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ELS Reports Improving Q3 Financial Results

October 22, 2012 by   - () Leave a Comment

Good Q3 results

Equity LifeStyle Properties Inc. ELS today (Oct. 22) announced results for the three and nine months ended Sept. 30, 2012.

For the three months ended Sept 30, Funds From Operations (FFO) were $53.2 million, or $1.17 per share on a fully-diluted basis, compared to $33.0 million, or $0.76 per share on a fully-diluted basis, for the same period in 2011.

For the nine months ended Sept 30, FFO was $159.7 million, or $3.52 per share on a fully-diluted basis, compared to $102.7 million, or $2.64 per share on a fully-diluted basis, for the same period in 2011.

Net income available to common stockholders totaled $16.0 million, or $0.39 per share on a fully-diluted basis, for the three months ended Sept 30, compared to a net loss of $2.9 million, or $0.07 per share on a fully-diluted basis, for the same period in 2011.

Net income available to common stockholders totaled $30.5 million, or $0.74 per share on a fully-diluted basis for the nine months ended Sept. 30, compared to $22.9 million, or $0.67 per share on a fully-diluted basis, for the same period in 2011.

The nine months ended Sept 30 compared to the same period in 2011 were impacted by the following:

  • The accelerated recognition of $2.1 million of revenue during the three months ended June 30, 2012, included in utility and other income, related to the early termination of a multi-year cable service agreement.
  • A decline in member right-to-use contract sales and related sales and marketing expenses as a result of the temporary cessation of membership upgrade sales in connection with sales force training and the roll out of new upgrade products during the first quarter of 2012. The overall performance of our right-to-use contracts net of related sales and marketing expense during the three months ended Sept. 30, was in-line with our previously announced guidance. Excluding the impact of these items, for the nine months ended Sept. 30, the increases in core property operating revenues, expenses and income were approximately 2.2%, 1.2% and 3%, respectively.

For the three months ended Sept. 30, property operating revenues, excluding deferrals, were $176.5 million, compared to $156.9 million in the same period of 2011. Property operating revenues, excluding deferrals, for the nine months ended Sept. 30 were $520.2 million, compared to $417.0 million for the nine months ended Sept. 30, 2011.

For the three months ended Sept. 30, core property operating revenues increased approximately 1.8% and income from core property operations increased approximately 2.6% as compared to the three months ended Sept. 30, 2011.

For the nine months ended Sept. 30, core property operating revenues increased approximately 1.8% and income from core property operations increased approximately 2.6% as compared to the nine months ended Sept. 30, 2011.

The cash balance as of Sept. 30 was approximately $147.9 million. Subsequent to the end of the quarter the company used approximately $83.9 million for the redemption of its Series A Preferred Stock.  Average long-term secured debt balance was approximately $2.1 billion, during the three months ended Sept. 30 with a weighted average interest rate, including amortization, of approximately 5.5 percent per annum and weighted average maturity of 5.2 years. Interest coverage was approximately 3.0 times in the three months ended Sept. 30.

During the quarter ended Sept. 30, the company received approximately $74.0 million of financing proceeds on one manufactured home community with a stated interest rate of 3.9% per annum, maturing in 2022. The proceeds were used to pay off the mortgage on the property, which was set to mature on May 1, 2013, totaling approximately $35.1 million, with a stated interest rate of 5.7%  per annum. The company also paid off two maturing mortgages totaling approximately $34.1 million, with a weighted average interest rate of 5.7% per annum.

During the quarter ended Sept 30, the company amended its $380 million unsecured line of credit to:

  • Extend the maturity to Sept. 15, 2016.
  • Lengthen the extension option to one-year.
  • Decrease the per annum interest rate to LIBOR plus a maximum of 1.4% to 2%, bearing a facility rate of 0.25% to 0.40%.
  • Effect certain other ministerial changes. The company currently has no amounts outstanding on its line of credit.

During the quarter ended Sept. 30, the company exchanged 5,445,765 shares of 8.034% Series A Cumulative Redeemable Perpetual Preferred Stock, par value $0.01 per share (the “Series A Preferred Stock”) for 5,445,765 depositary shares representing 1/100th of a share of the company’s 6.75% Series C Cumulative Redeemable Perpetual Preferred Stock (the “Series C Preferred Stock”) with a liquidation value of $25.00 per depositary share, plus accrued and unpaid dividends of $0.3849625 per share of Series A Preferred Stock.

The newly issued depositary shares trade on the New York Stock Exchange with the ticker symbol ELSPrC. On Oct. 18, the company redeemed the remaining 2,554,235 shares of Series A Preferred Stock at the $25.00 per share liquidation value and accrued and unpaid dividends of $0.094846 per share on such redeemed shares for approximately $64.1 million.

As of Oct. 22, Equity LifeStyle Properties Inc. owns or has an interest in 382  properties in 32 states and British Columbia consisting of 141,077 sites. The company is a self-administered, self-managed, real estate investment trust (REIT) with headquarters in Chicago.

 

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