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8-K - LIVE FILING - INDEPENDENCE REALTY TRUST, INC. | htm_49778.htm |
Independence Realty Trust Announces First Quarter 2014 Financial Results
PHILADELPHIA, PA May 8, 2014 Independence Realty Trust, Inc. (IRT) (NYSE MKT: IRT) today announced first quarter 2014 financial results.
Highlights
| Core funds from operations (CFFO) increased 100% to $2.6 million for the quarter ended March 31, 2014 from $1.3 million for the quarter ended March 31, 2013. |
| Operating income increased 10% to $1.3 million for the quarter ended March 31, 2014 from $1.2 million for the quarter ended March 31, 2013. |
| Total revenues grew 74% to $8.1 million for the quarter ended March 31, 2014 from $4.7 million for the quarter ended March 31, 2013. |
| On January 29, 2014, IRT completed its underwritten public offering selling 8,050,000 shares of IRT common stock for $8.30 per share raising gross proceeds of $66.8 million. The majority of the proceeds were deployed in the latter half of the first quarter ended March 31, 2014. After giving effect to this offering, the percent of IRTs outstanding common stock held by RAIT Financial Trust, IRTs largest stockholder and the parent company of IRTs external advisor, was reduced from 59.7% to 39.4%. |
| IRT acquired 7 properties totaling 2,180 units for $126.7 million during the quarter ended March 31, 2014. |
Financial Results
IRT reported CFFO, a non-GAAP financial measure, for the three-month period ended March 31, 2014 of $2.6 million, or $0.17 per share diluted based on 15.2 million weighted-average shares outstanding diluted, as compared to CFFO for the three-month period ended March 31, 2013 of $1.3 million, or $0.23 per share diluted based on 5.6 million weighted-average shares outstanding diluted. IRT reported a net income allocable to common stock for the three-month period ended March 31, 2014 of $2.9 million, or $0.19 per share diluted based on 15.2 million weighted-average shares outstanding diluted, as compared to net income allocable to common stock for the three-month period ended March 31, 2013 of $4,000, or $0.00 per share diluted based on 5.6 million weighted-average shares outstanding diluted.
A reconciliation of IRTs reported net income (loss) to its funds from operations (FFO) and CFFO is included as Schedule I to this release. Schedule I also includes managements rationale for the usefulness of each of these non-GAAP financial measures.
Distributions
On January 15, 2014, IRTs Board of Directors declared monthly cash dividends for the first quarter of 2014 on IRTs shares of common stock in the amount of $0.06 per share per month. The month for which each dividend was declared is set forth below, with the relevant amount per share, record date and payment date set forth opposite the month:
Month
|
Amount | Record Date | Payment Date | |||||||||||||||||||||||
January 2014
|
$ | 0.06 | 1/31/2014 | 2/14/2014 | ||||||||||||||||||||||
February 2014
|
$ | 0.06 | 2/28/2014 | 3/17/2014 | ||||||||||||||||||||||
March 2014
|
$ | 0.06 | 3/31/2014 | 4/15/2014 |
On April 17, 2014, IRTs Board of Directors declared monthly cash dividends for the second quarter of 2014 on IRTs shares of common stock in the amount of $0.06 per share per month. The month for which each dividend was declared is set forth below, with the relevant amount per share, record date and payment date set forth opposite the month:
Month
|
Amount | Record Date | Payment Date | |||||||||||||||||||||||
April 2014
|
$ | 0.06 | 4/30/2014 | 5/15/2014 | ||||||||||||||||||||||
May 2014
|
$ | 0.06 | 5/30/2014 | 6/16/2014 | ||||||||||||||||||||||
June 2014
|
$ | 0.06 | 6/30/2014 | 7/15/2014 |
Key Statistics
(Unaudited and dollars in thousands, except per share and per unit information)
As of or For the Three-Month Periods Ended |
March 31, 2014 | December 31, 2013 | September 30, 2013 | June 30, 2013 | March 31, 2013 | ||||||||||||||||
Financial Statistics: |
||||||||||||||||||||
Total revenue |
$ | 8,135 | $ | 5,768 | $ | 4,787 | $ | 4,700 | $ | 4,688 | ||||||||||
Earnings (loss) per share-diluted |
$ | 0.19 | $ | 0.03 | $ | 0.03 | $ | 0.01 | $ | 0.00 | ||||||||||
Funds from Operations (FFO) per share |
$ | 0.33 | $ | 0.17 | $ | 0.17 | $ | 0.23 | $ | 0.23 | ||||||||||
Core funds from operations (CFFO) per share |
$ | 0.17 | $ | 0.20 | $ | 0.17 | $ | 0.23 | $ | 0.23 | ||||||||||
Dividends declared per common share |
$ | 0.18 | $ | 0.16 | $ | 0.16 | $ | 0.16 | $ | 0.15 | ||||||||||
Total Shares Outstanding |
17,742,540 | 9,652,540 | 9,643,540 | 5,643,540 | 356,558 | |||||||||||||||
Apartment Property Portfolio: |
||||||||||||||||||||
Reported investments in real estate at cost |
$ | 320,437 | $ | 190,096 | $ | 166,665 | $ | 154,040 | $ | 153,717 | ||||||||||
Net operating income |
$ | 4,147 | $ | 3,159 | $ | 2,373 | $ | 2,459 | $ | 2,523 | ||||||||||
Number of properties owned |
17 | 10 | 9 | 8 | 8 | |||||||||||||||
Multifamily units owned |
4,970 | 2,790 | 2,358 | 2,004 | 2,004 | |||||||||||||||
Portfolio weighted average occupancy |
93.9 | % | 94.6 | % | 94.4 | % | 94.2 | % | 94.2 | % | ||||||||||
Weighted average monthly effective rent per unit (1) |
$ | 730 | $ | 765 | $ | 784 | $ | 784 | $ | 786 |
(1) | Weighted average monthly effective rent per occupied unit represents the average monthly rent collected for all occupied units after giving effect to tenant concessions. We do not report average effective rent per unit in the month of acquisition as it is not representative of a full month of operations. Same Store weighted average effective rent per unit was $795, $792, $784, $784, and $786 for the periods presented above, respectively. |
Properties
The following table presents an overview of our apartment portfolio as of March 31, 2014:
Weighted Average Monthly | ||||||||||||||||||||
Year | Effective | |||||||||||||||||||
Acquisition | Built or | Physical | Rent per | |||||||||||||||||
Property Name | Location | Date | Renovated (1) | Units (2) | Occupancy (3) | Occupied Unit (4) | ||||||||||||||
Belle Creek........... | Henderson, Colorado | 4/29/2011 | 2011 | 162 (5) | 99.4% | $ 960 | ||||||||||||||
Copper Mill.
|
Austin, Texas | 4/29/2011 | 2010 | 320 | 96.9 | % | 768 | |||||||||||||
Crestmont.
|
Marietta, Georgia | 4/29/2011 | 2010 | 228 | 96.5 | % | 719 | |||||||||||||
Cumberland Glen.
|
Smyrna, Georgia | 4/29/2011 | 2010 | 222 | 95.5 | % | 681 | |||||||||||||
Heritage Trace.
|
Newport News, Virginia | 4/29/2011 | 2010 | 200 | 90 .0 | % | 682 | |||||||||||||
Tresa at Arrowhead.
|
Phoenix, Arizona | 4/29/2011 | 2006 | 360 | 94.7 | % | 839 | |||||||||||||
Centrepoint.
|
Tucson, Arizona | 12/16/2011 | 2006 | 320 | 93.8 | % | 815 | |||||||||||||
Runaway Bay.
|
Indianapolis, Indiana | 10/11/2012 | 2002 | 192 | 93.8 | % | 923 | |||||||||||||
Berkshire Square.
|
Indianapolis, Indiana | 9/19/2013 | 2012 | 354 | 97.5 | % | 574 | |||||||||||||
The Crossings.
|
Jackson, Mississippi | 11/22/2013 | 2006 | 432 | 92.6 | % | 780 | |||||||||||||
Reserve at Eagle Ridge
|
Waukegan, Illinois | 1/31/2014 | 2008 | 370 | 97.3 | % | 923 | |||||||||||||
Windrush.
|
Edmond, Oklahoma | 2/28/2014 | 2011 | 160 | 94.4 | % | 775 | |||||||||||||
Heritage Park.
|
Oklahoma City, Oklahoma | 2/28/2014 | 2011 | 453 | 87.9 | % | 620 | |||||||||||||
Raindance.
|
Oklahoma City, Oklahoma | 2/28/2014 | 2011 | 504 | 94.2 | % | 522 | |||||||||||||
Augusta.
|
Oklahoma City, Oklahoma | 2/28/2014 | 2011 | 197 | 86.3 | % | 726 | |||||||||||||
Invitational.
|
Oklahoma City, Oklahoma | 2/28/2014 | 2011 | 344 | 93.3 | % | 673 | |||||||||||||
Kings Landing.
|
Creve Coeur, Missouri | 3/31/2014 | 2005 | 152 | 94.2 | % | | (6) | ||||||||||||
4,970 | 93.9 | % | $ | 730 | ||||||||||||||||
(1) | All dates are for the year in which a significant renovation program was completed, except for Runaway Bay and Kings Landing, which is the year construction was completed. |
(2) | Units represent the total number of apartment units available for rent at March 31, 2014. |
(3) | Physical occupancy for each of our properties is calculated as (i) total units rented as of March 31, 2014 divided by (ii) total units available as of March 31, 2014, expressed as a percentage. |
(4) | Weighted average monthly effective rent per occupied unit represents the weighted average monthly rent for all occupied units for the three-month period ended March 31, 2014. |
(5) | Includes 6,256 square feet of retail space in six units, of which 1,010 square feet of space is occupied by RAIT Residential for use as the leasing office. The remaining 5,246 square feet of space is 100% occupied by five tenants with an average monthly base rent of $1,537, or $16 per square foot per year. These five tenants are principally engaged in the following businesses: grocery, retail and various retail services. |
(6) | We do not report average effective rent per unit in the month of acquisition as it is not representative of a full month of operations. As of March 2014, the average monthly effective rent per occupied unit was $1,386. |
Conference Call
All interested parties can listen to the live conference call webcast at 9:00 AM ET on
Thursday, May 8, 2014 from the investor relations section of the IRT website at www.irtreit.com or by dialing 866.202.3048, access code 78548541. For those who are not available to listen to the live call, the replay will be available shortly following the live call on IRTs website and telephonically until Thursday, May 15, 2014, by dialing 888.286.8010, access code 43302304.
About Independence Realty Trust, Inc.
Independence Realty Trust, Inc. (NYSE MKT: IRT) is a real estate investment trust that seeks to own well-located apartment properties in geographic submarkets that it believes support strong occupancy and the potential for growth in rental rates. IRT seeks to provide stockholders with attractive risk-adjusted returns, with an emphasis on distributions and capital appreciation. IRT is externally advised by a wholly-owned subsidiary of RAIT Financial Trust (NYSE: RAS).
Forward-Looking Statements
This press release may contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements can generally be identified by our use of forward-looking terminology such as may, trend, will, expect, intend, anticipate, estimate, believe, continue, seek or other similar words. Because such statements include risks, uncertainties and contingencies, actual results may differ materially from the expectations, intentions, beliefs, plans or predictions of the future expressed or implied by such forward-looking statements. These risks, uncertainties and contingencies include, but are not limited to, those disclosed in IRTs filings with the Securities and Exchange Commission. IRT undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as may be required by law.
Independence Realty Trust, Inc. Contact
Andres Viroslav
215.243.9000
aviroslav@irtreit.com
Independence Realty Trust, Inc.
Consolidated Statements of Operations
(Dollars in thousands, except share and per share information)
(unaudited)
For the Three-Month | ||||||||
Period Ended | ||||||||
March 31 | ||||||||
2014 | 2013 | |||||||
Revenues: |
||||||||
Rental income |
$ | 7,353 | $ | 4,178 | ||||
Tenant reimbursement income |
366 | 223 | ||||||
Other income |
416 | 287 | ||||||
Total revenue |
8,135 | 4,688 | ||||||
Expenses: |
||||||||
Property operating expenses |
3,988 | 2,165 | ||||||
General and administrative expenses |
168 | 177 | ||||||
Asset management fees |
146 | 82 | ||||||
Acquisition expenses |
362 | | ||||||
Depreciation and amortization |
2,123 | 1,036 | ||||||
Total expenses |
6,787 | 3,460 | ||||||
Operating income |
1,348 | 1,228 | ||||||
Interest expense |
(1,299 | ) | (888 | ) | ||||
Interest income |
4 | | ||||||
Gain (loss) on assets |
2,882 | | ||||||
Net income (loss): |
2,935 | 340 | ||||||
(Income) loss allocated to preferred stock |
| (4 | ) | |||||
(Income) loss allocated to non-controlling interests |
| (332 | ) | |||||
Net income (loss) allocable to common stock |
$ | 2,935 | $ | 4 | ||||
Earnings (loss) per share: |
||||||||
Basic |
$ | 0.19 | $ | 0.01 | ||||
Diluted |
$ | 0.19 | $ | 0.00 | ||||
Weighted-average shares: |
||||||||
Basic |
15,198,096 | 345,910 | ||||||
Diluted |
15,213,951 | 5,620,810 | ||||||
Dividends declared per common share |
$ | 0.18 | $ | 0.15 | ||||
Independence Realty Trust, Inc.
Consolidated Balance Sheets
(Dollars in thousands, except share and per share information)
(unaudited)
As of | As of | |||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
Assets: |
||||||||
Investments in real estate: |
||||||||
Investments in real estate at cost |
$ | 320,437 | $ | 190,096 | ||||
Accumulated depreciation |
(17,039 | ) | (15,775 | ) | ||||
Investments in real estate, net |
303,398 | 174,321 | ||||||
Cash and cash equivalents |
24,635 | 3,334 | ||||||
Restricted cash |
3,126 | 1,122 | ||||||
Accounts receivable and other assets |
2,142 | 1,731 | ||||||
Intangible assets, net of accumulated amortization of $1,299 and $569, respectively |
1,827 | 517 | ||||||
Deferred costs, net of accumulated amortization of $229 and $151, respectively |
1,442 | 846 | ||||||
Total assets |
$ | 336,570 | $ | 181,871 | ||||
Liabilities and Equity: |
||||||||
Indebtedness |
$ | 191,350 | $ | 103,303 | ||||
Accounts payable and accrued expenses |
5,493 | 2,374 | ||||||
Accrued interest payable |
32 | 63 | ||||||
Dividends payable |
1,062 | 515 | ||||||
Other liabilities |
961 | 708 | ||||||
Total liabilities |
198,898 | 106,963 | ||||||
Equity: |
||||||||
Stockholders equity: |
| | ||||||
Preferred stock, $0.01 par value; 50,000,000 shares authorized, 0 and 0
shares issued and outstanding, respectively |
||||||||
Common stock, $0.01 par value; 300,000,000 shares authorized, 17,742,540
and 9,652,540 shares issued and outstanding, including 40,000 unvested
restricted common share awards as of March 31, 2014 |
177 | 96 | ||||||
Additional paid-in capital |
141,046 | 78,112 | ||||||
Retained earnings (accumulated deficit) |
(3,551 | ) | (3,300 | ) | ||||
Total equity |
137,672 | 74,908 | ||||||
Total liabilities and equity |
$ | 336,570 | $ | 181,871 | ||||
Schedule I
Independence Realty Trust, Inc.
Reconciliation of Net income (loss) Allocable to Common Stock and
Funds From Operations (FFO) and
Core Funds From Operations (CFFO) (1)
(Dollars in thousands, except share and per share amounts)
(unaudited)
For the Three-Month Period Ended March 31, 2014 | For the Three-Month Period Ended March 31, 2013 | |||||||||||||||
Amount | Per Share | Amount | Per Share | |||||||||||||
Funds From Operations: |
||||||||||||||||
Net income (loss) |
$ | 2,935 | $ | 0.19 | $ | 340 | $ | 0.06 | ||||||||
Adjustments: |
||||||||||||||||
Income allocated to preferred shares |
| | (4 | ) | (0.00 | ) | ||||||||||
Income allocated to preferred units |
| | (88 | ) | (0.02 | ) | ||||||||||
Real estate depreciation and amortization |
2,123 | 0.14 | 1,036 | 0.19 | ||||||||||||
Funds From Operations |
$ | 5,058 | $ | 0.33 | $ | 1,284 | $ | 0.23 | ||||||||
Weighted-average sharesdiluted |
15,213,951 | 15,213,951 | 5,620,810 | 5,620,810 | ||||||||||||
Core Funds From Operations: |
||||||||||||||||
Funds From Operations |
$ | 5,058 | $ | 0.33 | $ | 1,284 | $ | 0.23 | ||||||||
Adjustments: |
||||||||||||||||
Equity based compensation |
31 | 0.00 | | | ||||||||||||
Acquisition fees and expenses |
362 | 0.03 | | | ||||||||||||
(Gain) loss on assets |
(2,882 | ) | (0.19 | ) | | | ||||||||||
Core Funds From Operations |
$ | 2,569 | $ | 0.17 | $ | 1,284 | $ | 0.23 | ||||||||
Weighted-average sharesdiluted |
15,213,951 | 15,213,951 | 5,620,810 | 5,620,810 | ||||||||||||
(1) | IRT believes that FFO and Core FFO, each of which is a non-GAAP measure, are additional appropriate measures of the operating performance of a REIT and IRT in particular. IRT computes FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts, or NAREIT, as net income or loss allocated to common stock (computed in accordance with GAAP), excluding real estate-related depreciation and amortization expense, gains or losses on sales of real estate and the cumulative effect of changes in accounting principles. |
Core FFO is a computation made by analysts and investors to measure a real estate companys operating performance by removing the effect of items that do not reflect ongoing property operations, including acquisition expenses, expensed costs related to the issuance of shares of our common stock, gains or losses on real estate transactions and equity-based compensation expenses, from the determination of FFO. IRT incurs acquisition expenses in connection with acquisitions of real estate properties and expenses those costs when incurred in accordance with U.S. GAAP. As these expenses are one-time and reflective of investing activities rather than operating performance, IRT adds back these costs to FFO in determining Core FFO.
IRTs calculation of Core FFO differs from the methodology used for calculating Core FFO by certain other REITs and, accordingly, IRTs Core FFO may not be comparable to Core FFO reported by other REITs. IRTs management utilizes FFO and Core FFO as measures of IRTs operating performance, and believes they are also useful to investors, because they facilitate an understanding of IRTs operating performance after adjustment for certain non-cash items, such as depreciation and amortization expenses, and acquisition expenses and pursuit costs that are required by GAAP to be expensed but may not necessarily be indicative of current operating performance and that may not accurately compare IRTs operating performance between periods. Furthermore, although FFO, Core FFO and other supplemental performance measures are defined in various ways throughout the REIT industry, IRT also believes that FFO and Core FFO may provide IRT and our investors with an additional useful measure to compare IRTs financial performance to certain other REITs. IRT also uses Core FFO for purposes of determining the quarterly incentive fee, if any, payable to our advisor beginning with the second quarter of 2013.Neither FFO nor Core FFO is equivalent to net income or cash generated from operating activities determined in accordance with GAAP. Furthermore, FFO and Core FFO do not represent amounts available for managements discretionary use because of needed capital replacement or expansion, debt service obligations or other commitments or uncertainties. Neither FFO nor Core FFO should be considered as an alternative to net income as an indicator of IRTs operating performance or as an alternative to cash flow from operating activities as a measure of IRTs liquidity.