On July 22, 2024, Equity Lifestyle Properties Inc (ELS, Financial) released its 8-K filing detailing the financial results for the second quarter and six months ended June 30, 2024. Equity Lifestyle Properties is a residential REIT that focuses on owning manufactured housing, residential vehicle communities, and marinas. The company currently has a portfolio of 451 properties across the U.S., with a higher concentration in the Sunbelt region, including 38% in Florida, 12% in Arizona, and 8% in California. The company targets owning properties in attractive retirement destinations, with over 70% of its properties either being age-restricted or having an average resident age over 55.
Performance Overview
Equity Lifestyle Properties Inc (ELS, Financial) reported a net income per common share of $0.42 for the quarter ended June 30, 2024, surpassing the analyst estimate of $0.36. This represents a 24.3% increase from the $0.34 reported in the same period in 2023. The company's funds from operations (FFO) per common share and OP unit were $0.69, a 13.1% increase from $0.61 in the previous year. Normalized FFO per common share and OP unit stood at $0.66, a 3.1% increase from $0.64 in the same period in 2023.
Financial Achievements
For the six months ended June 30, 2024, Equity Lifestyle Properties Inc (ELS, Financial) reported a net income per common share of $1.01, a 29.5% increase from $0.78 in the same period in 2023. FFO per common share and OP unit were $1.55, a 16.5% increase from $1.33 in the previous year. Normalized FFO per common share and OP unit was $1.44, a 5.9% increase from $1.36 in the same period in 2023.
Operational Highlights
Core property operating revenues increased by 4.6%, and core income from property operations, excluding property management, increased by 5.5% for the quarter ended June 30, 2024, compared to the same period in 2023. For the six months ended June 30, 2024, core property operating revenues increased by 5.2%, and core income from property operations, excluding property management, increased by 6.4% compared to the same period in 2023.
Segment Performance
Core manufactured housing (MH) base rental income for the quarter ended June 30, 2024, increased by 6.2% compared to the same period in 2023, reflecting 6.0% growth from rate increases and 0.2% from occupancy gains. Core MH homeowners increased by 171, and 255 new homes were sold during the quarter, with an average sales price of approximately $89,000. Core MH base rental income for the six months ended June 30, 2024, increased by 6.3% compared to the same period in 2023.
Core RV and marina base rental income for the quarter ended June 30, 2024, increased by 2.0% compared to the same period in 2023. Core RV and marina annual base rental income increased by 6.6% for the quarter ended June 30, 2024, compared to the same period in 2023. For the six months ended June 30, 2024, core RV and marina base rental income increased by 4.0%, and core RV and marina annual base rental income increased by 7.3% compared to the same period in 2023.
Balance Sheet Activity
On July 18, 2024, Equity Lifestyle Properties Inc (ELS, Financial) closed on a modification of its $500 million unsecured line of credit to extend the maturity date to July 18, 2028, and added an option to extend the maturity date on its $300 million senior unsecured term loan to April 16, 2027. All other material terms, including interest rate terms, remain the same.
Guidance Update
Equity Lifestyle Properties Inc (ELS, Financial) has updated its guidance for 2024. The company now expects net income per common share for the third quarter to be in the range of $0.42 to $0.48 and for the full year to be between $1.89 and $1.99. FFO per common share and OP unit is expected to be between $0.69 and $0.75 for the third quarter and between $2.96 and $3.06 for the full year. Normalized FFO per common share and OP unit is projected to be between $0.69 and $0.75 for the third quarter and between $2.86 and $2.96 for the full year.
| Metric | Q2 2024 | Q2 2023 | % Change |
|---|---|---|---|
| Net Income per Common Share | $0.42 | $0.34 | 24.3% |
| FFO per Common Share and OP Unit | $0.69 | $0.61 | 13.1% |
| Normalized FFO per Common Share and OP Unit | $0.66 | $0.64 | 3.1% |
Analysis
Equity Lifestyle Properties Inc (ELS, Financial) has demonstrated robust performance in the second quarter of 2024, exceeding analyst estimates and showing significant year-over-year growth in key financial metrics. The company's strong performance in core operations, particularly in the manufactured housing and RV/marina segments, underscores its strategic focus on high-demand retirement destinations. The increase in guidance for 2024 reflects management's confidence in sustaining
Explore the complete 8-K earnings release (here) from Equity Lifestyle Properties Inc for further details.
