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ELS Reports First Quarter Results

Continued Strong Performance

CHICAGO, April 22, 2024--(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, 2024. All per share results are reported on a fully diluted basis unless otherwise noted.

($ in millions, except per share data)

FINANCIAL RESULTS

Q1 2024

Q1 2023

$ Change

Total Revenues

$

386.6

$

370.0

$

16.6

Net Income available for Common Stockholders

$

109.9

$

82.4

$

27.5

Net Income per Common Share

$

0.59

$

0.44

$

0.15

NON-GAAP FINANCIAL MEASURES

Q1 2024

Q1 2023

$ Change

Funds from Operations ("FFO") per Common Share and OP Unit

$

0.86

$

0.72

$

0.14

Normalized Funds from Operations ("Normalized FFO") per Common Share and

OP Unit

$

0.78

$

0.72

$

0.06

Property operating revenues

$

353.7

$

334.8

$

18.9

Income from property operations, excluding property management

$

211.4

$

198.0

$

13.4

CORE PORTFOLIO PERFORMANCE

Q1 2024

Q1 2023

% Change

Core property operating revenues

$

345.4

$

326.4

5.8

%

Core Income from property operations, excluding property management

$

206.1

$

192.4

7.1

%

Operations Update

Normalized FFO for the quarter ended March 31, 2024 was $0.78 per share, representing an 8.6% increase compared to the same period in 2023, and is in line with the midpoint of our guidance expectation.

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MH

Core MH base rental income for the quarter ended March 31, 2024 increased 6.4% compared to the same period in 2023, which reflects 6.3% growth from rate increases and 0.1% from occupancy gains. Core MH homeowners increased by 123 since December 31, 2023. We sold 191 new homes during the quarter ended March 31, 2024, with an average sales price of approximately $93,000.

RV and Marina

Core RV and marina base rental income for the quarter ended March 31, 2024 increased 5.8% compared to the same period in 2023. Core RV and marina annual base rental income increased 8.0% for the quarter ended March 31, 2024, which included allocation of an additional day’s revenue resulting from the leap year, compared to the same period in 2023. Total nights camped during the quarter ended March 31, 2024 is in line compared to the same period in 2023.

Property Operating Expenses

Core property operating expenses, excluding property management for the quarter ended March 31, 2024 increased 3.9% compared to the same period in 2023. See page 8 for details of the Core property operating expenses, excluding property management.

We completed our property and casualty insurance renewal as of April 1, 2024 with no change to program deductibles, an increase to certain coverage limits, and a premium increase of approximately 9%.

Balance Sheet Activity

In April 2024, the Company entered into three interest rate swap agreements ("Swaps") with an aggregate notional value of $300.0 million allowing us to trade the variable interest rate associated with our $300.0 million unsecured term loan for a fixed interest rate. The Swaps have a weighted average all-in fixed interest rate of 6.05% per annum and mature on April 17, 2026. As a result, borrowings on our unsecured line of credit represent our only exposure to floating rate debt.

Guidance Update (1)(2)

($ in millions, except per share data)

2024

Second Quarter

Full Year

Net Income per Common Share

$0.34 to $0.40

$1.83 to $1.93

FFO per Common Share and OP Unit

$0.61 to $0.67

$2.91 to $3.01

Normalized FFO per Common Share and OP Unit

$0.61 to $0.67

$2.84 to $2.94

2023 Actual

2024 Growth Rates

Core Portfolio:

Second Quarter

Full Year

Second Quarter

Full Year

MH base rental income

$

166.3

$

668.5

5.9% to 6.5%

5.6% to 6.6%

RV and marina base rental income (3)

$

98.6

$

413.5

2.8% to 3.4%

4.5% to 5.5%

Property operating revenues

$

317.7

$

1,297.7

4.8% to 5.4%

4.8% to 5.8%

Property operating expenses, excluding property management

$

145.4

$

562.3

5.3% to 5.9%

4.2% to 5.2%

Income from property operations, excluding property management

$

172.3

$

735.4

4.3% to 4.9%

5.3% to 6.3%

Non-Core Portfolio:

2024 Full Year

Income from property operations, excluding property management

$15.2 to $19.2

Other Guidance Assumptions:

2024 Full Year

Property management and general administrative

$114.7 to $120.7

Debt assumptions:

Weighted average debt outstanding

$3,400 to $3,600

Interest and related amortization

$141.2 to $147.2

______________________

  1. Second quarter and full year 2024 guidance represent management’s estimate of a range of possible outcomes. The midpoint of the ranges reflect management’s estimate of the most likely outcome based on our current view of existing market conditions and assumptions. Actual results could vary materially from management’s estimates presented above if any of our assumptions, including occupancy and rate changes, our ability to manage expenses in an inflationary environment, our ability to integrate and operate recent acquisitions and costs to restore property operations and potential revenue losses following storms or other unplanned events, are incorrect. See Forward-Looking Statements in this press release for additional factors impacting our 2024 guidance assumptions. See Non-GAAP Financial Measures Definitions and Reconciliations at the end of the supplemental financial information for definitions of FFO and Normalized FFO and a reconciliation of Net income per Common Share - Fully Diluted to FFO per Common Share and OP Unit - Fully Diluted and Normalized FFO per Common Share and OP Unit - Fully Diluted.

  2. Guidance assumptions do not include future capital events (financing transactions, acquisitions or dispositions).

  3. Core RV and marina annual revenue represents approximately 73.2% and 69.3% of second quarter 2024 and full year 2024 RV and marina base rental income, respectively. Core RV and marina annual revenue second quarter 2024 growth rate range is 6.5% to 7.1% and the full year 2024 growth rate range is 6.6% to 7.6%.

About Equity LifeStyle Properties

We are a self-administered, self-managed real estate investment trust ("REIT") with headquarters in Chicago. As of April 22, 2024, we own or have an interest in 451 properties in 35 states and British Columbia consisting of 172,464 sites.

For additional information, please contact our Investor Relations Department at (800) 247-5279 or at investor_relations@equitylifestyle.com.

Conference Call

A live audio webcast of our conference call discussing these results will take place tomorrow, Tuesday, April 23, 2024, 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," "estimate," "guidance," "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. Forward-looking statements, including our guidance concerning Net Income, FFO and Normalized FFO per share data, and certain growth rates, by their nature, involve estimates, projections, goals, forecasts and assumptions and are subject to risks and uncertainties that could cause actual results or outcomes to differ materially from those expressed in a forward-looking statement due to a number of factors, which include, but are not limited to the following: (i) the mix of site usage within the portfolio; (ii) yield management on our short-term resort and marina sites; (iii) scheduled or implemented rate increases on community, resort and marina sites; (iv) scheduled or implemented rate increases in annual payments under membership subscriptions; (v) occupancy changes; (vi) our ability to attract and retain membership customers; (vii) change in customer demand regarding travel and outdoor vacation destinations; (viii) our ability to manage expenses in an inflationary environment; (ix) our ability to integrate and operate recent acquisitions in accordance with our estimates; (x) our ability to execute expansion/development opportunities in the face of supply chain delays/shortages; (xi) completion of pending transactions in their entirety and on assumed schedule; (xii) our ability to attract and retain property employees, particularly seasonal employees; (xiii) ongoing legal matters and related fees; (xiv) costs to restore property operations and potential revenue losses following storms or other unplanned events; and (xv) the potential impact of, and our ability to remediate, material weaknesses in our internal control over financial reporting. 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" and "Forward-Looking Statements" sections in our most recent Annual Report on Form 10-K and any 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

Financial Highlights

(In millions, except Common Shares and OP Units outstanding and per share data, unaudited)

As of and for the Quarters Ended

Mar 31, 2024

Dec 31, 2023

Sep 30, 2023

Jun 30, 2023

Mar 31, 2023

Operating Information

Total revenues

$

386.6

$

360.6

$

388.8

$

370.0

$

370.0

Consolidated net income

$

115.3

$

96.4

$

80.7

$

66.0

$

86.5

Net income available for Common Stockholders

$

109.9

$

91.9

$

77.0

$

62.9

$

82.4

Adjusted EBITDAre (1)

$

186.3

$

171.1

$

167.0

$

157.7

$

173.0

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

$

167.4

$

148.5

$

133.8

$

118.6

$

140.3

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

$

152.7

$

138.2

$

133.9

$

124.9

$

140.5

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

$

136.9

$

109.2

$

107.8

$

98.3

$

122.4

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

Common Shares and OP Units, end of the period

195,598

195,531

195,525

195,514

195,446

Weighted average Common Shares and OP Units outstanding - Fully Diluted

195,545

195,475

195,440

195,430

195,369

Net income per Common Share - Fully Diluted (3)

$

0.59

$

0.49

$

0.41

$

0.34

$

0.44

FFO per Common Share and OP Unit - Fully Diluted

$

0.86

$

0.76

$

0.68

$

0.61

$

0.72

Normalized FFO per Common Share and OP Unit - Fully Diluted

$

0.78

$

0.71

$

0.68

$

0.64

$

0.72

Dividends per Common Share

$

0.4775

$

0.4475

$

0.4475

$

0.4475

$

0.4475

Balance Sheet

Total assets

$

5,630

$

5,614

$

5,626

$

5,586

$

5,519

Total liabilities

$

4,110

$

4,115

$

4,129

$

4,083

$

4,006

Market Capitalization

Total debt (4)

$

3,507

$

3,548

$

3,533

$

3,479

$

3,414

Total market capitalization (5)

$

16,104

$

17,341

$

15,990

$

16,557

$

16,534

Ratios

Total debt / total market capitalization

21.8

%

20.5

%

22.1

%

21.0

%

20.6

%

Total debt / Adjusted EBITDAre (6)

5.1

5.3

5.4

5.4

5.4

Interest coverage (7)

5.2

5.2

5.3

5.4

5.5

Fixed charges(8)

5.1

5.1

5.1

5.2

5.4

______________________

  1. See Non-GAAP Financial Measures Definitions and Reconciliations 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 6 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 $28.6 million as of March 31, 2024.

  5. See page 14 for the calculation of market capitalization as of March 31, 2024.

  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 Reconciliations 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, 2024

December 31, 2023

(unaudited)

Assets

Investment in real estate:

Land

$

2,088,657

$

2,088,657

Land improvements

4,435,288

4,380,649

Buildings and other depreciable property

1,229,374

1,236,985

7,753,319

7,706,291

Accumulated depreciation

(2,497,039

)

(2,448,876

)

Net investment in real estate

5,256,280

5,257,415

Cash and restricted cash

47,281

29,937

Notes receivable, net

49,346

49,937

Investment in unconsolidated joint ventures

84,989

85,304

Deferred commission expense

54,024

53,641

Other assets, net

138,314

137,499

Total Assets

$

5,630,234

$

5,613,733

Liabilities and Equity

Liabilities:

Mortgage notes payable, net

...

$

2,974,728

$

2,989,959

Term loans, net

497,875

497,648

Unsecured line of credit

6,000

31,000

Accounts payable and other liabilities

171,061

151,567

Deferred membership revenue

223,470

218,337

Accrued interest payable

12,543

12,657

Rents and other customer payments received in advance and security deposits

131,547

126,451

Distributions payable

93,264

87,493

Total Liabilities

4,110,488

4,115,112

Equity:

Preferred stock, $0.01 par value, 10,000,000 shares authorized as of March 31, 2024 and December 31, 2023; none issued and outstanding.

Common stock, $0.01 par value, 600,000,000 shares authorized as of March 31, 2024 and December 31, 2023; 186,493,598 and 186,426,281 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively.

1,917

1,917

Paid-in capital

1,644,410

1,644,319

Distributions in excess of accumulated earnings

(202,721

)

(223,576

)

Accumulated other comprehensive income

5,280

6,061

Total Stockholders’ Equity

1,448,886

1,428,721

Non-controlling interests – Common OP Units

70,860

69,900

Total Equity

1,519,746

1,498,621

Total Liabilities and Equity

$

5,630,234

$

5,613,733

Consolidated Statements of Income

(In thousands, unaudited)

Quarters Ended March 31,

2024

2023

Revenues:

Rental income

$

316,599

$

296,451

Annual membership subscriptions

16,215

15,970

Membership upgrade sales (1)

3,947

3,505

Other income

15,548

17,714

Gross revenues from home sales, brokered resales and ancillary services

30,053

32,133

Interest income

2,168

2,088

Income from other investments, net

2,038

2,091

Total revenues

386,568

369,952

Expenses:

Property operating and maintenance

114,783

112,483

Real estate taxes

20,787

18,316

Membership sales and marketing (2)

5,297

4,838

Property management

19,710

19,464

Depreciation and amortization

51,108

50,502

Cost of home sales, brokered resales and ancillary services

21,967

23,141

Home selling expenses and ancillary operating expenses

6,147

6,924

General and administrative

11,989

11,661

Casualty-related charges/(recoveries), net (3)

(14,843

)

Other expenses

1,331

1,468

Interest and related amortization

33,543

32,588

Total expenses

271,819

281,385

Income before income taxes and other items

114,749

88,567

Gain/(Loss) on sale of real estate and impairment, net

(2,632

)

Income tax benefit

239

Equity in income of unconsolidated joint ventures

283

524

Consolidated net income

115,271

86,459

Income allocated to non-controlling interests – Common OP Units

(5,366

)

(4,088

)

Net income available for Common Stockholders

$

109,905

$

82,371

______________________

  1. Membership upgrade sales revenue is net of deferrals of $3.6 million and $4.5 million for the quarters ended March 31, 2024 and March 31, 2023, respectively. See page 13 for details of membership sales activity.

  2. Membership sales and marketing expense is net of sales commission deferrals of $0.4 million and $0.7 million for the quarters ended March 31, 2024 and March 31, 2023, respectively. See page 13 for details of membership sales activity.

  3. Casualty-related charges/(recoveries), net for the quarter ended March 31, 2024 includes debris removal and cleanup costs related to Hurricane Ian of $0.5 million and insurance recovery revenue of $15.4 million including excess revenue of $14.8 million for reimbursement of capital expenditures related to Hurricane Ian.

Non-GAAP Financial Measures

This document contains certain Non-GAAP measures used by management that we believe are helpful to understand 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 are they 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 6 and Non-GAAP Financial Measures Definitions and Reconciliations on pages 16-19.

Selected Non-GAAP Financial Measures

(In millions, except per share data, unaudited)

Quarter Ended

March 31, 2024

Income from property operations, excluding property management - 2024 Core (1)

$

206.1

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

5.3

Property management and general and administrative

(31.3

)

Other income and expenses

6.1

Interest and related amortization

(33.5

)

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

$

152.7

Deferred income tax benefit

0.2

Transaction/pursuit costs and other

(0.4

)

Insurance proceeds due to catastrophic weather event (3)

14.8

FFO available for Common Stock and OP Unit holders (2)(4)

$

167.4

FFO per Common Share and OP Unit

$

0.86

Normalized FFO per Common Share and OP Unit

$

0.78

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

$

152.7

Non-revenue producing improvements to real estate

(15.8

)

FAD for Common Stock and OP Unit holders (2)

$

136.9

Weighted average Common Shares and OP Units - Fully Diluted

195.5

______________________

  1. See pages 8-9 for details of the Core Income from Property Operations, excluding property management. See page 10 for details of the Non-Core Income from Property Operations, excluding property management.

  2. See page 6 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.

  3. Represents insurance recovery revenue for reimbursement of capital expenditures related to Hurricane Ian.

  4. Amounts may not foot due to rounding.

Reconciliation of Net Income to Non-GAAP Financial Measures

(In thousands, except per share data, unaudited)

Quarters Ended March 31,

2024

2023

Net income available for Common Stockholders

$

109,905

$

82,371

Income allocated to non-controlling interests – Common OP Units

5,366

4,088

Depreciation and amortization

51,108

50,502

Depreciation on unconsolidated joint ventures

1,051

1,135

Gain on unconsolidated joint ventures

(416

)

(Gain)/Loss on sale of real estate and impairment, net

2,632

FFO available for Common Stock and OP Unit holders

167,430

140,312

Deferred income tax benefit

(239

)

Transaction/pursuit costs and other (1)

383

206

Insurance proceeds due to catastrophic weather event (2)

(14,843

)

Normalized FFO available for Common Stock and OP Unit holders

152,731

140,518

Non-revenue producing improvements to real estate

(15,812

)

(18,112

)

FAD for Common Stock and OP Unit holders

$

136,919

$

122,406

Net income per Common Share - Basic

$

0.59

$

0.44

Net income per Common Share - Fully Diluted (3)

$

0.59

$

0.44

FFO per Common Share and OP Unit - Basic

$

0.86

$

0.72

FFO per Common Share and OP Unit - Fully Diluted

$

0.86

$

0.72

Normalized FFO per Common Share and OP Unit - Basic

$

0.78

$

0.72

Normalized FFO per Common Share and OP Unit - Fully Diluted

$

0.78

$

0.72

Weighted average Common Shares outstanding - Basic

186,287

185,900

Weighted average Common Shares and OP Units outstanding - Basic

195,392

195,162

Weighted average Common Shares and OP Units outstanding - Fully Diluted

195,545

195,369

____________________

  1. Prior period amounts have been reclassified to conform to the current period presentation.

  2. Represents insurance recovery revenue for reimbursement of capital expenditures related to Hurricane Ian.

  3. Net income per Common Share - Fully Diluted 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,

2024

2023

MH base rental income (2)

$

175.1

$

164.6

Rental home income (2)

3.5

3.9

RV and marina base rental income (2)

120.2

111.6

Annual membership subscriptions

16.2

16.0

Membership upgrade sales (3)

3.9

3.5

Utility and other income (2)(4)

34.8

35.2

Property operating revenues

353.7

334.8

Property operating, maintenance and real estate taxes (2)

137.0

132.0

Membership sales and marketing (3)

5.3

4.8

Property operating expenses, excluding property management (1)

142.3

136.8

Income from property operations, excluding property management (1)

$

211.4

$

198.0

Manufactured home site figures and occupancy averages:

Total sites

73,008

72,717

Occupied sites

68,916

68,847

Occupancy %

94.4

%

94.7

%

Monthly base rent per site

$

847

$

797

RV and marina base rental income:

Annual

$

75.6

$

69.4

Seasonal

29.5

28.0

Transient

15.1

14.2

Total RV and marina base rental income

$

120.2

$

111.6

______________________

  1. Excludes property management expenses.

  2. MH base rental income, Rental home income, RV and marina base rental income and Utility income, net of bad debt expense, are presented in Rental income in the Consolidated Statements of Income on page 3. Bad debt expense is presented in Property operating, maintenance and real estate taxes in this table.

  3. See page 13 for details of membership sales activity.

  4. Includes approximately $1.9 million and $4.0 million of business interruption income from Hurricane Ian during the quarters ended March 31, 2024 and March 31, 2023, respectively.

Core Income from Property Operations (1)

(In millions, except occupancy figures, unaudited)

Quarters Ended March 31,

2024

2023

Change (2)

MH base rental income

$

174.9

$

164.4

6.4

%

Rental home income

3.5

3.9

(9.2

)%

RV and marina base rental income

115.6

109.3

5.8

%

Annual membership subscriptions

16.2

15.8

2.7

%

Membership upgrade sales

3.9

3.5

13.9

%

Utility and other income

31.3

29.5

5.6

%

Property operating revenues

345.4

326.4

5.8

%

Utility expense

38.7

38.4

0.7

%

Payroll

27.7

28.1

(1.4

)%

Repair & maintenance

20.8

21.8

(4.6

)%

Insurance and other (3)

26.4

23.0

14.6

%

Real estate taxes

20.4

17.9

14.3

%

Membership sales and marketing

5.3

4.8

9.9

%

Property operating expenses, excluding property management (1)

139.3

134.0

3.9

%

Income from property operations, excluding property management (1)

$

206.1

$

192.4

7.1

%

Occupied sites (4)

68,904

68,801

_____________________

  1. Excludes property management expenses.

  2. Calculations prepared using actual results without rounding.

  3. Includes bad debt expense for the periods presented.

  4. Occupied sites are presented as of the end of the period.

Core Income from Property Operations (continued)

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

Quarters Ended March 31,

2024

2023

Core manufactured home site figures and occupancy averages:

Total sites

72,593

72,456

Occupied sites

68,858

68,790

Occupancy %

94.9

%

94.9

%

Monthly base rent per site

$

847

$

797

Quarters Ended March 31,

2024

2023

Change (1)

Core RV and marina base rental income:

Annual (2)

$

73.1

$

67.6

8.0

%

Seasonal

28.2

27.6

2.4

%

Transient

14.3

14.1

1.4

%

Total Seasonal and Transient

$

42.5

$

41.7

2.1

%

Total RV and marina base rental income

$

115.6

$

109.3

5.8

%

Quarters Ended March 31,

2024

2023

Change (1)

Core utility information:

Income

$

18.0

$

17.6

2.3

%

Expense

38.7

38.4

0.7

%

Expense, net

$

20.7

$

20.8

(0.5

)%

Utility recovery rate (3)

46.5

%

45.8

%

_____________________

  1. Calculations prepared using actual results without rounding.

  2. Core Annual marina base rental income represents approximately 99% of the total Core marina base rental income for all periods presented.

  3. Calculated by dividing the utility income by utility expense.

Non-Core Income from Property Operations (1)

(In millions, unaudited)

Quarter Ended

March 31, 2024

MH base rental income

$

0.2

RV and marina base rental income

4.5

Utility and other income

3.6

Property operating revenues

8.3

Property operating expenses, excluding property management (1)(2)

3.0

Income from property operations, excluding property management (1)

$

5.3

______________________

  1. Excludes property management expenses.

  2. Includes bad debt expense for the periods presented.

Home Sales and Rental Home Operations

(In thousands, except home sale volumes and occupied rentals, unaudited)

Home Sales - Select Data

Quarters Ended March 31,

2024

2023

Total new home sales volume

191

176

New home sales gross revenues

$

17,700

$

18,314

Total used home sales volume

54

102

Used home sales gross revenues

$

838

$

1,175

Brokered home resales volume

109

134

Brokered home resales gross revenues

$

572

$

675

Rental Homes - Select Data

Quarters Ended March 31,

2024

2023

Rental operations revenues (1)

$

9,058

$

10,258

Rental home operations expense (2)

1,369

959

Depreciation on rental homes (3)

2,568

2,747

Occupied rentals: (4)

New

1,922

2,389

Used

236

313

Total occupied rental sites

2,158

2,702

As of March 31, 2024

As of March 31, 2023

Cost basis in rental homes: (5)

Gross

Net of Depreciation

Gross

Net of Depreciation

New

$

238,963

$

197,641

$

252,204

$

209,673

Used

11,744

7,118

14,056

8,094

Total rental homes

$

250,707

$

204,759

$

266,260

$

217,767

______________________

  1. For the quarters ended March 31, 2024 and 2023, approximately $5.6 million and $6.4 million, respectively, of the rental operations revenue is included in the MH base rental income in the Core Income from Property Operations on pages 8-9. The remainder of the rental operations revenue for the quarters ended March 31, 2024 and 2023 is included in Rental home income in the Core Income from Property Operations on pages 8-9.

  2. Rental home operations expense is included in Property operating, maintenance and real estate taxes in the Consolidated Income from Property Operations on page 7. Rental home operations expense is included in Insurance and other in the Core Income from Property Operations on pages 8-9.

  3. Depreciation on rental homes in our Core portfolio is presented in Depreciation and amortization in the Consolidated Statements of Income on page 3.

  4. Includes occupied rental sites in our Core portfolio.

  5. Includes both occupied and unoccupied rental homes in our Core portfolio.

Total Sites

(Unaudited)

Summary of Total Sites as of March 31, 2024

Sites (1)

MH sites

73,000

RV sites:

Annual

34,900

Seasonal

11,800

Transient

16,300

Marina slips

6,900

Membership (2)

26,000

Joint Ventures (3)

3,600

Total

172,500

______________________

  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 118,900 members. Includes approximately 6,100 sites rented on an annual basis.

  3. Joint ventures have approximately 2,000 annual sites and 1,600 transient sites.

Membership Campgrounds - Select Data

(Unaudited)

Years Ended December 31,

Quarter Ended March 31,

Campground and Membership Revenue
($ in thousands, unaudited)

2020

2021

2022

2023

2024

Annual membership subscriptions

$

53,085

$

58,251

$

63,215

$

65,379

$

16,215

Annual RV base rental income

$

20,761

$

23,127

$

25,945

$

27,842

$

7,116

Seasonal/Transient RV base rental income

$

18,126

$

25,562

$

24,316

$

20,996

$

2,823

Membership upgrade sales

$

9,677

$

11,191

$

12,958

$

14,719

$

3,947

Utility and other income

$

2,426

$

2,735

$

2,626

$

2,544

$

361

Membership Count

Total Memberships (1)

116,169

125,149

128,439

121,002

118,885

Paid Membership Origination

20,587

23,923

23,237

20,758

3,883

Promotional Membership Origination

23,542

26,600

28,178

25,232

5,485

Membership Upgrade Sales Volume (2)

3,373

4,863

4,068

3,858

806

Campground Metrics

Membership Campground Count

81

81

82

82

82

Membership Campground RV Site Count

24,800

25,100

25,800

26,000

26,000

Annual Site Count (3)

5,986

6,320

6,390

6,154

6,121

Membership Sales Activity
($ in thousands, unaudited)

Quarters Ended March 31,

2024

2023

Membership upgrade sales current period, gross

$

7,543

$

7,975

Membership upgrade sales upfront payments, deferred, net

(3,596

)

(4,470

)

Membership upgrade sales

$

3,947

$

3,505

Membership sales and marketing, gross

$

(5,713

)

$

(5,517

)

Membership sales commissions, deferred, net

416

679

Membership sales and marketing

$

(5,297

)

$

(4,838

)

______________________

  1. Members who have entered into annual subscriptions with us that entitle them to use certain properties on a continuous basis for up to 21 days.

  2. 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.

  3. Sites that have been rented by members for an entire year.

Market Capitalization

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

Capital Structure as of March 31, 2024

Total Common Shares/Units

% of Total Common Shares/Units

Total

% of Total

% of Total Market Capitalization

Secured Debt

$

3,001

85.6

%

Unsecured Debt

506

14.4

%

Total Debt (1)

$

3,507

100.0

%

21.8

%

Common Shares

186,493,598

95.3

%

OP Units

9,104,654

4.7

%

Total Common Shares and OP Units

195,598,252

100.0

%

Common Stock price at March 31, 2024

$

64.40

Fair Value of Common Shares and OP Units

$

12,597

100.0

%

Total Equity

$

12,597

100.0

%

78.2

%

Total Market Capitalization

$

16,104

100.0

%

______________________

1. Excludes deferred financing costs of approximately $28.6 million.

Debt Maturity Schedule

Debt Maturity Schedule as of March 31, 2024

(In thousands, unaudited)

Year

Outstanding Debt

Weighted Average Interest Rate

% of Total Debt

Weighted Average Years to Maturity

Secured Debt

2024

$

%

%

2025

89,757

3.45

%

2.56

%

1.02

2026

%

%

2027

%

%

2028

200,461

4.19

%

5.72

%

4.45

2029

272,266

4.92

%

7.76

%

5.43

2030

275,385

2.69

%

7.85

%

6.00

2031

248,749

2.46

%

7.09

%

7.14

2032

202,000

2.47

%

5.76

%

8.46

Thereafter

1,712,601

4.07

%

48.83

%

12.86

Total

$

3,001,219

3.77

%

85.57

%

9.85

Unsecured Term Loans

2024

$

%

%

2025

%

%

2026

300,000

2.20

%

8.56

%

2.08

2027

200,000

4.88

%

5.70

%

2.85

2028

%

%

Thereafter

%

%

Total

$

500,000

3.27

%

14.26

%

2.39

Total Secured and Unsecured

$

3,501,219

3.70

%

99.83

%

8.80

Line of Credit Borrowing (1)

6,000

6.65

%

0.17

%

Note Premiums and Unamortized loan costs

(28,616

)

Total Debt, Net

$

3,478,603

3.89% (2)

100

%

_____________________

  1. The floating interest rate on the line of credit is daily SOFR plus 1.25% to 1.65%. During the quarter ended March 31, 2024, the effective interest rate on the line of credit borrowings was 6.65%.

  2. Reflects effective interest rate for the quarter ended March 31, 2024, including interest associated with the line of credit and amortization of deferred financing costs.

Non-GAAP Financial Measures Definitions and Reconciliations

The following Non-GAAP financial measures definitions have been revised and do not include adjustments in respect to membership upgrade sales: (i) FFO; (ii) Normalized FFO; (iii) EBITDAre; (iv) Adjusted EBITDAre; (v) Property operating revenues; (vi) Property operating expenses; and (vii) Income from property operations, excluding property management. For comparability, prior periods’ non-GAAP financial measures have also been updated.

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 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 non-operating income and expense items, such as gains and losses from early debt extinguishment, including prepayment penalties, defeasance costs, transaction/pursuit costs and other, and 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 normal 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 PROPERTY MANAGEMENT. We define Income from property operations, excluding 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, membership sales and marketing expenses, excluding property management expenses. Property management represents the expenses associated with indirect costs such as off-site payroll and certain administrative and professional expenses. We believe exclusion of property management expenses is helpful to investors and analysts as a measure of the operating results of our properties, excluding items that are not directly related to the operation of the properties. 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)

2024

2023

Net income available for Common Stockholders

$

109,905

$

82,371

Income allocated to non-controlling interests – Common OP Units

5,366

4,088

Consolidated net income

115,271

86,459

Equity in income of unconsolidated joint ventures

(283

)

(524

)

Income tax benefit

(239

)

(Gain) / Loss on sale of real estate and impairment, net

2,632

Gross revenues from home sales, brokered resales and ancillary services

(30,053

)

(32,133

)

Interest income

(2,168

)

(2,088

)

Income from other investments, net

(2,038

)

(2,091

)

Property management

19,710

19,464

Depreciation and amortization

51,108

50,502

Cost of home sales, brokered resales and ancillary services

21,967

23,141

Home selling expenses and ancillary operating expenses

6,147

6,924

General and administrative

11,989

11,661

Casualty-related charges/(recoveries), net (1)

(14,843

)

Other expenses

1,331

1,468

Interest and related amortization

33,543

32,588

Income from property operations, excluding property management

211,442

198,003

Property management

(19,710

)

(19,464

)

Income from property operations

$

191,732

$

178,539

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 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, transaction/pursuit costs and other, 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.

____________________

  1. Represents insurance recovery revenue for reimbursement of capital expenditures related to Hurricane Ian.

The following table reconciles Consolidated net income to EBITDAre and Adjusted EBITDAre:

Quarters Ended March 31,

(amounts in thousands)

2024

2023

Consolidated net income

$

115,271

$

86,459

Interest income

(2,168

)

(2,088

)

Real estate depreciation and amortization

51,108

50,502

Other depreciation and amortization

1,318

1,351

Interest and related amortization

33,543

32,588

Income tax benefit

(239

)

(Gain)/Loss on sale of real estate and impairment, net

2,632

Adjustments to our share of EBITDAre of unconsolidated joint ventures

1,880

1,307

EBITDAre

200,713

172,751

Transaction/pursuit costs and other (1)

383

206

Insurance proceeds due to catastrophic weather event (2)

(14,843

)

Adjusted EBITDAre

$

186,253

$

172,957

CORE. The Core properties include properties we owned and operated during all of 2023 and 2024. 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 in 2024 include properties that were not owned and operated during all of 2023 and 2024, including six properties in Florida impacted by Hurricane Ian and two properties in California that were impacted by storm and flooding events. The 2024 guidance reflects Non-Core properties in 2024, which includes properties not owned and operated during all of 2023 and 2024.

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.

______________________

  1. Prior period amounts have been reclassified to conform to the current period presentation.

  2. Represents insurance recovery revenue for reimbursement of capital expenditures related to Hurricane Ian.

FORWARD-LOOKING NON-GAAP MEASURES. The following table reconciles Net Income per Common Share - Fully Diluted guidance to FFO per Common Share and OP Unit - Fully Diluted guidance and Normalized FFO per Common Share and OP Unit - Fully diluted guidance:

(Unaudited)

Second Quarter

2024

Full Year

2024

Net income per Common Share

$0.34 to $0.40

$1.83 to $1.93

Depreciation and amortization

0.27

1.08

FFO per Common Share and OP Unit - Fully Diluted

$0.61 to $0.67

$2.91 to $3.01

Other

$—

$(0.07)

Normalized FFO per Common Share and OP Unit - Fully Diluted

$0.61 to $0.67

$2.84 to $2.94

This press release includes certain forward-looking information, including Core and Non-Core Income from property operations, excluding property management, that is not presented in accordance with GAAP. In reliance on the exception in Item 10(e)(1)(i)(B) of Regulation S-K, we do not provide a quantitative reconciliation of such forward-looking information to the most directly comparable financial measure calculated and presented in accordance with GAAP, where we are unable to provide a meaningful or accurate calculation or estimation of reconciling items and the information is not available without unreasonable effort. This includes, for example, (i) scheduled or implemented rate increases on community, resort and marina sites; (ii) scheduled or implemented rate increases in annual payments under membership subscriptions; (iii) occupancy changes; (iv) costs to restore property operations and potential revenue losses following storms or other unplanned events; and (v) other nonrecurring/unplanned income or expense items, which may not be within our control, may vary between periods and cannot be reasonably predicted. These unavailable reconciling items could significantly impact our future financial results.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240421483510/en/

Contacts

Paul Seavey
(800) 247-5279