American Homes 4 Rent Reports Second Quarter 2013 Financial Results

AGOURA HILLS, Calif., Aug. 20, 2013 /PRNewswire/ -- American Homes 4 Rent (NYSE: AMH) ("AMH", "we" or "us") today announced its financial and operating results for the quarter ended June 30, 2013 and certain updated portfolio information through July 31, 2013.

Highlights

• Increase in properties to 19,825 as of July 31, 2013 from 18,326 as of June 30, 2013
• Maintained high occupancy level with 97% of properties leased that have been rent ready for more than 90 days
• 1,773 properties leased during July 2013, for a total of 11,753 leased properties as of month-end, with an additional 2,176 properties rent ready as of July 31, 2013
• Closed internalization transaction on June 10, 2013
• Closed transaction to acquire 4,778 properties held by joint venture with Alaska Permanent Fund Corporation on June 11, 2013 (the "Alaska Portfolio")
• Completion of initial public offering and concurrent private placements, and recent exercise in full of the underwriters' option to purchase additional shares.

"We are pleased with our recent accomplishments of internalizing our management platform and completing our initial public offering.  We believe that our new public platform will provide us opportunities for the continued expansion of our business across many fronts.  We are also excited about our continuing opportunity to acquire quality homes," said David P. Singelyn, AMH's Chief Executive Officer.

Recent Transactions

As previously disclosed, on June 10, 2013, AMH closed an important transaction to internalize certain operations previously provided to AMH by American Homes 4 Rent, LLC ("AH LLC"), a company formed by our founder and board chairman B. Wayne Hughes.  AMH is now self-managed with respect to corporate and property management operations, which we believe provides an efficient structure for both current operations and future growth. 

On June 11, 2013, AMH completed the acquisition of 4,778 properties from a joint venture with the Alaska Permanent Fund Corporation, substantially increasing the size of its portfolio.

As previously announced, AMH completed its IPO in August 2013 and the underwriters exercised in full their option to purchase additional shares.  Assuming that the underwriters' option closes as expected on August 21, 2013, the sale of the IPO shares together with the shares sold in the concurrent private placements to American Homes 4 Rent, LLC and the Alaska Permanent Fund Corporation, will provide us with gross proceeds of $886.8 million, before underwriters' discounts and offering costs.

Second Quarter 2013 Financial Results

AMH had total revenues of $18.1 million for the second quarter of 2013, a 176% increase over revenues reported for the first quarter of 2013.  This increase was largely due to the acquisition of the Alaska Portfolio, which was 75% leased as of the date of acquisition, and revenue from leases commencing throughout the first and second quarters.  

AMH reported net loss attributable to common shareholders of $14.0 million for the second quarter of 2013 and $21.7 million for the six months ended June 30, 2013.

AMH had net operating income ("NOI") from leased properties of $10.7 million for the second quarter of 2013, an increase of 164% over the first quarter of 2013.  NOI from leased properties is a supplemental non-GAAP financial measure that we define as rents from single-family properties, less property operating expenses for leased single-family properties.  A reconciliation from net income / (loss) to NOI is included in a schedule accompanying this press release.    

Properties

AMH had 19,825 properties as of July 31, 2013 compared to 18,326 properties as of June 30, 2013. 

"We are pleased that we have been able to continue to successfully grow our portfolio and lease our properties across a broad and diverse base of markets, while maintaining our strict underwriting standards with respect to the quality of the product and expected financial returns," said Jack Corrigan, AMH's Chief Operating Officer.

The following tables provide a summary of properties in which AMH has an interest as of July 31, 2013 and June 30, 2013.

Leasing and Renewal Experience

The following tables summarize our leasing experience on Stabilized Properties ⁽¹⁾ through July 31, 2013 and June 30, 2013.

As previously disclosed, based on our experience with 471 leases that matured before June 30, 2013, 65% of the tenants renewed their leases at an average increase in rental rate of 2.4%.

Capital Activities and Liquidity

As of June 30, 2013, AMH had cash and cash equivalents of $251.4 million and $670.0 million was outstanding on its credit facility. The initial closing of AMH's IPO and concurrent private placements on August 6, 2013 provided us with $747.4 million of proceeds, net of underwriters' discounts before other offering costs.  Proceeds from the IPO and concurrent private placements were immediately used to pay down the outstanding balance of the credit facility.  The credit facility now provides for aggregate borrowings up to $500 million.

As previously reported, the underwriters have exercised in full their option to purchase an additional 6,617,647 of our Class A common shares at the IPO price of $16.00 per share, less underwriters' discounts.  This transaction, which is expected to close on August 21, 2013, will provide AMH with an additional $100.9 million of proceeds, net of underwriters' discounts.

Conference Call

A conference call is scheduled on Wednesday, August 21, 2013, at 11:00 a.m. Eastern Time to discuss AMH's financial results for the second quarter ended June 30, 2013 and to provide a portfolio update. The domestic dial-in number is (800) 434-1335 (for U.S. and Canada) and the international dial-in number is (404) 920-6442 (conference ID number for either domestic or international is 979119#). A simultaneous audio webcast may be accessed by using the link at www.americanhomes4rent.com, under "For Investors."  A replay of the conference call may be accessed through September 4, 2013 by calling (800) 920-7487 (U.S. and Canada) or (404) 920-1710 (international) or by using the link at www.americanhomes4rent.com, under "For Investors."  All forms of replay utilize conference ID number 979119#.

About American Homes 4 Rent

American Homes 4 Rent is an internally managed Maryland real estate investment trust, or REIT, focused on acquiring, renovating, leasing, and operating single-family homes as rental properties. As of July 31, 2013, we owned 19,825 single-family properties in selected submarkets in 22 states and we continually evaluate potential target markets that meet our underwriting criteria and are located where we believe we can achieve sufficient scale for internalized property management. We are a leader in the single-family home rental industry and "American Homes 4 Rent" is fast becoming a nationally recognized brand for rental homes, known for high quality, good value and tenant satisfaction. 

Forward-Looking Statements

This press release contains "forward-looking statements." These forward-looking statements relate to beliefs, expectations or intentions and similar statements concerning matters that are not of historical fact and are generally accompanied by words such as "estimate," "project," "predict," "believe," "expect," "anticipate," "intend," ,"potential," "plan," "goal" or other words that convey the uncertainty of future events or outcomes. Examples of forward-looking statements contained in this press release include, among others, the expected timing of the closing of the underwriters' option to purchase additional shares, our belief that our self-managed platform will provide an efficient structure for both current operations and future growth, our ability to continue growing our single-family home portfolio and expanding our business across many fronts and our continuing opportunity to acquire quality homes.  AMH has based these forward-looking statements on its current expectations and assumptions about future events. While AMH's management considers these expectations to be reasonable, they are inherently subject to risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond AMH's control. Investors should not place undue reliance on these forward-looking statements.  All information in this press release is current as of the date of the release.  AMH undertakes no obligation to update any forward-looking statements to conform to actual results or changes in its expectations.  For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of AMH in general, see AMH's prospectus filed with the Securities and Exchange Commission on August 2, 2013. 

(Photo: http://photos.prnewswire.com/prnh/20130820/LA67031)

Non-GAAP Financial Measures

Reconciliation of Net Operating Income to Net Income (Loss)

Net operating income, or NOI, from leased properties is a supplemental non-GAAP financial measure that AMH defines as rents from single-family properties, less property operating expenses for leased single-family properties.  NOI excludes income from discontinued operations, gain on remeasurement of equity method investment, depreciation and amortization, acquisition fees and costs expensed, noncash share-based compensation expense, interest expense, advisory fees, general and administrative expense, property operating expenses for vacant single-family properties and other revenues. 

AMH considers NOI from leased properties to be a meaningful financial measure because we believe it is helpful to investors in understanding the operating performance of our leased single-family properties. It should be considered only as a supplement to net income (loss) as a measure of our performance. NOI from leased properties should not be used as a measure of AMH's liquidity, nor is it indicative of funds available to fund AMH's cash needs, including its ability to pay dividends or make distributions. NOI from leased properties also should not be used as a supplement to or substitute for net income (loss) or net cash flows from operating activities (as computed in accordance with GAAP).

The following is a reconciliation of NOI to net income (loss) as determined in accordance with GAAP:

Contact: Peter J. Nelson
American Homes 4 Rent
Tel: (855) 794-2447

SOURCE American Homes 4 Rent

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