Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K INVESTOR PRESENTATION NOVEMBER 2017 - SUN COMMUNITIES INC | form8-kxinvestorpresentati.htm |
INVESTOR PRESENTATION
NOVEMBER 2017
PALM CREEK – CASA GRANDE, AZ
2
This presentation has been prepared for informational purposes only from information supplied by Sun Communities, Inc. (the “Company”, “Sun”) and from third-party
sources indicated herein. Such third-party information has not been independently verified. The Company makes no representation or warranty, expressed or implied, as to
the accuracy or completeness of such information.
This presentation contains various “forward-looking statements” within the meaning of the United States Securities Act of 1933, as amended, and the United States
Securities Exchange Act of 1934, as amended, and we intend that such forward-looking statements will be subject to the safe harbors created thereby. For this purpose, any
statements contained in this presentation 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” and similar expressions are intended to
identify forward-looking statements, although not all forward looking statements contain these words. These forward-looking statements reflect our 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
presentation. These risks and uncertainties may cause our actual results to be materially different from any future results expressed or implied by such forward-looking
statements. In addition to the risks disclosed under “Risk Factors” contained in our Annual Report on Form 10-K for the year ended December 31, 2016, and our other filings
with the Securities and Exchange Commission from time to time, such risks and uncertainties include but are not limited to:
changes in general economic conditions, the real estate industry and the markets in which we operate;
difficulties in our ability to evaluate, finance, complete and integrate acquisitions, developments and expansions successfully;
our liquidity and refinancing demands;
our ability to obtain or refinance maturing debt;
our ability to maintain compliance with covenants contained in our debt facilities;
availability of capital;
changes in foreign currency exchange rates, specifically between the U.S. dollar and Canadian dollar;
our ability to maintain rental rates and occupancy levels;
our failure 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 property taxes;
risks related to natural disasters;
general volatility of the capital markets and the market price of shares of our capital stock;
our failure to maintain our 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 manufactured home buyers to obtain financing; and
the level of repossessions by manufactured home 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. We undertake no
obligation to publicly update or revise any forward-looking statements included in this presentation, whether as a result of new information, future events, changes in our
expectations or otherwise, except as required by law. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot
guarantee future results, levels of activity, performance or achievements. All written and oral forward-looking statements attributable to us or persons acting on our behalf
are qualified in their entirety by these cautionary statements.
FORWARD-LOOKING STATEMENTS
SUN COMMUNITIES, INC. (NYSE: SUI) OVERVIEW
Source: Company Information. Refer to Sun Communities, Inc. Form 10-Q and Supplemental for the quarter ended September 30, 2017 as well as Press Releases after September 30, 2017 for additional information.
4,882
1,595
680
149
1,757
25,756
3,009
1,277
916
1,156
2,904
548
2,150
698
237
672
481
1,049
475
413
976
226
2,483
473
7,802
42,921
4,614
324
6,501
3,420
349 communities
consisting of
~120,500 sites
across 29 states and
Ontario, Canada
Current Portfolio
As of November 1, 2017
3
9% 25%
66%
31 manufactured housing and recreational vehicle communities
89 recreational vehicle only communities
229 manufactured housing communities
66%
[VA
LUE
]
34
%
All-age communities
Age-restricted communities
Trailing Twelve Months Rental Revenue
As of September 30, 2017
88%
Annual
Revenues
Manufactured
Housing
72%
RV - Annual
16%
RV - Transient
12%
Purchase Price Sites Location Acquisition Date
49er Village RV Resort $13.0mm 328 Plymouth, California March 16, 2017
Land Parcel $5.9mm 775 Myrtle Beach, South Carolina April 20, 2017
Sunset Lakes RV Resort $8.0mm 498 Hillsdale, Illinois May 18, 2017
Arbor Woods MH Community $16.9mm 458 Superior Township, Michigan June 1, 2017
Pismo Dunes RV Resort4 $21.9mm 331 Pismo Beach, California July 27, 2017
Lazy J Ranch, Ocean West, Caliente Sands $32.8mm 468 Humboldt Bay and Cathedral City, California September 26, 2017
Emerald Coast RV Beach Resort $19.5mm 201 Panama Beach, FL November 1, 2017
2017 YEAR-TO-DATE HIGHLIGHTS
4
Source: Company Information. Refer to Sun Communities, Inc. Form 10-Q and Supplemental for the quarter ended September 30, 2017 for additional information. Refer to information regarding non-GAAP financial
measures in the attached Appendix.
1 Company Information. Diluted.
2 Based on diluted shares of 82.984 million and 73.667 million for 3Q 2017 and 3Q 2016, respectively.
3 Company Information. Total Same-community Portfolio.
4 Property acquired by issuing ~242,000 common shares to seller at a $88.36 share price.
Year-to-Date Acquisitions
Quarter Ended September 30,
2017 2016 % Change
Revenue $268.2mm $249.7mm 7.4%
EPS1 $0.31 $0.27 14.8%
FFO / Share1,2 $1.13 $1.13 0%
Total Portfolio NOI $147.1mm $136.8mm 7.5%
Base Rent / Site3 $506 $489 3.5%
ESTIMATED
3Q 2017 Highlights JELLYSTONE PARK - NORTH JAVA, NY
Sun is the premiere owner and operator of manufactured home (“MH”) and recreational vehicle (“RV”) communities
Strong cycle-tested record of operating, expanding and acquiring MH and RV communities dating back to 1975
5
POWERING SUN’S GROWTH ENGINE
Source: Company Information. Refer to Sun Communities, Inc. Form 10-Q and Supplemental for the quarter ended September 30, 2017 for additional information.
INTERNAL EXTERNAL
Contractual Rent Increases
Weighted average monthly rent has
historically increased by 2-4% annually
3Q17 weighted average monthly rent
increase of 3.5%
MH Occupancy Gains
3Q17 MH occupancy of 95.2%
~130 communities are 98%+ occupied
Expect additional 250-300bps of
occupancy gains across MH portfolio to
reach 98%
Expansions
Delivered ~1,000 expansion sites YTD
~1,200 additional expansion site
deliveries expected by year end 2017
Additional ~7,200 sites available for
expansion post-2017
~16,100 transient RV sites in portfolio,
a portion of which can be converted to
annual leases over time
Conversions to annual leases have
increased revenues by 40-60%
historically
Historical annual average of
~$200mm in single asset / small
portfolio transactions
$112mm of acquisitions YTD
High degree of visibility into
acquisition pipeline
Acquisitions
Looking to start on 1-2 greenfield
developments per year
Targeting high single digit IRRs
Projects underway in California and
South Carolina
Development Transient Conversions
SUN’S FAVORABLE REVENUE DRIVERS
6
The average cost to move a home ranges
from $4K-$10K, resulting in low move-out
of homes
Tenure of homes in our communities is
44 years1
Tenure of residents in our communities is
approximately 13 years1
Source: Company Information. Refer to Sun Communities, Inc. Form 10-Q and Supplemental for the quarter ended September 30, 2017 for additional information. Refer to information regarding non-GAAP financial
measures in the attached Appendix.
1 Average since 2010.
Three Year Average Resident Move-out Trends
(Home stays in community) (Home leaves community)
COUNTR HILL VILLAGE – HUDSONVILLE, MI
WINDMILL VILLAGE - DAVENPORT, FL
6.13%
1.97%
Resident Re-sales Resident Move-outs
STRONG SAME-COMMUNITY PERFORMANCE
7
Positive NOI growth for
18 consecutive years
Low-annual resident turnover results
in stability of income and occupancy
Source: Company Information. Refer to Sun Communities, Inc. Form 10-Q and Supplemental for the period ended September 30, 2017 and Form 10-K and Supplemental for the period ended December 31st for the
respective year for additional information. Refer to information regarding non-GAAP financial measures in the attached Appendix.
Note: Same-community pool of assets changes annually. Same-community pools included 136 communities in 2012 and 231 communities in 2017.
1 Same-community NOI guidance range of 6.4 - 6.8% for full year 2017.
NOI Growth Percentage Occupancy Percentage Manufactured Home Weighted
Average Monthly Rent per Site
Strong and consistent rental rate
growth creates a stable revenue
stream that is recession-resistant
Occupancy gains are a function of
Sun’s integrated platform, which
includes: leasing, sales, and financing
$437
$445
$461
$481
$498
$514
YE 2012 YE 2013 YE 2014 YE 2015 YE 2016 Q3 2017
5.5%
5.9%
7.7%
9.1%
7.1%
6.8%
YE 2012 YE 2013 YE 2014 YE 2015 YE 2016 Q3 2017
7.1%
2012-2016
AVERAGE
86.7%
88.9%
93.2%
95.9%
96.6%
97.2%
YE 2012 YE 2013 YE 2014 YE 2015 YE 2016 Q3 2017
10.5%
INCREASE
YTD 2017
1
8
GROWTH AND ATTRACTIVE RETURNS
EXPANSIONS PROVIDE STRONG
Source: Company Information. Refer to Sun Communities, Inc. Form 10-Q and Supplemental for the quarter ended September 30, 2017 for additional information.
Approximately 2,200 sites are expected to be developed by the end of 2017
At the start of 2018, inventory of ~7,200 zoned and entitled sites available for expansion at ~60 properties in
16 states and Ontario, Canada
A 100 site expansion at a $35,000 cost per site, that is leased up in a year (8 sites/month), results in a 5-year
unlevered IRR of 12 - 14%
Expansion in communities with strong demand evidenced by occupancies >96% and continued strong demand
PALM CREEK GOLF & RV RESORT – CASA GRANDE, AZ
PARK ROYALE - PINELLAS PARK, FL
WATER OAK – LADY LAKE, FL
9
SUPPORTED BY RENTAL PROGRAM
EXPANSION OPPORTUNITIES
Source: Company Information. Refer to Sun Communities, Inc. Form 10-Q and Supplemental for the quarter ended September 30, 2017 for additional information.
1 Operating expenses include repairs and refurbishment, taxes and insurance, marketing, and commissions.
Sun’s rental program is a key onboarding and conversion tool for our communities
Rental Program All-in 5-Year Unlevered IRR
$42,000 initial investment in new home
Weighted average monthly rental rate $900 x 12 = $10,800 (3% annual increases)
Monthly operating expenses1 +1 month vacancy factor $275 x 12 = $3,300 (3% annual increases)
End of 5-year period sell the home and recoup ~90% of original invoice price
All-in 5-year unlevered IRR in the high teens
RENTAL: EAST VILLAGE ESTATES – WASHINGTON, MI RENTAL: CIDER MILL CROSSING – FENTON, MI
2013
EXTRACTING VALUE FROM STRATEGIC ACQUISITIONS
10
Since May 2011, Sun has acquired communities valued in excess of $4.4 billion, increasing its number of sites
and communities by ~180%
1
2011
159 communities
54,811 sites
173 communities
63,697 sites
188 communities
69,789 sites
217 communities
79,554 sites
231 communities
88,612 sites
341 communities
117,376 sites
Source: Company Information. Refer to Sun Communities, Inc. Form 10-K and Supplemental for the period ended December 31st for the respective year as well as Sun Communities, Inc. Form 10-Q and Supplemental for
the period ended September 30, 2017 for additional information.
1 Includes 30 community dispositions realized in 2014 and 2015.
2012 2014 2015 2016
349 communities
120,544 sites
2017
Year-end Communities and Sites
Y T D
HOME SALES
& RENTAL
PROGRAM
CALL CENTER
& DIGITAL
MARKETING
OUTREACH
SKILLED
EXPENSE
MANAGEMENT
REPOSITIONING
WITH ADDIT’L
CAPEX
ADDING
VALUE WITH
EXPANSIONS
INCREASING
MARKET
RENT
PROFESSIONAL
OPERATIONAL
MANAGEMENT
STRATEGIC BALANCE SHEET
11
Source: Company Information. Refer to Sun Communities, Inc. Form 10-Q and Supplemental for the quarter ended September 30, 2017 for additional information.
1 The debt ratios are calculated using trailing 12 months EBITDA for the period ended September 30, 2017. Refer to information regarding non-GAAP financial measures in the attached Appendix.
2 Total Enterprise Value includes common shares outstanding (per Supplemental), OP Units and Preferred OP Units, as converted, outstanding at the end of each respective period.
3 Includes premium / discount on debt and financing costs.
61.5%
50.4%
45.8%
34.8% 34.0% 33.8%
28.3%
2011 2012 2013 2014 2015 2016 Q3 2017
GWYNN’S ISLAND RV RESORT – GWYNNS ISLAND, VA
Net Debt / Adj. TTM EBITDA1 Net Debt / TEV2
Principal
Outstanding3
WA
Interest Rates
Quarter Ended September 30, 2017
CMBS $452,311 5.11%
Fannie Mae $1,032,621 4.38%
Life Companies $949,970 3.89%
Freddie Mac $387,738 3.86%
Total $2,822,640 4.26%
Mortgage Debt Financings
principal amounts in thousands
Mortgage Debt 5-Year Maturity Ladder
amounts in thousands
Balance sheet supports growth strategy
Sun’s annual mortgage maturities average 3.8% from 2018-2022
Sun’s $450mm term loan / revolving credit facility currently at zero balance
2018 2019 2020 2021 2022
CMBS Fannie Mae Freddie Mac Life Companies
$64,314
$117,351
$270,680
$58,078
9.7x
8.4x
7.2x 7.3x 6.6x
7.5x
6.0x
2011 2012 2013 2014 2015 2016 Q3 2017
$28,186
-10%
-8%
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
1Q
02
2Q
02
3Q
02
4Q
02
1Q
03
2Q
03
3Q
03
4Q
03
1Q
04
2Q
04
3Q
04
4Q
04
1Q
05
2Q
05
3Q
05
4Q
05
1Q
06
2Q
06
3Q
06
4Q
06
1Q
07
2Q
07
3Q
07
4Q
07
1Q
08
2Q
08
2Q
09
3Q
09
4Q
09
1Q
10
2Q
10
3Q
10
4Q
10
1Q
11
2Q
11
3Q
11
4Q
11
1Q
12
2Q
12
3Q
12
4Q
12
1Q
13
2Q
13
3Q
13
4Q
13
1Q
14
2Q
14
3Q
14
4Q
14
1Q
15
2Q
15
3Q
15
4Q
15
1Q
16
2Q
16
3Q
16
4Q
16
1Q
17
2Q
17
3Q
17
Sun Communities, Inc.
Apartments
Sun's Average (4.4%)
Apartment Average (2.7%)
REIT Industry Average (2.5%)
4.4%
2.5%
2.7%
STRONG INTERNAL GROWTH
12
Source: Citi Investment research, September, 2017. “REIT Industry Average” includes an index of REITs across a variety of asset classes including: self storage, mixed office, regional malls, shopping centers, apartments,
student housing, manufactured homes and specialty. Refer to information regarding non-GAAP financial measures of the attached Appendix.
SUN’s average same community NOI growth has exceeded REIT industry average by ~190 bps and the
apartment sector’s average by ~170 bps since 2002
Same-community NOI Growth Percentage
5-year Total Return
STRATEGY-DRIVEN OUTPERFORMANCE
13
Sun has significantly outperformed major REIT and broader market indices over the last ten years
2017 Year to Date Total Return
Source: SNL Financial as of September 30, 2017.
3-year Total Return
10-year Total Return
Sun Communities, Inc. (SUI) MSCI US REIT (RMS) S&P 500
(20.0%)
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
120.0%
140.0%
160.0%
145.2%
94.4%
58.0%
(5.0%)
0.0%
5.0%
0.0%
15.0%
20.0%
25.0%
14.5%
14.2%
3.6%
(100.0%)
0.0%
100.0%
200.0%
300.0%
400.0%
500.0%
600.0%
527.4%
104.9%
75.6%
(20.0%)
0. %
20. %
40. %
60.0%
80.0%
100.0%
89.0%
36.1
31.9%
APPENDIX
PETERS POND RV RESORT – SANDWICH, MA
CONSISTENT NOI GROWTH
15
Manufactured housing is one of the most recession-resistant sectors of the housing and commercial real
estate sectors and has consistently outperformed multifamily in same community NOI growth since 2000
NOI Growth
Source: Citi Investment research, September, 2017. Refer to information regarding non-GAAP financial measures in this Appendix.
$90
$110
$130
$150
$170
$190
$210
$230
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Sun Communities
Manufactured Housing
Apartment
Industrial
Mall
Office
Strip Mall
Self-storage
$211
$207
$154
$223
$147
$138
$128
$134
16
MANUFACTURED HOUSING VS. MULTIFAMILY
Sun’s manufactured homes provide nearly 15% more space at over 30% less cost per square foot
Sun’s Manufactured
Homes VS.
RENT
~$908
1 per month
Multifamily
Housing
~$1,1502 per month
SQUARE FOOTAGE
PRICE
~1,2501 sq. ft. ~1,1002 sq. ft.
$0.73 per sq. ft. $1.05 per sq. ft.
1 Source: Company Information.
2 Source: The RentPath Network. Represents average rent for a 2 bedroom apartment in major metropolitan areas Sun operates in adjusted for inflation as of September 2017.
Source: Manufactured Housing Institute, Quick Facts: “Trends and Information About the Manufactured Housing Industry, 2017.”
1 Historical average from SUI community applications. 17
MANUFACTURED HOUSING VS. SINGLE FAMILY
Single Family Homes Manufactured Homes
Average cost of Single Family is $286,814 or roughly 8
years median income
Average cost of a new Manufactured Home is
$70,600 or roughly 2 years median income
Sun’s communities offer affordable options in attractive locations
$63,100 $62,800 $60,500 $62,200 $64,000 $65,300 $68,000 $70,600
$203,182 $206,560 $207,950
$223,085
$249,429 $261,172
$276,284 $286,814
$-
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
$350,000
$400,000 Manufactured Homes Single Family Homes Portion of purchase price attributable to land
Average
Household
Income
~$37,5001
2009 2010 2011 2012 2013 2014 2015 2016
NON-GAAP TERMS DEFINED
18
Investors in and analysts following the real estate industry utilize funds from operations (“FFO”), net operating income (“NOI”), and recurring earnings before interest, tax, depreciation and
amortization (“Recurring EBITDA”) as supplemental performance measures. We believe FFO, NOI, and Recurring EBITDA are appropriate measures given their wide use by and relevance to investors
and analysts. FFO, reflecting the assumption that real estate values rise or fall with market conditions, principally adjusts for the effects of GAAP depreciation/amortization of real estate assets. NOI
provides a measure of rental operations and does not factor in depreciation/amortization and non-property specific expenses such as general and administrative expenses. Recurring EBITDA, a
metric calculated as EBITDA exclusive of certain nonrecurring items, provides a further tool to evaluate ability to incur and service debt and to fund dividends and other cash needs. Additionally, FFO,
NOI, and Recurring EBITDA are commonly used in various ratios, pricing multiples/yields and returns and valuation calculations used to measure financial position, performance and value.
FFO is defined by the National Association of Real Estate Investment Trusts (“NAREIT”) as net income (loss) computed in accordance with generally accepted accounting principles (“GAAP”),
excluding gains (or losses) from sales of depreciable operating property, plus real estate-related depreciation and amortization, and after adjustments for unconsolidated partnerships and joint
ventures. FFO is a non-GAAP financial measure that management believes is a useful supplemental measure of the Company’s operating performance. Management generally considers FFO to be a
useful measure for reviewing comparative operating and financial performance because, by excluding gains and losses related to sales of previously depreciated operating real estate assets,
impairment and excluding real estate asset depreciation and amortization (which can vary among owners of identical assets in similar condition based on historical cost accounting and useful life
estimates), FFO provides a performance measure that, when compared period over period, reflects the impact to operations from trends in occupancy rates, rental rates, and operating costs,
providing perspective not readily apparent from net income (loss). Management believes that the use of FFO has been beneficial in improving the understanding of operating results of REITs among
the investing public and making comparisons of REIT operating results more meaningful. FFO is computed in accordance with the Company's interpretation of standards established by 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
the Company. The Company also uses FFO excluding certain items, which excludes certain gain and loss items that management considers unrelated to the operational and financial performance of
our core business. We believe that this provides investors with another financial measure of our operating performance that is more comparable when evaluating period over period results.
Because FFO excludes significant economic components of net income (loss) including depreciation and amortization, FFO should be used as an adjunct to net income (loss) and not as an alternative
to net income (loss). The principal limitation of FFO is that it does not represent cash flow from operations as defined by GAAP and is a supplemental measure of performance that does not replace
net income (loss) as a measure of performance or net cash provided by operating activities as a measure of liquidity. In addition, FFO is not intended as a measure of a REIT’s ability to meet debt
principal repayments and other cash requirements, nor as a measure of working capital. FFO only provides investors with an additional performance measure that, when combined with measures
computed in accordance with GAAP such as net income (loss), cash flow from operating activities, investing activities and financing activities, provide investors with an indication of our ability to
service debt and to fund acquisitions and other expenditures. Other REITs may use different methods for calculating FFO, accordingly, our FFO may not be comparable to other REITs.
NOI is derived from revenues minus property operating expenses and real estate taxes. NOI does not represent cash generated from operating activities in accordance with GAAP and should not be
considered to be an alternative to net income (loss) (determined in accordance with GAAP) as an indication of the Company's financial performance or to be an alternative to cash flow from
operating activities (determined in accordance with GAAP) as a measure of the Company's liquidity; nor is it indicative of funds available for the Company's cash needs, including its ability to make
cash distributions. The Company believes that net income (loss) is the most directly comparable GAAP measurement to NOI. Because of the inclusion of items such as interest, depreciation, and
amortization, the use of net income (loss) as a performance measure is limited as these items may not accurately reflect the actual change in market value of a property, in the case of depreciation
and in the case of interest, may not necessarily be linked to the operating performance of a real estate asset, as it is often incurred at a parent company level and not at a property level. The
Company believes that NOI is helpful to investors as a measure of operating performance because it is an indicator of the return on property investment, and provides a method of comparing
property performance over time. The Company uses NOI as a key management tool when evaluating performance and growth of particular properties and/or groups of properties. The principal
limitation of NOI is that it excludes depreciation, amortization interest expense and non-property specific expenses such as general and administrative expenses, all of which are significant costs,
therefore, NOI is a measure of the operating performance of the properties of the Company rather than of the Company overall.
EBITDA is defined as NOI plus other income, plus (minus) equity earnings (loss) from affiliates, minus general and administrative expenses. EBITDA includes EBITDA from discontinued operations. The
Company believes that net income (loss) is the most directly comparable GAAP measurement to EBITDA.
NET INCOME TO FFO RECONCILIATION
19
(amounts in thousands except per share data)
Source: Company Information. Refer to Sun Communities, Inc. Form 10-Q and Supplemental for the quarter ended September 30, 2017 for additional information.
2017 2016 2017 2016 2016 2015 2014
Net income attributable to Sun Communities, Inc. common stockholders 24,115$ 18,897$ 57,583$ 18,969$ 17,369$ 137,325$ 22,376$
Adjustments:
Depreciation and amortization 64,484 61,809 190,143 159,225 221,576 178,048 134,252
Amounts attributable to noncontrolling interests 1,608 685 3,710 255 (41) 9,644 1,086
Preferred return to preferred OP units 578 616 1,750 1,858 2,462 2,612 281
Preferred distribution to Series A-4 preferred stock 441 683 1,666 - - - 76
Asset impairment charge - - - - - - 837
Gain on disposition of properties, net - - - - - (125,376) (17,654)
Gain on disposition of assets, net (4,309) (4,667) (11,342) (12,226) (15,713) (10,125) (6,705)
FFO attributable to Sun Communities, Inc. common stockholders and dilutive
convertible securities 86,917$ 78,023$ 243,510$ 168,081$ 225,653$ 192,128$ 134,549$
Adjustments:
Transaction costs 2,167 4,191 6,990 27,891 31,914 17,803 18,259
Other acquisition related costs 343 1,467 2,712 1,467 3,328 - -
Income from affiliate transactions - - - (500) (500) (7,500) -
Foreign currency exchange - - - - 5,005 - -
Contingent liability re-measurement - - - - 181 - -
Gain on acquisition of property - - - - (510) - -
Catastrophic weather related charges 7,756 - 8,124 - 1,172 - -
Gain on settlement - - - - - - (4,452)
Preferred stock redemption costs - - - - - 4,328 -
Extinguishment of debt - - 759 - 1,127 2,800 -
Other income, net (3,345) - (5,340) - - - -
Debt premium write-off - - (438) - (839) - -
Deferred tax benefit (81) - (745) - (400) 1,000 -
FFO attributable to Sun Communities, Inc. common stockholders and dilutive
convertible securities excluding certain items 93,757$ 83,681$ 255,572$ 196,939$ 266,131$ 210,559$ 148,356$
Weighted average common shares outstanding - basic 78,369 68,655 75,234 63,716 65,856 53,686 41,337
W ighted average common shares outstanding - fully diluted 82,984 73,667 80,176 68,031 70,165 57,979 44,022
FFO attributable to Sun Communities, Inc. common stockholders and dilutive
convertible securities per share - fully diluted 1.05$ 1.06$ 3.04$ 2.47$ 3.22$ 3.31$ 3.06$
FFO attributable to Sun Communities, Inc. common stockholders and dilutive
convertible securities per share excluding certain items - fully diluted 1.13$ 1.13$ 3.19$ 2.89$ 3.79$ 3.63$ 3.37$
Three Months Ended September 30, Nine Months Ended September 30, Year Ended December 31,
NET INCOME TO NOI RECONCILIATION
20
(amounts in thousands)
Source: Company Information. Refer to Sun Communities, Inc. Form 10-Q and Supplemental for the quarter ended September 30, 2017 for additional information.
2017 2016 2017 2016 2016 2015 2014
Net income attributable to Sun Communities, Inc., common stockholders 24,115$ 18,897$ 57,583$ 18,969$ 17,369$ 137,325$ 22,376$
Other revenues (7,011) (5,689) (18,587) (15,459) (21,150) (18,157) (15,498)
Home selling expenses 3,290 2,643 9,391 7,240 9,744 7,476 5,235
General and administrative 18,267 16,575 56,188 46,910 64,087 47,455 37,387
Transaction costs 2,167 4,191 6,990 27,891 31,914 17,803 18,259
Depreciation and amortization 64,232 61,483 189,719 159,565 221,770 177,637 133,726
Asset impairment charge - - - - - - 837
Extinguishment of debt - - 759 - 1,127 2,800 -
Interest expense 32,875 34,589 98,126 90,885 122,315 110,878 76,981
Catastrophic weather related charges 7,756 - 8,124 - 1,172 - -
Other income, net (3,345) - (5,340) - 4,676 - -
Gain on disposition of properties, net - - - - - (125,376) (17,654)
Gain on settlement - - - - - - (4,452)
Current tax (benefit) / expense (38) 283 133 567 683 158 219
Deferred tax benefit (81) - (745) - (400) 1,000 -
Income from affiliate transactions - (500) - (500) (500) (7,500) (1,200)
Preferred return to preferred OP units 1,112 1,257 3,482 3,793 5,006 4,973 2,935
Amounts attributable to noncontrolling interests 1,776 879 4,179 460 150 10,054 1,752
Preferred stock distributions 1,955 2,197 6,233 6,748 8,946 13,793 6,133
Preferred stock redemption costs - - - - - 4,328 -
NOI/Gross Profit 147,070$ 136,805$ 416,235$ 347,069$ 466,909$ 384,647$ 267,036$
2017 2016 2017 2016 2016 2015 2014
Real Property NOI 125,961$ 114,851$ 361,595$ 296,081$ 403,337$ 335,567$ 232,478$
Rental Program NOI 22,060 21,213 68,759 64,223 85,086 83,232 70,232
Home Sales NOI / Gross Profit 8,103 9,276 23,320 23,184 30,087 20,787 13,398
Ancillary NOI / Gross Profit 7,024 6,997 10,367 9,745 9,999 7,013 5,217
Site rent from Rental Program (included in Real Property NOI) (16,078) (15,532) (47,806) (46,164) (61,600) (61,952) (54,289)
NOI / Gross Profit 147,070$ 136,805$ 416,235$ 347,069$ 466,909$ 384,647$ 267,036$
Three Months Ended September 30, Nine Months Ended September 30, Year Ended December 31,
Three Months Ended September 30, Nine Months Ended September 30, Year Ended December 31,
21
NET INCOME TO RECURRING EBITDA RECONCILIATION
(amounts in thousands)
Source: Company Information. Refer to Sun Communities, Inc. Form 10-Q and Supplemental for the quarter ended September 30, 2017 for additional information.
2017 2016 2017 2016 2016 2015 2014
Net income attributable to Sun Communities, Inc., common stockholders 24,115$ 18,897$ 57,573$ 18,969$ 17,369$ 137,325$ 22,376$
Interest 32,085 33,800 95,765 88,522 119,163 107,659 73,771
Interest on mandatorily redeemable preferred OP units 790 789 2,361 2,363 3,152 3,219 3,210
Depreciation and amortization 64,232 61,483 189,719 159,565 221,770 177,637 133,726
Asset impairment charge - - - - - - 837
Extinguishment of debt - - 759 - 1,127 2,800 -
Transaction costs 2,167 4,191 6,990 27,891 31,914 17,803 18,259
Catastrophic weather related charges 7,756 - 8,124 - 1,172 - -
Other income, net (3,345) - (5,340) - 4,676 - -
Gains on disposition of properties, net - - - - - (125,376) (17,654)
Gain on settlement - - - - - - (4,452)
Current tax (benefit) / expense (38) 283 133 567 683 158 219
Deferred tax benefit (81) - (745) - (400) 1,000 -
Income from affiliate transactions - (500) - (500) (500) (7,500) (1,200)
Preferred return to preferred OP units 1,112 1,257 3,482 3,793 5,006 4,973 2,935
Amounts attributable to noncontrolling interests 1,776 879 4,179 460 150 10,054 1,752
Preferred stock distributions 1,955 2,197 6,233 6,748 8,946 13,793 6,133
Preferred stock redemption costs - - - - - 4,328 -
Recurring EBITDA 132,524$ 123,276$ 369,233$ 308,378$ 414,228$ 347,873$ 239,912$
Three Months Ended September 30, Nine Months Ended September 30, Year Ended December 31,