CHICAGO--(BUSINESS WIRE)--Equity LifeStyle Properties, Inc. (NYSE: ELS) (referred to herein as “we,” “us,” and “our”) today announced results for the quarter and nine months ended September 30, 2019. All Common Stock and OP units as well as per share results reflect the two-for-one stock split that was completed on October 15, 2019. Additionally, all per share results are reported on a fully diluted basis unless otherwise noted.
Financial Results for the Quarter and Nine Months Ended September 30, 2019
For the quarter ended September 30, 2019, total revenues increased $14.5 million, or 5.6 percent, to $271.2 million compared to $256.7 million for the same period in 2018. For the quarter ended September 30, 2019, net income available for Common Stockholders increased $8.4 million, or $0.04 per Common Share, to $64.5 million, or $0.35 per Common Share, compared to $56.1 million, or $0.31 per Common Share, for the same period in 2018.
For the nine months ended September 30, 2019, total revenues increased $35.4 million, or 4.8 percent, to $778.6 million compared to $743.2 million for the same period in 2018. For the nine months ended September 30, 2019, net income available for Common Stockholders increased $61.8 million, or $0.33 per Common Share, to $224.2 million, or $1.24 per Common Share, compared to $162.4 million, or $0.91 per Common Share, for the same period in 2018.
Non-GAAP Financial Measures and Portfolio Performance
For the quarter ended September 30, 2019, Funds from Operations (“FFO”) available for Common Stock and OP Unit holders increased $10.9 million, or $0.05 per Common Share, to $108.6 million, or $0.56 per Common Share, compared to $97.7 million, or $0.51 per Common Share, for the same period in 2018. For the nine months ended September 30, 2019, FFO available for Common Stock and OP Unit holders increased $24.9 million, or $0.12 per Common Share, to $306.4 million, or $1.60 per Common Share, compared to $281.5 million, or $1.48 per Common Share, for the same period in 2018.
For the quarter ended September 30, 2019, Normalized Funds from Operations (“Normalized FFO”) available for Common Stock and OP Unit holders increased $8.8 million, or $0.04 per Common Share, to $102.7 million, or $0.53 per Common Share, compared to $93.9 million, or $0.49 per Common Share, for the same period in 2018. For the nine months ended September 30, 2019, Normalized FFO available for Common Stock and OP Unit holders increased $26.7 million, or $0.13 per Common Share, to $302.3 million, or $1.58 per Common Share, compared to $275.6 million, or $1.45 per Common Share, for the same period in 2018.
For the quarter ended September 30, 2019, property operating revenues, excluding deferrals, increased $14.6 million to $256.2 million compared to $241.6 million for the same period in 2018. For the nine months ended September 30, 2019, property operating revenues, excluding deferrals, increased $43.9 million to $747.8 million compared to $703.9 million for the same period in 2018. For the quarter ended September 30, 2019, income from property operations, excluding deferrals and property management, increased $6.9 million to $145.3 million compared to $138.4 million for the same period in 2018. For the nine months ended September 30, 2019, income from property operations, excluding deferrals and property management, increased $25.5 million to $434.4 million compared to $408.9 million for the same period in 2018.
For the quarter ended September 30, 2019, Core property operating revenues, excluding deferrals, increased approximately 4.8 percent and Core income from property operations, excluding deferrals and property management, increased approximately 5.1 percent compared to the same period in 2018. For the nine months ended September 30, 2019, Core property operating revenues, excluding deferrals, increased approximately 4.6 percent and Core income from property operations, excluding deferrals and property management, increased approximately 5.1 percent compared to the same period in 2018.
Investment Activity
On September 10, 2019, we completed the acquisition of the remaining interest in the Loggerhead joint venture that owns 11 marinas for a purchase price of approximately $49.0 million. As part of the acquisition, we also funded the joint venture's repayment of its non-transferable debt of approximately $72.0 million. The transaction was funded with proceeds from our unsecured line of credit. Following the consummation of the transaction, we own 100% of the marinas.
About Equity LifeStyle Properties
We are a self-administered, self-managed real estate investment trust (“REIT”) with headquarters in Chicago. As of October 21, 2019, we own or have an interest in 413 quality properties in 33 states and British Columbia consisting of 156,081 sites.
For additional information, please contact our Investor Relations Department at (800) 247-5279 or at investor_relations@equitylifestyle.com.
Conference Call
A live webcast of our conference call discussing these results will take place tomorrow, Tuesday, October 22, 2019, at 10:00 a.m. Central Time. Please visit the Investor Relations section at www.equitylifestyleproperties.com for the link. A replay of the webcast will be available for two weeks at this site.
Reporting Calendar
Quarterly financial results and related earnings conference calls for the next three quarters are expected to occur as follows:
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Release Date |
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Earnings Call |
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Fourth Quarter 2019 |
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Monday, January 27, 2020 |
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Tuesday, January 28, 2020 10:00 a.m. CT |
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First Quarter 2020 |
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Monday, April 20, 2020 |
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Tuesday, April 21, 2020 10:00 a.m. CT |
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Second Quarter 2020 |
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Monday, July 20, 2020 |
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Tuesday, July 21, 2020 10:00 a.m. CT |
Forward-Looking Statements
In addition to historical information, this press release includes certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. When used, words such as "anticipate," "expect," "believe," "project," "intend," "may be" and "will be" and similar words or phrases, or the negative thereof, unless the context requires otherwise, are intended to identify forward-looking statements and may include without limitation, information regarding our expectations, goals or intentions regarding the future, and the expected effect of our acquisitions. These forward-looking statements are subject to numerous assumptions, risks and uncertainties, including, but not limited to:
- our ability to control costs and real estate market conditions, our ability to retain customers, the actual use of sites by customers and our success in acquiring new customers at our properties (including those that we may acquire);
- our ability to maintain historical or increase future rental rates and occupancy with respect to properties currently owned or that we may acquire;
- our ability to retain and attract customers renewing, upgrading and entering right-to-use contracts;
- our assumptions about rental and home sales markets;
- our assumptions and guidance concerning 2019 and 2020, including estimated net income, FFO and Normalized FFO;
- our ability to manage counterparty risk;
- our ability to renew our insurance policies at existing rates and on consistent terms;
- in the age-qualified properties, home sales results could be impacted by the ability of potential home buyers to sell their existing residences as well as by financial, credit and capital markets volatility;
- results from home sales and occupancy will continue to be impacted by local economic conditions, lack of affordable manufactured home financing and competition from alternative housing options including site-built single-family housing;
- impact of government intervention to stabilize site-built single-family housing and not manufactured housing;
- effective integration of recent acquisitions and our estimates regarding the future performance of recent acquisitions;
- the completion of future transactions in their entirety, if any, and timing and effective integration with respect thereto;
- unanticipated costs or unforeseen liabilities associated with recent acquisitions;
- ability to obtain financing or refinance existing debt on favorable terms or at all;
- the effect of interest rates;
- the effect from any breach of our, or any of our vendors', data management systems;
- the dilutive effects of issuing additional securities;
- the outcome of pending or future lawsuits or actions brought against us, including those disclosed in our filings with the Securities and Exchange Commission; and
- other risks indicated from time to time in our filings with the Securities and Exchange Commission.
For further information on these and other factors that could impact us and the statements contained herein, refer to our filings with the Securities and Exchange Commission, including the “Risk Factors” section in our most recent Annual Report on Form 10-K and subsequent quarterly reports on Form 10-Q.
These forward-looking statements are based on management's present expectations and beliefs about future events. As with any projection or forecast, these statements are inherently susceptible to uncertainty and changes in circumstances. We are under no obligation to, and expressly disclaim any obligation to, update or alter our forward-looking statements whether as a result of such changes, new information, subsequent events or otherwise.
Investor Information |
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Equity Research Coverage (1) |
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Bank of America Merrill Lynch
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BMO Capital Markets |
Citi Research |
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Jeffrey Spector/ Joshua Dennerlein |
John Kim |
Michael Bilerman/ Nick Joseph |
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646-855-1363 |
212-885-4115 |
212-816-1383 |
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Evercore ISI |
Green Street Advisors |
Robert W. Baird & Company |
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Steve Sakwa/ Samir Khanal |
John Pawlowski |
Drew T. Babin |
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212-466-5600 |
949-640-8780 |
215-553-7816 |
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Wells Fargo Securities |
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Todd Stender |
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562-637-1371 |
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| ______________________ | ||
1. |
Any opinions, estimates or forecasts regarding our performance made by these analysts or agencies do not represent our opinions, forecasts or predictions. We do not by reference to these firms imply our endorsement of or concurrence with such information, conclusions or recommendations. |
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Financial Highlights |
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(In millions, except Common Stock and OP Units outstanding and per share data (adjusted for stock split), unaudited) |
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As of and for the Three Months Ended |
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Sept 30,
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June 30,
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March 31,
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Dec 31,
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Sept 30,
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Operating Information |
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Total revenues |
$ |
|
271.2 |
|
$ |
|
248.4 |
|
$ |
|
259.1 |
|
$ |
|
243.5 |
|
$ |
|
256.7 |
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Net income |
$ |
|
68.2 |
|
$ |
|
49.1 |
|
$ |
|
120.5 |
|
$ |
|
53.4 |
|
$ |
|
59.7 |
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Net income available for Common Stockholders |
$ |
|
64.5 |
|
$ |
|
46.4 |
|
$ |
|
113.3 |
|
$ |
|
50.2 |
|
$ |
|
56.1 |
|
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Adjusted EBITDAre (1) |
$ |
|
127.0 |
|
$ |
|
117.7 |
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$ |
|
133.3 |
|
$ |
|
117.9 |
|
$ |
|
119.5 |
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FFO available for Common Stock and OP Unit holders (1)(2) |
$ |
|
108.6 |
|
$ |
|
89.8 |
|
$ |
|
108.0 |
|
$ |
|
90.4 |
|
$ |
|
97.7 |
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Normalized FFO available for Common Stock and OP Unit holders (1)(2) |
$ |
|
102.7 |
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$ |
|
91.9 |
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$ |
|
107.7 |
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$ |
|
92.3 |
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$ |
|
93.9 |
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Funds available for distribution ("FAD") available for Common Stock and OP Unit holders (1)(2) |
$ |
|
88.4 |
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$ |
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79.1 |
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$ |
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97.6 |
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$ |
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80.4 |
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$ |
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82.1 |
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Common Stock and OP Units Outstanding (In thousands) and Per Share Data |
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Common Stock and OP Units, end of the period |
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192,574 |
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192,562 |
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191,470 |
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191,334 |
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190,986 |
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Weighted average Common Stock and OP Units outstanding - Fully Diluted |
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192,400 |
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191,860 |
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191,248 |
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191,154 |
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190,526 |
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Net income per Common Share - Fully Diluted (3) |
$ |
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0.35 |
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$ |
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0.26 |
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$ |
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0.63 |
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$ |
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0.28 |
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$ |
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0.31 |
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FFO per Common Share and OP Unit - Fully Diluted |
$ |
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0.56 |
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$ |
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0.47 |
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$ |
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0.56 |
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$ |
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0.47 |
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$ |
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0.51 |
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Normalized FFO per Common Share and OP Unit - Fully Diluted |
$ |
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0.53 |
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$ |
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0.48 |
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$ |
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0.56 |
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$ |
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0.48 |
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$ |
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0.49 |
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Dividends per Common Share |
$ |
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0.3063 |
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$ |
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0.3063 |
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$ |
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0.3063 |
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$ |
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0.2750 |
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$ |
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0.2750 |
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Balance Sheet |
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Total assets |
$ |
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4,136 |
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$ |
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4,014 |
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$ |
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4,009 |
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$ |
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3,926 |
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$ |
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3,855 |
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Total liabilities |
$ |
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2,816 |
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$ |
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2,707 |
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$ |
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2,752 |
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$ |
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2,732 |
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$ |
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2,665 |
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Market Capitalization |
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Total debt (4) |
$ |
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2,406 |
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$ |
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2,300 |
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$ |
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2,372 |
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$ |
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2,386 |
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$ |
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2,318 |
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Total market capitalization (5) |
$ |
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15,270 |
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$ |
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13,983 |
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$ |
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13,315 |
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$ |
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11,678 |
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$ |
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11,528 |
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Ratios |
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Total debt / total market capitalization |
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15.8 |
% |
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16.4 |
% |
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17.8 |
% |
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20.4 |
% |
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20.1 |
% |
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Total debt / Adjusted EBITDAre (6) |
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4.9 |
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4.7 |
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4.9 |
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5.1 |
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5.1 |
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Interest coverage (7) |
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4.8 |
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4.7 |
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4.6 |
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4.5 |
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4.4 |
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Fixed charges + preferred distributions coverage (8) |
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4.7 |
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4.6 |
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4.5 |
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4.5 |
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4.4 |
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| ______________________ | ||
1. |
See Non-GAAP Financial Measures Definitions and Other Terms at the end of the supplemental information for definitions of Adjusted EBITDAre, FFO, Normalized FFO and FAD and a reconciliation of Consolidated net income to Adjusted EBITDAre. |
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2. |
See page 7 for a reconciliation of Net income available for Common Stockholders to Non-GAAP financial measures FFO available for Common Stock and OP Unit holders, Normalized FFO available for Common Stock and OP Unit holders and FAD available for Common Stock and OP Unit holders. |
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3. |
Net income per Common Share - Fully Diluted is calculated before Income allocated to non-controlling interest - Common OP Units. |
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4. |
Excludes deferred financing costs of approximately $24.6 million as of September 30, 2019. |
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5. |
See page 18 for market capitalization as of September 30, 2019. |
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6. |
Calculated using trailing twelve months Adjusted EBITDAre. |
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7. |
Calculated by dividing trailing twelve months Adjusted EBITDAre by the interest expense incurred during the same period. |
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8. |
See Non-GAAP Financial Measures Definitions and Other Terms at the end of the supplemental information for a definition of fixed charges. This ratio is calculated by dividing trailing twelve months Adjusted EBITDAre by the sum of fixed charges and preferred stock dividends during the same period. |
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Consolidated Balance Sheets |
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(In thousands, except share and per share data (adjusted for stock split)) |
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September 30, 2019 |
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December 31, 2018 |
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(unaudited) |
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Assets |
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Investment in real estate: |
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Land |
$ |
1,516,956 |
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$ |
1,408,832 |
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Land improvements |
3,290,312 |
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3,143,745 |
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Buildings and other depreciable property |
870,511 |
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720,900 |
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5,677,779 |
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5,273,477 |
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Accumulated depreciation |
(1,739,285 |
) |
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(1,631,888 |
) |
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Net investment in real estate |
3,938,494 |
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3,641,589 |
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Cash and restricted cash |
42,386 |
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68,974 |
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Notes receivable, net |
37,228 |
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35,041 |
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Investment in unconsolidated joint ventures |
20,339 |
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|
57,755 |
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Deferred commission expense |
40,953 |
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40,308 |
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Other assets, net |
56,551 |
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|
46,227 |
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Assets held for sale, net |
— |
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|
35,914 |
|
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Total Assets |
$ |
4,135,951 |
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|
$ |
3,925,808 |
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|
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Liabilities and Equity |
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Liabilities: |
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Mortgage notes payable, net |
$ |
2,062,736 |
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$ |
2,149,726 |
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Term loan, net |
198,868 |
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|
198,626 |
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Unsecured line of credit |
120,000 |
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|
— |
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Accounts payable and other liabilities |
143,102 |
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102,854 |
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Deferred revenue – upfront payments from right-to-use contracts (membership upgrade sales) |
124,577 |
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116,363 |
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Deferred revenue – right-to-use annual payments (membership subscriptions) |
11,395 |
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|
10,055 |
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Accrued interest payable |
8,410 |
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|
8,759 |
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Rents and other customer payments received in advance and security deposits |
88,094 |
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|
81,114 |
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Distributions payable |
58,976 |
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|
52,617 |
|
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Liabilities related to assets held for sale |
— |
|
|
12,350 |
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Total Liabilities |
2,816,158 |
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|
2,732,464 |
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Equity: |
|
|
|
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Preferred stock, $0.01 par value, 10,000,000 shares authorized as of September 30, 2019 and December 31, 2018; none issued and outstanding. |
— |
|
|
— |
|
|||
Common stock, $0.01 par value, 400,000,000 and 200,000,000 shares authorized as of September 30, 2019 and December 31, 2018, respectively; 182,080,186 and 179,842,036 shares issued and outstanding as of September 30, 2019 and December 31, 2018, respectively. |
1,802 |
|
|
1,792 |
|
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Paid-in capital |
1,399,961 |
|
|
1,328,495 |
|
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Distributions in excess of accumulated earnings |
(153,505 |
) |
|
(211,034 |
) |
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Accumulated other comprehensive income (loss) |
(499 |
) |
|
2,299 |
|
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Total Stockholders’ Equity |
1,247,759 |
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|
1,121,552 |
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Non-controlling interests – Common OP Units |
72,034 |
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|
71,792 |
|
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Total Equity |
1,319,793 |
|
|
1,193,344 |
|
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Total Liabilities and Equity |
$ |
4,135,951 |
|
|
$ |
3,925,808 |
|
|
Consolidated Income Statements |
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(In thousands, unaudited) |
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Quarters Ended September 30, |
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Nine Months Ended September 30, |
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2019 |
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2018 |
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2019 |
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2018 |
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Revenues: |
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Rental income |
$ |
225,116 |
|
|
$ |
211,102 |
|
|
$ |
660,689 |
|
|
$ |
617,250 |
|
|
Right-to-use annual payments (membership subscriptions) |
13,150 |
|
|
12,206 |
|
|
38,052 |
|
|
35,616 |
|
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Right-to-use contracts current period, gross (membership upgrade sales) |
5,730 |
|
|
4,863 |
|
|
14,609 |
|
|
11,969 |
|
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Right-to-use contract upfront payments, deferred, net |
(3,530 |
) |
|
(2,883 |
) |
|
(8,213 |
) |
|
(6,189 |
) |
|||||
Other income |
11,263 |
|
|
13,419 |
|
|
31,898 |
|
|
38,991 |
|
|||||
Gross revenues from home sales |
8,438 |
|
|
9,339 |
|
|
22,738 |
|
|
26,753 |
|
|||||
Brokered resale and ancillary services revenues, net |
2,133 |
|
|
1,362 |
|
|
4,564 |
|
|
3,380 |
|
|||||
Interest income |
1,831 |
|
|
1,846 |
|
|
5,385 |
|
|
5,658 |
|
|||||
Income from other investments, net |
7,029 |
|
|
5,421 |
|
|
8,894 |
|
|
9,774 |
|
|||||
Total revenues |
271,160 |
|
|
256,675 |
|
|
778,616 |
|
|
743,202 |
|
|||||
|
|
|
|
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Expenses: |
|
|
|
|
|
|
|
|||||||||
Property operating and maintenance |
90,765 |
|
|
86,349 |
|
|
253,581 |
|
|
244,401 |
|
|||||
Real estate taxes |
15,166 |
|
|
13,240 |
|
|
45,596 |
|
|
40,815 |
|
|||||
Sales and marketing, gross |
4,063 |
|
|
3,568 |
|
|
11,686 |
|
|
9,685 |
|
|||||
Right-to-use contract commissions, deferred, net |
(313 |
) |
|
(458 |
) |
|
(893 |
) |
|
(744 |
) |
|||||
Property management |
14,605 |
|
|
13,589 |
|
|
42,675 |
|
|
40,742 |
|
|||||
Depreciation and amortization |
37,032 |
|
|
34,980 |
|
|
112,785 |
|
|
101,699 |
|
|||||
Cost of home sales |
8,434 |
|
|
9,742 |
|
|
23,230 |
|
|
27,948 |
|
|||||
Home selling expenses |
1,033 |
|
|
1,101 |
|
|
3,218 |
|
|
3,149 |
|
|||||
General and administrative |
8,710 |
|
|
8,816 |
|
|
27,844 |
|
|
26,523 |
|
|||||
Other expenses |
1,460 |
|
|
386 |
|
|
2,427 |
|
|
1,096 |
|
|||||
Early debt retirement |
— |
|
|
— |
|
|
1,491 |
|
|
— |
|
|||||
Interest and related amortization |
25,547 |
|
|
26,490 |
|
|
77,964 |
|
|
78,478 |
|
|||||
Total expenses |
206,502 |
|
|
197,803 |
|
|
601,604 |
|
|
573,792 |
|
|||||
Gain on sale of real estate, net |
— |
|
|
— |
|
|
52,507 |
|
|
— |
|
|||||
Income before equity in income of unconsolidated joint ventures |
64,658 |
|
|
58,872 |
|
|
229,519 |
|
|
169,410 |
|
|||||
Equity in income of unconsolidated joint ventures |
3,518 |
|
|
788 |
|
|
8,277 |
|
|
3,596 |
|
|||||
Consolidated net income |
68,176 |
|
|
59,660 |
|
|
237,796 |
|
|
173,006 |
|
|||||
|
|
|
|
|
|
|
|
|||||||||
Income allocated to non-controlling interests – Common OP Units |
(3,715 |
) |
|
(3,590 |
) |
|
(13,617 |
) |
|
(10,569 |
) |
|||||
Redeemable perpetual preferred stock dividends |
— |
|
|
— |
|
|
(8 |
) |
|
(8 |
) |
|||||
Net income available for Common Stockholders |
$ |
64,461 |
|
|
$ |
56,070 |
|
|
$ |
224,171 |
|
|
$ |
162,429 |
|
|
Non-GAAP Financial Measures
This document contains certain non-GAAP measures used by management that we believe are helpful in understanding our business. We believe investors should review these non-GAAP measures along with GAAP net income and cash flows from operating activities, investing activities and financing activities, when evaluating an equity REIT’s operating performance. Our definitions and calculations of these non-GAAP financial and operating measures and other terms may differ from the definitions and methodologies used by other REITs and, accordingly, may not be comparable. These non-GAAP financial and operating measures do not represent cash generated from operating activities in accordance with GAAP, nor do they represent cash available to pay distributions and should not be considered as an alternative to net income, determined in accordance with GAAP, as an indication of our financial performance, or to cash flows from operating activities, determined in accordance with GAAP, as a measure of our liquidity, nor is it indicative of funds available to fund our cash needs, including our ability to make cash distributions. For definitions and reconciliations of non-GAAP measures to our financial statements as prepared under GAAP, please refer to both Reconciliation of Net Income to Non-GAAP Financial Measures on page 7 and Non-GAAP Financial Measures Definitions and Reconciliations on pages 20 - 22.
Selected Non-GAAP Financial Measures |
||||
(In millions, except per share data (adjusted for stock split), unaudited) |
||||
|
Quarter Ended |
|||
|
September 30, 2019 |
|||
Income from property operations, excluding deferrals and property management - 2019 Core (1) |
$ |
140.5 |
|
|
Income from property operations, excluding deferrals and property management - Non-Core (1) |
|
4.8 |
|
|
Property management and general and administrative |
|
(23.3 |
) |
|
Other income and expenses |
|
6.2 |
|
|
Interest and related amortization |
|
(25.5 |
) |
|
Normalized FFO available for Common Stock and OP Unit holders (2) |
|
102.7 |
|
|
Insurance proceeds due to catastrophic weather event (3) |
|
5.9 |
|
|
FFO available for Common Stock and OP Unit holders (2) |
$ |
108.6 |
|
|
|
|
|||
Normalized FFO per Common Share and OP Unit - Fully Diluted |
$0.53 |
|
||
FFO per Common Share and OP Unit - Fully Diluted |
$0.56 |
|
||
|
|
|||
|
|
|||
Normalized FFO available for Common Stock and OP Unit holders (2) |
$ |
102.7 |
|
|
Non-revenue producing improvements to real estate (2) |
|
(14.3 |
) |
|
FAD available for Common Stock and OP Unit holders (2) |
$ |
88.4 |
|
|
|
|
|||
Weighted average Common Stock and OP Units - Fully Diluted |
|
192.4 |
|
|
| __________________________ | ||
1. |
See page 9 for details of the Core Income from Property Operations, excluding deferrals and property management. See page 10 for details of the Non-Core Income from Property Operations, excluding deferrals and property management. |
|
2. |
See page 7 for a reconciliation of Net income available for Common Stockholders to FFO available for Common Stock and OP Unit holders, Normalized FFO available for Common Stock and OP Unit holders and FAD available for Common Stock and OP Unit holders. |
|
3. |
Represents insurance recovery revenue from reimbursement for capital expenditures related to Hurricane Irma. |
|
Reconciliation of Net Income to Non-GAAP Financial Measures |
||||||||||||||||
(In thousands, except per share data (adjusted for stock split), unaudited) |
||||||||||||||||
|
|
Quarters Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||
Net income available for Common Stockholders |
|
$ |
64,461 |
|
|
$ |
56,070 |
|
|
$ |
224,171 |
|
|
$ |
162,429 |
|
Income allocated to non-controlling interests – Common OP Units |
|
3,715 |
|
|
3,590 |
|
|
13,617 |
|
|
10,569 |
|
||||
Right-to-use contract upfront payments, deferred, net |
|
3,530 |
|
|
2,883 |
|
|
8,213 |
|
|
6,189 |
|
||||
Right-to-use contract commissions, deferred, net |
|
(313 |
) |
|
(458 |
) |
|
(893 |
) |
|
(744 |
) |
||||
Depreciation and amortization |
|
37,032 |
|
|
34,980 |
|
|
112,785 |
|
|
101,699 |
|
||||
Depreciation on unconsolidated joint ventures |
|
174 |
|
|
651 |
|
|
1,047 |
|
|
1,390 |
|
||||
Gain on sale of real estate, net |
|
— |
|
|
— |
|
|
(52,507 |
) |
|
— |
|
||||
FFO available for Common Stock and OP Unit holders |
|
108,599 |
|
|
97,716 |
|
|
306,433 |
|
|
281,532 |
|
||||
Early debt retirement |
|
— |
|
|
— |
|
|
2,085 |
|
|
— |
|
||||
Insurance proceeds due to catastrophic weather event and other, net (1) |
|
(5,856 |
) |
|
(3,833 |
) |
|
(6,205 |
) |
|
(5,925 |
) |
||||
Normalized FFO available for Common Stock and OP Unit holders |
|
102,743 |
|
|
93,883 |
|
|
302,313 |
|
|
275,607 |
|
||||
Non-revenue producing improvements to real estate |
|
(14,357 |
) |
|
(11,790 |
) |
|
(37,270 |
) |
|
(32,965 |
) |
||||
FAD available for Common Stock and OP Unit holders |
|
$ |
88,386 |
|
|
$ |
82,093 |
|
|
$ |
265,043 |
|
|
$ |
242,642 |
|
|
|
|
|
|
|
|
|
|
||||||||
Net income available per Common Share - Basic |
|
$ |
0.35 |
|
|
$ |
0.31 |
|
|
$ |
1.24 |
|
|
$ |
0.91 |
|
Net income available per Common Share - Fully Diluted (2) |
|
$ |
0.35 |
|
|
$ |
0.31 |
|
|
$ |
1.24 |
|
|
$ |
0.91 |
|
|
|
|
|
|
|
|
|
|
||||||||
FFO per Common Share and OP Unit - Basic |
|
$ |
0.57 |
|
|
$ |
0.51 |
|
|
$ |
1.60 |
|
|
$ |
1.49 |
|
FFO per Common Share and OP Unit - Fully Diluted |
|
$ |
0.56 |
|
|
$ |
0.51 |
|
|
$ |
1.60 |
|
|
$ |
1.48 |
|
|
|
|
|
|
|
|
|
|
||||||||
Normalized FFO per Common Share and OP Unit - Basic |
|
$ |
0.53 |
|
|
$ |
0.49 |
|
|
$ |
1.58 |
|
|
$ |
1.46 |
|
Normalized FFO per Common Share and OP Unit - Fully Diluted |
|
$ |
0.53 |
|
|
$ |
0.49 |
|
|
$ |
1.58 |
|
|
$ |
1.45 |
|
|
|
|
|
|
|
|
|
|
||||||||
Average Common Stock - Basic |
|
181,649 |
|
|
178,400 |
|
|
180,515 |
|
|
177,520 |
|
||||
Average Common Stock and OP Units - Basic |
|
192,145 |
|
|
189,942 |
|
|
191,599 |
|
|
189,138 |
|
||||
Average Common Stock and OP Units - Fully Diluted |
192,400 |
|
190,526 |
|
|
191,840 |
|
|
189,654 |
|
||||||
| ______________________ | ||
1. |
Represents insurance recovery revenue from reimbursement for capital expenditures related to Hurricane Irma. |
|
2. |
Net income per fully diluted Common Share is calculated before Income allocated to non-controlling interest - Common OP Units. |
|
Consolidated Income from Property Operations (1) |
||||||||||||||||
(In millions, except home site and occupancy figures, unaudited) |
||||||||||||||||
|
Quarters Ended September 30, |
|
Nine Months Ended September 30, |
|||||||||||||
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|||||||||
Community base rental income (2) |
$ |
137.6 |
|
|
$ |
130.7 |
|
|
$ |
409.1 |
|
|
$ |
386.1 |
|
|
Rental home income |
3.8 |
|
|
3.5 |
|
|
11.0 |
|
|
10.6 |
|
|||||
Resort and marina base rental income (3) |
71.7 |
|
|
64.4 |
|
|
204.8 |
|
|
183.8 |
|
|||||
Right-to-use annual payments (membership subscriptions) |
13.1 |
|
|
12.2 |
|
|
38.0 |
|
|
35.6 |
|
|||||
Right-to-use contracts current period, gross (membership upgrade sales) |
5.7 |
|
|
4.9 |
|
|
14.6 |
|
|
12.0 |
|
|||||
Utility and other income (4) |
24.3 |
|
|
25.9 |
|
|
70.3 |
|
|
75.8 |
|
|||||
Property operating revenues |
256.2 |
|
|
241.6 |
|
|
747.8 |
|
|
703.9 |
|
|||||
|
|
|
|
|
|
|
|
|||||||||
Property operating, maintenance and real estate taxes (5) |
105.3 |
|
|
97.7 |
|
|
297.7 |
|
|
280.3 |
|
|||||
Rental home operating and maintenance |
1.6 |
|
|
1.9 |
|
|
4.1 |
|
|
5.0 |
|
|||||
Sales and marketing, gross |
4.0 |
|
|
3.6 |
|
|
11.6 |
|
|
9.7 |
|
|||||
Property operating expenses |
110.9 |
|
|
103.2 |
|
|
313.4 |
|
|
295.0 |
|
|||||
Income from property operations, excluding deferrals and property management (1) |
$ |
145.3 |
|
|
$ |
138.4 |
|
|
$ |
434.4 |
|
|
$ |
408.9 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Manufactured home site figures and occupancy averages: |
|
|
|
|
|
|
|
|||||||||
Total sites |
72,008 |
|
|
72,221 |
|
|
72,121 |
|
|
71,782 |
|
|||||
Occupied sites |
68,352 |
|
|
68,330 |
|
|
68,419 |
|
|
67,857 |
|
|||||
Occupancy % |
94.9 |
% |
|
94.6 |
% |
|
94.9 |
% |
|
94.5 |
% |
|||||
Monthly base rent per site |
$ |
671 |
|
|
$ |
638 |
|
|
$ |
664 |
|
|
$ |
632 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Resort and marina base rental income: |
|
|
|
|
|
|
|
|||||||||
Annual |
$ |
42.6 |
|
|
$ |
37.4 |
|
|
$ |
122.4 |
|
|
$ |
109.2 |
|
|
Seasonal |
5.4 |
|
|
4.9 |
|
|
32.2 |
|
|
29.0 |
|
|||||
Transient |
23.7 |
|
|
22.1 |
|
|
50.2 |
|
|
45.6 |
|
|||||
Total resort and marina base rental income |
$ |
71.7 |
|
|
$ |
64.4 |
|
|
$ |
204.8 |
|
|
$ |
183.8 |
|
|
| ____________________ | ||
1. |
|
Excludes property management and the GAAP deferral of right-to-use contract upfront payments and related commissions, net. |
2. |
See the manufactured home site figures and occupancy averages included below within this table. |
|
3. |
See resort and marina base rental income detail included below within this table. |
|
4. |
Includes Hurricane Irma insurance recovery revenues of $0.2 million and $0.8 million, which we have identified as business interruption related to Non-Core properties for the quarter and nine months ended September 30, 2019, respectively, and Hurricane Irma insurance recovery revenues of $1.3 million and $6.5 million, of which we have identified $1.2 million and $3.7 million as business interruption related to Non-Core properties, for the quarter and nine months ended September 30, 2018, respectively. |
|
5. |
Property operating, maintenance and real estate taxes includes bad debt expense for the quarters and nine months ended September 30, 2019 and 2018. |
|
Property operating, maintenance and real estate taxes includes debris removal and cleanup costs related to Hurricane Irma of $0.1 million and $2.6 million for the quarter and nine months ended September 30, 2018, respectively. |
||
Core Income from Property Operations (1) |
||||||||||||||||||||||||||
(In millions, except home site and occupancy figures, unaudited) |
||||||||||||||||||||||||||
|
Quarters Ended September 30, |
|
Nine Months Ended September 30, |
|||||||||||||||||||||||
|
2019 |
|
2018 |
|
Change (2) |
|
2019 |
|
2018 |
|
Change (2) |
|||||||||||||||
Community base rental income (3) |
$ |
|
133.8 |
|
|
$ |
|
126.9 |
|
|
5.4 |
% |
|
$ |
|
397.2 |
|
|
$ |
|
377.6 |
|
|
5.2 |
% |
|
Rental home income |
|
3.8 |
|
|
|
3.2 |
|
|
18.4 |
% |
|
|
10.9 |
|
|
|
9.7 |
|
|
12.4 |
% |
|||||
Resort base rental income (4) |
|
65.5 |
|
|
|
62.6 |
|
|
4.5 |
% |
|
|
187.6 |
|
|
|
179.9 |
|
|
4.3 |
% |
|||||
Right-to-use annual payments (membership subscriptions) |
|
13.1 |
|
|
|
12.2 |
|
|
7.7 |
% |
|
|
38.0 |
|
|
|
35.6 |
|
|
6.8 |
% |
|||||
Right-to-use contracts current period, gross (membership upgrade sales) |
|
5.7 |
|
|
|
4.9 |
|
|
17.8 |
% |
|
|
14.6 |
|
|
|
12.0 |
|
|
22.0 |
% |
|||||
Utility and other income (5) |
|
23.4 |
|
|
|
24.3 |
|
|
(3.7 |
)% |
|
|
67.8 |
|
|
|
70.2 |
|
|
(3.5 |
)% |
|||||
Property operating revenues |
|
245.3 |
|
|
|
234.1 |
|
|
4.8 |
% |
|
|
716.1 |
|
|
|
685.0 |
|
|
4.6 |
% |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Property operating, maintenance and real estate taxes (6) |
|
99.2 |
|
|
|
95.1 |
|
|
4.3 |
% |
|
|
282.7 |
|
|
|
273.1 |
|
|
3.5 |
% |
|||||
Rental home operating and maintenance |
|
1.6 |
|
|
|
1.8 |
|
|
(10.8 |
)% |
|
|
4.1 |
|
|
|
4.7 |
|
|
(12.9 |
)% |
|||||
Sales and marketing, gross |
|
4.0 |
|
|
|
3.6 |
|
|
13.8 |
% |
|
|
11.6 |
|
|
|
9.7 |
|
|
20.7 |
% |
|||||
Property operating expenses |
|
104.8 |
|
|
|
100.5 |
|
|
4.4 |
% |
|
|
298.4 |
|
|
|
287.5 |
|
|
3.8 |
% |
|||||
Income from property operations, excluding deferrals and property management (1) |
$ |
|
140.5 |
|
|
$ |
|
133.6 |
|
|
5.1 |
% |
|
$ |
|
417.7 |
|
|
$ |
|
397.5 |
|
|
5.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Occupied sites (7) |
|
66,573 |
|
|
|
66,161 |
|
|
|
|
|
|
|
|
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Core manufactured home site figures and occupancy averages: |
|
|
|
|
|
|
||||||||||||||||||||
Total sites |
|
69,693 |
|
|
|
69,568 |
|
|
|
|
|
69,634 |
|
|
|
69,546 |
|
|
|
|||||||
Occupied sites |
|
66,482 |
|
|
|
66,061 |
|
|
|
|
|
66,394 |
|
|
|
65,996 |
|
|
|
|||||||
Occupancy % |
|
95.4 |
% |
|
|
95.0 |
% |
|
|
|
|
95.3 |
% |
|
|
94.9 |
% |
|
|
|||||||
Monthly base rent per site |
$ |
|
671 |
|
|
$ |
|
640 |
|
|
|
|
$ |
|
665 |
|
|
$ |
|
636 |
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Resort base rental income: |
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Annual |
$ |
|
39.0 |
|
|
$ |
|
36.7 |
|
|
6.2 |
% |
|
$ |
|
114.6 |
|
|
$ |
|
108.0 |
|
|
6.1 |
% |
|
Seasonal |
|
4.6 |
|
|
|
4.4 |
|
|
3.9 |
% |
|
|
28.9 |
|
|
|
28.1 |
|
|
3.2 |
% |
|||||
Transient |
|
21.9 |
|
|
|
21.5 |
|
|
1.8 |
% |
|
|
44.1 |
|
|
|
43.8 |
|
|
0.5 |
% |
|||||
Total resort base rental income |
$ |
|
65.5 |
|
|
$ |
|
62.6 |
|
|
4.5 |
% |
|
$ |
|
187.6 |
|
|
$ |
|
179.9 |
|
|
4.3 |
% |
|
| ______________________ | ||
1. |
Excludes property management and the GAAP deferral of right-to-use contract upfront payments and related commissions, net. |
|
2. |
Calculations prepared using actual results without rounding. |
|
3. |
See Core manufactured home site figures and occupancy averages included below within this table. |
|
4. |
See Core resort base rental income detail included below within this table. |
|
5. |
Includes Hurricane Irma insurance recovery revenues of $2.4 million for the nine months ended September 30, 2018. |
|
6. |
Property operating, maintenance and real estate taxes includes bad debt expense for the quarters and nine months ended September 30, 2019 and 2018. Property operating, maintenance and real estate taxes includes debris removal and cleanup costs related to Hurricane Irma of $2.2 million for the nine months ended September 30, 2018. |
|
7. |
Occupied sites are presented as of the end of the period. Occupied sites have increased by 262 from 66,311 at December 31, 2018. |
|
Non-Core Income from Property Operations (1) |
||||||||
(In millions, unaudited) |
||||||||
|
Quarter Ended |
|
Nine Months Ended |
|||||
|
September 30, 2019 |
|
September 30, 2019 |
|||||
Community base rental income |
$ |
3.8 |
|
|
$ |
11.9 |
|
|
Rental home income |
— |
|
|
0.1 |
|
|||
Resort and marina base rental income |
6.2 |
|
|
17.2 |
|
|||
Utility and other income (2) |
0.9 |
|
|
2.5 |
|
|||
Property operating revenues |
10.9 |
|
|
31.7 |
|
|||
|
|
|
|
|||||
Property operating expenses (3) |
6.1 |
|
|
15.0 |
|
|||
Income from property operations, excluding deferrals and property management (1) |
$ |
4.8 |
|
|
$ |
16.7 |
|
|
| ______________________ | ||
1. |
Excludes property management and the GAAP deferral of right-to-use contract upfront payments and related commissions, net. |
|
2. |
Utility and other income includes Hurricane Irma insurance recovery revenues of $0.2 million and $0.8 million, which we have identified as business interruption for the quarter and nine months ended September 30, 2019, respectively. |
|
3. |
Property operating expenses include bad debt expense for the quarter and nine months ended September 30, 2019. |
|
Income from Rental Home Operations |
|||||||||||||||
(In millions, except occupied rentals, unaudited) |
|||||||||||||||
|
Quarters Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||
Manufactured homes: |
|
|
|
|
|
|
|
||||||||
Rental operations revenues (1) |
$ |
11.6 |
|
|
$ |
10.8 |
|
|
$ |
34.2 |
|
|
$ |
33.0 |
|
Rental operations expense |
1.6 |
|
|
1.8 |
|
|
4.1 |
|
|
4.7 |
|
||||
Income from rental operations |
10.0 |
|
|
9.0 |
|
|
30.1 |
|
|
28.3 |
|
||||
Depreciation on rental homes (2) |
2.7 |
|
|
2.3 |
|
|
7.6 |
|
|
6.9 |
|
||||
Income from rental operations, net of depreciation |
$ |
7.3 |
|
|
$ |
6.7 |
|
|
$ |
22.5 |
|
|
$ |
21.4 |
|
|
|
|
|
|
|
|
|
||||||||
Occupied rentals: (3) |
|
|
|
|
|
|
|
||||||||
New |
3,073 |
|
|
2,622 |
|
|
|
|
|
||||||
Used |
913 |
|
|
1,323 |
|
|
|
|
|
||||||
Total occupied rental sites |
3,986 |
|
|
3,945 |
|
|
|
|
|
||||||
|
As of September 30, 2019 |
|
As of September 30, 2018 |
||||||||||||
Cost basis in rental homes: (4) |
Gross |
|
Net of
|
|
Gross |
|
Net of
|
||||||||
New |
$ |
216.2 |
|
|
$ |
182.4 |
|
|
$ |
147.0 |
|
|
$ |
125.5 |
|
Used |
23.4 |
|
|
10.4 |
|
|
32.1 |
|
|
16.3 |
|
||||
Total rental homes |
$ |
239.6 |
|
|
$ |
192.8 |
|
|
$ |
179.1 |
|
|
$ |
141.8 |
|
______________________ |
||
1. |
For both quarters ended September 30, 2019 and 2018, approximately $7.8 million and $7.6 million, respectively, of the rental operations revenue is included in the Community base rental income in the Core Income from Property Operations on page 9. For the nine months ended September 30, 2019 and 2018, approximately $23.4 million and $23.3 million, respectively, of the rental operations revenue is included in the Community base rental income in the Core Income from Property Operations on page 9.The remainder of the rental operations revenue is included in Rental home income for the quarters and nine months ended September 30, 2019 and 2018 in the Core Income from Property Operations on page 9. |
|
2. |
Depreciation on rental homes in our Core portfolio is included in Depreciation and amortization in the Consolidated Income Statements on page 4. |
|
3. |
Occupied rentals as of the end of the period in our Core portfolio. Included in the quarters ended September 30, 2019 and 2018 were 294 and 265 homes rented through our ECHO joint venture, respectively. For the quarters ended September 30, 2019 and 2018, the rental home investment associated with our ECHO joint venture totaled approximately $10.7 million and $9.4 million, respectively. |
|
4. |
Includes both occupied and unoccupied rental homes in our Core portfolio. New home cost basis does not include the costs associated with our ECHO joint venture. At September 30, 2019 and 2018, our investment in the ECHO joint venture was approximately $16.7 million and $16.1 million, respectively. |
|
Total Sites and Home Sales |
||||||||||||||||
(In thousands, except sites and home sale volumes, unaudited) |
||||||||||||||||
Summary of Total Sites as of September 30, 2019 |
|
|||||||||||||||
|
Sites |
|||||||||||||||
Community sites |
72,100 |
|
||||||||||||||
Resort sites: |
|
|||||||||||||||
Annuals |
30,400 |
|
||||||||||||||
Seasonal |
11,300 |
|
||||||||||||||
Transient |
12,100 |
|
||||||||||||||
Marina slips |
2,300 |
|
||||||||||||||
Right-to-use Membership (1) |
24,300 |
|
||||||||||||||
Joint Ventures (2) |
3,600 |
|
||||||||||||||
Total |
156,100 |
|
||||||||||||||
Home Sales - Select Data |
|
|
|
|
|
|
|
|||||||||
|
Quarters Ended September 30, |
|
Nine Months Ended September 30, |
|||||||||||||
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|||||||||
Total New Home Sales Volume (3) |
128 |
|
|
141 |
|
|
336 |
|
|
417 |
|
|||||
New Home Sales Volume - ECHO joint venture |
19 |
|
|
31 |
|
|
50 |
|
|
74 |
|
|||||
New Home Sales Gross Revenues (3) |
$ |
6,864 |
|
|
$ |
7,048 |
|
|
$ |
17,492 |
|
|
$ |
20,643 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Total Used Home Sales Volume |
198 |
|
|
304 |
|
|
627 |
|
|
842 |
|
|||||
Used Home Sales Gross Revenues |
$ |
1,574 |
|
|
$ |
2,291 |
|
|
$ |
5,246 |
|
|
$ |
6,110 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Brokered Home Resales Volume |
270 |
|
|
231 |
|
|
675 |
|
|
677 |
|
|||||
Brokered Home Resale Revenues, net |
$ |
420 |
|
|
$ |
358 |
|
|
$ |
1,077 |
|
|
$ |
1,009 |
|
|
______________________ |
||
1. |
Sites primarily utilized by approximately 117,600 members. Includes approximately 5,900 sites rented on an annual basis. |
|
2. |
Joint ventures have approximately 2,700 annual Sites, 400 seasonal Sites and 500 transient Sites. |
|
3. |
Total new home sales volume includes home sales from our ECHO joint venture. New home sales gross revenues does not include the revenues associated with our ECHO joint venture. |
|
2019 Guidance - Selected Financial Data (1) |
Our guidance acknowledges the existence of volatile economic conditions, which may impact our current guidance assumptions. Factors impacting 2019 guidance include, but are not limited to the following: (i) the mix of site usage within the portfolio; (ii) yield management on our short-term resort and marina sites; (iii) scheduled or implemented rate increases on community, resort and marina sites; (iv) scheduled or implemented rate increases in annual payments under right-to-use contracts; (v) occupancy changes; (vi) our ability to retain and attract customers renewing or entering right-to-use contracts; (vii) our ability to integrate and operate recent acquisitions in accordance with our estimates; (viii) completion of pending transactions in their entirety and on assumed schedule; (ix) ongoing legal matters and related fees; and (x) costs to restore property operations and potential revenue losses following storms or other unplanned events. |
(In millions, except per share data (adjusted for stock split), unaudited) |
||||||||
|
Quarter Ending |
|
Year Ending |
|||||
|
December 31, 2019 |
|
December 31, 2019 |
|||||
Income from property operations, excluding deferrals and property management - Core (2) |
$ |
139.4 |
|
|
$ |
557.2 |
|
|
Income from property operations - Non-Core (3) |
6.3 |
|
|
23.0 |
|
|||
Property management and general and administrative |
(22.6 |
) |
|
(93.1 |
) |
|||
Other income and expenses |
1.6 |
|
|
17.9 |
|
|||
Interest and related amortization |
(26.1 |
) |
|
(104.1 |
) |
|||
Normalized FFO available for Common Stock and OP Unit holders |
98.6 |
|
|
400.9 |
|
|||
Early debt retirement |
— |
|
|
(2.1 |
) |
|||
Insurance proceeds due to catastrophic weather event (4) |
— |
|
|
6.2 |
|
|||
FFO available for Common Stock and OP Unit holders |
98.6 |
|
|
405.0 |
|
|||
Depreciation and amortization |
(38.3 |
) |
|
(152.0 |
) |
|||
Deferral of right-to-use contract sales revenue and commission, net |
(1.6 |
) |
|
(9.0 |
) |
|||
Gain on sale of real estate, net |
— |
|
|
52.5 |
|
|||
Income allocated to non-controlling interest-Common OP Units |
(3.2 |
) |
|
(16.7 |
) |
|||
Net income available for Common Stockholders |
$ |
55.5 |
|
|
$ |
279.8 |
|
|
|
|
|
|
|||||
|
|
|
|
|||||
Net income per Common Share - Fully Diluted (5) |
$0.29 - $0.33 |
|
$1.52 - $1.56 |
|||||
FFO per Common Share and OP Unit - Fully Diluted |
$0.49 - $0.53 |
|
$2.09 - $2.13 |
|||||
Normalized FFO per Common Share and OP Unit - Fully Diluted |
$0.49 - $0.53 |
|
$2.07 - $2.11 |
|||||
|
|
|
|
|||||
Weighted average Common Stock outstanding - Fully Diluted |
192.4 |
|
192.0 |
|||||
______________________ |
||
1. |
Each line item represents the mid-point of a range of possible outcomes and reflects management’s estimate of the most likely outcome. Actual Normalized FFO available for Common Stock and OP Unit holders, Normalized FFO per Common Share and OP Unit, FFO available for Common Stock and OP Unit holders, FFO per Common Share and OP Unit, Net income available for Common Stockholders and Net income per Common Share could vary materially from amounts presented above if any of our assumptions is incorrect. |
|
2. |
See page 14 for 2019 Core Guidance Assumptions. Amount represents 2018 Income from property operations, excluding deferrals and property management, from the 2019 Core properties of $133.4 million multiplied by an estimated growth rate of 4.6% and $530.9 million multiplied by an estimated growth rate of 4.9% for the quarter and year ending December 31, 2019, respectively. |
|
3. |
See page 14 for the 2019 Assumptions regarding the Non-Core Properties. |
|
4. |
Includes insurance recovery revenue from reimbursement for capital expenditures related to Hurricane Irma. |
|
5. |
Net income per Common Share - Fully Diluted is calculated before Income allocated to non-controlling interest - Common OP Units. |
|
2019 Core Guidance Assumptions (1) |
||||||||||||||
(In millions, unaudited) |
||||||||||||||
|
Quarter Ended |
|
Fourth Quarter
|
|
Year Ended |
|
2019 |
|||||||
|
December 31, 2018 |
|
Growth Factors (2) |
|
December 31, 2018 |
|
Growth Factors (2) |
|||||||
Community base rental income |
$ |
127.7 |
|
|
5.3 |
% |
|
$ |
505.3 |
|
|
5.2 |
% |
|
Rental home income |
3.4 |
|
|
16.7 |
% |
|
13.1 |
|
|
13.5 |
% |
|||
Resort base rental income (3) |
53.4 |
|
|
4.9 |
% |
|
233.4 |
|
|
4.4 |
% |
|||
Right-to-use annual payments (membership subscriptions) |
12.2 |
|
|
6.4 |
% |
|
47.8 |
|
|
6.7 |
% |
|||
Right-to-use contracts current period, gross (membership upgrade sales) |
3.2 |
|
|
6.3 |
% |
|
15.2 |
|
|
18.7 |
% |
|||
Utility and other income |
23.4 |
|
|
(10.0 |
)% |
|
93.5 |
|
|
(5.1 |
)% |
|||
Property operating revenues |
223.3 |
|
|
3.9 |
% |
|
908.3 |
|
|
4.4 |
% |
|||
|
|
|
|
|
|
|
|
|||||||
Property operating, maintenance, and real estate taxes |
85.2 |
|
|
3.3 |
% |
|
358.4 |
|
|
3.5 |
% |
|||
Rental home operating and maintenance |
1.8 |
|
|
(20.0 |
)% |
|
6.5 |
|
|
(14.9 |
)% |
|||
Sales and marketing, gross |
2.9 |
|
|
4.2 |
% |
|
12.5 |
|
|
16.9 |
% |
|||
Property operating expenses |
89.9 |
|
|
2.8 |
% |
|
377.4 |
|
|
3.6 |
% |
|||
Income from property operations, excluding deferrals and property management |
$ |
133.4 |
|
|
4.6 |
% |
|
$ |
530.9 |
|
|
4.9 |
% |
|
|
|
|
|
|
|
|
|
|||||||
Resort base rental income: |
|
|
|
|
|
|
|
|||||||
Annual |
$ |
37.6 |
|
|
5.5 |
% |
|
$ |
145.7 |
|
|
6.0 |
% |
|
Seasonal |
8.2 |
|
|
4.1 |
% |
|
36.3 |
|
|
3.4 |
% |
|||
Transient |
7.6 |
|
|
3.0 |
% |
|
51.4 |
|
|
0.8 |
% |
|||
Total resort base rental income |
$ |
53.4 |
|
|
4.9 |
% |
|
$ |
233.4 |
|
|
4.4 |
% |
|
2019 Non-Core Guidance Assumptions (1) |
||||||||
(In millions, unaudited) |
||||||||
|
Quarter Ending |
|
Year Ending |
|||||
|
December 31, 2019 |
|
December 31, 2019 |
|||||
Community base rental income |
$ |
3.8 |
|
|
$ |
15.7 |
|
|
Rental home income |
— |
|
|
0.1 |
|
|||
Resort and marina base rental income |
8.5 |
|
|
25.7 |
|
|||
Utility and other income |
1.2 |
|
|
3.7 |
|
|||
Property operating revenues |
13.5 |
|
|
45.2 |
|
|||
|
|
|
|
|||||
Property operating, maintenance, and real estate taxes |
7.2 |
|
|
22.2 |
|
|||
Property operating expenses |
7.2 |
|
|
22.2 |
|
|||
Income from property operations, excluding deferrals and property management |
$ |
6.3 |
|
|
$ |
23.0 |
|
|
___________________ |
||
1. |
Each line item represents the mid-point of a range of possible outcomes and reflects management’s best estimate of the most likely outcome. Actual income from property operations could vary materially from amounts presented above if any of our assumptions is incorrect. |
|
2. |
Management’s estimate of the growth of property operations in the 2019 Core Properties compared to actual 2018 performance. Represents the mid-point of a range of possible outcomes. Calculations prepared using actual results without rounding. Actual growth for Core properties could vary materially from amounts presented above if any of our assumptions is incorrect. |
|
3. |
See resort base rental income detail included below within this table. |
|
Preliminary 2020 Guidance - Selected Financial Data (1) |
Our guidance acknowledges the existence of volatile economic conditions, which may impact our current guidance assumptions. Factors impacting 2020 guidance include, but are not limited to the following: (i) the mix of site usage within the portfolio; (ii) yield management on our short-term resort and marina sites; (iii) scheduled or implemented rate increases on community, resort and marina sites; (iv) scheduled or implemented rate increases in annual payments under right-to-use contracts; (v) occupancy changes; (vi) our ability to retain and attract customers renewing or entering right-to-use contracts; (vii) our ability to integrate and operate recent acquisitions in accordance with our estimates; (viii) completion of pending transactions in their entirety and on assumed schedule; and (ix) ongoing legal matters and related fees; and (x) costs to restore property operations following storms or other unplanned events. |
(In millions, except per share data, unaudited) |
||||
|
Year Ending |
|||
|
December 31, 2020 |
|||
Income from property operations, excluding deferrals and property management - 2020 Core (2) |
$ |
605.8 |
|
|
Income from property operations - Non-Core (3) |
10.8 |
|
||
Property management and general and administrative |
(95.5 |
) |
||
Other income and expenses |
11.6 |
|
||
Interest and related amortization |
(106.3 |
) |
||
Normalized FFO and FFO available for Common Stock and OP Unit holders |
426.4 |
|
||
Depreciation on real estate and other |
(137.6 |
) |
||
Depreciation on rental homes |
(11.1 |
) |
||
Deferral of right-to-use contract sales revenue and commission, net |
(9.5 |
) |
||
Income allocated to non-controlling interest-Common OP Units |
(14.6 |
) |
||
Net income available for Common Stockholders |
$ |
253.6 |
|
|
|
|
|||
|
|
|||
Net income per Common Share - Fully Diluted (4) |
$1.36 - $1.42 |
|||
FFO per Common Share and OP Unit - Fully Diluted |
$2.19 - $2.25 |
|||
Normalized FFO per Common Share and OP Unit - Fully Diluted |
$2.19 - $2.25 |
|||
|
|
|||
Weighted average Common Stock outstanding - Fully Diluted |
192.5 |
|||
______________________ |
||
1. |
Each line item represents the mid-point of a range of possible outcomes and reflects management’s estimate of the most likely outcome. Actual Normalized FFO available for Common Stock and OP Unit holders, Normalized FFO per Common Share and OP Unit, FFO available for Common Stock and OP Unit holders, FFO per Common Share and OP Unit, Net income available for Common Stockholders and Net income per Common Share could vary materially from amounts presented above if any of our assumptions is incorrect. |
|
2. |
See page 16 for Preliminary 2020 Core Guidance Assumptions. Amount represents estimated 2019 Income from property operations, excluding deferrals and property management, from the 2020 Core properties of $575.0 million multiplied by an estimated growth rate of 5.3% for the year ending December 31, 2020. |
|
3. |
See page 16 for Preliminary 2020 Non-Core Guidance Assumptions. |
|
4. |
Net income per fully diluted Common Share is calculated before Income allocated to Common OP Units. |
|
Preliminary 2020 Core Guidance Assumptions (1) |
|||||||
(In millions, unaudited) |
|||||||
|
Year Ending |
|
2020 |
||||
|
December 31, 2019 |
|
Growth Factors (2) |
||||
Community base rental income |
$ |
544.4 |
|
|
4.4 |
% |
|
Rental home income |
14.9 |
|
|
2.5 |
% |
||
Resort base rental income (3) |
258.9 |
|
|
5.2 |
% |
||
Right-to-use annual payments (membership subscriptions) |
51.0 |
|
|
4.2 |
% |
||
Right-to-use contracts current period, gross (membership upgrade sales) |
18.0 |
|
|
10.5 |
% |
||
Utility and other income |
91.1 |
|
|
2.7 |
% |
||
Property operating revenues |
978.3 |
|
|
4.6 |
% |
||
|
|
|
|
||||
Property operating, maintenance, and real estate taxes |
383.1 |
|
|
3.1 |
% |
||
Rental home operating and maintenance |
5.5 |
|
|
2.9 |
% |
||
Sales and marketing, gross |
14.7 |
|
|
7.5 |
% |
||
Property operating expenses |
403.3 |
|
|
3.3 |
% |
||
Income from property operations, excluding deferrals and property management |
$ |
575.0 |
|
|
5.3 |
% |
|
|
|
|
|
||||
Resort base rental income: |
|
|
|
||||
Annual |
$ |
160.8 |
|
|
5.4 |
% |
|
Seasonal |
41.0 |
|
|
4.6 |
% |
||
Transient |
57.1 |
|
|
4.8 |
% |
||
Total resort base rental income |
$ |
258.9 |
|
|
5.2 |
% |
|
Preliminary 2020 Non-Core Guidance Assumptions (1) |
||||
(In millions, unaudited) |
||||
|
Year Ending |
|||
|
December 31, 2020 |
|||
Community base rental income |
$ |
— |
|
|
Rental home income |
— |
|
||
Resort and marina base rental income |
22.0 |
|
||
Utility and other income |
3.0 |
|
||
Property operating revenues |
25.0 |
|
||
|
|
|||
Property operating, maintenance, and real estate taxes |
14.2 |
|
||
Property operating expenses |
14.2 |
|
||
Income from property operations, excluding deferrals and property management |
$ |
10.8 |
|
|
______________________ |
||
1. |
Each line item represents the mid-point of a range of possible outcomes and reflects management’s best estimate of the most likely outcome. Actual income from property operations could vary materially from amounts presented above if any of our assumptions is incorrect. |
|
2. |
Management’s estimate of the growth of property operations in the 2020 Core Properties compared to estimated 2019 performance. Represents the mid-point of a range of possible outcomes. Calculations prepared using actual results without rounding. Actual growth could vary materially from amounts presented above if any of our assumptions is incorrect. |
|
3. |
See resort base rental income table included below within this table. |
|
Right-To-Use Memberships - Select Data |
|||||||||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||
|
|
2016 |
|
2017 |
|
2018 |
|
2019 (1) |
|
2020 (1) |
|||||||||||||||||
Member Count (2) |
|
|
104,728 |
|
|
|
106,456 |
|
|
|
111,094 |
|
|
|
116,000 |
|
|
|
120,000 |
|
|||||||
Thousand Trails Camping Pass (TTC) Origination |
|
|
29,576 |
|
|
|
31,618 |
|
|
|
37,528 |
|
|
|
40,800 |
|
|
|
42,700 |
|
|||||||
TTC Sales |
|
|
12,856 |
|
|
|
14,128 |
|
|
|
17,194 |
|
|
|
19,100 |
|
|
|
20,300 |
|
|||||||
RV Dealer TTC Activations |
|
|
16,720 |
|
|
|
17,490 |
|
|
|
20,334 |
|
|
|
21,700 |
|
|
|
22,400 |
|
|||||||
Number of annuals (3) |
|
|
5,756 |
|
|
|
5,843 |
|
|
|
5,888 |
|
|
|
5,600 |
|
|
|
5,600 |
|
|||||||
Number of upgrade sales (4) |
|
|
2,477 |
|
|
|
2,514 |
|
|
|
2,500 |
|
|
|
2,900 |
|
|
|
3,100 |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
(In thousands, unaudited) |
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Right-to-use annual payments (membership subscriptions) |
|
$ |
|
45,036 |
|
|
$ |
|
45,798 |
|
|
$ |
|
47,778 |
|
|
$ |
|
51,000 |
|
|
$ |
|
53,100 |
|
||
Resort base rental income from annuals |
|
$ |
|
15,413 |
|
|
$ |
|
16,841 |
|
|
$ |
|
18,363 |
|
|
$ |
|
19,600 |
|
|
$ |
|
21,100 |
|
||
Resort base rental income from seasonals/transients |
|
$ |
|
17,344 |
|
|
$ |
|
18,231 |
|
|
$ |
|
19,840 |
|
|
$ |
|
20,400 |
|
|
$ |
|
21,900 |
|
||
Upgrade contract initiations (5) |
|
$ |
|
12,312 |
|
|
$ |
|
14,130 |
|
|
$ |
|
15,191 |
|
|
$ |
|
18,000 |
|
|
$ |
|
20,000 |
|
||
Utility and other income |
|
$ |
|
2,442 |
|
|
$ |
|
2,254 |
|
|
$ |
|
2,410 |
|
|
$ |
|
2,300 |
|
|
$ |
|
2,000 |
|
||
______________________ |
||
1. |
Guidance estimate. Each line item represents the mid-point of a range of possible outcomes and reflects management’s best estimate of the most likely outcome. Actual figures could vary materially from amounts presented above if any of our assumptions is incorrect. |
|
2. |
Members have entered into right-to-use contracts (membership subscriptions) with us that entitle them to use certain properties on a continuous basis for up to 21 days. |
|
3. |
Members who rent a specific site for an entire year in connection with their right-to-use contracts (membership subscriptions). |
|
4. |
Existing members who have upgraded agreements are eligible for enhanced benefits, including but not limited to longer stays, the ability to make earlier reservations, potential discounts on rental units, and potential access to additional properties. Upgrades require a non-refundable upfront payment. |
|
5. |
Revenues associated with contract upgrades, included in Right-to-use contracts current period, gross (membership upgrade sales) on our Consolidated Income Statements on page 4. |
|
Market Capitalization |
|||||||||||||||||
(In millions, except share and OP Unit data (adjusted for stock split), unaudited) |
|||||||||||||||||
Capital Structure as of September 30, 2019 |
|
|
|
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
Total
|
|
% of Total
|
|
Total |
|
% of Total |
|
% of Total
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Secured Debt |
|
|
|
|
|
$ |
2,086 |
|
|
86.7 |
% |
|
|
||||
Unsecured Debt |
|
|
|
|
|
320 |
|
|
13.3 |
% |
|
|
|||||
Total Debt (1) |
|
|
|
|
|
$ |
2,406 |
|
|
100.0 |
% |
|
15.8 |
% |
|||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Common Stock |
|
182,080,186 |
|
|
94.6 |
% |
|
|
|
|
|
|
|||||
OP Units |
|
10,493,422 |
|
|
5.4 |
% |
|
|
|
|
|
|
|||||
Total Common Stock and OP Units |
|
192,573,608 |
|
|
100.0 |
% |
|
|
|
|
|
|
|||||
Common Stock price at September 30, 2019(2) |
$ |
66.80 |
|
|
|
|
|
|
|
|
|
||||||
Fair Value of Common Stock and OP Units |
|
|
|
|
|
$ |
12,864 |
|
|
100.0 |
% |
|
|
||||
Total Equity |
|
|
|
|
|
$ |
12,864 |
|
|
100.0 |
% |
|
84.2 |
% |
|||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Total Market Capitalization |
|
|
|
|
|
$ |
15,270 |
|
|
|
|
100.0 |
% |
||||
______________________ |
||
1. |
Excludes deferred financing costs of approximately $24.6 million. |
|
2. |
Reflects the September 30, 2019 share closing price of $133.60 on a post stock-split basis. |
|
Debt Maturity Schedule |
|||||||||||||||||||||||||
Debt Maturity Schedule as of September 30, 2019 |
|||||||||||||||||||||||||
(In thousands, unaudited) |
|||||||||||||||||||||||||
Year |
|
Secured
|
|
Weighted
|
|
Unsecured
|
|
Weighted
|
|
Total Debt |
|
% of
|
|
Weighted
|
|
||||||||||
2019 |
|
$ |
— |
|
|
— |
% |
|
$ |
— |
|
|
— |
% |
|
$ |
— |
|
|
— |
% |
|
— |
% |
|
2020 |
|
48,607 |
|
|
5.18 |
% |
|
— |
|
|
— |
% |
|
48,607 |
|
|
2.13 |
% |
|
5.18 |
% |
|
|||
2021 |
|
169,804 |
|
|
5.01 |
% |
|
— |
|
|
— |
% |
|
169,804 |
|
|
7.43 |
% |
|
5.01 |
% |
|
|||
2022 |
|
147,101 |
|
|
4.62 |
% |
|
— |
|
|
— |
% |
|
147,101 |
|
|
6.44 |
% |
|
4.62 |
% |
|
|||
2023 |
|
103,552 |
|
|
5.05 |
% |
|
200,000 |
|
|
3.05 |
% |
|
303,552 |
|
|
13.28 |
% |
|
3.73 |
% |
|
|||
2024 |
|
10,683 |
|
|
5.49 |
% |
|
— |
|
|
— |
% |
|
10,683 |
|
|
0.47 |
% |
|
5.49 |
% |
|
|||
2025 |
|
101,486 |
|
|
3.45 |
% |
|
— |
|
|
— |
% |
|
101,486 |
|
|
4.44 |
% |
|
3.45 |
% |
|
|||
2026 |
|
— |
|
|
— |
% |
|
— |
|
|
— |
% |
|
— |
|
|
— |
% |
|
— |
% |
|
|||
2027 |
|
— |
|
|
— |
% |
|
— |
|
|
— |
% |
|
— |
|
|
— |
% |
|
— |
% |
|
|||
2028 |
|
222,879 |
|
|
4.19 |
% |
|
— |
|
|
— |
% |
|
222,879 |
|
|
9.75 |
% |
|
4.19 |
% |
|
|||
Thereafter |
|
1,280,856 |
|
|
4.24 |
% |
|
— |
|
|
— |
% |
|
1,280,856 |
|
|
56.06 |
% |
|
4.24 |
% |
|
|||
Total |
|
$ |
2,084,968 |
|
|
4.35 |
% |
|
$ |
200,000 |
|
|
3.05 |
% |
|
$ |
2,284,968 |
|
|
100.0 |
% |
|
4.24 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Unsecured Line of Credit (1) |
|
— |
|
|
|
|
120,000 |
|
|
|
|
120,000 |
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Note Premiums |
|
1,234 |
|
|
|
|
— |
|
|
|
|
1,234 |
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total Debt |
|
2,086,202 |
|
|
|
|
320,000 |
|
|
|
|
2,406,202 |
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deferred Financing Costs |
|
(23,466 |
) |
|
|
|
(1,132 |
) |
|
|
|
(24,598 |
) |
|
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total Debt, net |
|
$ |
2,062,736 |
|
|
|
|
$ |
318,868 |
|
|
|
|
$ |
2,381,604 |
|
|
|
|
4.29 |
%(2) |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Average Years to Maturity |
|
13.4 |
|
|
|
3.1 |
|
|
|
12.0 |
|
|
|
|
|
||||||||||
______________________ |
||
1. |
Reflects outstanding balance on the Line of Credit as of September 30, 2019. The Line of Credit matures in October 2021 and had an effective interest rate of 1.76% during the third quarter of 2019. |
|
2. |
Reflects effective interest rate during the third quarter of 2019, including amortization of note premiums and deferred financing costs. |
|
Non-GAAP Financial Measures Definitions and Reconciliations
FUNDS FROM OPERATIONS (FFO). We define FFO as net income, computed in accordance with GAAP, excluding gains or losses from sales of properties, depreciation and amortization related to real estate, impairment charges, and adjustments to reflect our share of FFO of unconsolidated joint ventures. Adjustments for unconsolidated joint ventures are calculated to reflect FFO on the same basis. We compute FFO in accordance with our interpretation of standards established by the National Association of Real Estate Investment Trusts (“NAREIT”), which may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition or that interpret the current NAREIT definition differently than we do. We receive up-front non-refundable payments from the entry of right-to-use contracts. In accordance with GAAP, the upfront non-refundable payments and related commissions are deferred and amortized over the estimated customer life. Although the NAREIT definition of FFO does not address the treatment of non-refundable right-to-use payments, we believe that it is appropriate to adjust for the impact of the deferral activity in our calculation of FFO.
We believe FFO, as defined by the Board of Governors of NAREIT, is generally a measure of performance for an equity REIT. While FFO is a relevant and widely used measure of operating performance for equity REITs, it does not represent cash flow from operations or net income as defined by GAAP, and it should not be considered as an alternative to these indicators in evaluating liquidity or operating performance.
NORMALIZED FUNDS FROM OPERATIONS (NORMALIZED FFO). We define Normalized FFO as FFO excluding the following non-operating income and expense items: a) gains and losses from early debt extinguishment, including prepayment penalties and defeasance costs, and b) other miscellaneous non-comparable items. Normalized FFO presented herein is not necessarily comparable to Normalized FFO presented by other real estate companies due to the fact that not all real estate companies use the same methodology for computing this amount.
FUNDS AVAILABLE FOR DISTRIBUTION (FAD). We define FAD as Normalized FFO less non-revenue producing capital expenditures.
We believe that FFO, Normalized FFO and FAD are helpful to investors as supplemental measures of the performance of an equity REIT. We believe that by excluding the effect of gains or losses from sales of properties, depreciation and amortization related to real estate, impairment charges, which are based on historical costs and may be of limited relevance in evaluating current performance, FFO can facilitate comparisons of operating performance between periods and among other equity REITs. We further believe that Normalized FFO provides useful information to investors, analysts and our management because it allows them to compare our operating performance to the operating performance of other real estate companies and between periods on a consistent basis without having to account for differences not related to our operations. For example, we believe that excluding the early extinguishment of debt, property acquisition and other transaction costs related to mergers and acquisitions from Normalized FFO allows investors, analysts and our management to assess the sustainability of operating performance in future periods because these costs do not affect the future operations of the properties. In some cases, we provide information about identified non-cash components of FFO and Normalized FFO because it allows investors, analysts and our management to assess the impact of those items.
INCOME FROM PROPERTY OPERATIONS, EXCLUDING DEFERRALS AND PROPERTY MANAGEMENT. We define Income from property operations, excluding deferrals and property management as rental income, utility and other income and right-to-use income less property and rental home operating and maintenance expenses, real estate taxes, sales and marketing expenses, excluding property management and the GAAP deferral of right-to-use contract upfront payments and related commissions, net. For comparative purposes, we present bad debt expense within Property operating, maintenance and real estate taxes in the current and prior periods. We believe that this Non-GAAP financial measure is helpful to investors and analysts as a measure of the operating results of our manufactured home and RV communities.
The following table reconciles Net income available for Common Stockholders to Income from property operations:
|
|
Quarters Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
(amounts in thousands) |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||
Net income available for Common Stockholders |
|
$ |
64,461 |
|
|
$ |
56,070 |
|
|
$ |
224,171 |
|
|
$ |
162,429 |
|
Redeemable perpetual preferred stock dividends |
|
— |
|
|
— |
|
|
8 |
|
|
8 |
|
||||
Income allocated to non-controlling interests – Common OP Units |
|
3,715 |
|
|
3,590 |
|
|
13,617 |
|
|
10,569 |
|
||||
Equity in income of unconsolidated joint ventures |
|
(3,518 |
) |
|
(788 |
) |
|
(8,277 |
) |
|
(3,596 |
) |
||||
Income before equity in income of unconsolidated joint ventures |
|
64,658 |
|
|
58,872 |
|
|
229,519 |
|
|
169,410 |
|
||||
Gain on sale of real estate, net |
|
— |
|
|
— |
|
|
(52,507 |
) |
|
— |
|
||||
Right-to-use contract upfront payments, deferred, net |
|
3,530 |
|
|
2,883 |
|
|
8,213 |
|
|
6,189 |
|
||||
Gross revenues from home sales |
|
(8,438 |
) |
|
(9,339 |
) |
|
(22,738 |
) |
|
(26,753 |
) |
||||
Brokered resale and ancillary services revenues, net |
|
(2,133 |
) |
|
(1,362 |
) |
|
(4,564 |
) |
|
(3,380 |
) |
||||
Interest income |
|
(1,831 |
) |
|
(1,846 |
) |
|
(5,385 |
) |
|
(5,658 |
) |
||||
Income from other investments, net |
|
(7,029 |
) |
|
(5,421 |
) |
|
(8,894 |
) |
|
(9,774 |
) |
||||
Right-to-use contract commissions, deferred, net |
|
(313 |
) |
|
(458 |
) |
|
(893 |
) |
|
(744 |
) |
||||
Property management |
|
14,605 |
|
|
13,589 |
|
|
42,675 |
|
|
40,742 |
|
||||
Depreciation and amortization |
|
37,032 |
|
|
34,980 |
|
|
112,785 |
|
|
101,699 |
|
||||
Cost of home sales |
|
8,434 |
|
|
9,742 |
|
|
23,230 |
|
|
27,948 |
|
||||
Home selling expenses |
|
1,033 |
|
|
1,101 |
|
|
3,218 |
|
|
3,149 |
|
||||
General and administrative |
|
8,710 |
|
|
8,816 |
|
|
27,844 |
|
|
26,523 |
|
||||
Other expenses |
|
1,460 |
|
|
386 |
|
|
2,427 |
|
|
1,096 |
|
||||
Early debt retirement |
|
— |
|
|
— |
|
|
1,491 |
|
|
— |
|
||||
Interest and related amortization |
|
25,547 |
|
|
26,490 |
|
|
77,964 |
|
|
78,478 |
|
||||
Income from property operations, excluding deferrals and property management |
|
145,265 |
|
|
138,433 |
|
|
434,385 |
|
|
408,925 |
|
||||
Right-to-use contracts, upfront payments and commissions, deferred, net |
|
(3,217 |
) |
|
(2,425 |
) |
|
(7,320 |
) |
|
(5,445 |
) |
||||
Property management |
|
(14,605 |
) |
|
(13,589 |
) |
|
(42,675 |
) |
|
(40,742 |
) |
||||
Income from property operations |
|
$ |
127,443 |
|
|
$ |
122,419 |
|
|
$ |
384,390 |
|
|
$ |
362,738 |
|
EARNINGS BEFORE INTEREST, TAX, DEPRECIATION AND AMORTIZATION FOR REAL ESTATE (EBITDAre) AND ADJUSTED EBITDAre. We define EBITDAre as net income or loss excluding interest income and expense, income taxes, depreciation and amortization, gains or losses from sales of properties, impairments charges, and adjustments to reflect our share of EBITDAre of unconsolidated joint ventures. We compute EBITDAre in accordance with our interpretation of the standards established by NAREIT, which may not be comparable to EBITDAre reported by other REITs that do not define the term in accordance with the current NAREIT definition or that interpret the current NAREIT definition differently than we do. We receive up-front non-refundable payments from the entry of right-to-use contracts. In accordance with GAAP, the upfront non-refundable payments and related commissions are deferred and amortized over the estimated customer life. Although the NAREIT definition of EBITDAre does not address the treatment of non-refundable right-to-use payments, we believe that it is appropriate to adjust for the impact of the deferral activity in our calculation of EBITDAre.
We define Adjusted EBITDAre as EBITDAre excluding non-operating income and expense items such as gains and losses from early debt extinguishment, including prepayment penalties and defeasance costs, and other miscellaneous non-comparable items.
We believe that EBITDAre and Adjusted EBITDAre may be useful to an investor in evaluating our operating performance and liquidity because the measures are widely used to measure the operating performance of an equity REIT.
The following table reconciles Consolidated net income to EBITDAre and Adjusted EBITDAre:
|
|
Quarters Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
(amounts in thousands) |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||
Consolidated net income |
|
$ |
68,176 |
|
|
$ |
59,660 |
|
|
$ |
237,796 |
|
|
$ |
173,006 |
|
Interest income |
|
(1,831 |
) |
|
(1,846 |
) |
|
(5,385 |
) |
|
(5,658 |
) |
||||
Right-to-use contract upfront payments, deferred, net |
|
3,530 |
|
|
2,883 |
|
|
8,213 |
|
|
6,189 |
|
||||
Right-to-use contract commissions, deferred, net |
|
(313 |
) |
|
(458 |
) |
|
(893 |
) |
|
(744 |
) |
||||
Real estate depreciation and amortization |
|
37,032 |
|
|
34,980 |
|
|
112,785 |
|
|
101,699 |
|
||||
Other depreciation and amortization |
|
460 |
|
|
386 |
|
|
1,336 |
|
|
1,096 |
|
||||
Interest and related amortization |
|
25,547 |
|
|
26,490 |
|
|
77,964 |
|
|
78,478 |
|
||||
Gain on sale of real estate, net |
|
— |
|
|
— |
|
|
(52,507 |
) |
|
— |
|
||||
Adjustments to our share of EBITDAre of unconsolidated joint ventures |
|
259 |
|
|
1,214 |
|
|
2,858 |
|
|
3,125 |
|
||||
EBITDAre |
|
132,860 |
|
|
123,309 |
|
|
382,167 |
|
|
357,191 |
|
||||
Early debt retirement |
|
— |
|
|
— |
|
|
2,085 |
|
|
— |
|
||||
Insurance proceeds due to catastrophic weather event |
|
(5,856 |
) |
|
(3,833 |
) |
|
(6,205 |
) |
|
(5,925 |
) |
||||
Adjusted EBITDAre |
|
$ |
127,004 |
|
|
$ |
119,476 |
|
|
$ |
378,047 |
|
|
$ |
351,266 |
|
CORE. The Core properties include properties we owned and operated during all of 2018 and 2019. We believe Core is a measure that is useful to investors for annual comparison as it removes the fluctuations associated with acquisitions, dispositions and significant transactions or unique situations.
NON-CORE. The Non-Core properties include all properties that were not owned and operated during all of 2018 and 2019. This includes, but is not limited to, four properties and the Loggerhead marinas acquired and five properties sold during 2019, five properties acquired during 2018 and Fiesta Key and Sunshine Key RV Resorts.
INCOME FROM RENTAL OPERATIONS, NET OF DEPRECIATION. We use Income from rental operations, net of depreciation as an alternative measure to evaluate the operating results of our home rental program. Income from rental operations, net of depreciation, represents income from rental operations less depreciation expense on rental homes. We believe this measure is meaningful for investors as it provides a complete picture of the home rental program operating results, including the impact of depreciation, which affects our home rental program investment decisions.
NON-REVENUE PRODUCING IMPROVEMENTS. Represents capital expenditures that will not directly result in increased revenue or expense savings and are primarily comprised of common area improvements, furniture and mechanical improvements.
FIXED CHARGES. Fixed charges consist of interest expense, amortization of note premiums and debt issuance costs.
