UMH Properties, Inc. Reports Results For The First Quarter Ended March 31, 2019
FREEHOLD, N.J., May 2, 2019 /PRNewswire/ -- UMH Properties, Inc. (NYSE: UMH) reported Total Income for the quarter ended March 31, 2019 of $34,287,000 as compared to $29,796,000 for the quarter ended March 31, 2018, representing an increase of 15%. Net Income Attributable to Common Shareholders amounted to $5,914,000 or $0.15 per diluted share for the quarter ended March 31, 2019 as compared to a Net Loss of $27,155,000 or $0.76 per diluted share for the quarter ended March 31, 2018.
Core Funds from Operations Attributable to Common Shareholders ("Core FFO"), was $6,091,000 or $0.16 per diluted share for the quarter ended March 31, 2019 as compared to $6,355,000 or $0.18 per diluted share for the quarter ended March 31, 2018. Normalized Funds from Operations Attributable to Common Shareholders ("Normalized FFO"), was $6,466,000 or $0.17 per diluted share for the quarter ended March 31, 2019, as compared to $6,335,000 or $0.18 per diluted share for the quarter ended March 31, 2018.
A summary of significant financial information for the three months ended March 31, 2019 and 2018 is as follows:
For the Three Months Ended |
||||||
March 31, |
||||||
2019 |
2018 |
|||||
Total Income |
$ |
34,287,000 |
$ |
29,796,000 |
||
Total Expenses |
$ |
29,750,000 |
$ |
25,492,000 |
||
Increase (Decrease) in Fair Value of Marketable Securities |
$ |
8,596,000 |
$ |
(25,899,000) |
||
Net Income (Loss) Attributable to Common Shareholders |
$ |
5,914,000 |
$ |
(27,155,000) |
||
Net Income (Loss) Attributable to Common Shareholders per Diluted Common Share |
$ |
0.15 |
$ |
(0.76) |
||
Core FFO (1) |
$ |
6,091,000 |
$ |
6,355,000 |
||
Core FFO (1) per Diluted Common Share |
$ |
0.16 |
$ |
0.18 |
||
Normalized FFO (1) |
$ |
6,466,000 |
$ |
6,335,000 |
||
Normalized FFO (1) per Diluted Common Share |
$ |
0.17 |
$ |
0.18 |
||
Diluted Weighted Average Shares Outstanding |
38,895,000 |
35,907,000 |
||||
A summary of significant balance sheet information as of March 31, 2019 and December 31, 2018 is as follows:
March 31, 2019 |
December 31, |
||
Gross Real Estate Investments |
$ 892,248,000 |
$ 881,456,000 |
|
Marketable Securities at Fair Value |
$ 108,700,000 |
$ 99,596,000 |
|
Total Assets |
$ 899,708,000 |
$ 880,902,000 |
|
Mortgages Payable, net |
$ 329,323,000 |
$ 331,093,000 |
|
Loans Payable, net |
$ 115,055,000 |
$ 107,985,000 |
|
Total Shareholders' Equity |
$ 434,695,000 |
$ 424,698,000 |
|
Samuel A. Landy, President and CEO, commented on the results of the first quarter of 2019.
"We are pleased to announce another solid quarter of operating results and an excellent start to 2019. During the quarter, we:
- Increased Rental and Related Income by 12%;
- Increased Community Net Operating Income (2) ("NOI") by 9%;
- Increased Same Property NOI (2) by 5%;
- Increased Same Property Occupancy by 120 basis points from 81.9% to 83.1%;
- Increased home sales by 44%;
- Increased our rental home portfolio by 153 homes to approximately 6,700 total rental homes, representing an increase of 14%;
- Raised $10.7 million through our Dividend Reinvestment and Stock Purchase Plan; and,
- Increased our total market capitalization to $1.3 billion, representing an increase of 14%."
Mr. Landy stated, "We have developed a business plan that has positioned the company for long-term growth. As evidenced by our income and sales growth, demand for affordable housing in our markets remains robust. The investments that we have made in our properties should continue to deliver improved operating results as we are able to further grow our occupancy and revenue."
"Our same property performance continues to validate our business plan. Same property occupancy improved to 83.1% at quarter end 2019 as compared to 81.9% in 2018. This occupancy growth is attributable to our exceptional rental and sales demand."
"We are particularly pleased to announce that after delivering sales growth of 45% in 2018, we began 2019 with an increase in sales of 44% for the quarter. We are optimistic about the potential earnings power of our sales operation."
"Subsequent to quarter end, we further increased our liquidity and strengthened our financial flexibility and balance sheet by issuing 4 million shares of our 6.75% Series C Perpetual Preferred stock resulting in net proceeds of approximately $96.6 million. This capital will be invested in our core business which should lead to future earnings growth."
UMH Properties, Inc. will host its First Quarter 2019 Financial Results Webcast and Conference Call. Senior management will discuss the results, current market conditions and future outlook on Friday, May 3, 2019 at 10:00 a.m. Eastern Time.
The Company's 2019 first quarter financial results being released herein will be available on the Company's website at www.umh.reit in the "Financial Information and Filings" section.
To participate in the webcast, select the microphone icon found on the homepage www.umh.reit to access the call. Interested parties can also participate via conference call by calling toll free 877-513-1898 (domestically) or 412-902-4147 (internationally).
The replay of the conference call will be available at 12:00 p.m. Eastern Time on Friday, May 3, 2019. It will be available until August 1, 2019 and can be accessed by dialing toll free 877-344-7529 (domestically) and 412-317-0088 (internationally) and entering the passcode 10129730. A transcript of the call and the webcast replay will be available at the Company's website, www.umh.reit.
UMH Properties, Inc., which was organized in 1968, is a public equity REIT that owns and operates 118 manufactured home communities containing approximately 21,500 developed homesites. These communities are located in New Jersey, New York, Ohio, Pennsylvania, Tennessee, Indiana, Michigan and Maryland. In addition, the Company owns a portfolio of REIT securities.
Certain statements included in this press release which are not historical facts may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements are based on the Company's current expectations and involve various risks and uncertainties. Although the Company believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the Company can provide no assurance those expectations will be achieved. The risks and uncertainties that could cause actual results or events to differ materially from expectations are contained in the Company's annual report on Form 10-K and described from time to time in the Company's other filings with the SEC. The Company undertakes no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events, or otherwise.
Note:
(1) |
Non-GAAP Information: We assess and measure our overall operating results based upon an industry performance measure referred to as Funds From Operations Attributable to Common Shareholders ("FFO"), which management believes is a useful indicator of our operating performance. FFO is used by industry analysts and investors as a supplemental operating performance measure of a REIT. FFO, as defined by The National Association of Real Estate Investment Trusts ("NAREIT"), represents Net Income (Loss) Attributable to Common Shareholders, as defined by accounting principles generally accepted in the United States of America ("U.S. GAAP"), excluding extraordinary items, as defined under U.S. GAAP, gains or losses from sales of previously depreciated real estate assets, impairment charges related to depreciable real estate assets, plus certain non-cash items such as real estate asset depreciation and amortization. NAREIT created FFO as a non-U.S. GAAP supplemental measure of REIT operating performance. We define Core Funds From Operations Attributable to Common Shareholders ("Core FFO") as FFO plus costs of early extinguishment of debt, change in the fair value of marketable securities and costs associated with the redemption of preferred stock. We define Normalized Funds From Operations Attributable to Common Shareholders ("Normalized FFO") as Core FFO excluding gains and losses realized on marketable securities investments and certain non-recurring charges. We define Community NOI as rental and related income less community operating expenses such as real estate taxes, repairs and maintenance, community salaries, utilities, insurance and other expenses. FFO, Core FFO and Normalized FFO, as well as Community NOI, should be considered as supplemental measures of operating performance used by REITs. FFO, Core FFO and Normalized FFO exclude historical cost depreciation as an expense and may facilitate the comparison of REITs which have a different cost basis. However, other REITs may use different methodologies to calculate FFO, Core FFO, Normalized FFO and Community NOI and, accordingly, our FFO, Core FFO, Normalized FFO and Community NOI may not be comparable to all other REITs. The items excluded from FFO, Core FFO and Normalized FFO are significant components in understanding the Company's financial performance. |
FFO, Core FFO and Normalized FFO (i) do not represent Cash Flow from Operations as defined by U.S. GAAP; (ii) should not be considered as an alternative to net income (loss) as a measure of operating performance or to cash flows from operating, investing and financing activities; and (iii) are not alternatives to cash flow as a measure of liquidity. |
|
The reconciliation of the Company's U.S. GAAP net loss to the Company's FFO, Core FFO and Normalized FFO for the three months ended March 31, 2019 and 2018 are calculated as follows: |
Three Months Ended |
|||
3/31/19 |
3/31/18 |
||
Net Income (Loss) Attributable to Common Shareholders |
$5,914,000 |
$(27,155,000) |
|
Depreciation Expense |
8,751,000 |
7,595,000 |
|
Loss on Sales of Depreciable Assets |
22,000 |
16,000 |
|
FFO Attributable to Common Shareholders |
14,687,000 |
(19,544,000) |
|
(Increase) Decrease in Fair Value of Marketable Securities |
(8,596,000) |
25,899,000 |
|
Core FFO Attributable to Common Shareholders |
6,091,000 |
6,355,000 |
|
Gain on Sales of Marketable Securities, net |
-0- |
(20,000) |
|
Settlement of utility billing dispute over a prior 10-year period |
375,000 |
-0- |
|
Normalized FFO Attributable to Common Shareholders |
$6,466,000 |
$6,335,000 |
|
The diluted weighted shares outstanding used in the calculation of Core FFO per Diluted Common Share and Normalized FFO per Diluted Common Share were 38,895,000 shares for the three months ended March 31, 2019 and 36,195,000 for the three months ended March 31, 2018. Common stock equivalents resulting from stock options in the amount of 250,000 shares for the three months ended March 31, 2019 are included in the diluted weighted shares outstanding. Common stock equivalents of 288,000 shares were excluded from the computation of the Diluted Net Loss per Share for the three months ended March 31, 2018 as their effect would be anti-dilutive.
The following are the cash flows provided (used) by operating, investing and financing activities for the three months ended March 31, 2019 and 2018:
2019 |
2018 |
|||
Operating Activities |
$12,175,000 |
$10,290,000 |
||
Investing Activities |
(14,737,000) |
(17,472,000) |
||
Financing Activities |
3,681,000 |
11,205,000 |
(2) |
Excludes settlement of utility billing dispute over a prior 10-year period of $375,000. |
SOURCE UMH Properties, Inc.
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