehouses as opposed to ordinary course lease expirations. Repair and maintenance expenses associated with our ordinary course operations are reflected as operating expenses on our Condensed Consolidated Statement of Operations.

Cyber incident related costs include third-party fees incurred in connection with the cyber incident that occurred in November 2020, as well as any incremental costs, internal and external, incurred to restore operations at our facilities and damage claims. Any subsequent reimbursements from insurance coverage for expenses incurred in connection with the event are also reflected within this category.
12


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
4. Debt
The Company’s outstanding indebtedness as of March 31, 2022 and December 31, 2021 was as follows (in thousands):
March 31, 2022 December 31, 2021
Indebtedness Stated Maturity Date Contractual Interest Rate
Effective Interest Rate as of March 31, 2022
Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value
2013 Mortgage Loans
Senior note
5/2023 3.81% 4.14% $ 165,719  $ 165,720  $ 167,545  $ 170,503 
Mezzanine A
5/2023 7.38% 7.55% 70,000  70,000  70,000  70,875 
Mezzanine B
5/2023 11.50% 11.75% 32,000  32,080  32,000  32,560 
Total 2013 Mortgage Loans
267,719  267,800  269,545  273,938 
Chile Mortgages(12)
2022 - 2029 4.01% 4.01% 10,443  10,443  9,761  9,761 
Senior Unsecured Notes
Series A Notes
1/2026 4.68% 4.77% 200,000  204,000  200,000  217,500 
Series B Notes
1/2029 4.86% 4.92% 400,000  415,000  400,000  454,000 
Series C Notes
1/2030 4.10% 4.15% 350,000  350,000  350,000  385,000 
Series D Notes(5)
1/2031 1.62% 1.67% 442,680  392,879  454,800  441,724 
Series E Notes(6)
1/2033 1.65% 1.70% 387,345  338,927  397,950  388,499 
Total Senior Unsecured Notes
1,780,025  1,700,806  1,802,750  1,886,723 
2020 Senior Unsecured Term Loan Tranche A-1(1)
3/2025
L+0.95%
1.69% 174,875  174,001  175,000  173,688 
2020 Senior Unsecured Term Loan Tranche A-2(2)(4)
3/2025
C+0.95%
2.03% 200,000  199,000  197,800  196,811 
Total 2020 Senior Unsecured Term Loan A Facility
374,875  373,001  372,800  370,499 
2020 Senior Unsecured Revolving Credit Facility-1(2)(3)(7)
3/2024
C+0.85%
2.22% 43,973  43,973  43,516  43,407 
2020 Senior Unsecured Revolving Credit Facility-2(3)(8)(9)
3/2024
SONIA+0.85%
2.02% 89,995  89,995  92,694  92,462 
2020 Senior Unsecured Revolving Credit Facility-3(1)(3)
3/2024
L+0.85%
1.75% 320,000  320,000  205,000  204,488 
2020 Senior Unsecured Revolving Credit Facility-4(3)(10)(11)
3/2024
BBSW+0.85%
1.36% 59,856  59,856  58,104  57,959 
Total 2020 Senior Unsecured Revolving Credit Facility $ 513,824  $ 513,824  $ 399,314  $ 398,316 
Total principal amount of indebtedness $ 2,946,886  $ 2,865,874  $ 2,854,170  $ 2,939,237 
Less: unamortized deferred financing costs
(10,492) n/a (11,050) n/a
Total indebtedness, net of unamortized deferred financing costs
$ 2,936,394  $ 2,865,874  $ 2,843,120  $ 2,939,237 
(1) L = one-month LIBOR.
(2) C = one-month CDOR.
(3) The Company has the option to extend the 2020 Senior Unsecured Revolving Credit Facility up to two times for a six-month period each.
(4) The 2020 Senior Unsecured Term Loan Tranche A-2 is denominated in Canadian dollars and aggregates to CAD $250.0 million. The carrying value in the table above is the US dollar equivalent as of March 31, 2022.
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Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
(5) The Senior Unsecured Notes Series D is denominated in Euros and aggregates to €400.0 million. The carrying value in the table above is the US dollar equivalent as of March 31, 2022.
(6) The Senior Unsecured Notes Series E is denominated in Euros and aggregates to €350.0 million. The carrying value in the table above is the US dollar equivalent as of March 31, 2022.
(7) The Senior Unsecured Revolving Credit Facility Draw 1 as of March 31, 2022, is denominated in CAD and aggregates to CAD $55.0 million. The carrying value in the table above is the US dollar equivalent as of March 31, 2022.
(8) The Senior Unsecured Revolving Credit Facility Draw 2 as of March 31, 2022, is denominated in GBP and aggregates to GBP £68.5 million. The carrying value in the table above is the US dollar equivalent as of March 31, 2022.
(9) SONIA = Sterling Overnight Interbank Average Rate.
(10) BBSW = Bank Bill Swap Rate
(11) The Senior Unsecured Revolving Credit Facility Draw 4 as of March 31, 2022, is denominated in AUD and aggregates to AUD 80.0 million. The carrying value in the table above is the US dollar equivalent as of March 31, 2022.
(12) The Chile Mortgages have varying maturities and interest rates. The above aggregates these given the immaterial balance of each individually.
There have been no new debt agreements entered into during 2022. Refer to our 2021 Form 10-K and below for details regarding our debt instruments.
Debt Covenants

Our Senior Unsecured Credit Facilities, the Senior Unsecured Notes and 2013 Mortgage Loans all require financial statement reporting, periodic reporting of compliance with financial covenants, other established thresholds and performance measurements, and compliance with affirmative and negative covenants that govern our allowable business practices. The affirmative and negative covenants include, among others, continuation of insurance, maintenance of collateral (in the case of the 2013 Mortgage Loans), the maintenance of REIT status, and restrictions on our ability to enter into certain types of transactions or take on certain exposures. As of March 31, 2022, we were in compliance with all debt covenants.
Loss on debt extinguishment, modifications and termination of derivative instruments
In the first quarter of 2021, the Company repaid $200 million of principal on the Senior Unsecured Term Loan A Facility and recorded $2.9 million to “Loss on debt extinguishment, modifications and termination of derivative instruments” in the accompanying Condensed Consolidated Statements of Operations, representing the write-off of unamortized deferred financing costs. Additionally, the Company recorded a reclassification from other comprehensive income to earnings to “Loss on debt extinguishment, modification, and termination of derivative instruments” related to the amortization of the portion deferred following the termination of interest rate swaps related to the Senior Unsecured Term Loan A Facility for $0.8 million and $0.6 million during the three months ended March 31, 2021 and 2022, respectively.

5. Fair Value Measurements
The Company categorizes assets and liabilities that are recorded at fair values into one of three tiers based upon fair value hierarchy. These tiers include: Level 1, defined as quoted market prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, model-based valuation techniques for which all significant assumptions are observable in the market, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3, defined as unobservable inputs that are not corroborated by market data. The carrying amounts of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued expenses and revolving line of credit approximate their fair values due to the short-term maturities of the instruments.
The Company’s mortgage notes, senior unsecured notes and term loans are reported at their aggregate principal amount less unamortized deferred financing costs on the accompanying Condensed Consolidated Balance Sheets.
14


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
The fair value of these financial instruments is estimated based on the present value of the expected coupon and principal payments using a discount rate that reflects the projected performance of the collateral asset as of each valuation date. The inputs used to estimate the fair value of the Company’s mortgage notes, senior unsecured notes and term loans are comprised of Level 2 inputs, including senior industrial commercial real estate loan spreads, corporate industrial loan indexes, risk-free interest rates, and Level 3 inputs, such as future coupon and principal payments, and projected future cash flows.
The Company’s financial assets and liabilities recorded at fair value on a recurring basis include derivative instruments. The fair value of interest rate swap and cross currency swap agreements, which are designated as cash flow hedges, and foreign currency forward contracts designated as net investment hedges, is based on inputs other than quoted market prices that are observable (Level 2). The fair value of foreign currency forward contracts is based on adjusting the spot rate utilized at the balance sheet date for translation purposes by an estimate of the forward points observed in active markets (Level 2). Additionally, the fair value of derivatives includes a credit valuation adjustment to appropriately incorporate nonperformance risk for the Company and the respective counterparty. Although the credit valuation adjustments associated with derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by us and our counterparties, the significance of the impact on the overall valuation of our derivative positions is insignificant. The Company’s cash equivalent money market funds and restricted cash assets are valued at quoted market prices in active markets for identical assets (Level 1), which the Company receives from the financial institutions that hold such investments on its behalf. The fair value hierarchy discussed above is also applicable to the Company’s pension and other post-retirement plans. The Company uses the fair value hierarchy to measure the fair value of assets held by various plans. The Company recognizes transfers between levels within the hierarchy as of the beginning of the reporting period. There were no transfers between levels within the hierarchy as of March 31, 2022 and 2021, respectively.
The Company’s assets and liabilities recorded at fair value on a non-recurring basis include long-lived assets when events or changes in circumstances indicate that the carrying amounts may not be recoverable. The Company estimates the fair values using unobservable inputs classified as Level 3 of the fair value hierarchy.
The Company’s assets and liabilities measured or disclosed at fair value are as follows:
Fair Value Fair Value
Hierarchy March 31, 2022 December 31, 2021
(In thousands)
Measured at fair value on a recurring basis:
Cross-currency swap asset Level 2 $ 191  $ 2,015 
Cross-currency swap liability Level 2 $ 2,502  $ — 
Disclosed at fair value:
Mortgage notes, senior unsecured notes and term loans(1)
Level 3 $ 2,865,874  $ 2,939,237 
(1)The carrying value of mortgage notes, senior unsecured notes and term loans is disclosed in Note 4.
15


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
6. Share-Based Compensation
On January 4, 2018, the Company’s Board of Trustees adopted the Americold Realty Trust 2017 Equity Incentive Plan (2017 Plan), which permits the grant of various forms of equity- and cash-based awards from a reserved pool of 9,000,000 common shares of the Company. The details of the 2017 Plan are disclosed in greater detail in the 2021 Form 10-K as filed with the SEC.
All share-based compensation cost is measured at the grant date, based on the estimated fair value of the award. The Company issues time-based, performance-based and market performance-based equity awards. Time-based awards and cliff vesting market performance-based awards are recognized on a straight-line basis over the associates’ requisite service period, as adjusted for estimate of forfeitures. Performance-based awards are recognized ratably over the vesting period using a graded vesting attribution model upon the achievement of the performance target, as adjusted for estimate of forfeitures. The only performance-based awards issued by the Company were granted in 2016 and 2017.
The Company implemented an Employee Stock Purchase Plan (ESPP) which became effective on December 8, 2020. Under the ESPP, eligible employees are granted options to purchase common shares at the lower of 85% of the fair market value of the stock at the time of grant or 85% of the fair market value at the time of exercise. Options to purchase shares are granted twice yearly on or about January 1 and July 1, and exercisable on or about the succeeding July 1, and January 1, respectively, of each year. No participant may purchase more than $25,000 worth of common shares in a six-month offering period, or a maximum of 2,400 common shares. There are 5,000,000 common shares available for issuance under the ESPP. The share-based compensation cost of the ESPP options are measured based on grant date at fair value and are recognized on a straight-line basis over the offering period. ESPP assumptions and the related fair value per share table are disclosed in the three month period in which there is ESPP activity, such as an ESPP purchase. The ESPP did not have a material impact on share-based compensation expense during each of the three months ended March 31, 2022 and 2021.
Aggregate share-based compensation charges were $8.3 million and $5.0 million during the three months ended March 31, 2022 and 2021, respectively. Routine share-based compensation expense is included as a component of “Selling, general and administrative” expense on the accompanying Condensed Consolidated Statements of Operations. As of March 31, 2022, there was $44.1 million of unrecognized share-based compensation expense related to stock options and restricted stock units, which will be recognized over a weighted-average period of 2.0 years. As of March 31, 2022 and December 31, 2021, the Company accrued $1.2 million and $1.5 million, respectively, of dividend equivalents on unvested units payable to associates and trustees.
Restricted Stock Units Activity
Restricted stock units are nontransferable until vested. Prior to the issuance of a common share, the grantees of restricted stock units are not entitled to vote the shares. Time-based restricted stock unit awards vest in equal annual increments over the vesting period. Performance-based and market performance-based restricted stock unit awards cliff vest upon the achievement of the performance target, as well as completion of the performance period.
16


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
The following table summarizes restricted stock unit grants under the 2017 Plan during the three months ended March 31, 2022 and 2021, respectively:
Three Months Ended March 31, Grantee Type Number of
Restricted Stock
Units Granted
Vesting
Period
Grant Date
Fair Value
(in thousands)
2022 Associates 481,099
1-3 years
$ 12,857 
2021 Associates 296,610
1-3 years
$ 9,885 
Restricted stock units granted for the three months ended March 31, 2022 consisted of: (i) 350,641 time-based graded vesting restricted stock units with various vesting periods ranging from one to three years issued to certain associates and (ii) 130,458 market performance-based cliff vesting restricted stock units with a three-year vesting period issued to certain associates. The vesting of such market performance-based awards will be determined based on Americold Realty Trust’s total shareholder return (TSR) relative to the MSCI US REIT Index (RMZ), computed for the performance period that began January 1, 2022 and will end December 31, 2024.
Restricted stock units granted for the three months ended March 31, 2021 consisted of (i) 188,088 time-based graded vesting restricted stock units with various vesting periods ranging from one to three years issued to certain associates and (ii) 108,522 market performance-based cliff vesting restricted stock units with a three-year vesting period issued to certain associates. The vesting of such market performance-based awards will be determined based on Americold Realty Trust’s total shareholder return (TSR) relative to the MSCI US REIT Index (RMZ), computed for the performance period that began January 1, 2021 and will end December 31, 2023.
In January 2021, following the completion of the applicable market-performance period, the Compensation Committee determined that the high level had been achieved for the 2018 awards and, accordingly, 799,591 units vested immediately, representing a vesting percentage of 150%.
In January 2022, following the completion of the applicable market-performance period, the Compensation Committee determined that the 51st percentile had been achieved for the 2019 awards and, accordingly, 194,111 units vested immediately, representing a vesting percentage of 91.4%.
17


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
The following table provides a summary of restricted stock awards activity during the three months ended March 31, 2022:
Three Months Ended March 31, 2022
Restricted Stock Number of Time-Based Restricted Stock Units Aggregate Intrinsic Value (in millions) Number of Performance-Based Restricted Stock Units Aggregate Intrinsic Value (in millions)
Number of Market Performance-Based Restricted Stock Units(2)
Aggregate Intrinsic Value (in millions)
Non-vested as of December 31, 2021
1,071,959  $ 35.1  —  $ —  374,048  $ 12.3 
Granted
350,641  —  130,458 
 Market-performance adjustment(3)
—  —  (18,253)
Vested
(171,176) —  (194,111)
Forfeited
(45,597) —  (8,044)
Non-vested as of March 31, 2022
1,205,827  $ 33.6  —  $ —  284,098  $ 7.9 
Shares vested, but not released(1)
615,643  17.2  42,856  1.2  —  — 
Total outstanding restricted stock units
1,821,470  $ 50.8  42,856  $ 1.2  284,098  $ 7.9 
(1)For certain vested restricted stock units, common share issuance is contingent upon the first to occur of: (1) termination of service; (2) change in control; (3) death; or (4) disability, as defined in the 2010 Plan. This is comprised of 568,753 vested time-based restricted stock units which belong to a member of the Board of Trustees who has resigned and common shares shall not be issued until the first to occur: (1) change in control; or (2) April 13, 2022. The weighted average grant date fair value of these units is $9.38 per unit. This is also comprised of 46,890 vested time-based restricted stock units which belong to an active member of the Board of Trustees and the date of issuance is therefore unknown at this time. The weighted average grant date fair value of these units is $8.42 per unit. Finally, this is comprised of 42,856 vested performance-based restricted stock units which belong to the former CEO and common shares shall not be issued until May 2, 2022 in accordance with the terms of the award. The weighted average grant date fair value of these units is $13.43 per unit. The holders of these vested restricted stock units are entitled to receive distributions, but are not entitled to vote the shares until common shares are issued.in exchange for these vested restricted stock units.
(2)The number of market performance-based restricted stock units are reflected within this table based upon the number of shares issuable upon achievement of the performance metric at target.
(3)Represents the decrease in the number of original market-performance units awarded based on the final performance criteria achievement at the end of the defined performance period.
The weighted average grant date fair value of restricted stock units granted during the three months ended March 31, 2022 was $26.73 per unit, for vested and converted restricted stock units was $33.68, for forfeited restricted stock units was $30.50. The weighted average grant date fair value of non-vested restricted stock units was $29.30 and $31.40 per unit as of March 31, 2022 and December 31, 2021, respectively.
OP Units Activity
The Trustees and certain members of management may elect to receive their awards in the form of either OP units or restricted stock units (applicable to time-vested and market-performance based awards). The terms of the OP units mirror the terms of the restricted stock units granted in the respective period.
18


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
The following table summarizes OP unit grants during the three months ended March 31, 2022 and March 31, 2021:
Three Months Ended March 31, Grantee Type Number of
OP Units Granted
Vesting
Period
Grant Date
Fair Value
(in thousands)
2022 Associates 342,980
1-3 years
$ 9,001 
2021 Associates 258,479
1-3 years
$ 8,434 
OP units granted for the year ended March 31, 2022 consisted of: (i) 98,994 time-based graded vesting OP units with various vesting periods ranging from one to three years issued to certain associates in connection with the annual grant provided in March and (ii) 243,986 market performance-based cliff vesting OP units with a three-year vesting period issued to certain associates in connection with the annual grant provided in March.
OP units granted for the year ended March 31, 2021 consisted of: (i) 60,472 time-based graded vesting OP units with various vesting periods ranging from one to three years issued to certain associates and (ii) 198,007 market performance-based cliff vesting OP units with a three-year vesting period issued to certain associates.
The following table provides a summary of the OP unit awards activity during the three months ended March 31, 2022:
Three Months Ended March 31, 2022
OP Units Number of Time-Based OP Units Aggregate Intrinsic Value (in millions) Number of Market Performance-Based OP Units Aggregate Intrinsic Value (in millions)
Non-vested as of December 31, 2021
140,222  $ 4.6  288,165  $ 9.4 
Granted
98,994  243,986 
Vested
(28,179) — 
Forfeited
(7,635) (20,366)
Non-vested as of March 31, 2022
203,402  $ 5.7  511,785  $ 14.3 
Shares vested, but not released
104,874  2.9  —  — 
Total outstanding OP units
308,276  $ 8.6  511,785  $ 14.3 
The weighted average grant date fair value of OP units granted for the three months ended March 31, 2022 was $26.49 per unit, for vested OP units was $32.93 and forfeited OP units was $31.94. The weighted average grant date fair value of non-vested OP units was $29.45 and $31.30 per unit as of March 31, 2022 and December 31, 2021, respectively.
19


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
Stock Options Activity
The following table provides a summary of option activity for the three months ended March 31, 2022:
Options Shares
(In thousands)
Weighted-Average Exercise Price Weighted-Average Remaining Contractual Terms (Years)
Outstanding as of December 31, 2021
206,298  $ 9.81  2.9
Granted
   
Exercised
(40,900) 9.81 
Forfeited or expired
   
Outstanding as of March 31, 2022
165,398  9.81  3.1
Exercisable as of March 31, 2022
165,398  $ 9.81  3.1
The total grant date fair value of stock option awards that vested during the three months ended for both March 31, 2022 and 2021 was approximately $0.1 million and $0.5 million, respectively. The total intrinsic value of options exercised for the three months ended March 31, 2022 and 2021 was $0.7 million and $4.2 million, respectively.
7. Commitments and Contingencies
Legal Proceedings
In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company and its legal counsel evaluate the merits of any legal proceedings or unasserted claims, as well as the perceived merits of the amount of relief sought or expected to be sought. If the assessment of a contingency suggests that a loss is probable, and the amount can be reasonably estimated, then a loss is recorded.
In addition to the matters discussed below, the Company may be subject to litigation and claims arising from the ordinary course of business. In the opinion of management, after consultation with legal counsel, the outcome of such matters is not expected to have a material impact on the Company’s financial condition, results of operations, or cash flows.
Kansas Breach of Settlement Agreement Litigation
This case was served against the Company in Wyandotte County, Kansas, on January 17, 2013, alleging breach of a 1994 Settlement Agreement reached with customers of our predecessor company, Americold Corporation. The plaintiffs originally brought claims in 1992 arising from a fire the previous year in an underground warehouse facility.
In 1994, a settlement was reached whereby Americold Corporation agreed to the entry of a $58.7 million judgment against it and assigned its rights to proceed against its insurer to satisfy the judgment. The settlement agreement contained a standard “cooperation provision” in which Americold Corporation agreed to execute any additional documents necessary to fulfill the intent of the settlement agreement. The plaintiffs then sued
20


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
Americold Corporation’s insurer to recover on the consent judgment. The case was ultimately dismissed in 2012, and the Kansas Supreme Court ruled that the 1994 consent judgment had expired and was not revivable as a matter of law.
On September 24, 2012, the plaintiffs filed a separate claim in the district court of Wyandotte County, Kansas, alleging that the Company and one of its subsidiaries, Americold Logistics, LLC, as successors to Americold Corporation, are liable for the full amount of the judgment, based upon the allegation that the Company failed to execute a document or take action to keep the judgment alive and viable.
On February 7, 2013, the Company removed the case to the U.S. federal court and ultimately filed a motion for summary judgment, which the plaintiffs vigorously opposed. On October 4, 2013, the court granted the Company’s motion and dismissed the case in full. The Court of Appeals ordered that the case be remanded to the Kansas State Court and the judgment in favor of Americold be vacated, finding U.S. federal diversity jurisdiction did not exist over the Company. The Company petitioned the U.S. Supreme Court for certiorari and oral argument occurred on January 19, 2016.
On March 7, 2016, the United States Supreme Court ruled that there was no federal diversity jurisdiction. Following the decision, the United States District Court for the District of Kansas entered an Order vacating the summary judgment and remanding the case to Kansas state court. Regardless of the venue, the Company remains confident that its defenses on the merits of plaintiffs’ claims are strong under Kansas law.
Following remand to Kansas state court, plaintiffs initially petitioned the court to amend their complaint to drop their claim for damages and only seek an Order of Specific Performance requiring Americold to sign a new document reinstating the consent judgment assigned in the 1994 Settlement Agreement. Plaintiffs filed a later motion to add back the damages claim, which was granted in February 2018.
In addition, the Company has sued the Chubb Group seeking the court’s declaration that Chubb Group owes coverage of the amounts sought by plaintiffs and for bad faith damages for denying coverage. Given the status of the proceedings to date, a liability amount cannot be reasonably estimated. The Company believes the ultimate outcome of this matter will not have a material adverse impact on its condensed consolidated financial statements.
Preferred Freezer Services, LLC Litigation
On February 11, 2019, Preferred Freezer Services, LLC (“PFS”) moved by Order to Show Cause in the Supreme Court of the State of New York, New York County, asserting breach of contract and other claims against the Company and seeking to preliminarily enjoin the Company from acting to acquire certain properties leased by PFS. In its complaint and request for preliminary injunctive relief, PFS alleged that the Company breached a confidentiality agreement entered into in connection with the Company’s participation in a bidding process for the sale of PFS by contacting PFS’s landlords and by using confidential PFS information in bidding for the properties leased by PFS (the “PFS Action”).
PFS’s request for a preliminary injunction was denied after oral argument on February 26, 2019. On March 1, 2019, PFS filed an application for interim injunctive relief from the Appellate Division of the Supreme Court, First Judicial Department (the “First Department”).
On April 2, 2019, while its application to the First Department was pending, PFS voluntarily dismissed its state court action, and First Department application, and re-filed substantially the same claims against the Company in the U.S. District Court for the Southern District of New York. In addition to an order enjoining Americold from
21


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
making offers to purchase the properties leased by PFS, PFS sought compensatory, consequential and/or punitive damages. The Company filed a motion to require PFS to reimburse the Company for its legal fees it incurred for the state court action before PFS is allowed to proceed in the federal court action. On February 18, 2020, the Court granted Americold’s request for an award of legal fees from PFS but declined to stay the case pending payment of that award. As to the amount of the award, the Company and PFS have entered into a stipulation that PFS will pay Americold $550,000 to reimburse the Company for its legal fees upon the conclusion of the case. PFS has since amended its complaint, and Americold has filed a motion to dismiss that amended complaint.
The Company denies the allegations of the PFS Action and the Fenway Action and believes the plaintiffs’ claims are without merit and intends to vigorously defend itself against the allegations. Given the status of the proceedings to date, a liability cannot be reasonably estimated. The Company believes the ultimate outcome of this matter will not have a material adverse impact on its condensed consolidated financial statements.
Environmental Matters
The Company is subject to a wide range of environmental laws and regulations in each of the locations in which the Company operates. Compliance with these requirements can involve significant capital and operating costs. Failure to comply with these requirements can result in civil or criminal fines or sanctions, claims for environmental damages, remediation obligations, the revocation of environmental permits, or restrictions on the Company’s operations.
The Company records accruals for environmental matters when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated based on current law and existing technologies. The Company adjusts these accruals periodically as assessment and remediation efforts progress or as additional technical or legal information become available. The Company recorded nominal environmental liabilities in accounts payable and accrued expenses as of March 31, 2022 and December 31, 2021. The Company believes it is in compliance with applicable environmental regulations in all material respects. Under various U.S. federal, state, and local environmental laws, a current or previous owner or operator of real estate may be liable for the entire cost of investigating, removing, and/or remediating hazardous or toxic substances on such property. Such laws often impose liability whether or not the owner or operator knew of, or was responsible for, the contamination. Even if more than one person may have been responsible for the contamination, each person covered by the environmental laws may be held responsible for the entire clean-up cost. There are no material unrecorded liabilities as of March 31, 2022. Most of the Company’s warehouses utilize ammonia as a refrigerant. Ammonia is classified as a hazardous chemical regulated by the Environmental Protection Agency, and an accident or significant release of ammonia from a warehouse could result in injuries, loss of life, and property damage.
Occupational Safety and Health Act (OSHA)
The Company’s warehouses located in the U.S. are subject to regulation under OSHA, which requires employers to provide employees with an environment free from hazards, such as exposure to toxic chemicals, excessive noise levels, mechanical dangers, heat or cold stress, and unsanitary conditions. The cost of complying with OSHA and similar laws enacted by states and other jurisdictions in which we operate can be substantial, and any failure to comply with these regulations could expose us to substantial penalties and potentially to liabilities to employees who may be injured at our warehouses. The Company records accruals for OSHA matters when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated. The Company believes that it is in substantial compliance with all OSHA regulations and that no material unrecorded liabilities exist as of March 31, 2022 and December 31, 2021.
22


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
8. Accumulated Other Comprehensive Loss
The Company reports activity in AOCI for foreign currency translation adjustments, including the translation adjustment for investments in partially owned entities, unrealized gains and losses on cash flow hedge derivatives, and minimum pension liability adjustments (net of tax). The activity in AOCI for the three months ended March 31, 2022 and 2021 is as follows (in thousands):
Three Months Ended March 31,
2022 2021
Pension and other postretirement benefits:
Gain arising during the period
$ 62  $ 381 
Amortization of prior service cost (1)
— 
Total pension and other postretirement benefits, net of tax $ 67  $ 381 
Foreign currency translation adjustments:
Cumulative translation adjustment $ (12,506) $ (10,682)
Derivative net investment hedges 23,692  — 
Total foreign currency translation gain (loss) $ 11,186  $ (10,682)
Designated derivatives:
Cash flow hedge derivatives $ (4,327) $ 2,672 
Net amount reclassified from AOCI to net gain (loss) (2) (3) (4)
4,478  (1,651)
Total unrealized gains on derivative contracts $ 151  $ 1,021 
Total change in other comprehensive income (loss) $ 11,404  $ (9,280)
(1)Amounts reclassified from AOCI for pension liabilities are recognized in “Selling, general and administrative” in the accompanying condensed consolidated statements of operations.
(2)Expense of a nominal amount will be reclassified to Interest Expense as of March 31, 2022 and 2021, respectively, related to derivatives designated as foreign exchange contracts.
(3)In conjunction with the termination of the interest rate swaps in 2020, the Company recorded $0.6 million in other comprehensive income that was reclassified as an adjustment to earnings during each of the three months ended March 31, 2022 and 2021. The Company recorded an increase to “Loss on debt extinguishment, modifications and termination of derivative instruments” related to this transaction.
(4)Included in the three months ended March 31, 2022 and 2021, respectively, was $3.9 million and $2.4 million in net amount reclassified from AOCI to foreign exchange gain (loss), net which is included within “Other, net” in the condensed consolidated statements of operations.

9. Segment Information
Our principal operations are organized into three reportable segments: Warehouse, Third-party managed and Transportation. The details of these segments remain materially unchanged from those disclosed in the 2021 Form 10-K as filed with the SEC.
Our reportable segments are strategic business units separated by service offerings. Each reportable segment is managed separately and requires different operational and marketing strategies. The accounting polices used in the preparation of our reportable segments financial information are the same as those used in the preparation of its condensed consolidated financial statements.
Our chief operating decision maker uses revenues and segment contribution to evaluate segment performance. We calculate segment contribution as earnings before interest expense, taxes, depreciation and amortization, and
23


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
exclude selling, general and administrative expense, acquisition, litigation and other, net, impairment of long-lived assets, gain or loss on sale of real estate and all components of non-operating other income and expense. Selling, general and administrative functions support all the business segments. Therefore, the related expense is not allocated to segments as the chief operating decision maker does not use it to evaluate segment performance.
Segment contribution is not a measurement of financial performance under GAAP, and may not be comparable to similarly titled measures of other companies. You should not consider our segment contribution as an alternative to operating income determined in accordance with GAAP.
The following table presents segment revenues and contributions with a reconciliation to loss before income tax for the three months ended March 31, 2022 and 2021 (in thousands):
Three Months Ended March 31,
2022 2021
Segment revenues:
Warehouse $ 540,925  $ 485,451 
Third-party managed 85,860  73,072 
Transportation 78,910  76,272 
Total revenues 705,695  634,795 
Segment contribution:
Warehouse 146,258  146,181 
Third-party managed 3,501  4,382 
Transportation 8,529  6,703 
Total segment contribution 158,288  157,266 
Reconciling items:
Depreciation and amortization (82,620) (77,211)
Selling, general and administrative (57,602) (45,052)
Acquisition, litigation and other, net (10,075) (20,751)
Interest expense (25,773) (25,956)
Loss on debt extinguishment, modifications and termination of derivative instruments (616) (3,499)
Other, net 245  176 
Loss before income tax benefit $ (18,153) $ (15,027)



24


Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
The following table details our assets by reportable segments, with a reconciliation to total assets reported for each of the periods presented in the accompanying Condensed Consolidated Balance Sheets.
March 31, 2022 December 31, 2021
(In thousands)
Assets:
Warehouse $ 7,834,970  $ 7,821,426 
Managed 57,953  48,497 
Transportation 219,250  218,252 
Total segments assets 8,112,173  8,088,175 
Reconciling items:
Corporate assets 52,170  90,564 
Investments in partially owned entities 43,526  37,458 
Total reconciling items 95,696  128,022 
Total assets $ 8,207,869  $ 8,216,197 
10. Loss per Common Share
Basic and diluted earnings per common share are calculated by dividing the net income or loss attributable to common shareholders by the basic and diluted weighted-average number of common shares outstanding in the period, respectively, using the allocation method prescribed by the two-class method. The Company applies this method to compute earnings per share because it distributes non-forfeitable dividend equivalents on restricted stock units and OP units granted to certain employees and non-employee trustees who have the right to participate in the distribution of common dividends while the restricted stock units and OP units are unvested.
The shares issuable upon settlement of forward sale agreements are reflected in the diluted earnings per share calculations using the treasury stock method. Under this method, the number of the Company’s common shares used in calculating diluted earnings per share is deemed to be increased by the excess, if any, of the number of common shares that would be issued upon full physical settlement of the forward sale agreements over the number of common shares that could be purchased by the Company in the market (based on the average market price during the period) using the proceeds receivable upon full physical settlement (based on the adjusted forward sale price at the end of the reporting period). If and when the Company physically or net share settles the forward sale agreements, the delivery of common shares would result in an increase in the number of shares outstanding and dilution to earnings per share.
A reconciliation of the basic and diluted weighted-average number of common shares outstanding for the three months ended March 31, 2022 and 2021 is as follows (in thousands):
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Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
Three Months Ended March 31,
2022 2021
Weighted average common shares outstanding – basic 269,164  252,938 
Dilutive effect of share-based awards —  — 
Equity forward contracts —  — 
Weighted average common shares outstanding – diluted 269,164  252,938 
For the three months ended March 31, 2022 and 2021, potential common shares under the treasury stock method and the if-converted method were antidilutive because the Company reported a net loss for both periods. Consequently, the Company did not have any adjustments between basic and diluted loss per share related to share-based awards or equity forward contracts.
The table below presents the number of antidilutive potential common shares that are not considered in the calculation of diluted loss per share (in thousands):
Three Months Ended March 31,
2022 2021
Employee stock options 202  413 
Restricted stock units 1,295  964 
OP units 494  358 
Equity forward contracts —  9,665 
1,991  11,400 
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Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
11. Revenue from Contracts with Customers
Disaggregated Revenue
The following tables represent a disaggregation of revenue from contracts with customers for the three months ended March 31, 2022 and 2021 by segment and geographic region:
Three Months Ended March 31, 2022
North America Europe Asia-Pacific South America Total
(In thousands)
Warehouse rent and storage
$ 181,939  $ 17,355  $ 16,721  $ 2,950  $ 218,965 
Warehouse services(1)
238,169  32,197  39,202  1,600  311,168 
Third-party managed
80,820  —  5,040  —  85,860 
Transportation
37,493  34,106  6,860  451  78,910 
Total revenues (2)
538,421  83,658  67,823  5,001  694,903 
Lease revenue (3)
9,313  1,479  —  —  10,792 
Total revenues from contracts with all customers
$ 547,734  $ 85,137  $ 67,823  $ 5,001  $ 705,695 
Three Months Ended March 31, 2021
North America Europe Asia-Pacific South America Total
(In thousands)
Warehouse rent and storage
$ 164,246  $ 17,252  $ 15,176  $ 2,425  $ 199,099 
Warehouse services(1)
210,846  25,336  42,469  1,524  280,175 
Third-party managed
67,697  —  5,375  —  73,072 
Transportation
40,315  30,612  4,973  372  76,272 
Total revenues (2)
483,104  73,200  67,993  4,321  628,618 
Lease revenue (3)
6,177  —  —  —  6,177 
Total revenues from contracts with all customers
$ 489,281  $ 73,200  $ 67,993  $ 4,321  $ 634,795 
(1)Warehouse services revenue includes sales of product that Americold purchases on the spot market, repackages, and sells to customers. Such revenues totaled $3.2 million and $2.9 million for the three months ended March 31, 2022 and March 31, 2021, respectively.
(2)Revenues are within the scope of ASC 606, Revenue From Contracts with Customers. Elements of contracts or arrangements that are in the scope of other standards (e.g., leases) are separated and accounted for under those standards.
(3)Revenues are within the scope of Topic 842, Leases.
Performance Obligations
Substantially all our revenue for warehouse storage and handling services, and management and incentive fees earned under third-party managed and other contracts is recognized over time as the customer benefits throughout the period until the contractual term expires. Typically, revenue is recognized over time using an output measure (e.g. passage of time) to measure progress. Revenue recognized at a point in time upon delivery when the customer typically obtains control, include most accessorial services, transportation services, reimbursed costs and quarry product shipments.
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Americold Realty Trust and Subsidiaries
Notes to Condensed Consolidated Financial Statements - (Unaudited)
For arrangements containing non-cancellable contract terms, any variable consideration related to storage renewals or incremental handling charges above stated minimums are 100% constrained and not included in aggregate amount of the transaction price allocated to the unsatisfied performance obligations disclosed below, given the degree in difficulty in estimation. Payment terms are generally 0 - 30 days upon billing, which is typically monthly, either in advance or subsequent to the performance of services. The same payment terms typically apply for arrangements containing variable consideration.
The Company has no material warranties or obligations for allowances, refunds or other similar obligations.
As of March 31, 2022, the Company had $703.7 million of remaining unsatisfied performance obligations from contracts with customers subject to non-cancellable terms and have an original expected duration exceeding one year. These obligations also do not include variable consideration beyond the non-cancellable term, which due to the inability to quantify by estimate, is fully constrained. The Company expects to recognize approximately 24% of these remaining performance obligations as revenue in 2022, and the remaining 76% to be recognized over a weighted average period of 12.6 years through 2038.
Contract Balances
The timing of revenue recognition, billings and cash collections results in accounts receivable (contract assets), and unearned revenue (contract liabilities) on the accompanying Condensed Consolidated Balance Sheets. Generally, billing occurs monthly, subsequent to revenue recognition, resulting in contract assets. However, the Company may bill and receive advances on storage and handling services, before revenue is recognized, resulting in contract liabilities. These assets and liabilities are reported on the accompanying Condensed Consolidated Balance Sheets on a contract-by-contract basis at the end of each reporting period. Changes in the contract asset and liability balances during the three months ended March 31, 2022, were not materially impacted by any other factors.
Opening and closing receivables balances related to contracts with customers accounted for under ASC 606 were $414.8 million and $375.1 million as of March 31, 2022 and December 31, 2021, respectively. All other trade receivable balances relate to contracts accounted for under ASC 842.
Opening and closing balances in unearned revenue related to contracts with customers were $28.3 million and $26.1 million as of March 31, 2022 and December 31, 2021, respectively. Substantially all revenue that was included in the contract liability balances at the beginning of 2022 has been recognized as of March 31, 2022, and represents revenue from the satisfaction of monthly storage and handling services with inventory that turns on average every 30 days.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
    The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q. In addition, the following discussion contains forward-looking statements, such as statements regarding our expectation for future performance, liquidity and capital resources, that involve risks, uncertainties and assumptions that could cause actual results to differ materially from our expectations. Our actual results may differ materially from those contained in or implied by any forward-looking statements. Factors that could cause such differences include those identified below and those described under Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2021.
MANAGEMENT’S OVERVIEW
We are the world’s largest publicly traded REIT focused on the ownership, operation, acquisition and development of temperature-controlled warehouses. We are organized as a self-administered and self-managed REIT with proven operating, development and acquisition expertise. As of March 31, 2022, we operated a global network of 249 temperature-controlled warehouses encompassing approximately 1.5 billion cubic feet, with 201 warehouses in North America, 27 in Europe, 18 warehouses in Asia-Pacific, and three warehouses in South America. In addition, we hold two minority interests in Brazilian-based joint ventures, one with SuperFrio, which owns or operates 33 temperature-controlled warehouses and one with Comfrio, which owns or operates 27 temperature-controlled warehouses.
Components of Our Results of Operations
Warehouse. Our primary source of revenues consists of rent, storage, and warehouse services fees. Our rent, storage, and warehouse services revenues are the key drivers of our financial performance. Rent and storage revenues consist of recurring, periodic charges related to the storage of frozen, perishable or other products in our warehouses by our customers. We also provide these customers with a wide array of handling and other warehouse services, such as (1) receipt, handling and placement of products into our warehouses for storage and preservation, (2) retrieval of products from storage upon customer request, (3) blast freezing, which involves the rapid freezing of non-frozen products, including individual quick freezing for agricultural produce and seafood, (4) case-picking, which involves selecting product cases to build customized pallets, (5) kitting and repackaging, which involves assembling custom product packages for delivery to retailers and consumers, and labeling services, (6) order assembly and load consolidation, (7) exporting and importing support services, (8) container handling, (9) cross-docking, which involves transferring inbound products to outbound trucks utilizing our warehouse docks without storing them in our warehouses, (10) government-approved temperature-controlled storage and inspection services, (11) fumigation, (12) pre-cooling and cold treatment services, (13) produce grading and bagging, (14) protein boxing, (15) e-commerce fulfillment, and (16) ripening. We refer to these handling and other warehouse services as our value-added services.
Cost of operations for our warehouse segment consist of power, other facilities costs, labor, and other service costs. Labor, the largest component of the cost of operations from our warehouse segment, consists primarily of employee wages, benefits, and workers’ compensation. Trends in our labor expense are influenced by changes in headcount, changes in compensation levels and associated performance incentives, the use of third-party labor to support our operations, changes in terms of collective bargaining agreements, changes in customer requirements and associated work content, workforce productivity, labor availability, governmental policies and regulations, variability in costs associated with medical insurance and the impact of workplace safety programs, inclusive of the number and severity of workers’ compensation claims. Labor expense can also be impacted as a result of discretionary bonuses. In response to the COVID-19 pandemic, we have incorporated certain activities such as
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staggered break schedules, social distancing, and other changes to process that can create inefficiencies, all of which we expect to continue to incur going forward. Our second largest cost of operations from our warehouse segment is power utilized in the operation of our temperature-controlled warehouses. As a result, fluctuations in the price for power in the regions where we operate may have a significant effect on our financial results. We may from time to time hedge our exposure to changes in power prices through fixed rate agreements or, to the extent possible and appropriate, through rate escalations or power surcharge provisions within our customer contracts. Additionally, business mix impacts power expense depending on the temperature zone or type of freezing required. Other facilities costs include utilities other than power, property insurance, property taxes, sanitation (which include incremental supplies as a result of COVID-19), repairs and maintenance on real estate, rent under real property operating leases, where applicable, security, and other related facilities costs. Other services costs include equipment costs, warehouse consumables (e.g., shrink-wrap and uniforms), personal protective equipment to maintain the health and safety of our associates, warehouse administration and other related services costs.
Third-Party Managed. We receive a reimbursement of substantially all expenses for warehouses that we manage on behalf of third-party owners, with all reimbursements recognized as revenues under the relevant accounting guidance. We also earn management fees, incentive fees upon achieving negotiated performance and cost-savings results, or an applicable mark-up on costs. Cost of operations for our third-party managed segment is reimbursed on a pass-through basis (typically within two weeks).
Transportation. We charge transportation fees, which may also include fuel and capacity surcharges, to our customers for whom we arrange the transportation of their products. Cost of operations for our transportation segment consists primarily of third-party carrier charges, which are impacted by factors affecting those carriers, including driver and equipment availability in certain markets. Additionally, in certain markets we employ drivers and assets to serve our customers. Costs to operate these assets include, wages, fuel, tolls, insurance and maintenance.
Other Consolidated Operating Expenses. We also incur depreciation and amortization expenses, corporate-level selling, general and administrative expenses and corporate-level acquisition, litigation and other, net expenses.
Our depreciation and amortization charges result primarily from the capital-intensive nature of our business. The principal components of depreciation relate to our warehouses, including buildings and improvements, refrigeration equipment, racking, leasehold improvements, material handling equipment, furniture and fixtures, and our computer hardware and software. Amortization relates primarily to intangible assets for customer relationships.
Our corporate-level selling, general and administrative expenses consist primarily of wages and benefits for management, administrative, business development, account management, project management, marketing, engineering, supply-chain solutions, human resources and information technology personnel, as well as expenses related to equity incentive plans, communications and data processing, travel, professional fees, bad debt, training, office equipment and supplies. Trends in corporate-level selling, general and administrative expenses are influenced by changes in headcount and compensation levels and achievement of incentive compensation targets. To position ourselves to meet the challenges of the current business environment, we have implemented a shared services support structure to better manage costs and enhance the efficiency of our operations. We have begun to integrate our recent acquisitions into this shared services structure.
Our corporate-level acquisition, litigation and other, net consists of costs that we view outside of selling, general and administrative expenses with a high level of variability from period-to-period, and include the following:
Acquisition related costs include costs associated with transactions, whether consummated or not, such as advisory, legal, accounting, valuation and other professional or consulting fees. We also
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include integration costs pre- and post-acquisition that reflect work being performed to facilitate merger and acquisition integration, such as employee retention expense and work associated with information systems and other projects including spending to support future acquisitions, which primarily consist of professional services.
Litigation costs incurred in order to defend ourselves from litigation charges outside of the normal course of business and related settlement costs.
Severance costs representing 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.
Equity acceleration costs representing the unrecognized expense for share-based awards that vest and convert to common shares in advance of the original negotiated vesting date and any other equity award changes resulting in accounting for the award as a modification.
Non-offering related equity issuance expenses whether incurred through our initial public offering, follow-on offerings or secondary offerings.
Terminated site operations costs represent expenses incurred to return leased sites to their original physical state at lease inception in connection with the termination of the applicable underlying lease. These terminations were part of our strategic efforts to exit or sell non-strategic warehouses as opposed to ordinary course lease expirations. Repair and maintenance expenses associated with our ordinary course operations are reflected as operating expenses on our condensed consolidated statement of operations.
Cyber incident related costs include third-party fees incurred in connection with the cyber incident that occurred in November 2020, as well as any incremental costs, internal and external, incurred to restore operations at our facilities and damage claims. Any subsequent reimbursements from insurance coverage for expenses incurred in connection with the event are also reflected within this category.
Other costs relate to insurance claim deductibles and related recoveries (2021) and additional superannuation pension costs related to prior years upon review by the Australian Tax Office (2020).

Key Factors Affecting Our Business and Financial Results
Market Conditions and COVID-19
During the three months ended March 31, 2022 and the year ended December 31, 2021, our business and financial results were negatively impacted by COVID-19 related disruptions in (1) the food supply chain; (ii) our customers’ production and transportation of goods; (iii) the labor market impacting availability and cost; and (iv) the macroeconomic environment including the impact of inflation on the cost to provide our services. We are continuing to closely monitor the impact of the COVID-19 pandemic and any variants on all aspects of our business and geographies, including how it will impact our customers and business partners. The extent to which COVID-19 impacts our operations will depend on future developments, which are highly uncertain and cannot be predicted with any degree of confidence, including the scope, severity, duration and geographies of the outbreak, the occurrence of additional waves or spikes in infection rates (including the spread of variant strains), the actions taken to contain the COVID-19 pandemic or mitigate its impact as requested or mandated by governmental authorities or otherwise voluntarily taken by individuals or businesses, and the direct and indirect economic effects of the outbreak and containment measures, among others.
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We expect that end-consumer demand for food will remain consistent with historic levels over the long-term. However, current end-consumer demand coupled with food production and transportation challenges since the outset of the pandemic has driven down holdings in our facilities. As a result, occupancy and throughput volume continue at lower than historical levels experienced prior to COVID-19. We expect this to continue until our customers are able to ramp production back up to pre-pandemic levels for an extended period of time and rebuild inventory in the supply chain.
The unprecedented labor environment continues to be challenging for many companies, including our food manufacturing customers. Labor availability continues to be the primary constraint on food production, along with the continuing spread of COVID-19 and related variants, which also impacts the labor market.
Our business has also been impacted due to inflation during the back half of 2021 and during the three months ended March 31, 2022. We believe we are positioned to address continued inflationary pressure as it arises; however, many of our contracts require that we experience sustained cost increases for an extended period of time ranging up to 60 days before we are able to initiate rate increases or seek remedies under our contracts. As a result of the significant impact of inflation on the cost of providing our storage, services and transportation to customers, during the second half of 2021 we initiated out-of-cycle rate increases in our customer contracts (many of which contain provisions for inflationary price escalators), and expect to continue to monitor further inflation and pricing increases required into 2022. We can give no assurance that we will be able to offset the entire impact of inflation or future inflationary cost increases through increased storage or service charges or by operational efficiencies.
Additionally, global supply chains have been volatile following the invasion of Ukraine by Russia which has resulted in sanctions from the U.S. and a number of European countries. While we do not expect our global operations and specifically our European operations to be directly impacted by this event currently, changes could occur that could impact our operations.
Refer to “Item 1A - Risk Factors” of our 2021 Annual Report on Form 10-K as filed with the SEC, as well as Item 1A. Risk Factors on this Quarterly Report on Form 10-Q for additional information.
Acquisitions and Joint Ventures
There have been no acquisitions during the three months ended March 31, 2022. Refer to Note 2 of the Notes to the Condensed Consolidated Financial Statements and Note 3 of our 2021 Annual Report on Form 10-K for further information.
Seasonality
We are involved in providing services to food producers, distributors, retailers and e-tailers whose businesses, in some cases, are seasonal or cyclical. In order to mitigate the volatility in our revenue and earnings caused by seasonal business, we have implemented fixed commitment contracts with certain of our customers. Our customers with fixed commitment contracts pay for guaranteed warehouse space in order to maintain their required inventory levels, which is especially helpful to them during periods of peak physical occupancy. The timing of Easter fluctuates between the first and second quarter of the year, however, on average the first and second quarter revenue and NOI are relatively consistent. On a portfolio-wide basis, physical occupancy rates are generally the lowest during May and June. Physical occupancy rates typically exhibit a gradual increase after May and June as a result of annual harvests and our customers building inventories in connection with end-of-year holidays and generally peak between mid-September and early December as a result thereof. The hottest weather for our portfolio occurs during the third quarter of the year resulting in increase power expense that negatively impacts NOI, and moderates during the fourth quarter. Typically, we have higher than average physical occupancy levels in October or November, which also tends to result in higher revenues. In light of the ongoing
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COVID-19 pandemic, we have seen variability in physical occupancy levels as compared to the typical seasonality trends.
Additionally, the involvement of our customers in a cross-section of the food industry mitigates, in part, the impact of seasonality as peak demand for various products occurs at different times of the year (for example, demand for ice cream is typically highest in the summer while demand for frozen turkeys usually peaks in the late fall). Our southern hemisphere operations in Australia, New Zealand and South America also help balance the impact of seasonality in our global operations, as their growing and harvesting cycles are complementary to North America and Europe. Each of our warehouses sets its own operating hours based on demand, which is heavily driven by growing seasons and seasonal consumer demand for certain products.
Foreign Currency Translation Impact on Our Operations
Our consolidated revenues and expenses are subject to variations caused by the net effect of foreign currency translation on revenues and expenses incurred by our operations outside the United States. Future fluctuations of foreign currency exchange rates and their impact on our Condensed Consolidated Statements of Operations are inherently uncertain. As a result of the relative size of our international operations, these fluctuations may be material on our results of operations. Our revenues and expenses from our international operations are typically denominated in the local currency of the country in which they are derived or incurred. Therefore, the impact of foreign currency fluctuations on our results of operations and margins is partially mitigated.
The following table shows a comparison of underlying average exchange rates of the foreign currencies that impacted our U.S. dollar-reported revenues and expenses during the periods discussed herein together with a comparison against the exchange rates of such currencies at the end of the applicable periods presented herein. The rates below represent the U.S. dollar equivalent of one unit of the respective foreign currency. Amounts presented in constant currency within our Results of Operations are calculated by applying the average foreign exchange rate from the comparable prior year period to actual local currency results in the current period, rather than the actual exchange rates in effect during the respective period. While constant currency metrics are a non-GAAP calculation and do not represent actual results, the comparison allows the reader to understand the impact of the underlying operations in addition to the impact of changing foreign exchange rates.
 
Foreign exchange
rates as of
March 31, 2022
Average foreign exchange rates used to translate actual operating results for the three months ended March 31, 2022
Foreign exchange
rates as of
March 31, 2021
Prior period average
foreign exchange rate used to adjust actual operating results for the three months ended March 31, 2022(1)
Argentinian peso 0.009  0.009  0.011  0.011 
Australian dollar 0.748  0.724  0.760  0.773 
Brazilian real 0.211  0.192  0.178  0.183 
British Pound 1.314  1.342  1.378  1.379 
Canadian dollar 0.800  0.789  0.796  0.790 
Chilean Peso 0.001  0.001  0.001  0.001 
Euro 1.107  1.122  1.173  1.205 
New Zealand dollar 0.695  0.676  0.699  0.719 
Poland Zloty 0.238  0.243  0.253  0.265 
(1)Represents the relevant average foreign exchange rates in effect in the comparable prior period applied to the activity for the current period. The average foreign currency exchange rates we apply to our operating results are derived from third party reporting sources for the periods indicated.
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Focus on Our Operational Effectiveness and Cost Structure
We continuously seek to execute on various initiatives aimed at streamlining our business processes and reducing our cost structure, including: realigning and centralizing key business processes and fully integrating acquired assets and businesses; implementing standardized operational processes; integrating and launching new information technology tools and platforms; instituting key health, safety, leadership and training programs; and capitalizing on the purchasing power of our network. Through the realignment of our business processes, we have acquired new talent and strengthened our service offerings. In order to reduce costs in our facilities, we have invested in energy efficiency projects, including LED lighting, thermal energy storage, motion-sensor technology, variable frequency drives for our fans and compressors, third party efficiency reviews and real-time monitoring of energy consumption, rapid open and close doors, and alternative-power generation technologies to improve the energy efficiency of our warehouses. We have also performed fine-tuning of our refrigeration systems, deployed efficient energy management practices, such as time-of-use and awareness, and have increased our participation in Power Demand Response programs with some of our power suppliers. These initiatives have allowed us to reduce our consumption of kilowatt hours and energy spend.
As part of our initiatives to streamline our business processes and to reduce our cost structure, we have evaluated and exited less strategic and profitable markets or business lines, including the sale of certain warehouse assets, the exit of certain leased facilities, the exit of certain managed warehouse agreements, the exit of the China JV during 2019, and the sale of our quarry business during 2020. Through our process of active portfolio management, we continue to evaluate our markets and offerings.
Strategic Shift within Our Transportation Segment
Several years ago, we initiated a strategic shift in our transportation segment services and solutions. The intention of this strategic shift was to better focus our business on the operation of our temperature-controlled warehouses. Specifically, we have gradually exited certain commoditized, non-scalable, or low margin services we historically offered to our customers, in favor of more profitable and value-added programs, such as regional, national, truckload and retailer-specific multi-vendor consolidation services. We designed each value-added program to improve efficiency and reduce transportation and logistics costs to our warehouse customers, whose transportation spend typically represents the majority of their supply-chain costs. We believe this efficiency and cost reduction helps to drive increased client retention, as well as maintain high occupancy levels in our temperature-controlled warehouses. Over the last several years, we have made significant progress in implementing our strategic initiative of growing our transportation service offering in a way that complements our temperature-controlled warehouse business, such as adding a dedicated fleet service offering through acquisitions such as Agro and Hall’s. We intend to continue executing this strategy in the future.
Historically Significant Customer
For the three months ended March 31, 2022 and 2021, one customer accounted for more than 10% of our total revenues. For the three months ended March 31, 2022 and 2021, revenues attributable to this customer were $78.1 million and $65.8 million, respectively. The substantial majority of this customer’s business relates to our third-party managed segment. We are reimbursed for substantially all expenses we incur in managing warehouses on behalf of third-party owners. We recognize these reimbursements as revenues under applicable accounting guidance, but these reimbursements generally do not affect our financial results because they are offset by the corresponding expenses that we recognize in our third-party managed segment cost of operations. Of the revenues received from this customer, $75.2 million and $61.3 million represented reimbursements for certain expenses we incurred during the three months ended March 31, 2022 and 2021, respectively, and were offset by matching expenses included in our third party managed cost of operations.
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Economic Occupancy of our Warehouses
We define average economic occupancy as the aggregate number of physically occupied pallets and any additional pallets otherwise contractually committed for a given period, without duplication. We estimate the number of contractually committed pallet positions by taking into account the actual pallet commitment specified in each customers’ contract, and subtracting the physical pallet positions. We regard economic occupancy as an important driver of our financial results. Historically, providers of temperature-controlled warehouse space have offered storage services to customers on an as-utilized, on-demand basis. We actively seek to enter into contracts that implement our commercial business rules which contemplate, among other things, fixed storage commitments in connection with establishing new customer relationships. Additionally, we actively seek opportunities to transition our current customers to contracts that feature a fixed storage commitment when renewing existing agreements or upon the change in the anticipated profile of our customer. This strategy mitigates the impact of changes in physical occupancy throughout the course of the year due to seasonality, as well as other factors that can impact physical occupancy while ensuring our customers have the necessary space they need to support their business.
Throughput at our Warehouses
The level and nature of throughput at our warehouses is an important factor impacting our warehouse services revenues in our warehouse segment. Throughput refers to the volume of pallets that enter and exit our warehouses. Higher levels of throughput drive warehouse services revenues in our warehouse segment as customers are typically billed on a basis that takes into account the level of throughput of the goods they store in our warehouses. The nature of throughput may be driven by the expected turn of the underlying product or commodity. Throughput pallets can be influenced both by the food manufacturers as well as shifts in demand preferences. Food manufacturers’ production levels, which respond to market conditions, labor availability, supply chain dynamics and consumer preferences, may impact inbound pallets. Similarly, a change in inventory turnover due to shift in customer demand may impact outbound pallets.
How We Assess the Performance of Our Business
Segment Contribution (Net Operating Income or “NOI”)
We evaluate the performance of our primary business segments based on their contribution (NOI) to our overall results of operations. We use the term “segment contribution (NOI)” to mean a segment’s revenues less its cost of operations (excluding any depreciation and amortization, impairment charges, corporate-level selling, general and administrative expenses and corporate-level acquisition, litigation and other, net). We use segment contribution (NOI) to evaluate our segments for purposes of making operating decisions and assessing performance in accordance with FASB ASC, Topic 280, Segment Reporting.
We also analyze the “segment contribution (NOI) margin” for each of our business segments, which we calculate as segment contribution (NOI) divided by segment revenues.
In addition to our segment contribution (NOI) and segment contribution (NOI) margin, we analyze the contribution (NOI) of our warehouse rent and storage operations and our warehouse services operations within our warehouse segment. We calculate the contribution (NOI) of our warehouse rent and storage operations as rent and storage revenues less power and other facilities cost. We calculate the contribution (NOI) of our warehouse services operations as warehouse services revenues less labor and other service costs. We calculate the contribution (NOI) margin for each of these operations as the applicable contribution (NOI) measure divided by the applicable revenue measure. We believe the presentation of these contribution (NOI) and contribution (NOI) margin measures helps investors understand the relative revenues, costs and earnings resulting from each of these
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separate types of services we provide to our customers in the same manner reviewed by our management in connection with the operation of our business. These contribution (NOI) measures within our warehouse segment are not measurements of financial performance under U.S. GAAP, and these measures should be considered as supplements, but not as alternatives, to our results calculated in accordance with U.S. GAAP. We provide reconciliations of these measures in the discussions of our comparative results of operations below.
Same Store Analysis
We define our “same store” population once a year at the beginning of the current calendar year. Our same store population includes properties that were owned or leased for the entirety of two comparable periods and that have reported at least twelve months of consecutive normalized operations prior to January 1 of the prior calendar year. We define “normalized operations” as properties that have been open for operation or lease after development or significant modification, including the expansion of a warehouse footprint or a warehouse rehabilitation subsequent to an event, such as a natural disaster or similar event causing disruption to operations. In addition, our definition of “normalized operations” takes into account changes in the ownership structure (e.g., purchase of a previously leased warehouse would result in different charges in the compared periods), which would impact comparability in our warehouse segment contribution (NOI).
Acquired properties will be included in the “same store” population if owned by us as of the first business day of each year, of the prior calendar year and still owned by us as of the end of the current reporting period, unless the property is under development. The “same store” pool is also adjusted to remove properties that were sold or entering development subsequent to the beginning of the current calendar year. As such, the “same store” population for the period ended March 31, 2022 includes all properties that we owned at January 3, which had both been owned and had reached “normalized operations” by January 3, 2022.
We calculate “same store contribution (NOI)” as revenues for the same store population less its cost of operations (excluding any depreciation and amortization, impairment charges, corporate-level selling, general and administrative expenses, corporate-level acquisition, litigation and other, net and gain or loss on sale of real estate). In order to derive an appropriate measure of period-to-period operating performance, we also calculate our same store contribution (NOI) on a constant currency basis to remove the effects of foreign currency exchange rate movements by using the comparable prior period exchange rate to translate from local currency into U.S. dollars for both periods. We evaluate the performance of the warehouses we own or lease using a “same store” analysis, and we believe that same store contribution (NOI) is helpful to investors as a supplemental performance measure because it includes the operating performance from the population of properties that is consistent from period to period and also on a constant currency basis, thereby eliminating the effects of changes in the composition of our warehouse portfolio and currency fluctuations on performance measures.
The following table shows the number of same-store warehouses in our portfolio as of March 31, 2022. The number of warehouses owned or operated in as of March 31, 2022 and excluded as same-store warehouses for the period ended March 31, 2022 is listed below. While not included in the non-same store warehouse count in the table below, the results of operations for the non-same store warehouses includes the partial period impact of sites that were exited during the periods presented.
Total Warehouses 249
Same Store Warehouses 215
Non-Same Store Warehouses (1)
25
Third-Party Managed Warehouses 9
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(1) During the first quarter of 2022, we ceased operations at a facility which we are preparing to lease, which is now included in the non-same store population as a result. Additionally, we exited a leased facility that had been recently acquired in connection with the Lago Cold Stores acquisition.
As of March 31, 2022, our portfolio consisted of 249 total warehouses, including 240 within the warehouse segment and nine in the third-party managed segment. In addition, we hold minority interests in two Brazilian joint ventures, Superfrio, which owns or operates 33 temperature-controlled warehouses, and Comfrio, which owns or operates 27 temperature-controlled warehouses.
Same store contribution (NOI) is not a measurement of financial performance under U.S. GAAP. In addition, other companies providing temperature-controlled warehouse storage and handling and other warehouse services may not define same store or calculate same store contribution (NOI) in a manner consistent with our definition or calculation. Same store contribution (NOI) should be considered as a supplement, but not as an alternative, to our results calculated in accordance with U.S. GAAP. We provide reconciliations of these measures in the discussions of our comparative results of operations below.
Constant Currency Metrics
As discussed above under “Key Factors Affecting Our Business and Financial Results—Foreign Currency Translation Impact on Our Operations,” our consolidated revenues and expenses are subject to variations outside our control that are caused by the net effect of foreign currency translation on revenues generated and expenses incurred by our operations outside the United States. As a result, in order to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency fluctuations, we analyze our business performance based on certain constant currency reporting that represents current period results translated into U.S. dollars at the relevant average foreign exchange rates applicable in the comparable prior period. We believe that the presentation of constant currency results provides a measurement of our ongoing operations that is meaningful to investors because it excludes the impact of these foreign currency movements that we cannot control. Constant currency results are not measurements of financial performance under U.S. GAAP, and our constant currency results should be considered as a supplement, but not as an alternative, to our results calculated in accordance with U.S. GAAP. The constant currency performance measures should not be considered a substitute for, or superior to, the measures of financial performance prepared in accordance with U.S. GAAP. We provide reconciliations of these measures in the discussions of our comparative results of operations below. Our discussion of the drivers of our performance below are based upon U.S. GAAP.
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Comparison of Results for the Three Months Ended March 31, 2022 and 2021
Warehouse Segment
The following table presents the operating results of our warehouse segment for the three months ended March 31, 2022 and 2021.
Three Months Ended March 31, Change
2022 actual
2022 constant currency(1)
2021 actual Actual Constant currency
(Dollars in thousands)
Rent and storage $ 229,757  $ 232,445  $ 205,275  11.9  % 13.2  %
Warehouse services 311,168  316,277  280,176  11.1  % 12.9  %
Total warehouse segment revenues 540,925  548,722  485,451  11.4  % 13.0  %
Power 33,035  33,626  26,204  26.1  % 28.3  %
Other facilities costs (2)
56,572  57,359  50,532  12.0  % 13.5  %
Labor 244,160  247,869  214,547  13.8  % 15.5  %
Other services costs (3)
60,900  61,910  47,987  26.9  % 29.0  %
Total warehouse segment cost of operations $ 394,667  $ 400,764  $ 339,270  16.3  % 18.1  %
Warehouse segment contribution (NOI) $ 146,258  $ 147,958  $ 146,181  0.1  % 1.2  %
Warehouse rent and storage contribution (NOI) (4)
$ 140,150  $ 141,460  $ 128,539  9.0  % 10.1  %
Warehouse services contribution (NOI) (5)
$ 6,108  $ 6,498  $ 17,642  (65.4) % (63.2) %
Total warehouse segment margin 27.0  % 27.0  % 30.1  % -307 bps -315 bps
Rent and storage margin(6)
61.0  % 60.9  % 62.6  % -162 bps -176 bps
Warehouse services margin(7)
2.0  % 2.1  % 6.3  % -433 bps -424 bps
(1)The adjustments from our U.S. GAAP operating results to calculate our operating results on a constant currency basis are the effect of changes in foreign currency exchange rates relative to the comparable prior period.
(2)Includes real estate rent expense of $10.6 million and $9.3 million, on an actual basis, for the three months ended March 31, 2022 and 2021, respectively.
(3)Includes non-real estate rent expense (equipment lease and rentals) of $3.1 million and $2.9 million, on an actual basis, for the three months ended March 31, 2022 and 2021, respectively.
(4)Calculated as rent and storage revenues less power and other facilities costs.
(5)Calculated as warehouse services revenues less labor and other services costs.
(6)Calculated as warehouse rent and storage contribution (NOI) divided by warehouse rent and storage revenues.
(7)Calculated as warehouse services contribution (NOI) divided by warehouse services revenues.
Warehouse segment revenues were $540.9 million for the three months ended March 31, 2022 an increase of $55.5 million, or 11.4%, compared to $485.5 million for the three months ended March 31, 2021. On a constant currency basis, our warehouse segment revenues were $548.7 million for the three months ended March 31, 2022, an increase of $63.3 million, or 13.0%, from the three months ended March 31, 2021. Approximately $29.6 million of the increase, on an actual currency basis, was driven by acquisitions completed during 2021, including the growth experienced period-over-period during overlapping periods of ownership. We acquired four facilities on March 1, 2021 as a result of the Liberty acquisition, two facilities on May 5, 2021 as a result of the KMT Brrr! acquisition, one facility on May 28, 2021 as a result of the Bowman Stores acquisition, two facilities on August 2, 2021 as a result of the ColdCo acquisition, one facility on September 1, 2021 as a result of the Newark Facility Management acquisition and two facilities on November 15, 2021 as a result of the Lago Cold Stores acquisition (one leased facility exited upon expiration during the first quarter of 2022), and therefore we did not have ownership of these facilities for the entirety of the prior comparable period. Revenue growth was also due to contractual and market-driven rate escalations in the same store population and our recently completed
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developments. This was partially offset by the timing of throughput associated with the Easter holiday and COVID-19 and the related labor challenges which continued to impact food production. The foreign currency translation of revenues earned by our foreign operations had a $7.8 million unfavorable impact during the three months ended March 31, 2022, which was mainly driven by the weakening of the U.S. dollar over the local currencies in our foreign subsidiaries.
Warehouse segment cost of operations was $394.7 million for the three months ended March 31, 2022, an increase of $55.4 million, or 16.3%, compared to the three months ended March 31, 2021. On a constant currency basis, our warehouse segment cost of operations was $400.8 million for the three months ended March 31, 2022, an increase of $61.5 million, or 18.1%, from the three months ended March 31, 2021. Approximately $22.0 million of the increase, on an actual basis, was driven by the additional facilities in the warehouse segment we acquired in connection with the aforementioned acquisitions. In addition, we incurred increases in our cost of operations, specifically including power, labor and travel, property tax, supplies and equipment maintenance, all of which are reflective of elevated inflation. Labor was also impacted by employee absenteeism and associated disruption throughout the first quarter of 2022 due to the Omicron variant. We also incurred higher costs related to our recently completed expansion and development projects. Additionally, the foreign currency translation of expenses incurred by our foreign operations had a net $6.1 million favorable impact during the three months ended March 31, 2022.
For the three months ended March 31, 2022, warehouse segment contribution (NOI), increased $0.1 million, or 0.1%, to $146.3 million for the three months ended March 31, 2022, compared to $146.2 million for the three months ended March 31, 2021. The foreign currency translation of our results of operations had a $1.7 million unfavorable impact to the warehouse segment contribution period-over-period. On a constant currency basis, warehouse segment NOI increased $1.8 million period-over-period. Approximately $7.7 million of the increase, on an actual basis, was driven by the additional facilities in the warehouse segment as a result of the aforementioned acquisitions, including the growth and synergies experienced period-over-period during overlapping periods of ownership. The increase was also driven by contractual and market-driven rate escalations, offset by cost increases driven primarily by inflation, higher costs related to our recently completed expansion and development projects, and lower throughput due to the timing of throughput associated with the Easter holiday and the ongoing supply chain disruption. Our NOI was also unfavorably impacted by the currency translation impact of the weakening of the U.S. dollar.
Same Store and Non-Same Store Analysis
We had 215 same stores for the three months ended March 31, 2022. Please see “How We Assess the Performance of Our Business—Same Store Analysis” above for a reconciliation of the change in the same store portfolio from period to period. Amounts related to the acquisitions of Bowman Stores, ColdCo, KMT Brrr!, Lago Cold Stores, Liberty, Newark, one recently leased warehouse in Australia, a recently constructed facility in Denver purchased in November 2021, as well as certain expansion and development projects not yet stabilized are reflected within non-same store results.
The following table presents revenues, cost of operations, contribution (NOI) and margins for our same stores and non-same stores with a reconciliation to the total financial metrics of our warehouse segment for the three months ended March 31, 2022 and 2021.
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Three Months Ended March 31, Change
2022 actual
2022 constant currency(1)
2021 actual Actual Constant currency
Number of same store sites 215 215 n/a n/a
Same store revenues: (Dollars in thousands)
Rent and storage $ 204,273  $ 206,643  $ 194,203  5.2  % 6.4  %
Warehouse services 279,116  283,913  268,591  3.9  % 5.7  %
Total same store revenues 483,389  490,556  462,794  4.5  % 6.0  %
Same store cost of operations:
Power 28,719  29,239  24,776  15.9  % 18.0  %
Other facilities costs 49,139  49,818  46,727  5.2  % 6.6  %
Labor 214,425  217,895  200,950  6.7  % 8.4  %
Other services costs 52,050  53,000  44,448  17.1  % 19.2  %
Total same store cost of operations $ 344,333  $ 349,952  $ 316,901  8.7  % 10.4  %
Same store contribution (NOI) $ 139,056  $ 140,604  $ 145,893  (4.7) % (3.6) %
Same store rent and storage contribution (NOI)(2)
$ 126,415  $ 127,586  $ 122,700  3.0  % 4.0  %
Same store services contribution (NOI)(3)
$ 12,641  $ 13,018  $ 23,193  (45.5) % (43.9) %
Total same store margin 28.8  % 28.7  % 31.5  % -276 bps -286 bps
Same store rent and storage margin(4)
61.9  % 61.7  % 63.2  % -130 bps -144 bps
Same store services margin(5)
4.5  % 4.6  % 8.6  % -411 bps -405 bps
Three Months Ended March 31, Change
2022 actual
2022 constant currency(1)
2021 actual Actual Constant currency
Number of non-same store sites 25 18 n/a n/a
Non-same store revenues: (Dollars in thousands)
Rent and storage $ 25,484  $ 25,802  $ 11,072  n/r n/r
Warehouse services 32,052  32,364  11,585  n/r n/r
Total non-same store revenues 57,536  58,166  22,657  n/r n/r
Non-same store cost of operations:
Power 4,316  4,388  1,428  n/r n/r
Other facilities costs 7,433  7,541  3,805  n/r n/r
Labor 29,735  29,974  13,597  n/r n/r
Other services costs 8,850  8,909  3,539  n/r n/r
Total non-same store cost of operations $ 50,334  $ 50,812  $ 22,369  n/r n/r
Non-same store contribution (NOI) $ 7,202  $ 7,354  $ 288  n/r n/r
Non-same store rent and storage contribution (NOI)(2)
$ 13,735  $ 13,873  $ 5,839  n/r n/r
Non-same store services contribution (NOI)(3)
$ (6,533) $ (6,519) $ (5,551) n/r n/r
Total non-same store margin 12.5  % 12.6  % 1.3  % n/r n/r
Non-same store rent and storage margin(4)
53.9  % 53.8  % 52.7  % n/r n/r
Non-same store services margin(5)
(20.4) % (20.1) % (47.9) % n/r n/r
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Three Months Ended March 31, Change
2022 actual
2022 constant currency(1)
2021 actual Actual Constant currency
Total warehouse segment revenues $ 540,925  $ 548,722  $ 485,451  11.4  % 13.0  %
Total warehouse cost of operations $ 394,667  $ 400,764  $ 339,270  16.3  % 18.1  %
Total warehouse segment contribution $ 146,258  $ 147,958  $ 146,181  0.1  % 1.2  %
(1)The adjustments from our U.S. GAAP operating results to calculate our operating results on a constant currency basis is the effect of changes in foreign currency exchange rates relative to the comparable prior period.
(2)Calculated as rent and storage revenues less power and other facilities costs.
(3)Calculated as warehouse services revenues less labor and other services costs.
(4)Calculated as rent and storage contribution (NOI) divided by rent and storage revenues.
(5)Calculated as warehouse services contribution (NOI) divided by warehouse services revenues.
(6)Non-same store warehouse count of 25 includes one recently leased warehouse in Australia, one recently constructed facility in Denver we purchased in November 2021, three facilities acquired through the Lago Cold Stores acquisition on November 15, 2021, one warehouse acquired through the Newark Facility Management acquisition on September 1, 2021, two facilities acquired through the ColdCo acquisition on August 2, 2021, one warehouse acquired through the Bowman stores acquisition on May 28, 2021, two warehouses acquired through the KMT Brrr! acquisition on May 5, 2021, four warehouses acquired through the Liberty Freezers acquisition on March 1, 2021, and 11 facilities under development or expansion. During the third quarter of 2021, a leased facility from the Liberty Freezers acquisition was exited upon expiration of the lease. During the first quarter of 2022, a leased facility from the Lago Cold Stores acquisition was exited upon expiration of the lease, and we ceased operations within a facility that is being prepared for lease to a third-party. The results of the facilities exited are included in the results above, and the results of these acquisitions are reflected in the results above since date of ownership.
n/a - not applicable, the change in actual and constant currency metrics does not apply to site count
n/r - not relevant

The following table provides certain operating metrics to explain the drivers of our same store performance.

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Three Months Ended March 31,
Units in thousands except per pallet and site number data - unaudited 2022 2021 Change
Number of same store sites 215  215  n/a
Same store rent and storage:
Economic occupancy(1)
Average occupied economic pallets 3,797  3,768  0.8  %
Economic occupancy percentage 77.6  % 77.4  % 22 bps
Same store rent and storage revenues per economic occupied pallet $ 53.80  $ 51.55  4.4  %
Constant currency same store rent and storage revenues per economic occupied pallet $ 54.43  $ 51.55  5.6  %
Physical occupancy(2)
Average physical occupied pallets 3,456  3,442  0.4  %
Average physical pallet positions 4,892  4,869  0.5  %
Physical occupancy percentage 70.7  % 70.7  % -4 bps
Same store rent and storage revenues per physical occupied pallet $ 59.10  $ 56.43  4.7  %
Constant currency same store rent and storage revenues per physical occupied pallet $ 59.79