Continued Strong Performance
Equity LifeStyle Properties, Inc. (NYSE: ELS) (referred to
herein as “we,” “us,” and “our”) today announced results for the
quarter ended March 31, 2024. All per share results are reported on
a fully diluted basis unless otherwise noted.
($ in millions, except per share
data)
FINANCIAL
RESULTS
Q1 2024
Q1 2023
$ Change
Total Revenues
$
386.6
$
370.0
$
16.6
Net Income available for Common
Stockholders
$
109.9
$
82.4
$
27.5
Net Income per Common Share
$
0.59
$
0.44
$
0.15
NON-GAAP
FINANCIAL MEASURES
Q1 2024
Q1 2023
$ Change
Funds from Operations (“FFO”) per Common
Share and OP Unit
$
0.86
$
0.72
$
0.14
Normalized Funds from Operations
(“Normalized FFO”) per Common Share and
OP Unit
$
0.78
$
0.72
$
0.06
Property operating revenues
$
353.7
$
334.8
$
18.9
Income from property operations, excluding
property management
$
211.4
$
198.0
$
13.4
CORE PORTFOLIO
PERFORMANCE
Q1 2024
Q1 2023
% Change
Core property operating revenues
$
345.4
$
326.4
5.8
%
Core Income from property operations,
excluding property management
$
206.1
$
192.4
7.1
%
Operations Update
Normalized FFO for the quarter ended March 31, 2024 was $0.78
per share, representing an 8.6% increase compared to the same
period in 2023, and is in line with the midpoint of our guidance
expectation.
MH
Core MH base rental income for the quarter ended March 31, 2024
increased 6.4% compared to the same period in 2023, which reflects
6.3% growth from rate increases and 0.1% from occupancy gains. Core
MH homeowners increased by 123 since December 31, 2023. We sold 191
new homes during the quarter ended March 31, 2024, with an average
sales price of approximately $93,000.
RV and Marina
Core RV and marina base rental income for the quarter ended
March 31, 2024 increased 5.8% compared to the same period in 2023.
Core RV and marina annual base rental income increased 8.0% for the
quarter ended March 31, 2024, which included allocation of an
additional day’s revenue resulting from the leap year, compared to
the same period in 2023. Total nights camped during the quarter
ended March 31, 2024 is in line compared to the same period in
2023.
Property Operating Expenses
Core property operating expenses, excluding property management
for the quarter ended March 31, 2024 increased 3.9% compared to the
same period in 2023. See page 8 for details of the Core property
operating expenses, excluding property management.
We completed our property and casualty insurance renewal as of
April 1, 2024 with no change to program deductibles, an increase to
certain coverage limits, and a premium increase of approximately
9%.
Balance Sheet Activity
In April 2024, the Company entered into three interest rate swap
agreements (“Swaps”) with an aggregate notional value of $300.0
million allowing us to trade the variable interest rate associated
with our $300.0 million unsecured term loan for a fixed interest
rate. The Swaps have a weighted average all-in fixed interest rate
of 6.05% per annum and mature on April 17, 2026. As a result,
borrowings on our unsecured line of credit represent our only
exposure to floating rate debt.
Guidance Update (1)(2)
($ in millions, except per share
data)
2024
Second Quarter
Full Year
Net Income per Common Share
$0.34 to $0.40
$1.83 to $1.93
FFO per Common Share and OP Unit
$0.61 to $0.67
$2.91 to $3.01
Normalized FFO per Common Share and OP
Unit
$0.61 to $0.67
$2.84 to $2.94
2023 Actual
2024 Growth Rates
Core Portfolio:
Second Quarter
Full Year
Second Quarter
Full Year
MH base rental income
$
166.3
$
668.5
5.9% to 6.5%
5.6% to 6.6%
RV and marina base rental income (3)
$
98.6
$
413.5
2.8% to 3.4%
4.5% to 5.5%
Property operating revenues
$
317.7
$
1,297.7
4.8% to 5.4%
4.8% to 5.8%
Property operating expenses, excluding
property management
$
145.4
$
562.3
5.3% to 5.9%
4.2% to 5.2%
Income from property operations, excluding
property management
$
172.3
$
735.4
4.3% to 4.9%
5.3% to 6.3%
Non-Core Portfolio:
2024 Full Year
Income from property operations, excluding
property management
$15.2 to $19.2
Other Guidance Assumptions:
2024 Full Year
Property management and general
administrative
$114.7 to $120.7
Debt assumptions:
Weighted average debt outstanding
$3,400 to $3,600
Interest and related amortization
$141.2 to $147.2
______________________
- Second quarter and full year 2024 guidance represent
management’s estimate of a range of possible outcomes. The midpoint
of the ranges reflect management’s estimate of the most likely
outcome based on our current view of existing market conditions and
assumptions. Actual results could vary materially from management’s
estimates presented above if any of our assumptions, including
occupancy and rate changes, our ability to manage expenses in an
inflationary environment, our ability to integrate and operate
recent acquisitions and costs to restore property operations and
potential revenue losses following storms or other unplanned
events, are incorrect. See Forward-Looking Statements in this press
release for additional factors impacting our 2024 guidance
assumptions. See Non-GAAP Financial Measures Definitions and
Reconciliations at the end of the supplemental financial
information for definitions of FFO and Normalized FFO and a
reconciliation of Net income per Common Share - Fully Diluted to
FFO per Common Share and OP Unit - Fully Diluted and Normalized FFO
per Common Share and OP Unit - Fully Diluted.
- Guidance assumptions do not include future capital events
(financing transactions, acquisitions or dispositions).
- Core RV and marina annual revenue represents approximately
73.2% and 69.3% of second quarter 2024 and full year 2024 RV and
marina base rental income, respectively. Core RV and marina annual
revenue second quarter 2024 growth rate range is 6.5% to 7.1% and
the full year 2024 growth rate range is 6.6% to 7.6%.
About Equity LifeStyle Properties
We are a self-administered, self-managed real estate investment
trust (“REIT”) with headquarters in Chicago. As of April 22, 2024,
we own or have an interest in 451 properties in 35 states and
British Columbia consisting of 172,464 sites.
For additional information, please contact our Investor
Relations Department at (800) 247-5279 or at
investor_relations@equitylifestyle.com.
Conference Call
A live audio webcast of our conference call discussing these
results will take place tomorrow, Tuesday, April 23, 2024, 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.
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,”
“estimate,” “guidance,” “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.
Forward-looking statements, including our guidance concerning Net
Income, FFO and Normalized FFO per share data, and certain growth
rates, by their nature, involve estimates, projections, goals,
forecasts and assumptions and are subject to risks and
uncertainties that could cause actual results or outcomes to differ
materially from those expressed in a forward-looking statement due
to a number of factors, which 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 membership subscriptions; (v) occupancy
changes; (vi) our ability to attract and retain membership
customers; (vii) change in customer demand regarding travel and
outdoor vacation destinations; (viii) our ability to manage
expenses in an inflationary environment; (ix) our ability to
integrate and operate recent acquisitions in accordance with our
estimates; (x) our ability to execute expansion/development
opportunities in the face of supply chain delays/shortages; (xi)
completion of pending transactions in their entirety and on assumed
schedule; (xii) our ability to attract and retain property
employees, particularly seasonal employees; (xiii) ongoing legal
matters and related fees; (xiv) costs to restore property
operations and potential revenue losses following storms or other
unplanned events; and (xv) the potential impact of, and our ability
to remediate, material weaknesses in our internal control over
financial reporting. 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” and “Forward-Looking Statements”
sections in our most recent Annual Report on Form 10-K and any
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.
Supplemental Financial Information
Financial Highlights
(In millions, except Common Shares and OP Units outstanding
and per share data, unaudited)
As of and for the Quarters
Ended
Mar 31, 2024
Dec 31, 2023
Sep 30, 2023
Jun 30, 2023
Mar 31, 2023
Operating Information
Total revenues
$
386.6
$
360.6
$
388.8
$
370.0
$
370.0
Consolidated net income
$
115.3
$
96.4
$
80.7
$
66.0
$
86.5
Net income available for Common
Stockholders
$
109.9
$
91.9
$
77.0
$
62.9
$
82.4
Adjusted EBITDAre (1)
$
186.3
$
171.1
$
167.0
$
157.7
$
173.0
FFO available for Common Stock and OP Unit
holders (1)(2)
$
167.4
$
148.5
$
133.8
$
118.6
$
140.3
Normalized FFO available for Common Stock
and OP Unit holders (1)(2)
$
152.7
$
138.2
$
133.9
$
124.9
$
140.5
Funds Available for Distribution ("FAD")
for Common Stock and OP Unit holders (1)(2)
$
136.9
$
109.2
$
107.8
$
98.3
$
122.4
Common Shares and OP Units Outstanding
(In thousands) and Per Share Data
Common Shares and OP Units, end of the
period
195,598
195,531
195,525
195,514
195,446
Weighted average Common Shares and OP
Units outstanding - Fully Diluted
195,545
195,475
195,440
195,430
195,369
Net income per Common Share - Fully
Diluted (3)
$
0.59
$
0.49
$
0.41
$
0.34
$
0.44
FFO per Common Share and OP Unit - Fully
Diluted
$
0.86
$
0.76
$
0.68
$
0.61
$
0.72
Normalized FFO per Common Share and OP
Unit - Fully Diluted
$
0.78
$
0.71
$
0.68
$
0.64
$
0.72
Dividends per Common Share
$
0.4775
$
0.4475
$
0.4475
$
0.4475
$
0.4475
Balance Sheet
Total assets
$
5,630
$
5,614
$
5,626
$
5,586
$
5,519
Total liabilities
$
4,110
$
4,115
$
4,129
$
4,083
$
4,006
Market Capitalization
Total debt (4)
$
3,507
$
3,548
$
3,533
$
3,479
$
3,414
Total market capitalization (5)
$
16,104
$
17,341
$
15,990
$
16,557
$
16,534
Ratios
Total debt / total market
capitalization
21.8
%
20.5
%
22.1
%
21.0
%
20.6
%
Total debt / Adjusted EBITDAre (6)
5.1
5.3
5.4
5.4
5.4
Interest coverage (7)
5.2
5.2
5.3
5.4
5.5
Fixed charges(8)
5.1
5.1
5.1
5.2
5.4
______________________
- See Non-GAAP Financial Measures Definitions and Reconciliations
at the end of the supplemental financial information for
definitions of Adjusted EBITDAre, FFO, Normalized FFO and FAD and a
reconciliation of Consolidated net income to Adjusted
EBITDAre.
- See page 6 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 for Common Stock and OP
Unit holders.
- Net income per Common Share - Fully Diluted is calculated
before Income allocated to non-controlling interest - Common OP
Units.
- Excludes deferred financing costs of approximately $28.6
million as of March 31, 2024.
- See page 14 for the calculation of market capitalization as of
March 31, 2024.
- Calculated using trailing twelve months Adjusted EBITDAre.
- Calculated by dividing trailing twelve months Adjusted EBITDAre
by the interest expense incurred during the same period.
- See Non-GAAP Financial Measures Definitions and Reconciliations
at the end of the supplemental financial 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, if any, during the same
period.
Consolidated Balance
Sheets
(In thousands, except share and per share data)
March 31, 2024
December 31, 2023
(unaudited)
Assets
Investment in real estate:
Land
$
2,088,657
$
2,088,657
Land improvements
4,435,288
4,380,649
Buildings and other depreciable
property
1,229,374
1,236,985
7,753,319
7,706,291
Accumulated depreciation
(2,497,039
)
(2,448,876
)
Net investment in real estate
5,256,280
5,257,415
Cash and restricted cash
47,281
29,937
Notes receivable, net
49,346
49,937
Investment in unconsolidated joint
ventures
84,989
85,304
Deferred commission expense
54,024
53,641
Other assets, net
138,314
137,499
Total Assets
$
5,630,234
$
5,613,733
Liabilities and Equity
Liabilities:
Mortgage notes payable, net
$
2,974,728
$
2,989,959
Term loans, net
497,875
497,648
Unsecured line of credit
6,000
31,000
Accounts payable and other liabilities
171,061
151,567
Deferred membership revenue
223,470
218,337
Accrued interest payable
12,543
12,657
Rents and other customer payments received
in advance and security deposits
131,547
126,451
Distributions payable
93,264
87,493
Total Liabilities
4,110,488
4,115,112
Equity:
Preferred stock, $0.01 par value,
10,000,000 shares authorized as of March 31, 2024 and December 31,
2023; none issued and outstanding.
—
—
Common stock, $0.01 par value, 600,000,000
shares authorized as of March 31, 2024 and December 31, 2023;
186,493,598 and 186,426,281 shares issued and outstanding as of
March 31, 2024 and December 31, 2023, respectively.
1,917
1,917
Paid-in capital
1,644,410
1,644,319
Distributions in excess of accumulated
earnings
(202,721
)
(223,576
)
Accumulated other comprehensive income
5,280
6,061
Total Stockholders’ Equity
1,448,886
1,428,721
Non-controlling interests – Common OP
Units
70,860
69,900
Total Equity
1,519,746
1,498,621
Total Liabilities and Equity
$
5,630,234
$
5,613,733
Consolidated Statements of
Income
(In thousands, unaudited)
Quarters Ended March
31,
2024
2023
Revenues:
Rental income
$
316,599
$
296,451
Annual membership subscriptions
16,215
15,970
Membership upgrade sales (1)
3,947
3,505
Other income
15,548
17,714
Gross revenues from home sales, brokered
resales and ancillary services
30,053
32,133
Interest income
2,168
2,088
Income from other investments, net
2,038
2,091
Total revenues
386,568
369,952
Expenses:
Property operating and maintenance
114,783
112,483
Real estate taxes
20,787
18,316
Membership sales and marketing (2)
5,297
4,838
Property management
19,710
19,464
Depreciation and amortization
51,108
50,502
Cost of home sales, brokered resales and
ancillary services
21,967
23,141
Home selling expenses and ancillary
operating expenses
6,147
6,924
General and administrative
11,989
11,661
Casualty-related charges/(recoveries), net
(3)
(14,843
)
—
Other expenses
1,331
1,468
Interest and related amortization
33,543
32,588
Total expenses
271,819
281,385
Income before income taxes and other
items
114,749
88,567
Gain/(Loss) on sale of real estate and
impairment, net
—
(2,632
)
Income tax benefit
239
—
Equity in income of unconsolidated joint
ventures
283
524
Consolidated net income
115,271
86,459
Income allocated to non-controlling
interests – Common OP Units
(5,366
)
(4,088
)
Net income available for Common
Stockholders
$
109,905
$
82,371
______________________
- Membership upgrade sales revenue is net of deferrals of $3.6
million and $4.5 million for the quarters ended March 31, 2024 and
March 31, 2023, respectively. See page 13 for details of membership
sales activity.
- Membership sales and marketing expense is net of sales
commission deferrals of $0.4 million and $0.7 million for the
quarters ended March 31, 2024 and March 31, 2023, respectively. See
page 13 for details of membership sales activity.
- Casualty-related charges/(recoveries), net for the quarter
ended March 31, 2024 includes debris removal and cleanup costs
related to Hurricane Ian of $0.5 million and insurance recovery
revenue of $15.4 million including excess revenue of $14.8 million
for reimbursement of capital expenditures related to Hurricane
Ian.
Non-GAAP Financial Measures
This document contains certain Non-GAAP measures used by
management that we believe are helpful to understand 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 are
they 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, refer to both Reconciliation of
Net Income to Non-GAAP Financial Measures on page 6 and Non-GAAP
Financial Measures Definitions and Reconciliations on pages
16-19.
Selected Non-GAAP Financial
Measures
(In millions, except per share data, unaudited)
Quarter Ended
March 31, 2024
Income from property operations, excluding
property management - 2024 Core (1)
$
206.1
Income from property operations, excluding
property management - Non-Core (1)
5.3
Property management and general and
administrative
(31.3
)
Other income and expenses
6.1
Interest and related amortization
(33.5
)
Normalized FFO available for Common
Stock and OP Unit holders (2)
$
152.7
Deferred income tax benefit
0.2
Transaction/pursuit costs and other
(0.4
)
Insurance proceeds due to catastrophic
weather event (3)
14.8
FFO available for Common Stock and OP
Unit holders (2)(4)
$
167.4
FFO per Common Share and OP Unit
$
0.86
Normalized FFO per Common Share and OP
Unit
$
0.78
Normalized FFO available for Common
Stock and OP Unit holders (2)
$
152.7
Non-revenue producing improvements to real
estate
(15.8
)
FAD for Common Stock and OP Unit
holders (2)
$
136.9
Weighted average Common Shares and OP
Units - Fully Diluted
195.5
______________________
- See pages 8-9 for details of the Core Income from Property
Operations, excluding property management. See page 10 for details
of the Non-Core Income from Property Operations, excluding property
management.
- See page 6 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 for Common Stock and OP Unit holders.
- Represents insurance recovery revenue for reimbursement of
capital expenditures related to Hurricane Ian.
- Amounts may not foot due to rounding.
Reconciliation of Net Income
to Non-GAAP Financial Measures
(In thousands, except per share data, unaudited)
Quarters Ended March
31,
2024
2023
Net income available for Common
Stockholders
$
109,905
$
82,371
Income allocated to non-controlling
interests – Common OP Units
5,366
4,088
Depreciation and amortization
51,108
50,502
Depreciation on unconsolidated joint
ventures
1,051
1,135
Gain on unconsolidated joint ventures
—
(416
)
(Gain)/Loss on sale of real estate and
impairment, net
—
2,632
FFO available for Common Stock and OP
Unit holders
167,430
140,312
Deferred income tax benefit
(239
)
—
Transaction/pursuit costs and other
(1)
383
206
Insurance proceeds due to catastrophic
weather event (2)
(14,843
)
—
Normalized FFO available for Common
Stock and OP Unit holders
152,731
140,518
Non-revenue producing improvements to real
estate
(15,812
)
(18,112
)
FAD for Common Stock and OP Unit
holders
$
136,919
$
122,406
Net income per Common Share -
Basic
$
0.59
$
0.44
Net income per Common Share - Fully
Diluted (3)
$
0.59
$
0.44
FFO per Common Share and OP Unit -
Basic
$
0.86
$
0.72
FFO per Common Share and OP Unit -
Fully Diluted
$
0.86
$
0.72
Normalized FFO per Common Share and OP
Unit - Basic
$
0.78
$
0.72
Normalized FFO per Common Share and OP
Unit - Fully Diluted
$
0.78
$
0.72
Weighted average Common Shares outstanding
- Basic
186,287
185,900
Weighted average Common Shares and OP
Units outstanding - Basic
195,392
195,162
Weighted average Common Shares and OP
Units outstanding - Fully Diluted
195,545
195,369
____________________
- Prior period amounts have been reclassified to conform to the
current period presentation.
- Represents insurance recovery revenue for reimbursement of
capital expenditures related to Hurricane Ian.
- Net income per Common Share - Fully Diluted 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 March
31,
2024
2023
MH base rental income (2)
$
175.1
$
164.6
Rental home income (2)
3.5
3.9
RV and marina base rental income (2)
120.2
111.6
Annual membership subscriptions
16.2
16.0
Membership upgrade sales (3)
3.9
3.5
Utility and other income (2)(4)
34.8
35.2
Property operating revenues
353.7
334.8
Property operating, maintenance and real
estate taxes (2)
137.0
132.0
Membership sales and marketing (3)
5.3
4.8
Property operating expenses, excluding
property management (1)
142.3
136.8
Income from property operations,
excluding property management (1)
$
211.4
$
198.0
Manufactured home site figures and
occupancy averages:
Total sites
73,008
72,717
Occupied sites
68,916
68,847
Occupancy %
94.4
%
94.7
%
Monthly base rent per site
$
847
$
797
RV and marina base rental
income:
Annual
$
75.6
$
69.4
Seasonal
29.5
28.0
Transient
15.1
14.2
Total RV and marina base rental income
$
120.2
$
111.6
______________________
- Excludes property management expenses.
- MH base rental income, Rental home income, RV and marina base
rental income and Utility income, net of bad debt expense, are
presented in Rental income in the Consolidated Statements of Income
on page 3. Bad debt expense is presented in Property operating,
maintenance and real estate taxes in this table.
- See page 13 for details of membership sales activity.
- Includes approximately $1.9 million and $4.0 million of
business interruption income from Hurricane Ian during the quarters
ended March 31, 2024 and March 31, 2023, respectively.
Core Income from Property
Operations (1)
(In millions, except occupancy figures, unaudited)
Quarters Ended March
31,
2024
2023
Change (2)
MH base rental income
$
174.9
$
164.4
6.4
%
Rental home income
3.5
3.9
(9.2
)%
RV and marina base rental income
115.6
109.3
5.8
%
Annual membership subscriptions
16.2
15.8
2.7
%
Membership upgrade sales
3.9
3.5
13.9
%
Utility and other income
31.3
29.5
5.6
%
Property operating revenues
345.4
326.4
5.8
%
Utility expense
38.7
38.4
0.7
%
Payroll
27.7
28.1
(1.4
)%
Repair & maintenance
20.8
21.8
(4.6
)%
Insurance and other (3)
26.4
23.0
14.6
%
Real estate taxes
20.4
17.9
14.3
%
Membership sales and marketing
5.3
4.8
9.9
%
Property operating expenses, excluding
property management (1)
139.3
134.0
3.9
%
Income from property operations,
excluding property management (1)
$
206.1
$
192.4
7.1
%
Occupied sites (4)
68,904
68,801
_____________________
- Excludes property management expenses.
- Calculations prepared using actual results without
rounding.
- Includes bad debt expense for the periods presented.
- Occupied sites are presented as of the end of the period.
Core Income from Property
Operations (continued)
(In millions, except home site and occupancy figures,
unaudited)
Quarters Ended March
31,
2024
2023
Core manufactured home site figures and
occupancy averages:
Total sites
72,593
72,456
Occupied sites
68,858
68,790
Occupancy %
94.9
%
94.9
%
Monthly base rent per site
$
847
$
797
Quarters Ended March
31,
2024
2023
Change (1)
Core RV and marina base rental
income:
Annual (2)
$
73.1
$
67.6
8.0
%
Seasonal
28.2
27.6
2.4
%
Transient
14.3
14.1
1.4
%
Total Seasonal and Transient
$
42.5
$
41.7
2.1
%
Total RV and marina base rental income
$
115.6
$
109.3
5.8
%
Quarters Ended March
31,
2024
2023
Change (1)
Core utility information:
Income
$
18.0
$
17.6
2.3
%
Expense
38.7
38.4
0.7
%
Expense, net
$
20.7
$
20.8
(0.5
)%
Utility recovery rate (3)
46.5
%
45.8
%
_____________________
- Calculations prepared using actual results without
rounding.
- Core Annual marina base rental income represents approximately
99% of the total Core marina base rental income for all periods
presented.
- Calculated by dividing the utility income by utility
expense.
Non-Core Income from Property
Operations (1)
(In millions, unaudited)
Quarter Ended
March 31, 2024
MH base rental income
$
0.2
RV and marina base rental income
4.5
Utility and other income
3.6
Property operating revenues
8.3
Property operating expenses, excluding
property management (1)(2)
3.0
Income from property operations,
excluding property management (1)
$
5.3
______________________
- Excludes property management expenses.
- Includes bad debt expense for the periods presented.
Home Sales and Rental Home
Operations
(In thousands, except home sale volumes and occupied rentals,
unaudited)
Home Sales - Select Data
Quarters Ended March
31,
2024
2023
Total new home sales volume
191
176
New home sales gross revenues
$
17,700
$
18,314
Total used home sales volume
54
102
Used home sales gross revenues
$
838
$
1,175
Brokered home resales volume
109
134
Brokered home resales gross revenues
$
572
$
675
Rental Homes - Select Data
Quarters Ended March
31,
2024
2023
Rental operations revenues (1)
$
9,058
$
10,258
Rental home operations expense (2)
1,369
959
Depreciation on rental homes (3)
2,568
2,747
Occupied rentals: (4)
New
1,922
2,389
Used
236
313
Total occupied rental sites
2,158
2,702
As of March 31, 2024
As of March 31, 2023
Cost basis in rental homes: (5)
Gross
Net of Depreciation
Gross
Net of Depreciation
New
$
238,963
$
197,641
$
252,204
$
209,673
Used
11,744
7,118
14,056
8,094
Total rental homes
$
250,707
$
204,759
$
266,260
$
217,767
______________________
- For the quarters ended March 31, 2024 and 2023, approximately
$5.6 million and $6.4 million, respectively, of the rental
operations revenue is included in the MH base rental income in the
Core Income from Property Operations on pages 8-9. The remainder of
the rental operations revenue for the quarters ended March 31, 2024
and 2023 is included in Rental home income in the Core Income from
Property Operations on pages 8-9.
- Rental home operations expense is included in Property
operating, maintenance and real estate taxes in the Consolidated
Income from Property Operations on page 7. Rental home operations
expense is included in Insurance and other in the Core Income from
Property Operations on pages 8-9.
- Depreciation on rental homes in our Core portfolio is presented
in Depreciation and amortization in the Consolidated Statements of
Income on page 3.
- Includes occupied rental sites in our Core portfolio.
- Includes both occupied and unoccupied rental homes in our Core
portfolio.
Total Sites
(Unaudited)
Summary of Total Sites as of March 31,
2024
Sites (1)
MH sites
73,000
RV sites:
Annual
34,900
Seasonal
11,800
Transient
16,300
Marina slips
6,900
Membership (2)
26,000
Joint Ventures (3)
3,600
Total
172,500
______________________
- MH sites are generally leased on an annual basis to residents
who own or lease factory-built homes, including manufactured homes.
Annual RV and marina sites are leased on an annual basis to
customers who generally have an RV, factory-built cottage, boat or
other unit placed on the site, including those Northern properties
that are open for the summer season. Seasonal RV and marina sites
are leased to customers generally for one to six months. Transient
RV and marina sites are leased to customers on a short-term
basis.
- Sites primarily utilized by approximately 118,900 members.
Includes approximately 6,100 sites rented on an annual basis.
- Joint ventures have approximately 2,000 annual sites and 1,600
transient sites.
Membership Campgrounds -
Select Data
(Unaudited)
Years Ended December
31,
Quarter Ended March
31,
Campground and Membership Revenue
($ in thousands, unaudited)
2020
2021
2022
2023
2024
Annual membership subscriptions
$
53,085
$
58,251
$
63,215
$
65,379
$
16,215
Annual RV base rental income
$
20,761
$
23,127
$
25,945
$
27,842
$
7,116
Seasonal/Transient RV base rental
income
$
18,126
$
25,562
$
24,316
$
20,996
$
2,823
Membership upgrade sales
$
9,677
$
11,191
$
12,958
$
14,719
$
3,947
Utility and other income
$
2,426
$
2,735
$
2,626
$
2,544
$
361
Membership Count
Total Memberships (1)
116,169
125,149
128,439
121,002
118,885
Paid Membership Origination
20,587
23,923
23,237
20,758
3,883
Promotional Membership Origination
23,542
26,600
28,178
25,232
5,485
Membership Upgrade Sales Volume (2)
3,373
4,863
4,068
3,858
806
Campground Metrics
Membership Campground Count
81
81
82
82
82
Membership Campground RV Site Count
24,800
25,100
25,800
26,000
26,000
Annual Site Count (3)
5,986
6,320
6,390
6,154
6,121
Membership Sales Activity ($ in
thousands, unaudited)
Quarters Ended March
31,
2024
2023
Membership upgrade sales current period,
gross
$
7,543
$
7,975
Membership upgrade sales upfront payments,
deferred, net
(3,596
)
(4,470
)
Membership upgrade sales
$
3,947
$
3,505
Membership sales and marketing, gross
$
(5,713
)
$
(5,517
)
Membership sales commissions, deferred,
net
416
679
Membership sales and marketing
$
(5,297
)
$
(4,838
)
______________________
- Members who have entered into annual subscriptions with us that
entitle them to use certain properties on a continuous basis for up
to 21 days.
- Existing members who have upgraded memberships 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.
- Sites that have been rented by members for an entire year.
Market Capitalization
(In millions, except share and OP Unit data,
unaudited)
Capital Structure as of March 31,
2024
Total Common
Shares/Units
% of Total Common
Shares/Units
Total
% of Total
% of Total Market
Capitalization
Secured Debt
$
3,001
85.6
%
Unsecured Debt
506
14.4
%
Total Debt (1)
$
3,507
100.0
%
21.8
%
Common Shares
186,493,598
95.3
%
OP Units
9,104,654
4.7
%
Total Common Shares and OP Units
195,598,252
100.0
%
Common Stock price at March 31, 2024
$
64.40
Fair Value of Common Shares and OP
Units
$
12,597
100.0
%
Total Equity
$
12,597
100.0
%
78.2
%
Total Market Capitalization
$
16,104
100.0
%
______________________
1. Excludes deferred financing costs of approximately $28.6
million.
Debt Maturity Schedule
Debt Maturity Schedule as of March 31, 2024
(In thousands, unaudited)
Year
Outstanding Debt
Weighted Average Interest
Rate
% of Total Debt
Weighted Average Years to
Maturity
Secured Debt
2024
$
—
—
%
—
%
—
2025
89,757
3.45
%
2.56
%
1.02
2026
—
—
%
—
%
—
2027
—
—
%
—
%
—
2028
200,461
4.19
%
5.72
%
4.45
2029
272,266
4.92
%
7.76
%
5.43
2030
275,385
2.69
%
7.85
%
6.00
2031
248,749
2.46
%
7.09
%
7.14
2032
202,000
2.47
%
5.76
%
8.46
Thereafter
1,712,601
4.07
%
48.83
%
12.86
Total
$
3,001,219
3.77
%
85.57
%
9.85
Unsecured Term Loans
2024
$
—
—
%
—
%
—
2025
—
—
%
—
%
—
2026
300,000
2.20
%
8.56
%
2.08
2027
200,000
4.88
%
5.70
%
2.85
2028
—
—
%
—
%
—
Thereafter
—
—
%
—
%
—
Total
$
500,000
3.27
%
14.26
%
2.39
Total Secured and
Unsecured
$
3,501,219
3.70
%
99.83
%
8.80
Line of Credit Borrowing
(1)
6,000
6.65
%
0.17
%
—
Note Premiums and Unamortized
loan costs
(28,616
)
Total Debt, Net
$
3,478,603
3.89% (2)
100
%
_____________________
- The floating interest rate on the line of credit is daily SOFR
plus 1.25% to 1.65%. During the quarter ended March 31, 2024, the
effective interest rate on the line of credit borrowings was
6.65%.
- Reflects effective interest rate for the quarter ended March
31, 2024, including interest associated with the line of credit and
amortization of deferred financing costs.
Non-GAAP Financial Measures
Definitions and Reconciliations
The following Non-GAAP financial measures definitions have been
revised and do not include adjustments in respect to membership
upgrade sales: (i) FFO; (ii) Normalized FFO; (iii) EBITDAre; (iv)
Adjusted EBITDAre; (v) Property operating revenues; (vi) Property
operating expenses; and (vii) Income from property operations,
excluding property management. For comparability, prior periods’
non-GAAP financial measures have also been updated.
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 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 non-operating income and
expense items, such as gains and losses from early debt
extinguishment, including prepayment penalties, defeasance costs,
transaction/pursuit costs and other, and 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 and 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
normal operations. For example, we believe that excluding the early
extinguishment of debt and other miscellaneous non-comparable items
from 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 PROPERTY
MANAGEMENT. We define Income from property operations,
excluding property management as rental income, membership
subscriptions and upgrade sales, utility and other income less
property and rental home operating and maintenance expenses, real
estate taxes, membership sales and marketing expenses, excluding
property management expenses. Property management represents the
expenses associated with indirect costs such as off-site payroll
and certain administrative and professional expenses. We believe
exclusion of property management expenses is helpful to investors
and analysts as a measure of the operating results of our
properties, excluding items that are not directly related to the
operation of the properties. 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 properties.
The following table reconciles Net income available for Common
Stockholders to Income from property operations:
Quarters Ended March
31,
(amounts in thousands)
2024
2023
Net income available for Common
Stockholders
$
109,905
$
82,371
Income allocated to non-controlling
interests – Common OP Units
5,366
4,088
Consolidated net income
115,271
86,459
Equity in income of unconsolidated joint
ventures
(283
)
(524
)
Income tax benefit
(239
)
—
(Gain) / Loss on sale of real estate and
impairment, net
—
2,632
Gross revenues from home sales, brokered
resales and ancillary services
(30,053
)
(32,133
)
Interest income
(2,168
)
(2,088
)
Income from other investments, net
(2,038
)
(2,091
)
Property management
19,710
19,464
Depreciation and amortization
51,108
50,502
Cost of home sales, brokered resales and
ancillary services
21,967
23,141
Home selling expenses and ancillary
operating expenses
6,147
6,924
General and administrative
11,989
11,661
Casualty-related charges/(recoveries), net
(1)
(14,843
)
—
Other expenses
1,331
1,468
Interest and related amortization
33,543
32,588
Income from property operations, excluding
property management
211,442
198,003
Property management
(19,710
)
(19,464
)
Income from property operations
$
191,732
$
178,539
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 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, transaction/pursuit costs and other, 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.
____________________
- Represents insurance recovery revenue for reimbursement of
capital expenditures related to Hurricane Ian.
The following table reconciles Consolidated net income to
EBITDAre and Adjusted EBITDAre:
Quarters Ended March
31,
(amounts in thousands)
2024
2023
Consolidated net income
$
115,271
$
86,459
Interest income
(2,168
)
(2,088
)
Real estate depreciation and
amortization
51,108
50,502
Other depreciation and amortization
1,318
1,351
Interest and related amortization
33,543
32,588
Income tax benefit
(239
)
—
(Gain)/Loss on sale of real estate and
impairment, net
—
2,632
Adjustments to our share of EBITDAre of
unconsolidated joint ventures
1,880
1,307
EBITDAre
200,713
172,751
Transaction/pursuit costs and other
(1)
383
206
Insurance proceeds due to catastrophic
weather event (2)
(14,843
)
—
Adjusted EBITDAre
$
186,253
$
172,957
CORE. The Core properties include properties we owned and
operated during all of 2023 and 2024. 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 in 2024 include
properties that were not owned and operated during all of 2023 and
2024, including six properties in Florida impacted by Hurricane Ian
and two properties in California that were impacted by storm and
flooding events. The 2024 guidance reflects Non-Core properties in
2024, which includes properties not owned and operated during all
of 2023 and 2024.
NON-REVENUE PRODUCING IMPROVEMENTS. Represents capital
expenditures that do 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.
______________________
- Prior period amounts have been reclassified to
conform to the current period presentation.
- Represents insurance recovery revenue for reimbursement of
capital expenditures related to Hurricane Ian.
FORWARD-LOOKING NON-GAAP MEASURES. The
following table reconciles Net Income per Common Share - Fully
Diluted guidance to FFO per Common Share and OP Unit - Fully
Diluted guidance and Normalized FFO per Common Share and OP Unit -
Fully diluted guidance:
(Unaudited)
Second Quarter
2024
Full Year
2024
Net income per Common Share
$0.34 to $0.40
$1.83 to $1.93
Depreciation and amortization
0.27
1.08
FFO per Common Share and OP Unit -
Fully Diluted
$0.61 to $0.67
$2.91 to $3.01
Other
$—
$(0.07)
Normalized FFO per Common Share and OP
Unit - Fully Diluted
$0.61 to $0.67
$2.84 to $2.94
This press release includes certain forward-looking information,
including Core and Non-Core Income from property operations,
excluding property management, that is not presented in accordance
with GAAP. In reliance on the exception in Item 10(e)(1)(i)(B) of
Regulation S-K, we do not provide a quantitative reconciliation of
such forward-looking information to the most directly comparable
financial measure calculated and presented in accordance with GAAP,
where we are unable to provide a meaningful or accurate calculation
or estimation of reconciling items and the information is not
available without unreasonable effort. This includes, for example,
(i) scheduled or implemented rate increases on community, resort
and marina sites; (ii) scheduled or implemented rate increases in
annual payments under membership subscriptions; (iii) occupancy
changes; (iv) costs to restore property operations and potential
revenue losses following storms or other unplanned events; and (v)
other nonrecurring/unplanned income or expense items, which may not
be within our control, may vary between periods and cannot be
reasonably predicted. These unavailable reconciling items could
significantly impact our future financial results.
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version on businesswire.com: https://www.businesswire.com/news/home/20240421483510/en/
Paul Seavey (800) 247-5279
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