Equity LifeStyle Reports Higher Q1 Revneues
Equity LifeStyle Properties Inc. has announced results for the quarter ended March 31, 2011.
ELS owns or has an interest in 307 quality properties in 27 states and British Columbia consisting of 111,004 sites. The Company is a self-administered, self-managed, real estate investment trust (REIT) with headquarters in Chicago.
a) Financial Results
For the first quarter 2011, Funds From Operations (FFO) were $40.6 million, or $1.14 per share, compared to $37.4 million, or $1.05 per share for the same period in 2010. Net income available to common stockholders totaled $19 million, or $0.61 per share on a fully-diluted basis for the quarter ended March 31, 2011. This compares to net income available to common stockholders of $15.1 million, or $0.49 per share on a fully-diluted basis for the same period in 2010.
b) Portfolio Performance
First quarter 2011 property operating revenues, excluding deferrals, were $131.6 million, compared to $131.4 million in the first quarter of 2010. For the quarter ended March 31, 2011, our Core property operating revenues were flat compared to the first quarter of 2010. Excluding upfront payments from right-to-use contracts, first quarter 2011 Core property revenues increased approximately 0.8% as compared to the first quarter of 2010. The reduction in upfront payments is primarily due to the shift to low cost, right-to-use contracts in the spring of 2010 instead of the historical high-cost memberships. The first quarter 2011 decrease in upfront payments is offset by a similar decrease in sales and marketing expenses. Core property operating expenses for the quarter ended March 31, 2011, decreased approximately 1.5%, resulting in an increase of approximately 1.4 percent to income from Core property operations over the quarter ended March 31, 2010.
c) Asset-related Transaction
On April 6, 2011, we closed on a $3.8 million note receivable with a stated interest rate of 15% per annum to the owner of Lakeland RV. Lakeland RV is a 700-site RV property located in Milton, Wis. The note requires interest only payments of 9% and matures on May 1, 2016. We also hold a right of first refusal to match any offer received on Lakeland RV during the time the note is outstanding.
d) Balance Sheet
Our cash and short-term investments balance as of March 31, 2011, was approximately $92.4 million. Our average long-term secured debt balance was approximately $1.4 billion in the quarter, with a weighted average interest rate, including amortization, of approximately 6.06% per annum. Interest coverage was approximately 3.2 times in the quarter ended March 31, 2011.
Our unsecured line of credit currently has an availability of $100 million and expires on June 29, 2011. We are currently negotiating a new line of credit with an expected availability of $300 million.
e) Preferred Stock Offering
On March 4, 2011, the company, on behalf of selling stockholders, closed on a public offering of 8 million shares of 8.034% Series A Cumulative Redeemable Perpetual Preferred Stock, par value $0.01 per share, liquidation preference of $25.00 per share, at a price of $24.75 per share. The company did not receive any proceeds from the offering.
Guidance for 2011 FFO per share, on a fully-diluted basis, is projected to be in the range of $3.75 to $3.95 for the year ending Dec. 31, 2011, and in the range of $0.75 to $0.85 for the quarter ending June 30, 2011. The company estimates that Core property operating revenue for 2011 is expected to grow at approximately 1.1% to 1.6% over 2010, assuming stable occupancy. Income from Core property operations, excluding property management expenses, is expected to grow at approximately 3% to 3.5% over 2010.