StockSelector.com
  Research, Select, & Monitor Wednesday, November 25, 2020 5:12:55 PM ET  
Trade Ideas The Market Industries Stocks Portfolio

 
Ticker Lookup
Equity LifeStyle Properties, Inc.$59.89$.22.37%

  Quote | Ranking | Chart | Valuations | Sentiment | Industry | News | Earnings | Analysts | More...

Your Target?

 ELS Reports First Quarter Results
   Monday, April 20, 2020 4:16:00 PM ET

Continued Strong Performance

CHICAGO--(BUSINESS WIRE)--Equity LifeStyle Properties, Inc. (NYSE: ELS) (referred to herein as “we,” “us,” and “our”) today announced results for the quarter ended March 31, 2020.

Marguerite Nader, our President and Chief Executive Officer, said "I would like to express my gratitude to our team members at ELS who have been continuing to serve residents and customers at our communities, as well as to our corporate and regional team members who have worked tirelessly under difficult circumstances. The safety of our team members, residents and customers continues to be our first priority. Our teams have navigated through new regulatory protocols and operating environments at an impressive pace while still maintaining our high quality standards. Within our properties, we are experiencing a true sense of community as our team members and residents work together to prioritize the well being of the entire community."



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 Ended March 31, 2020

For the quarter ended March 31, 2020, total revenues increased $21.4 million, or 8.3 percent, to $280.5 million compared to $259.1 million for the same period in 2019. For the quarter ended March 31, 2020, net income available for Common Stockholders decreased $46.4 million, or $0.26 per Common Share, to $66.9 million, or $0.37 per Common Share, compared to $113.3 million, or $0.63 per Common Share, for the same period in 2019. The financial results for the first quarter of 2019 included a gain of $52.5 million on the sale of five all-age MH communities.

Non-GAAP Financial Measures and Portfolio Performance

For the quarter ended March 31, 2020, Funds from Operations (“FFO”) available for Common Stock and OP Unit holders increased $4.3 million, or $0.02 per Common Share, to $112.3 million, or $0.58 per Common Share, compared to $108.0 million, or $0.56 per Common Share, for the same period in 2019.

For the quarter ended March 31, 2020, Normalized Funds from Operations (“Normalized FFO”) available for Common Stock and OP Unit holders increased $5.6 million, or $0.03 per Common Share, to $113.3 million, or $0.59 per Common Share, compared to $107.7 million, or $0.56 per Common Share, for the same period in 2019.

For the quarter ended March 31, 2020, property operating revenues, excluding deferrals, increased $18.8 million to $269.7 million compared to $250.9 million for the same period in 2019. For the quarter ended March 31, 2020, income from property operations, excluding deferrals and property management, increased $10.5 million to $163.9 million compared to $153.4 million for the same period in 2019.

For the quarter ended March 31, 2020, Core property operating revenues, excluding deferrals, increased approximately 5.4 percent and Core income from property operations, excluding deferrals and property management, increased approximately 5.2 percent compared to the same period in 2019.

Business Update - COVID-19

As we developed and implemented our response to the impact of the COVID-19 pandemic on our business, our highest priority has been the health and safety of our employees, residents and customers. Over the past few weeks we have acted quickly to implement certain operational changes. Page 1 of this Earnings Release and Supplemental Financial Information provides a summary of those operational changes as well as our April cash collection activity and our liquidity position.

2020 Guidance

Given the uncertainty surrounding the economic impact of the COVID-19 pandemic and the impact of operational changes we have and may implement in response to the pandemic, we are withdrawing our full year 2020 guidance, which was included in our January 27, 2020 earnings release.

Balance Sheet Activity

During the quarter ended March 31, 2020, we closed on a financing transaction with Fannie Mae generating gross proceeds of $275.4 million. The loan is secured by eight MH and four RV communities, has a fixed interest rate of 2.69% per annum and matures in 10 years. The net proceeds from the transaction were used to repay the outstanding balance on our line of credit and three loans scheduled to mature in 2020, as well as to fund working capital. The three loans had an outstanding principal balance of $48.1 million and a weighted average interest rate of 5.18% per annum. As part of the transaction, we incurred $1.0 million of prepayment penalties.

Subsequent to the quarter we borrowed $100.0 million from our line of credit. Our line of credit has remaining availability of $300 million, subject to certain conditions.

About Equity LifeStyle Properties

We are a self-administered, self-managed real estate investment trust (“REIT”) with headquarters in Chicago. As of April 20, 2020, we own or have an interest in 413 quality properties in 33 states and British Columbia consisting of 156,655 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, April 21, 2020, 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," "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 attract and retain customers entering, renewing and upgrading membership subscriptions;
  • our assumptions about rental and home sales markets;
  • 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.

In addition, these forward-looking statements are subject to risks related to the COVID-19 pandemic, many of which are unknown, including the duration of the pandemic, the extent of the adverse health impact on the general population and on our residents, customers, and employees in particular, its impact on the employment rate and the economy, the extent and impact of governmental responses, and the impact of operational changes we have and may implement in response to the pandemic.

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.

Supplemental Financial Information

Operational Response

In response to the COVID-19 pandemic, we have taken actions to prioritize the safety and security of our employees, residents and customers, including, but not limited to, the following:

  • MH properties are open and complying with state and local shelter-in-place orders.
  • RV properties are open and complying with state and local shelter-in-place orders, subject to the following:
    • 46 northern RV resorts, which were otherwise scheduled to open in March or April, have delayed openings to comply with restrictions. Customers of these northern RV properties, which generated approximately 20% of 2019 Annual resort base rental income, have lease renewals in April and May.
    • We stopped accepting reservations for RV Transient stays through April 30, 2020. In 2019, 23% of our Transient revenue for the second quarter was earned in April, 33% in May and 44% in June.
  • Seven Loggerhead marinas are open and complying with state and local shelter-in-place orders and the remaining four are subject to boat launching restrictions.
  • Implemented CDC and local public health department guidelines and developed protocols for social distancing and enhanced community/office cleaning.
    • All indoor amenity areas, pools and playgrounds are closed.
    • Office hours are by appointment only.
  • Implemented measures to assist our residents and customers.
    • Introduced rent deferral program for financial hardship related to COVID-19 to allow payment of April rent over subsequent three months.
    • Suspended eviction proceedings and notice of MH rent increases.
    • Waived April late fees and RV reservation cancellation fees.
    • Allowing extended stays for Thousand Trails members to facilitate compliance with shelter-in-place orders.
    • Provided guide for residents to identify available local, state and federal resources.
  • Introduced Employee Time Off program to provide continuation of pay for up to two weeks during period of disruption caused by COVID-19.
  • Transitioned our corporate, regional, contact center and sales employees to a remote workforce.

April 2020 Performance and Liquidity

We are continuously monitoring the COVID-19 pandemic and its potential impact on our financial condition, results of operations, liquidity and capital resources. The below April 2020 information is as of April 17, 2020.

  • Manufactured home portfolio – 96% of April 2020 rent is collected as compared to 97% at this time in April 2019.
  • RV Annuals – 96% of April Annual 2020 rent is collected as compared to 98% at this time in April 2019.
    • We have collected from customers in our Northern resorts with April and May lease renewals, 61% of installment rent payments as compared to 71% at this time in April 2019.
  • RV Seasonals – At this time, seasonal RV customers have made $2.1 million in reservations for April, or 88% as compared to the $2.4 million in seasonal RV reservations for April as of this time in April 2019.
  • Thousand Trails – 95% of cash receipts as compared to this time in April 2019.
  • Marina – 93% of total April billing is collected.
  • Liquidity position – $125.9 million available cash, $300.0 million available on line of credit (subject to certain conditions).

Investor Information

Equity Research Coverage (1)

Bank of America Securities

BMO Capital Markets

Citi Research

Jeffrey Spector/ Joshua Dennerlein

John Kim

Michael Bilerman/ Nick Joseph

 

 

 

Evercore ISI

Green Street Advisors

Robert W. Baird & Company

Steve Sakwa/ Samir Khanal

John Pawlowski

Drew T. Babin

 

 

 

Wells Fargo Securities

 

 

Todd Stender

 

 

 

 

 

 

 

 

______________________

  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.

Financial Highlights

(In millions, except Common Stock and OP Units outstanding and per share data (adjusted for stock split), unaudited)

 

 

As of and for the Three Months Ended

 

Mar 31,
2020

Dec 31,
2019

Sept 30,
2019

Jun 30,
2019

Mar 31,
2019

Operating Information

 

 

 

 

 

Total revenues

$

280.5

 

$

258.6

 

$

271.2

 

$

248.4

 

$

259.1

 

Net income

$

70.7

 

$

58.1

 

$

68.2

 

$

49.1

 

$

120.5

 

Net income available for Common Stockholders

$

66.9

 

$

55.0

 

$

64.5

 

$

46.4

 

$

113.3

 

Adjusted EBITDAre (1)

$

138.2

 

$

124.5

 

$

127.0

 

$

117.7

 

$

133.3

 

FFO available for Common Stock and OP Unit holders (1)(2)

$

112.3

 

$

99.5

 

$

108.6

 

$

89.8

 

$

108.0

 

Normalized FFO available for Common Stock and OP Unit holders (1)(2)

$

113.3

 

$

99.5

 

$

102.7

 

$

91.9

 

$

107.7

 

Funds Available for Distribution ("FAD") for Common Stock and OP Unit holders (1)(2)

$

101.8

 

$

84.6

 

$

88.4

 

$

79.1

 

$

97.6

 

 

 

 

 

 

 

Common Stock and OP Units Outstanding (In thousands) and Per Share Data

 

 

 

 

 

Common Stock and OP Units, end of the period

192,627

 

192,581

 

192,574

 

192,562

 

191,470

 

Weighted average Common Stock and OP Units outstanding - Fully Diluted

192,564

 

192,458

 

192,400

 

191,860

 

191,248

 

Net income per Common Share - Fully Diluted (3)

$

0.37

 

$

0.30

 

$

0.35

 

$

0.26

 

$

0.63

 

FFO per Common Share and OP Unit - Fully Diluted

$

0.58

 

$

0.52

 

$

0.56

 

$

0.47

 

$

0.56

 

Normalized FFO per Common Share and OP Unit - Fully Diluted

$

0.59

 

$

0.52

 

$

0.53

 

$

0.48

 

$

0.56

 

Dividends per Common Share

$

0.3425

 

$

0.3063

 

$

0.3063

 

$

0.3063

 

$

0.3063

 

 

 

 

 

 

 

Balance Sheet

 

 

 

 

 

Total assets

$

4,212

 

$

4,151

 

$

4,137

 

$

4,014

 

$

4,009

 

Total liabilities

$

2,892

 

$

2,829

 

$

2,818

 

$

2,707

 

$

2,752

 

 

 

 

 

 

 

Market Capitalization

 

 

 

 

 

Total debt (4)

$

2,486

 

$

2,432

 

$

2,406

 

$

2,300

 

$

2,372

 

Total market capitalization (5)

$

13,558

 

$

15,988

 

$

15,270

 

$

13,983

 

$

13,315

 

 

 

 

 

 

 

Ratios

 

 

 

 

 

Total debt / total market capitalization

18.3

%

15.2

%

15.8

%

16.4

%

17.8

%

Total debt / Adjusted EBITDAre (6)

4.9

 

4.8

 

4.9

 

4.7

 

4.9

 

Interest coverage (7)

4.9

 

4.9

 

4.8

 

4.7

 

4.6

 

Fixed charges(8)

4.9

 

4.8

 

4.7

 

4.6

 

4.5

 

______________________

  1. See Non-GAAP Financial Measures Definitions and Other Terms 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.
  2. See page 8 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.
  3. Net income per Common Share - Fully Diluted is calculated before Income allocated to non-controlling interest - Common OP Units.
  4. Excludes deferred financing costs of approximately $26.0 million as of March 31, 2020.
  5. See page 15 for the calculation of market capitalization as of March 31, 2020.
  6. Calculated using trailing twelve months Adjusted EBITDAre.
  7. Calculated by dividing trailing twelve months Adjusted EBITDAre by the interest expense incurred during the same period.
  8. See Non-GAAP Financial Measures Definitions and Other Terms 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, 2020

 

December 31, 2019

 

(unaudited)

 

 

Assets

 

 

 

Investment in real estate:

 

 

 

Land

$

1,526,225

 

 

$

1,525,407

 

Land improvements

3,362,287

 

 

3,336,070

 

Buildings and other depreciable property

892,816

 

 

881,572

 

 

5,781,328

 

 

5,743,049

 

Accumulated depreciation

(1,812,822

)

 

(1,776,224

)

Net investment in real estate

3,968,506

 

 

3,966,825

 

Cash and restricted cash

96,921

 

 

28,860

 

Notes receivable, net

35,227

 

 

37,558

 

Investment in unconsolidated joint ventures

20,130

 

 

20,074

 

Deferred commission expense

41,230

 

 

41,149

 

Other assets, net

50,450

 

 

56,809

 

Total Assets

$

4,212,464

 

 

$

4,151,275

 

 

 

 

 

Liabilities and Equity

 

 

 

Liabilities:

 

 

 

Mortgage notes payable, net

$

2,260,819

 

 

$

2,049,509

 

Term loan, net

199,030

 

 

198,949

 

Unsecured line of credit

—

 

 

160,000

 

Accounts payable and other liabilities

124,396

 

 

124,665

 

Deferred revenue – upfront payments from membership upgrade sales

129,356

 

 

126,814

 

Deferred revenue – annual membership subscriptions

12,319

 

 

10,599

 

Accrued interest payable

8,627

 

 

8,639

 

Rents and other customer payments received in advance and security deposits

91,152

 

 

91,234

 

Distributions payable

65,858

 

 

58,978

 

Total Liabilities

2,891,557

 

 

2,829,387

 

Equity:

 

 

 

Preferred stock, $0.01 par value, 10,000,000 shares authorized as of March 31, 2020 and December 31, 2019; none issued and outstanding.

—

 

 

—

 

Common stock, $0.01 par value, 400,000,000 shares authorized as of March 31, 2020 and December 31, 2019; 182,144,559 and 182,089,595 shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively.

1,812

 

 

1,812

 

Paid-in capital

1,402,514

 

 

1,402,696

 

Distributions in excess of accumulated earnings

(153,703

)

 

(154,318

)

Accumulated other comprehensive income (loss)

(1,713

)

 

(380

)

Total Stockholders’ Equity

1,248,910

 

 

1,249,810

 

Non-controlling interests – Common OP Units

71,997

 

 

72,078

 

Total Equity

1,320,907

 

 

1,321,888

 

Total Liabilities and Equity

$

4,212,464

 

 

$

4,151,275

 

Consolidated Income Statements

 

(In thousands, unaudited)

Quarters Ended March 31,

2020

 

2019

Revenues:

 

 

 

Rental income

$

239,346

 

 

$

223,566

 

Annual membership subscriptions

13,073

 

 

12,316

 

Membership upgrade sales current period, gross

4,843

 

 

3,838

 

Membership upgrade sales upfront payments, deferred, net

(2,542

)

 

(1,771

)

Other income

11,059

 

 

10,370

 

Gross revenues from home sales

11,309

 

 

6,475

 

Brokered resale and ancillary services revenues, net

938

 

 

1,559

 

Interest income

1,807

 

 

1,751

 

Income from other investments, net

643

 

 

986

 

Total revenues

280,476

 

 

259,090

 

 

 

 

Expenses:

 

 

 

Property operating and maintenance

83,634

 

 

77,948

 

Real estate taxes

16,841

 

 

15,323

 

Sales and marketing, gross

3,978

 

 

3,409

 

Membership sales commissions, deferred, net

(216

)

 

(191

)

Property management

15,004

 

 

13,685

 

Depreciation and amortization

39,024

 

 

37,977

 

Cost of home sales

11,911

 

 

6,632

 

Home selling expenses

1,213

 

 

1,083

 

General and administrative

10,855

 

 

9,909

 

Other expenses

588

 

 

427

 

Early debt retirement

1,054

 

 

—

 

Interest and related amortization

26,073

 

 

26,393

 

Total expenses

209,959

 

 

192,595

 

Gain on sale of real estate, net

—

 

 

52,507

 

Income before equity in income of unconsolidated joint ventures

70,517

 

 

119,002

 

Equity in income of unconsolidated joint ventures

207

 

 

1,533

 

Consolidated net income

70,724

 

 

120,535

 

 

 

 

Income allocated to non-controlling interests – Common OP Units

(3,849

)

 

(7,226

)

Net income available for Common Stockholders

$

66,875

 

 

$

113,309

 

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, refer to both Reconciliation of Net Income to Non-GAAP Financial Measures on page 8 and Non-GAAP Financial Measures Definitions and Reconciliations on pages 17 - 19.

Selected Non-GAAP Financial Measures

 

(In millions, except per share data, unaudited)

Quarter Ended

 

March 31, 2020

Income from property operations, excluding deferrals and property management - 2020 Core (1)

$

161.1

 

Income from property operations, excluding deferrals and property management - Non-Core (1)

2.8

 

Property management and general and administrative

(25.9

)

Other income and expenses

1.4

 

Interest and related amortization

(26.1

)

Normalized FFO available for Common Stock and OP Unit holders (2)

113.3

 

Early debt retirement

(1.0

)

FFO available for Common Stock and OP Unit holders (2)

$

112.3

 

 

 

Normalized FFO per Common Share and OP Unit - Fully Diluted

$0.59

 

FFO per Common Share and OP Unit - Fully Diluted

$0.58

 

 

 

 

 

Normalized FFO available for Common Stock and OP Unit holders (2)

$

113.3

 

Non-revenue producing improvements to real estate (2)

(11.5

)

FAD for Common Stock and OP Unit holders (2)

$

101.8

 

 

 

Weighted average Common Stock and OP Units - Fully Diluted

192.6

 

______________________

  1. See page 10 for details of the Core Income from Property Operations, excluding deferrals and property management. See page 11 for details of the Non-Core Income from Property Operations, excluding deferrals and property management.
  2. See page 8 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.

Reconciliation of Net Income to Non-GAAP Financial Measures

 

(In thousands, except per share data (adjusted for stock split), unaudited)

Quarters Ended March 31,

2020

2019

Net income available for Common Stockholders

 

$

66,875

 

 

$

113,309

 

Income allocated to non-controlling interests – Common OP Units

 

3,849

 

 

7,226

 

Membership upgrade sales upfront payments, deferred, net

 

2,542

 

 

1,771

 

Membership sales commissions, deferred, net

 

(216

)

 

(191

)

Depreciation and amortization

 

39,024

 

 

37,977

 

Depreciation on unconsolidated joint ventures

 

177

 

 

433

 

Gain on sale of real estate, net

 

—

 

 

(52,507

)

FFO available for Common Stock and OP Unit holders

 

112,251

 

 

108,018

 

Early debt retirement

 

1,054

 

 

—

 

Insurance proceeds due to catastrophic weather event (1)

 

—

 

 

(349

)

Normalized FFO available for Common Stock and OP Unit holders

 

113,305

 

 

107,669

 

Non-revenue producing improvements to real estate

 

(11,467

)

 

(10,064

)

FAD for Common Stock and OP Unit holders

 

$

101,838

 

 

$

97,605

 

 

 

 

 

 

Net income available per Common Share - Basic

 

$

0.37

 

 

$

0.63

 

Net income available per Common Share - Fully Diluted (2)

 

$

0.37

 

 

$

0.63

 

 

 

 

 

 

FFO per Common Share and OP Unit - Basic

 

$

0.58

 

 

$

0.57

 

FFO per Common Share and OP Unit - Fully Diluted

 

$

0.58

 

 

$

0.56

 

 

 

 

 

 

Normalized FFO per Common Share and OP Unit - Basic

 

$

0.59

 

 

$

0.56

 

Normalized FFO per Common Share and OP Unit - Fully Diluted

 

$

0.59

 

 

$

0.56

 

 

 

 

 

 

Average Common Stock - Basic

 

181,729

 

 

179,560

 

Average Common Stock and OP Units - Basic

 

192,220

 

 

191,042

 

Average Common Stock and OP Units - Fully Diluted

 

192,564

 

 

191,248

 

______________________

  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 March 31,

 

2020

 

2019

MH base rental income (2)

$

141.4

 

 

$

135.3

 

Rental home income

4.0

 

 

3.6

 

RV and marina base rental income (3)

81.1

 

 

72.1

 

Annual membership subscriptions

13.1

 

 

12.3

 

Membership upgrade sales current period, gross

4.8

 

 

3.8

 

Utility and other income (4)

25.3

 

 

23.8

 

Property operating revenues

269.7

 

 

250.9

 

 

 

 

 

Property operating, maintenance and real estate taxes (5)

100.5

 

 

92.9

 

Rental home operating and maintenance

1.3

 

 

1.2

 

Sales and marketing, gross

4.0

 

 

3.4

 

Property operating expenses

105.8

 

 

97.5

 

Income from property operations, excluding deferrals and property management (1)

$

163.9

 

 

$

153.4

 

 

 

 

 

Manufactured home site figures and occupancy averages:

 

 

 

Total sites

72,251

 

 

72,370

 

Occupied sites

68,495

 

 

68,590

 

Occupancy %

94.8

%

 

94.8

%

Monthly base rent per site

$

688

 

 

$

657

 

 

 

 

 

RV and marina base rental income:

 

 

 

Annual

$

47.3

 

 

$

39.0

 

Seasonal

22.6

 

 

21.1

 

Transient

11.2

 

 

12.0

 

Total RV and marina base rental income

$

81.1

 

 

$

72.1

 

______________________

  1. Excludes property management and the GAAP deferral of membership upgrade sales upfront payments and membership sales commissions, net.
  2. See the manufactured home site figures and occupancy averages included below within this table.
  3. See RV and marina base rental income detail included below within this table.
  4. Includes Hurricane Irma insurance recovery revenues of $0.6 million, which we have identified as business interruption, for the quarter ended March 31, 2019.
  5. Includes bad debt expense for the periods presented.

Core Income from Property Operations (1)

(In millions, except home site and occupancy figures, unaudited)

 

 

Quarters Ended March 31,

 

2020

 

2019

 

Change (2)

MH base rental income (3)

$

141.4

 

 

$

134.9

 

 

4.9

%

Rental home income

4.0

 

 

3.5

 

 

14.1

%

RV base rental income (4)

75.6

 

 

72.1

 

 

4.8

%

Annual membership subscriptions

13.1

 

 

12.3

 

 

6.1

%

Membership upgrade sales current period, gross

4.8

 

 

3.8

 

 

26.2

%

Utility and other income (5)

24.9

 

 

23.7

 

 

5.1

%

Property operating revenues

263.8

 

 

250.3

 

 

5.4

%

 

 

 

 

 

 

Property operating, maintenance and real estate taxes (6)

97.5

 

 

92.6

 

 

5.3

%

Rental home operating and maintenance

1.3

 

 

1.2

 

 

13.4

%

Sales and marketing, gross

3.9

 

 

3.4

 

 

16.7

%

Property operating expenses

102.7

 

 

97.2

 

 

5.8

%

Income from property operations, excluding deferrals and property management (1)

$

161.1

 

 

$

153.1

 

 

5.2

%

 

 

 

 

 

 

Occupied sites (7)

68,589

 

 

68,254

 

 

 

 

 

 

 

 

 

Core manufactured home site figures and occupancy averages:

Total sites

71,979

 

 

71,754

 

 

 

Occupied sites

68,486

 

 

68,171

 

 

 

Occupancy %

95.1

%

 

95.0

%

 

 

Monthly base rent per site

$

688

 

 

$

659

 

 

 

 

 

 

 

 

 

Core RV base rental income:

 

 

 

 

 

Annual

$

41.9

 

 

$

39.0

 

 

7.4

%

Seasonal

22.6

 

 

21.1

 

 

7.0

%

Transient

11.1

 

 

12.0

 

 

(7.6

)%

Total RV base rental income

$

75.6

 

 

$

72.1

 

 

4.8

%

____________________

  1. Excludes property management and the GAAP deferral of membership upgrades sales upfront payments and membership sales 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 RV base rental income detail included below within this table.
  5. Includes Hurricane Irma insurance recovery revenues of $0.6 million, which we have identified as business interruption, for the quarter ended March 31, 2019.
  6. Includes bad debt expense for the periods presented.
  7. Occupied sites are presented as of the end of the period. Occupied sites have increased by 13 from 68,576 at December 31, 2019.

Non-Core Income from Property Operations (1)

(In millions, unaudited)

 

 

Quarter Ended

 

March 31, 2020

MH base rental income

$

—

Rental home income

—

RV and marina base rental income

5.5

Utility and other income

0.4

Property operating revenues

5.9

 

 

Property operating expenses (2)

3.1

Income from property operations, excluding deferrals and property management (1)

$

2.8

______________________

  1. Excludes property management and the GAAP deferral of membership upgrade sales upfront payments and membership sales commissions, net.
  2. Includes bad debt expense for the periods presented.

Income from Rental Home Operations

(In millions, except occupied rentals, unaudited)

 

 

Quarters Ended March 31,

 

2020

 

2019

Manufactured homes:

 

 

 

Rental operations revenues (1)

$

11.7

 

$

11.2

Rental operations expense

1.3

 

1.2

Income from rental operations

10.4

 

10.0

Depreciation on rental homes (2)

2.8

 

2.4

Income from rental operations, net of depreciation

$

7.6

 

$

7.6

 

 

 

 

Occupied rentals: (3)

 

 

 

New

3,226

 

2,860

Used

687

 

1,106

Total occupied rental sites

3,913

 

3,966

 

As of March 31, 2020

 

As of March 31, 2019

Cost basis in rental homes: (4)

Gross

 

Net of
Depreciation

 

Gross

 

Net of
Depreciation

New

$

233.7

 

$

197.3

 

$

174.6

 

$

151.6

Used

19.6

 

9.0

 

27.3

 

13.5

Total rental homes

$

253.3

 

$

206.3

 

$

201.9

 

$

165.1

______________________

  1. For the quarters ended March 31, 2020 and 2019, approximately $7.8 million and $7.7 million, respectively, of the rental operations revenue is included in the MH base rental income in the Core Income from Property Operations on page 10. The remainder of the rental operations revenue is included in Rental home income for the quarters ended March 31, 2020 and 2019 in the Core Income from Property Operations on page 10.
  2. Depreciation on rental homes in our Core portfolio is included in Depreciation and amortization in the Consolidated Income Statements on page 5.
  3. Occupied rentals as of the end of the period in our Core portfolio. Included in the quarters ended March 31, 2020 and 2019 were 286 and 290 homes rented through our ECHO joint venture, respectively. For the quarters ended March 31, 2020 and 2019, the rental home investment associated with our ECHO joint venture totaled approximately $11.1 million and $10.5 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 March 31, 2020 and 2019, our investment in the ECHO joint venture was approximately $17.0 million and $16.4 million, respectively.

Total Sites and Home Sales

 

(In thousands, except sites and home sale volumes, unaudited)

 

Summary of Total Sites as of March 31, 2020

 

Sites(1)

MH sites

72,200

RV sites:

 

Annual

29,700

Seasonal

10,200

Transient

13,900

Marina slips

2,300

Membership (2)

24,600

Joint Ventures (3)

3,600

Total (4)

156,700

Home Sales - Select Data

 

Quarters Ended March 31,

 

2020

2019

Total New Home Sales Volume (5)

155

91

New Home Sales Volume - ECHO joint venture

12

13

New Home Sales Gross Revenues (5)

$

9,382

$

4,564

 

 

 

Total Used Home Sales Volume

194

219

Used Home Sales Gross Revenues

$

1,927

$

1,911

 

 

 

Brokered Home Resales Volume

176

168

Brokered Home Resale Revenues, net

$

261

$

278

______________________

  1. 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.
  2. Sites primarily utilized by approximately 116,500 members. Includes approximately 5,900 sites rented on an annual basis.
  3. Joint ventures have approximately 2,900 annual Sites, 500 seasonal Sites, and 200 transient Sites.
  4. Total does not foot due to rounding.
  5. 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.

Memberships - Select Data

(Unaudited)

 

 

 

 

2016

 

2017

 

2018

 

2019

 

2020 Q1 (1)

Member Count (2)

 

104,728

106,456

111,094

115,680

116,547

Thousand Trails Camping Pass (TTC) Origination

 

29,576

31,618

37,528

41,484

8,238

TTC Sales

 

12,856

14,128

17,194

19,267

3,202

RV Dealer TTC Activations

 

16,720

17,490

20,334

22,217

5,036

Number of annuals (3)

 

5,756

5,843

5,888

5,938

5,903

Number of upgrade sales (4)

 

2,477

2,514

2,500

2,919

727

 

 

 

 

 

 

 

(In thousands, unaudited)

 

 

 

 

 

 

Annual membership subscriptions

 

$

45,036

$

45,798

$

47,778

$

51,015

$

13,073

RV base rental income from annuals

 

$

15,413

$

16,841

$

18,363

$

19,634

$

5,044

RV base rental income from seasonals/transients

 

$

17,344

$

18,231

$

19,840

$

20,181

$

2,366

Upgrade contract initiations (5)

 

$

12,312

$

14,130

$

15,191

$

19,111

$

4,843

Utility and other income

 

$

2,442

$

2,254

$

2,410

$

2,422

$

427

______________________

  1. Activity through March 31, 2020.
  2. Members have entered into annual 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 membership subscriptions.
  4. 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.
  5. Revenues associated with membership upgrades are included in membership upgrade sales current period, gross on our Consolidated Income Statements on page 5.

Market Capitalization

(In millions, except share and OP Unit data, unaudited)

 

Capital Structure as of March 31, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total
Common
Stock/Units

% of Total
Common
Stock/Units

 

Total

% of Total

 

% of Total
Market
Capitalization

 

 

 

 

 

 

 

 

 

 

 

Secured Debt

 

 

 

 

 

$

2,286

 

92.0

%

 

 

Unsecured Debt

 

 

 

 

 

200

 

8.0

%

 

 

Total Debt (1)

 

 

 

 

 

$

2,486

 

100.0

%

 

18.3

%

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

182,144,559

 

94.6

%

 

 

 

 

 

 

OP Units

 

10,481,994

 

5.4

%

 

 

 

 

 

 

Total Common Stock and OP Units

 

192,626,553

 

100.0

%

 

 

 

 

 

 

Common Stock price at March 31, 2020

 

$

57.48

 

 

 

 

 

 

 

 

 

Fair Value of Common Stock and OP Units

 

 

 

 

 

$

11,072

 

100.0

%

 

 

Total Equity

 

 

 

 

 

$

11,072

 

100.0

%

 

81.7

%

 

 

 

 

 

 

 

 

 

 

 

Total Market Capitalization

 

 

 

 

 

$

13,558

 

 

 

100.0

%

______________________

1. Excludes deferred financing costs of approximately $26.0 million.

 

Debt Maturity Schedule

Debt Maturity Schedule as of March 31, 2020

(In thousands, unaudited)

 

Year

 

Secured
Debt

Weighted
Average
Interest
Rate

 

Unsecured
Debt

Weighted
Average
Interest
Rate

 

Total Debt

% of Total
Debt

 

Weighted
Average
Interest
Rate

 

2020

 

$

—

 

 

—

%

 

$

—

 

 

—

%

 

$

—

 

 

—

%

 

—

%

 

2021

 

168,034

 

5.01

%

 

—

 

—

%

 

168,034

 

6.76

%

 

5.01

%

 

2022

 

144,889

 

4.62

%

 

—

 

—

%

 

144,889

 

5.83

%

 

4.62

%

 

2023

 

101,987

 

5.03

%

 

200,000

 

3.05

%

 

301,987

 

12.15

%

 

3.72

%

 

2024

 

10,585

 

5.49

%

 

—

 

—

%

 

10,585

 

0.43

%

 

5.49

%

 

2025

 

100,267

 

3.45

%

 

—

 

—

%

 

100,267

 

4.04

%

 

3.45

%

 

2026

 

—

 

—

%

 

—

 

—

%

 

—

 

—

%

 

—

%

 

2027

 

—

 

—

%

 

—

 

—

%

 

—

 

—

%

 

—

%

 

2028

 

220,606

 

4.19

%

 

—

 

—

%

 

220,606

 

8.88

%

 

4.19

%

 

2029

 

—

 

—

%

 

—

 

—

%

 

—

 

—

%

 

—

%

 

Thereafter

 

1,538,533

 

3.96

%

 

—

 

—

%

 

1,538,533

 

61.92

%

 

3.96

%

 

Total

 

$

2,284,901

 

 

4.13

%

 

$

200,000

 

 

3.05

%

 

$

2,484,901

 

 

100.0

%

 

4.05

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unsecured Line of Credit

 

—

 

 

 

—

 

 

 

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Note Premiums

 

946

 

 

 

—

 

 

 

946

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Debt

 

2,285,847

 

 

 

200,000

 

 

 

2,485,847

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deferred Financing Costs

 

(25,028

)

 

 

 

(970

)

 

 

 

(25,998

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Debt, net

 

$

2,260,819

 

 

 

 

$

199,030

 

 

 

 

$

2,459,849

 

 

 

 

4.24

%

(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Years to Maturity

 

12.8

 

 

3.1

 

 

12.0

 

 

 

 

______________________

  1. Reflects effective interest rate for the quarter ended March 31, 2020, 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 non-refundable upfront payments from membership upgrade contracts. In accordance with GAAP, the non-refundable upfront payments and related commissions are deferred and amortized over the estimated membership upgrade contract term. Although the NAREIT definition of FFO does not address the treatment of non-refundable upfront 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 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 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 DEFERRALS AND PROPERTY MANAGEMENT. We define Income from property operations, excluding deferrals and 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, sales and marketing expenses, excluding property management and the GAAP deferral of membership upgrade sales upfront payments and membership sales 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 properties.

The following table reconciles Net income available for Common Stockholders to Income from property operations:

 

 

Quarters Ended March 31,

(amounts in thousands)

 

2020

 

2019

Net income available for Common Stockholders

 

$

66,875

 

 

$

113,309

 

Income allocated to non-controlling interests – Common OP Units

 

3,849

 

 

7,226

 

Equity in income of unconsolidated joint ventures

 

(207

)

 

(1,533

)

Income before equity in income of unconsolidated joint ventures

 

70,517

 

 

119,002

 

Gain on sale of real estate, net

 

—

 

 

(52,507

)

Membership upgrade sales upfront payments, deferred, net

 

2,542

 

 

1,771

 

Gross revenues from home sales

 

(11,309

)

 

(6,475

)

Brokered resale and ancillary services revenues, net

 

(938

)

 

(1,559

)

Interest income

 

(1,807

)

 

(1,751

)

Income from other investments, net

 

(643

)

 

(986

)

Membership sales commissions, deferred, net

 

(216

)

 

(191

)

Property management

 

15,004

 

 

13,685

 

Depreciation and amortization

 

39,024

 

 

37,977

 

Cost of home sales

 

11,911

 

 

6,632

 

Home selling expenses

 

1,213

 

 

1,083

 

General and administrative

 

10,855

 

 

9,909

 

Other expenses

 

588

 

 

427

 

Early debt retirement

 

1,054

 

 

—

 

Interest and related amortization

 

26,073

 

 

26,393

 

Income from property operations, excluding deferrals and property management

 

163,868

 

 

153,410

 

Membership upgrade sales upfront payments, and membership sales commissions, deferred, net

 

(2,326

)

 

(1,580

)

Property management

 

(15,004

)

 

(13,685

)

Income from property operations

 

$

146,538

 

 

$

138,145

 

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 non-refundable upfront payments from membership upgrade contracts. In accordance with GAAP, the non-refundable upfront 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 upfront 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 March 31,

(amounts in thousands)

 

2020

 

2019

Consolidated net income

 

$

70,724

 

 

$

120,535

 

Interest income

 

(1,807

)

 

(1,751

)

Membership upgrade sales upfront payments, deferred, net

 

2,542

 

 

1,771

 

Membership sales commissions, deferred, net

 

(216

)

 

(191

)

Real estate depreciation and amortization

 

39,024

 

 

37,977

 

Other depreciation and amortization

 

588

 

 

427

 

Interest and related amortization

 

26,073

 

 

26,393

 

Gain on sale of real estate, net

 

—

 

 

(52,507

)

Adjustments to our share of EBITDAre of unconsolidated joint ventures

 

263

 

 

1,001

 

EBITDAre

 

137,191

 

 

133,655

 

Early debt retirement

 

1,054

 

 

—

 

Insurance proceeds due to catastrophic weather event

 

—

 

 

(349

)

Adjusted EBITDAre

 

$

138,245

 

 

$

133,306

 

CORE. The Core properties include properties we owned and operated during all of 2019 and 2020. 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 properties that were not owned and operated during all of 2019 and 2020. This includes, but is not limited to, four properties and the marinas acquired and five properties sold during 2019.

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 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.

Paul Seavey
(800) 247-5279

Source: Equity LifeStyle Properties, Inc.



Register |  Password |  Feedback |  Copyright |  Usage Agreement |  Privacy Policy |  Advertising |  About Us |  Contact Us |  FAQ 

Past performance is not indicative of future results

StockSelector.com, the StockSelector.com logo, and News Selects are trademarks of StockSelector.com.
Copyright © 1998 - 2020 StockSelector.com. All rights reserved.