UMH Properties, Inc. Reports Results For The Year Ended And The Fourth Quarter Ended December 31, 2015
FREEHOLD, N.J., March 9, 2016 /PRNewswire/ -- UMH Properties, Inc. (NYSE: UMH) reported Normalized Funds from Operations ("Normalized FFO") for the year ended December 31, 2015 of $14,188,000 or $0.55 per diluted share as compared to $10,778,000 or $0.48 a year ago. This represents a 14.6% increase in Normalized FFO per diluted share. Normalized FFO for the quarter was $3,817,000 or $0.14 per diluted share, as compared to $3,513,000 or $0.15 per diluted share in the prior year period. Core Funds from Operations ("Core FFO") was $14,267,000 or $0.55 per diluted share for the year ended December 31, 2015, as compared to $12,321,000 or $0.55 per diluted share in the prior year period. Core Funds from Operations ("Core FFO") was $3,894,000 or $0.14 per diluted share for the quarter ended December 31, 2015, as compared to $3,783,000 or $0.16 per diluted share for the quarter ended December 31, 2014.
A summary of significant financial information for the three and twelve months ended December 31, 2015 and 2014 is as follows:
| For the Three Months Ended |
||||||
| December 31, |
||||||
| 2015 |
2014 |
|||||
| Total Income |
$ |
21,924,000 |
$ |
18,879,000 |
||
| Total Expenses |
$ |
19,256,000 |
$ |
16,152,000 |
||
| Gain on Securities Transactions, net |
$ |
77,000 |
$ |
270,000 |
||
| Community Net Operating Income ("NOI") (1) |
$ |
10,879,000 |
$ |
8,560,000 |
||
| Net Loss Attributable to Common Shareholders |
$ |
(2,425,000) |
$ |
(326,000) |
||
| Net Loss Attributable to Common Shareholders per Diluted Common Share |
$ |
(0.10) |
$ |
(0.01) |
||
| Core FFO (1) |
$ |
3,894,000 |
$ |
3,783,000 |
||
| Core FFO (1) per Diluted Common Share |
$ |
0.14 |
$ |
0.16 |
||
| Normalized FFO (1) |
$ |
3,817,000 |
$ |
3,513,000 |
||
| Normalized FFO (1) per Diluted Common Share |
$ |
0.14 |
$ |
0.15 |
||
| Weighted Average Diluted Shares Outstanding |
27,024,000 |
23,855,000 |
||||
| For the Twelve Months Ended |
||||||
| December 31, |
||||||
| 2015 |
2014 |
|||||
| Total Income |
$ |
81,517,000 |
$ |
71,432,000 |
||
| Total Expenses |
$ |
72,077,000 |
$ |
64,521,000 |
||
| Gain on Securities Transactions, net |
$ |
204,000 |
$ |
1,543,000 |
||
| Community Net Operating Income (1) |
$ |
37,713,000 |
$ |
30,294,000 |
||
| Net Loss Attributable to Common Shareholders |
$ |
(6,123,000) |
$ |
(3,319,000) |
||
| Net Loss Attributable to Common Shareholders per Diluted Common Share |
$ |
(0.24) |
$ |
(0.15) |
||
| Core FFO (1) |
$ |
14,267,000 |
$ |
12,321,000 |
||
| Core FFO (1) per Diluted Common Share |
$ |
0.55 |
$ |
0.55 |
||
| Normalized FFO (1) |
$ |
14,188,000 |
$ |
10,778,000 |
||
| Normalized FFO (1) per Diluted Common Share |
$ |
0.55 |
$ |
0.48 |
||
| Weighted Average Diluted Shares Outstanding |
25,973,000 |
22,540,000 |
||||
A summary of significant balance sheet information as of December 31, 2015 and 2014 is as follows:
| 2015 |
2014 |
||||
| Gross Real Estate Investments |
$ |
577,709,000 |
$ |
448,164,000 |
|
| Total Assets |
$ |
604,029,000 |
$ |
478,269,000 |
|
| Securities Available for Sale at Fair Value |
$ |
75,011,000 |
$ |
63,556,000 |
|
| Mortgages Payable |
$ |
286,637,000 |
$ |
182,671,000 |
|
| Loans Payable |
$ |
57,987,000 |
$ |
77,439,000 |
|
| Total Shareholders' Equity |
$ |
246,238,000 |
$ |
208,827,000 |
Samuel A. Landy, President and CEO, commented on the 2015 results,
"UMH continued to make progress in growing the Company and building long-term value for our shareholders. During 2015, the Company's accomplishments included the following:
- Acquired 10 communities containing approximately 2,800 homesites for $81.2 million. This represents an 18% increase in developed sites over the prior year;
- Increased Normalized FFO per diluted share by 14.6%;
- Increased Community NOI by 24.5%;
- Increased Same Property Occupancy from 83.2% to 83.9%;
- Increased Same Property NOI by 17.2%;
- Decreased our Operating Expense Ratio from 52.6% to 49.6%;
- Raised approximately $25 million in common equity capital through our Dividend Reinvestment and Stock Purchase Plan;
- Raised approximately $43 million in net proceeds in a registered direct placement of 8.0% Series B Cumulative Redeemable Preferred Stock;
- Financed/refinanced 21 communities for a total of $139 million, reducing our weighted average interest rate from 4.8% to 4.5%
- Increased our rental home portfolio by 1,100 homes, representing an increase of 42% to 3,700 total rental homes; and
- Increased rental home occupancy from 91.5% to 92.9%."
Mr. Landy stated, "We have continued to produce strong results, increasing Normalized FFO per diluted share by 14.6%, from $0.48 per diluted share in 2014 to $0.55 per diluted share in 2015. This is the second year in a row that we have delivered double-digit per share Normalized FFO growth. For the fourth quarter, our Normalized FFO was $0.14 per diluted share, as compared to $0.15 per diluted share in the prior year period. Our per share results for the fourth quarter of 2015 were impacted by our recent preferred equity offering completed in October of this year. Excluding the effects of our recent preferred equity offering, our Normalized FFO is $0.17 for the fourth quarter. As the proceeds from this offering become fully invested, our results will be favorably impacted."
"Same property revenue increased 9.0% quarter over quarter, while expenses only increased 1.6%. Same property occupancy increased 70 basis points to 83.9% during the quarter. This resulted in an increase in same property NOI for the quarter of 15.1% over the prior year period. For the twelve months, same property NOI increased 17.2%. This marks the second consecutive year of double digit same property NOI growth."
"UMH made further advancements in our growth strategy, by acquiring ten manufactured home communities for an aggregate cost of $81.2 million. Over the past five years, we have increased the total sites in our portfolio by 123%. Most of these acquisitions contain land in the Marcellus and Utica Shale regions. While energy prices have fallen sharply this past year, we are long-term investors and view owning real estate in close proximity to some of the world's largest oil and natural gas reserves as a great investment."
"With respect to our capital markets activity, during the fourth quarter, we issued 1.8 million shares of 8% Series B Cumulative Redeemable Perpetual Preferred Stock at a purchase price of $25.00 per share. As a result, the Company received net proceeds of approximately $43 million. This offering further strengthens our balance sheet and positions the Company to continue to execute our growth strategy."
UMH Properties, Inc. will host its Fourth Quarter and Year End 2015 Financial Results Webcast and Conference Call. Senior management will discuss the results, current market conditions and future outlook on Thursday, March 10, 2016 at 10:00 a.m. Eastern Time.
The Company's 2015 fourth quarter and yearend financial results being released herein will be available on the company 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 Thursday, March 10, 2016. It will be available until May 2, 2016, and can be accessed by dialing toll free 877-344-7529 (domestically) and 412-317-0088 (internationally) and entering the passcode 10077524. 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 ninety-eight manufactured home communities containing approximately 17,800 developed homesites. These communities are located in New Jersey, New York, Ohio, Pennsylvania, Tennessee, Indiana and Michigan. 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.
| (1) |
Non-GAAP Information: We assess and measure our overall operating results based upon an industry performance measure referred to as Funds From Operations ("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 ("Core FFO") as FFO plus acquisition costs and costs of early extinguishment of debt. We define Normalized Funds From Operations ("Normalized FFO") as Core FFO excluding gains and losses realized on 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. Community NOI excludes realized gains (losses) on securities transactions. 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. 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. FFO, Core FFO and Normalized FFO, as well as Community NOI, as calculated by the Company, may not be comparable to similarly titled measures reported by other REITs. |
The reconciliation of the Company's U.S. GAAP net income (loss) to the Company's FFO, Core FFO and Normalized FFO for the three and twelve months ended December 31, 2015 and 2014 are calculated as follows:
| Three Months Ended |
Twelve Months Ended |
||||||||
| 12/31/15 |
12/31/14 |
12/31/15 |
12/31/14 |
||||||
| Net Loss Attributable to Common Shareholders |
$(2,425,000) |
$(326,000) |
$(6,123,000) |
$(3,319,000) |
|||||
| Depreciation Expense |
5,412,000 |
4,112,000 |
18,878,000 |
15,163,000 |
|||||
| (Gain) Loss on Sales of Depreciable Assets |
14,000 |
(10,000) |
80,000 |
(7,000) |
|||||
| FFO Attributable to Common Shareholders |
3,001,000 |
3,776,000 |
12,835,000 |
11,837,000 |
|||||
| Acquisition Costs |
508,000 |
7,000 |
957,000 |
484,000 |
|||||
| Cost of Early Extinguishment of Debt |
385,000 |
- |
475,000 |
- |
|||||
| Core FFO Attributable to Common Shareholders |
3,894,000 |
3,783,000 |
14,267,000 |
12,321,000 |
|||||
| Gain on Sale of Securities Transactions, net |
(77,000) |
(270,000) |
(204,000) |
(1,543,000) |
|||||
| Settlement of Litigation |
- |
- |
125,000 |
- |
|||||
| Normalized FFO Attributable to Common Shareholders |
$3,817,000 |
$3,513,000 |
$14,188,000 |
$10,778,000 |
|||||
The following are the cash flows provided (used) by operating, investing and financing activities for the twelve months ended December 31, 2015 and 2014:
| 2015 |
2014 |
|||
| Operating Activities |
$25,708,000 |
$24,326,000 |
||
| Investing Activities |
(148,675,000) |
(56,034,000) |
||
| Financing Activities |
121,420,000 |
32,175,000 |
SOURCE UMH Properties, Inc.
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