On July 31, 2024, EPR Properties (EPR, Financial) released its 8-K filing detailing the financial results for the second quarter ended June 30, 2024. EPR Properties is a real estate investment trust that leases experiential properties in the United States and Canada, focusing on two segments: Experiential and Education. The majority of its revenue is derived from the Experiential sector, which includes theaters, family entertainment centers, ski resorts, and other attractions.
Performance Overview
For the second quarter of 2024, EPR Properties reported total revenue of $173.1 million, significantly above the analyst estimate of $156.55 million. This marks a modest increase from the $172.9 million reported in the same period last year. Net income available to common shareholders was $39.1 million, or $0.51 per diluted share, compared to $7.6 million, or $0.10 per diluted share, in Q2 2023.
Despite the revenue beat, the company faced challenges with its Funds From Operations as adjusted (FFOAA) and Adjusted Funds From Operations (AFFO). FFOAA per diluted common share was $1.22, down from $1.28 in the same quarter last year. Similarly, AFFO per diluted common share decreased to $1.20 from $1.31 in Q2 2023.
Financial Achievements and Liquidity
EPR Properties demonstrated strong liquidity with $33.7 million in cash on hand and no borrowings on its $1.0 billion unsecured revolving credit facility. The company’s consolidated debt profile is entirely at fixed interest rates, with only $136.6 million maturing in 2024. This robust liquidity position is crucial for maintaining financial flexibility and supporting future investments.
Investment and Portfolio Updates
During the second quarter, EPR Properties invested $46.9 million, bringing the year-to-date investment spending to $132.7 million. The company has committed approximately $180.0 million for experiential development and redevelopment projects, expected to be funded over the next two years. The Experiential portfolio, excluding properties intended for sale, was 99% leased as of June 30, 2024.
Income Statement Highlights
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Total Revenue | $173.1 million | $172.9 million |
| Net Income Available to Common Shareholders | $39.1 million | $7.6 million |
| FFOAA per Diluted Common Share | $1.22 | $1.28 |
| AFFO per Diluted Common Share | $1.20 | $1.31 |
Balance Sheet and Cash Flow
As of June 30, 2024, EPR Properties reported total assets of $5.6 billion, with real estate investments net of accumulated depreciation amounting to $4.57 billion. The company’s cash and cash equivalents stood at $33.7 million, down from $78.1 million at the end of 2023. Total liabilities were $3.22 billion, while total equity was $2.42 billion.
Dividend Information
The company declared regular monthly cash dividends totaling $0.855 per common share for the second quarter of 2024, representing an annualized dividend of $3.42 per common share, a 3.6% increase over the prior year’s annualized dividend.
Guidance and Outlook
EPR Properties reaffirmed its 2024 guidance for FFOAA per diluted common share of $4.76 to $4.96, representing a 3.2% increase at the midpoint over 2023. The company also updated its disposition proceeds guidance to $60.0 million to $75.0 million from the previous range of $50.0 million to $75.0 million.
“We were pleased to deliver a quarter that demonstrated our continued positive momentum,” stated Company Chairman and CEO Greg Silvers. “Demand for our tenant categories broadly remains strong, as evidenced by our sustained rent coverage. Consumers prioritize spending on experiences, and we look forward to the anticipated increase in box office as the number of major releases grows.”
For more detailed financial information, readers can access the full 8-K filing.
Explore the complete 8-K earnings release (here) from EPR Properties for further details.
