Sun Communities, Inc. Reports 2023 Second Quarter and Year-to-Date Results
Net Earnings per Diluted Share of $0.72 for the Quarter Increased by 18% Year-over-Year
Core FFO per Share of $1.96 for the Quarter, in line with Guidance
Same Property NOI Grew by 6.3% and 6.5%, for the Quarter and Year-to-Date over the 2022 Periods;
Strong Demand and Effective Expense Management Drove Outperformance
Same Property Adjusted Occupancy for MH and RV Increased by 170 Basis Points, Year-over-Year
Solid Transient-to-Annual RV Site Conversions of over 750 Sites
Revising Full-Year Core FFO per Share Guidance for 2023 to $7.09 - $7.23
Increasing Guidance for Total Same Property NOI Growth to 5.3% - 6.1%
*Southfield, MI, July 26, 2023 (GLOBE NEWSWIRE) -- Sun Communities, Inc. (NYSE: SUI) *(the "Company" or "SUI"), a real estate investment trust ("REIT") that owns and operates, or has an interest in, manufactured housing ("MH") and recreational vehicle ("RV") communities and marinas (collectively, the "properties"), today reported its second quarter results for 2023.
*Financial Results for the Quarter and **Six Months Ended June 30, 2023*
· For the quarter ended June 30, 2023, net income attributable to common shareholders was $89.8 million, or $0.72 per diluted share, compared to net income attributable to common shareholders of $74.0 million, or $0.61 per diluted share for the same period in 2022, an 18% increase.· For the six months ended June 30, 2023, net income attributable to common shareholders was $59.7 million, or $0.48 per diluted share, compared to net income attributable to common shareholders of $74.7 million, or $0.63 per diluted share, for the same period in 2022.
*Non-GAAP Financial Measures*
· *Core Funds from Operations ("Core FFO")* for the quarter and six months ended June 30, 2023, were $1.96 per common share and dilutive convertible securities ("Share") and $3.19 per Share, respectively, representing 3.0% and 5.3% decreases as compared to the corresponding periods in 2022.· *Same Property Net Operating Income ("NOI") *increased by 6.3% and 6.5% for the quarter and six months ended June 30, 2023, respectively, as compared to the corresponding period in 2022.
"We delivered strong second quarter results that were in line with our expectations, driven by the reliability of our real property operations which produce steady growth through economic cycles," said Gary A. Shiffman, Chairman, President and CEO. "This growth was demonstrated across each of our segments which possess sustained compelling market dynamics. In Manufactured Housing, we are pleased with our ability to outpace inflation rates in rental income, while also realizing a steady increase in occupancy levels. In our RV segment, we continued to successfully convert transient guests into annual residents at a record pace. Our outperformance in Marinas was primarily fueled by robust demand, as our members recognize the value of our industry-leading marina network. In the UK, where a more challenging macro environment is creating home sales headwinds, we continue to see strength in real property income generation. Overall, we remain highly confident in our ability to produce solid cash flow growth and generate value throughout our exceptional MH, RV and Marina portfolios."
*OPERATING HIGHLIGHTS*
*North America Portfolio Occupancy*
· Total MH and annual RV occupancy was 97.1% at June 30, 2023, as compared to 97.2% at June 30, 2022.· During the quarter ended June 30, 2023, the number of MH and annual RV revenue producing sites increased by 1,039 sites, as compared to an increase of 950 sites during the corresponding period in 2022, a 9.4% increase.· Transient-to-annual RV site conversions totaled over 750 sites during the second quarter of 2023 and account for 72.6% of the revenue producing site gains.
*Same Property* *Results*
For the properties owned and operated by the Company since at least January 1, 2022, the following table reflects the percentage changes for the quarter and six months ended June 30, 2023:
*Quarter Ended June 30, 2023* *MH* *RV* *Marina* *Total*
Revenue 6.7 % 3.6 % 9.2 % 6.2 %
Expense 9.4 % 4.1 % 3.4 % 6.0 %
*NOI* 5.7 % 3.2 % 11.9 % 6.3 % *Six Months Ended June 30, 2023* *MH* *RV* *Marina* *Total*
Revenue 6.5 % 4.7 % 9.9 % 6.7 %
Expense 9.9 % 5.8 % 3.8 % 7.0 %
*NOI* 5.4 % 3.7 % 13.2 % 6.5 %
*Number of Properties* 289 161 119 569
Same Property adjusted blended occupancy for MH and RV increased 170 basis points to 98.7% at June 30, 2023, from 97.0% at June 30, 2022.
*INVESTMENT ACTIVITY*
During the quarter ended June 30, 2023, the Company expanded its existing communities by over 110 sites.
*BALANCE SHEET, CAPITAL MARKETS ACTIVITY AND OTHER ITEMS*
As of June 30, 2023, the Company had $7.6 billion in debt outstanding with a weighted average interest rate of 4.0% and a weighted average maturity of 7.1 years. At June 30, 2023, the Company's net debt to trailing twelve-month Recurring EBITDA ratio was 6.2 times.
*2023 GUIDANCE UPDATE*
The Company is updating full-year 2023 and establishing third quarter 2023 guidance for diluted EPS and Core FFO per Share as follows:
*Reconciliation of Diluted EPS to Core FFO per Share*
*Full-Year Ending December 31, 2023* *Third Quarter Ending *
*September 30, 2023* *Prior FY Guidance* *Revised FY Range*
*Diluted EPS* $ 2.12 $ 2.32 $ 2.11 $ 2.25 $ 1.36 $ 1.43
Depreciation and amortization 5.06 5.06 5.07 5.07 1.26 1.26
Gain / (loss) on sale of assets (0.30 ) (0.30 ) (0.28 ) (0.28 ) (0.09 ) (0.09 )
Business combination expense and other acquisition related costs 0.07 0.07 0.09 0.09 0.01 0.01
Other adjustments^(a) 0.27 0.27 0.10 0.10 (0.05 ) (0.05 )
*Core FFO*^*(b)** per Share* $ 7.22 $ 7.42 $ 7.09 $ 7.23 $ 2.49 $ 2.56
^(a) Other adjustments consist primarily of deferred taxes, changes in remeasurement gains / (losses), contingent legal and insurance gains and other items presented in the table that reconciles Net income attributable to SUI common shareholders to Core FFO on page 6.
^(b) The Company's updated guidance translates forecasted results from operations in the UK using the relevant exchange rate in effect provided in the 2023 Guidance Assumptions table presented below. The impact of fluctuations in Canadian and Australian foreign currency rates on revised and initial guidance are not material.
The 2.2% downward revision to the midpoint of full-year guidance is due primarily to lower expected UK home sales NOI, higher interest expense related to short-term interest rate increases since April 26, 2023, and a modest reduction to expected Service, retail, dining and entertainment NOI as compared to prior guidance. In addition to the assumptions underlying the Company's revised 2023 guidance detailed in the table below, the Company expects total same property NOI to increase 3.2% - 4.5% during the third quarter ending September 30, 2023:
*FY 2022* *Expected Change in 2023*
*2023** Guidance Assumptions (dollars in millions)* *Actual Results* *Prior FY Guidance* *July 26, 2023 Update*
*Consolidated Portfolio:*
Total real property NOI 6.1% - 7.0% 6.1% - 6.9%
Service, retail, dining and entertainment NOI $53.3 - $55.3 $50.4 - $52.9
General and administrative expenses $252.2 - $256.0 $249.9 - $255.4
North America home sales contribution to Core FFO^(a) $18.9 - $19.7 $18.9 - $21.7
*UK*
UK real property NOI $62.2 - $65.5 $63.6 - $65.6
UK home sales NOI $79.1 - $82.4 $65.7 - $75.4
UK NOI $141.3 - $147.9 $129.3 - $141.0
*Same Property Portfolio*^*(b)*
MH NOI (289 properties) $ 569.7 4.6% - 5.4% 5.2% - 5.8%
RV NOI (161 properties) $ 281.7 4.4% - 5.6% 3.4% - 4.6%
Marina NOI (119 properties) $ 210.8 6.8% - 8.0% 8.0% - 9.0%
*Total Same Property Pool (569 Properties):*
Revenue from real property $ 1,601.0 6.2% - 6.6% 6.2% - 6.5%
Property operating expenses^(c)(d) $ 538.8 7.9% - 8.8% 7.2% - 7.9%
*Same Property NOI* $ 1,062.2 5.0% - 6.0% 5.3% - 6.1%
*Exchange rates in effect at:* *December 31, 2022* *March 31, 2023* *June 30, 2023*
U.S. Dollar ("USD") / Pound Sterling ("GBP") 1.21 1.24 1.27
USD / Canadian Dollar ("CAD") 0.74 0.74 0.75
USD / Australian Dollar ("AUS") 0.68 0.67 0.66
*Footnotes to 2023 Guidance Assumptions*
(a) FFO from home sales in North America is net of home selling expenses and includes the gross profit from new and certain pre-owned home sales. Gross profit from pre-owned home sales of depreciated homes is excluded.
(b) The amounts in the table reflect constant currency, as currency figures included within the 2022 actual amounts have been translated at the assumed exchange rate used for 2023 guidance.
(c) Total Same Property results net $101.1 million of utility revenue for 2022 actual results and $108.0 million for 2023 guidance against the related utility expense in property operating expenses.
(d) 2022 actual results exclude $1.3 million of expense incurred at recently acquired properties to bring them up to the Company's standards. The improvements included items such as tree trimming and painting costs that do not meet the Company's capitalization policy.
*Seasonality (Updated as of July 26, 2023)* *1Q23* *2Q23* *3Q23* *4Q23*
*Same Property NOI:*
MH 25 % 25 % 25 % 25 %
RV 16 % 25 % 41 % 18 %
Marina 20 % 27 % 29 % 24 %
*Total Same Property* 21 % 26 % 30 % 23 %
*UK NOI:*
Real property 10 % 27 % 42 % 21 %
Home sales 16 % 33 % 34 % 17 %
*Total NOI from UK Operations* 13 % 30 % 38 % 19 %
*Consolidated Service, Retail, Dining and Entertainment NOI* 5 % 37 % 49 % 9 %
*Consolidated EBITDA* 19 % 27 % 33 % 21 %
*Core FFO per Share* 17 % 28 % 35 % 20 %
The estimates and assumptions presented above represent a range of possible outcomes and may differ materially from actual results. These estimates include contributions from all acquisitions, dispositions and capital markets activity completed through July 26, 2023, and the effect of a property disposition under contract expected to close during the third quarter 2023. These estimates exclude all other prospective acquisitions, dispositions and capital markets activity. The estimates and assumptions are forward-looking based on the Company's current assessment of economic and market conditions and are subject to the other risks outlined below under the caption Cautionary Statement Regarding Forward-Looking Statements.
*EARNINGS CONFERENCE CALL*
A conference call to discuss second quarter results will be held on Thursday, July 27, 2023 at 12:00 P.M. (ET). To participate, call toll-free at (877) 407-9039. Callers outside the U.S. or Canada can access the call at (201) 689-8470. A replay will be available following the call through August 10, 2023 and can be accessed toll-free by calling (844) 512-2921 or (412) 317-6671. The Conference ID number for the call and the replay is 13739127. The conference call will be available live on the Company's website located at www.suncommunities.com. The replay will also be available on the website.
*CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS*
This press release contains various "forward-looking statements" within the meaning of the Securities Act of 1933, as amended (the "Securities Act"), and the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the Company intends that such forward-looking statements will be subject to the safe harbors created thereby. For this purpose, any statements contained in this document that relate to expectations, beliefs, projections, future plans and strategies, trends or prospective events or developments and similar expressions concerning matters that are not historical facts are deemed to be forward-looking statements. Words such as "forecasts," "intends," "intend," "intended," "goal," "estimate," "estimates," "expects," "expect," "expected," "project," "projected," "projections," "plans," "predicts," "potential," "seeks," "anticipates," "anticipated," "should," "could," "may," "will," "designed to," "foreseeable future," "believe," "believes," "scheduled," "guidance," "target" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these words. These forward-looking statements reflect the Company's current views with respect to future events and financial performance, but involve known and unknown risks and uncertainties, both general and specific to the matters discussed in this document, some of which are beyond the Company's control. These risks and uncertainties and other factors may cause the Company's actual results to be materially different from any future results expressed or implied by such forward-looking statements. In addition to the risks described under "Risk Factors" contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2022, and in the Company's other filings with the Securities and Exchange Commission, from time to time, such risks, uncertainties and other factors include, but are not limited to:
*∙* Outbreaks of disease and related restrictions on business operations;
*∙* Changes in general economic conditions, including inflation, deflation and energy costs, the real estate industry and the markets within which the Company operates;
*∙* Difficulties in the Company's ability to evaluate, finance, complete and integrate acquisitions, developments and expansions successfully;
*∙* The Company's liquidity and refinancing demands;
*∙* The Company's ability to obtain or refinance maturing debt;
*∙* The Company's ability to maintain compliance with covenants contained in its debt facilities and its unsecured notes;
*∙* Availability of capital;
*∙* Changes in foreign currency exchange rates, including between the U.S. dollar and each of the Canadian dollar, Australian dollar and Pound sterling;
*∙* The Company's ability to maintain rental rates and occupancy levels;
*∙* The Company's ability to maintain effective internal control over financial reporting and disclosure controls and procedures;
*∙* Increases in interest rates and operating costs, including insurance premiums and real estate taxes;
*∙* Risks related to natural disasters such as hurricanes, earthquakes, floods, droughts and wildfires;
*∙* General volatility of the capital markets and the market price of shares of the Company's capital stock;
*∙* The Company's ability to maintain its status as a REIT;
*∙* Changes in real estate and zoning laws and regulations;
*∙* Legislative or regulatory changes, including changes to laws governing the taxation of REITs;
*∙* Litigation, judgments or settlements;
*∙* Competitive market forces;
*∙* The ability of purchasers of manufactured homes and boats to obtain financing; and
*∙* The level of repossessions by manufactured home and boat lenders.
Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made. The Company undertakes no obligation to publicly update or revise any forward-looking statements included or incorporated by reference into this document, whether as a result of new information, future events, changes in the Company's expectations or otherwise, except as required by law.
Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, the Company cannot guarantee future results, levels of activity, performance or achievements. All written and oral forward-looking statements attributable to the Company or persons acting on the Company's behalf are qualified in their entirety by these cautionary statements.
*Company Overview and Investor Information*
*The Company*
Established in 1975, Sun Communities, Inc. became a publicly owned corporation in December 1993. The Company is a fully integrated REIT listed on the New York Stock Exchange under the symbol: SUI. As of June 30, 2023, the Company owned, operated, or had an interest in a portfolio of 671 developed MH, RV and Marina properties comprising approximately 180,060 developed sites and approximately 48,180 wet slips and dry storage spaces in the U.S., the UK and Canada.
For more information about the Company, please visit www.suncommunities.com.
*Company Contacts*
*Management* *Investor Relations*
· Gary A. Shiffman, Chairman, President and CEO
Sara Ismail, Vice President
· Fernando Castro-Caratini, EVP and CFO
(248) 208-2500
· Bruce D. Thelen, EVP and COO
investorrelations@suncommunities.com
*Corporate Debt Ratings*
*Moody's* *S&P*
Baa3 | Stable BBB | Stable
*Equity Research Coverage*
Bank of America Merrill Lynch Joshua Dennerlein joshua.dennerlein@bofa.com
Barclays Anthony Powell anthony.powell@barclays.com
BMO Capital Markets John Kim jp.kim@bmo.com
Citi Research Nicholas Joseph nicholas.joseph@citi.com Eric Wolfe eric.wolfe@citi.com
Evercore ISI Samir Khanal samir.khanal@evercoreisi.com Steve Sakwa steve.sakwa@evercoreisi.com
Green Street Advisors John Pawlowski jpawlowski@greenstreetadvisors.com
JMP Securities Aaron Hecht ahecht@jmpsecurities.com
RBC Capital Markets Brad Heffern brad.heffern@rbccm.com
Robert W. Baird & Co. Wesley Golladay wgolladay@rwbaird.com
Truist Securities Anthony Hau anthony.hau@truist.com
UBS Michael Goldsmith michael.goldsmith@ubs.com
Wells Fargo James Feldman james.feldman@wellsfargo.com
Wolfe Research Andrew Rosivach arosivach@wolferesearch.com Keegan Carl kcarl@wolferesearch.com
*Financial and Operating Highlights*
*(amounts in millions, except for *)*
*Quarters Ended* *6/30/2023* *3/31/2023* *12/31/2022* *9/30/2022* *6/30/2022*
*Financial Information*
Basic earnings / (loss) per share* $ 0.72 $ (0.24 ) $ 0.04 $ 1.32 $ 0.61
Diluted earnings / (loss) per share* $ 0.72 $ (0.24 ) $ 0.04 $ 1.32 $ 0.61
Cash distributions declared per common share* $ 0.93 $ 0.93 $ 0.88 $ 0.88 $ 0.88
FFO per Share^(a)* $ 1.95 $ 1.14 $ 1.02 $ 2.54 $ 1.95
Core FFO per Share^(a)* $ 1.96 $ 1.23 $ 1.33 $ 2.65 $ 2.02
Real Property NOI
MH $ 168.7 $ 156.9 $ 153.5 $ 166.8 $ 158.2
RV 76.5 45.8 46.1 127.0 78.8
Marinas 72.4 52.0 58.3 77.8 63.0
Total $ 317.6 $ 254.7 $ 257.9 $ 371.6 $ 300.0
Recurring EBITDA $ 339.7 $ 237.4 $ 236.3 $ 408.1 $ 328.4
TTM Recurring EBITDA / Interest* 4.3 x 4.6 x 5.2 x 5.7 x 5.9 x
*Balance Sheet*
Total assets $ 17,561.4 $ 17,363.8 $ 17,084.2 $ 16,484.6 $ 16,397.8
Total debt $ 7,614.0 $ 7,462.0 $ 7,197.2 $ 6,711.0 $ 6,930.9
Total liabilities $ 9,474.8 $ 9,294.8 $ 8,992.8 $ 8,354.6 $ 8,566.3
*Operating Information****
Properties
MH 354 354 353 350 349
RV 182 182 182 181 182
Marina 135 135 134 131 130
Total 671 671 669 662 661
Sites, Wet Slips and Dry Storage Spaces*
Manufactured homes 118,170 117,970 118,020 116,910 116,420
Annual RV 31,620 30,860 30,330 32,030 31,770
Transient RV 30,270 30,870 31,180 31,150 31,990
Total sites 180,060 179,700 179,530 180,090 180,180
Marina wet slips and dry storage spaces^(b) 48,180 47,990 47,820 46,190 45,910
*Occupancy**
MH occupancy (including UK) 95.3 % 95.1 % 95.0 % 95.5 % 95.6 %
Annual RV occupancy 100.0 % 100.0 % 100.0 % 100.0 % 100.0 %
Blended MH and annual RV occupancy 96.3 % 96.1 % 96.0 % 96.5 % 96.6 %
*MH and RV Revenue Producing Site Net Gains*^(c)* (excluding UK Operations)**
MH leased sites, net 285 278 346 122 132
RV leased sites, net 754 524 267 567 818
Total leased sites, net 1,039 802 613 689 950
^(a) Excludes the effects of certain anti-dilutive convertible securities.
^(b) Total wet slips and dry storage spaces are adjusted each quarter based on site configuration and usability.
^(c) Revenue producing site net gains do not include occupied sites acquired during the year.
^(d)
*Portfolio Overview** as of **June 30, 2023*
*MH & RV Properties* *Properties*
*MH & Annual RV* *RV Transient Sites*
*Total MH and RV Sites*
*Sites for Development**Location* *Sites* *Occupancy %*
Florida 129 40,200 97.4 % 4,200 44,400 3,400
Michigan 85 32,740 96.8 % 660 33,400 1,250
California 37 6,900 98.8 % 1,900 8,800 940
Texas 31 8,910 94.9 % 2,510 11,420 1,960
Ontario, Canada 16 4,650 100.0 % 530 5,180 1,470
Connecticut 16 1,910 94.4 % 90 2,000 —
Maine 16 2,610 95.0 % 1,090 3,700 200
Arizona 13 4,540 93.8 % 970 5,510 —
Indiana 12 3,160 97.4 % 1,020 4,180 180
New Jersey 11 2,960 100.0 % 1,090 4,050 260
Colorado 11 2,800 88.7 % 990 3,790 1,490
Virginia 10 1,480 99.7 % 1,970 3,450 750
New York 10 1,500 99.1 % 1,440 2,940 780
New Hampshire 10 1,740 99.9 % 660 2,400 100
Other 74 15,740 98.3 % 7,800 23,540 1,170
North America Total 481 131,840 97.1 % 26,920 158,760 13,950
United Kingdom 55 17,950 90.1 % 3,350 21,300 1,770
*Total* *536* *149,790* *96.3* *%* *30,270* *180,060* *15,720*
*Marina* *Properties*
*Wet Slips and Dry Storage Spaces*
*Location*
Florida 21 5,200
Rhode Island 12 3,460
California 11 5,710
Connecticut 11 3,330
New York 9 3,020
Maryland 9 2,630
Massachusetts 9 2,520
Other 53 22,310
*Total* *135* *48,180*
*Properties*
*Sites, Wet Slips and Dry Storage Spaces*
*Total Portfolio* *671* *228,240*
*Consolidated Balance Sheets*
*(amounts in millions)*
*June 30, 2023* *December 31, 2022*
*Assets*
Land $ 4,039.5 $ 4,322.3
Land improvements and buildings 11,323.5 10,903.4
Rental homes and improvements 694.1 645.2
Furniture, fixtures and equipment 941.8 839.0
Investment property 16,998.9 16,709.9
Accumulated depreciation (3,011.4 ) (2,738.9 )
Investment property, net 13,987.5 13,971.0
Cash, cash equivalents and restricted cash 68.7 90.4
Marketable securities 110.4 127.3
Inventory of manufactured homes 236.6 202.7
Notes and other receivables, net 733.3 617.3
Goodwill 1,104.2 1,018.4
Other intangible assets, net 385.4 402.0
Other assets, net 935.3 655.1
*Total Assets* $ 17,561.4 $ 17,084.2
*Liabilities*
Secured debt $ 3,373.0 $ 3,217.8
Unsecured debt 4,241.0 3,979.4
Distributions payable 118.0 111.3
Advanced reservation deposits and rent 430.9 352.1
Accrued expenses and accounts payable 353.6 396.3
Other liabilities 958.3 935.9
*Total Liabilities* 9,474.8 8,992.8
Commitments and contingencies
Temporary equity 298.1 202.9
*Shareholders' Equity*
Common stock 1.2 1.2
Additional paid-in capital 9,567.5 9,549.7
Accumulated other comprehensive income / (loss) 37.6 (9.9 )
Distributions in excess of accumulated earnings (1,898.2 ) (1,731.2 )
*Total SUI shareholders' equity* 7,708.1 7,809.8
Noncontrolling interests
Common and preferred OP units 80.4 78.7
Total noncontrolling interests 80.4 78.7
*Total Shareholders' Equity* 7,788.5 7,888.5
*Total Liabilities, Temporary Equity and Shareholders' Equity* $ 17,561.4 $ 17,084.2
*Consolidated Statements of Operations*
*(amounts in millions, except for per share amounts)*
*Quarter Ended* *Six Months Ended* *June 30, 2023* *June 30, 2022* *% Change* *June 30, 2023* *June 30, 2022* *% Change*
*Revenues*
Real property (excluding transient) $ 430.3 $ 390.0 10.3 % $ 828.3 $ 732.8 13.0 %
Real property - transient 95.9 98.1 (2.2) % 139.3 143.1 (2.7) %
Home sales 122.6 142.7 (14.1) % 208.9 207.4 0.7 %
Service, retail, dining and entertainment 190.9 167.6 13.9 % 293.5 248.8 18.0 %
Interest 14.0 7.3 91.8 % 25.4 14.1 80.1 %
Brokerage commissions and other, net 9.8 8.6 14.0 % 19.3 16.6 16.3 %
*Total Revenues* 863.5 814.3 6.0 % 1,514.7 1,362.8 11.1 %
*Expenses*
Property operating and maintenance 178.6 160.4 11.3 % 335.2 284.5 17.8 %
Real estate tax 30.0 27.7 8.3 % 60.1 53.8 11.7 %
Home costs and selling 81.2 92.9 (12.6) % 144.4 138.8 4.0 %
Service, retail, dining and entertainment 171.7 142.7 20.3 % 271.7 218.4 24.4 %
General and administrative 62.3 62.2 0.2 % 126.2 117.9 7.0 %
Catastrophic event-related charges, net (0.1 ) 0.1 N/M 0.9 0.1 N/M
Business combinations 0.2 15.0 (98.7) % 3.0 15.5 (80.6) %
Depreciation and amortization 164.1 150.1 9.3 % 319.7 298.0 7.3 %
Asset impairments 6.5 0.1 N/M 8.9 0.7 N/M
Loss on extinguishment of debt — 0.1 (100.0) % — 0.4 (100.0) %
Interest 79.2 55.3 43.2 % 155.8 100.5 55.0 %
Interest on mandatorily redeemable preferred OP units / equity 0.9 1.1 (18.2) % 1.9 2.1 (9.5) %
*Total Expenses* 774.6 707.7 9.5 % 1,427.8 1,230.7 16.0 %
*Income Before Other Items* 88.9 106.6 (16.6) % 86.9 132.1 (34.2) %
Gain / (loss) on remeasurement of marketable securities 5.8 (32.3 ) N/M (14.1 ) (66.8 ) (78.9) %
Gain on foreign currency exchanges 2.7 9.0 — — 6.8 —
Gain / (loss) on dispositions of properties (0.6 ) (0.1 ) N/M (2.2 ) 13.3 N/M
Other income / (expense), net^(a) (0.8 ) 0.4 N/M (1.8 ) (0.2 ) N/M
Gain / (loss) on remeasurement of notes receivable (0.1 ) — N/A (1.8 ) 0.2 N/M
Income / (loss) from nonconsolidated affiliates (0.7 ) 0.9 N/M (0.9 ) 1.8 N/M
Gain / (loss) on remeasurement of investment in nonconsolidated affiliates — 0.4 (100.0) % (4.5 ) 0.5 N/M
Current tax expense (5.4 ) (3.9 ) 38.5 % (9.3 ) (5.2 ) 78.8 %
Deferred tax benefit 7.7 0.3 N/M 12.3 0.3 N/M
*Net Income* 97.5 81.3 19.9 % 64.6 82.8 (22.0) %
Less: Preferred return to preferred OP units / equity interests 3.3 3.1 — 5.7 6.1 —
Less: Income / (loss) attributable to noncontrolling interests 4.4 4.2 4.8 % (0.8 ) 2.0 N/M
*Net Income Attributable to SUI Common Shareholders* $ 89.8 $ 74.0 21.4 % $ 59.7 $ 74.7 (20.1) %
Weighted average common shares outstanding - basic^(a) 123.4 120.0 2.8 % 123.4 117.6 4.9 %
Weighted average common shares outstanding - diluted^(a) 123.4 120.0 2.8 % 123.4 120.4 2.5 %
Basic earnings per share $ 0.72 $ 0.61 18.0 % $ 0.48 $ 0.63 (23.8) %
Diluted earnings per share^(b) $ 0.72 $ 0.61 18.0 % $ 0.48 $ 0.63 (23.8) %
^(a) Refer to Definitions and Notes for additional information.
^(b) Excludes the effect of certain anti-dilutive convertible securities.
N/M = Percentage change is not meaningful.
N/A = Percentage change is not applicable.
*Reconciliation of Net Income Attributable to SUI Common Shareholders to Core FFO*
*(amounts in millions, except for per share data)*
*Quarter Ended* *Six Months Ended* *June 30, 2023* *June 30, 2022* *June 30, 2023* *June 30, 2022*
*Net Income Attributable to SUI Common Shareholders* $ 89.8 $ 74.0 $ 59.7 $ 74.7
Adjustments
Depreciation and amortization 163.4 149.4 318.3 297.1
Depreciation on nonconsolidated affiliates 0.1 0.1 0.1 0.1
Asset impairments 6.5 0.1 8.9 0.7
(Gain) / loss on remeasurement of marketable securities (5.8 ) 32.3 14.1 66.8
(Gain) / loss on remeasurement of investment in nonconsolidated affiliates — (0.4 ) 4.5 (0.5 )
(Gain) / loss on remeasurement of notes receivable 0.1 — 1.8 (0.2 )
(Gain) / loss on dispositions of properties, including tax effect 0.8 0.1 4.3 (13.3 )
Add: Returns on preferred OP units 1.5 3.4 5.2 6.7
Add: Income / (loss) attributable to noncontrolling interests 3.3 4.2 (1.1 ) 2.0
Gain on dispositions of assets, net (10.6 ) (17.2 ) (18.5 ) (32.3 )
*FFO*^*(a)* $ 249.1 $ 246.0 $ 397.3 $ 401.8
Adjustments
Business combination expense and other acquisition related costs^(a) 4.9 17.8 11.4 20.9
Loss on extinguishment of debt — 0.1 — 0.4
Catastrophic event-related charges, net (0.1 ) 0.2 0.9 0.2
Loss of earnings - catastrophic event-related charges, net 5.5 — 11.0 —
Gain on foreign currency exchanges (2.7 ) (9.0 ) — (6.8 )
Other adjustments, net^(a) (7.1 ) (0.5 ) (10.7 ) 1.4
*Core FFO*^*(a)(b)* $ 249.6 $ 254.6 $ 409.9 $ 417.9
*Weighted Average Common Shares Outstanding - Diluted* 127.4 126.0 128.6 123.9
*FFO per Share*^*(b)* $ 1.95 $ 1.95 $ 3.09 $ 3.24
*Core FFO per Share*^*(b)* $ 1.96 $ 2.02 $ 3.19 $ 3.37
^(a) Refer to Definitions and Notes for additional information, including the Home sales contribution to FFO.
^(b) Excludes the effect of certain anti-dilutive convertible securities.
*Reconciliation of Net Income Attributable to SUI Common Shareholders to NOI*
*(amounts in millions)*
*Quarter Ended* *Six Months Ended* *June 30, 2023* *June 30, 2022* *June 30, 2023* *June 30, 2022*
*Net Income Attributable to SUI Common Shareholders* $ 89.8 $ 74.0 $ 59.7 $ 74.7
Interest income (14.0 ) (7.3 ) (25.4 ) (14.1 )
Brokerage commissions and other revenues, net (9.8 ) (8.6 ) (19.3 ) (16.6 )
General and administrative 62.3 62.2 126.2 117.9
Catastrophic event-related charges, net (0.1 ) 0.1 0.9 0.1
Business combination expense 0.2 15.0 3.0 15.5
Depreciation and amortization 164.1 150.1 319.7 298.0
Asset impairments 6.5 0.1 8.9 0.7
Loss on extinguishment of debt — 0.1 — 0.4
Interest expense 79.2 55.3 155.8 100.5
Interest on mandatorily redeemable preferred OP units / equity 0.9 1.1 1.9 2.1
(Gain) / loss on remeasurement of marketable securities (5.8 ) 32.3 14.1 66.8
Gain on foreign currency exchanges (2.7 ) (9.0 ) — (6.8 )
(Gain) / loss on disposition of properties 0.6 0.1 2.2 (13.3 )
Other (income) / expense, net^(a) 0.8 (0.4 ) 1.8 0.2
(Gain) / loss on remeasurement of notes receivable 0.1 — 1.8 (0.2 )
(Income) / loss from nonconsolidated affiliates 0.7 (0.9 ) 0.9 (1.8 )
(Gain) / loss on remeasurement of investment in nonconsolidated affiliates — (0.4 ) 4.5 (0.5 )
Current tax expense 5.4 3.9 9.3 5.2
Deferred tax benefit (7.7 ) (0.3 ) (12.3 ) (0.3 )
Preferred return to preferred OP units / equity interests 3.3 3.1 5.7 6.1
Add: Income / (loss) attributable to noncontrolling interests 4.4 4.2 (0.8 ) 2.0
*NOI* $ 378.2 $ 374.7 $ 658.6 $ 636.6
*Quarter Ended* *Six Months Ended* *June 30, 2023* *June 30, 2022* *June 30, 2023* *June 30, 2022*
Real Property NOI^(a) $ 317.6 $ 300.0 $ 572.3 $ 537.6
Home Sales NOI^(a) 41.4 49.8 64.5 68.6
Service, retail, dining and entertainment NOI^(a) 19.2 24.9 21.8 30.4
*NOI* $ 378.2 $ 374.7 $ 658.6 $ 636.6
^(a) Refer to Definitions and Notes for additional information.
*Reconciliation of Net Income Attributable to SUI Common Shareholders to Recurring EBITDA*
*(amounts in millions)*
*Quarter Ended* *Six Months Ended* *June 30, 2023* *June 30, 2022* *June 30, 2023* *June 30, 2022*
*Net Income Attributable to SUI Common Shareholders* $ 89.8 $ 74.0 $ 59.7 $ 74.7
Adjustments
Depreciation and amortization 164.1 150.1 319.7 298.0
Asset impairments 6.5 0.1 8.9 0.7
Loss on extinguishment of debt — 0.1 — 0.4
Interest expense 79.2 55.3 155.8 100.5
Interest on mandatorily redeemable preferred OP units / equity 0.9 1.1 1.9 2.1
Current tax expense 5.4 3.9 9.3 5.2
Deferred tax benefit (7.7 ) (0.3 ) (12.3 ) (0.3 )
(Income) / loss from nonconsolidated affiliates 0.7 (0.9 ) 0.9 (1.8 )
Less: (Gain) / loss on dispositions of properties 0.6 0.1 2.2 (13.3 )
Less: Gain on dispositions of assets, net (10.6 ) (17.2 ) (18.5 ) (32.3 )
*EBITDAre* $ 328.9 $ 266.3 $ 527.6