DALLAS, April 3, 2025 /PRNewswire/ -- NexPoint Residential Trust, Inc. ("NXRT" or the "Company") (NYSE: NXRT) announced today that the Company is scheduled to host a conference call on Tuesday, April 29, 2025, at 11:00 a.m. ET (10:00 am CT), to discuss first quarter 2025 financial results.  The conference call can be accessed live over the phone by dialing 888-660-4430 or, for international callers, +1 646-960-0537 and using passcode Conference ID: 5001576.  A live audio webcast of the call will be availabl ...

Financial Performance - Net income decreased primarily due to a reduction in gains on sales of real estate by $13.7 million and rental income by $18.2 million, alongside an increase in loss on extinguishment of debt and modification costs of $21.6 million[30]. - As of December 31, 2024, the company had total indebtedness of $1.5 billion at a weighted average interest rate of 5.56%[404]. - 73% of the company's floating rate mortgage debt is effectively fixed through interest rate swap agreements, resulting in an adjusted weighted average interest rate of 2.90%[404]. - The company has entered into interest rate cap agreements that effectively cap SOFR on $2.6 billion of floating rate mortgage debt at a weighted average rate of 6.31%[405]. - A quarter point change in SOFR results in an approximate increase to annual interest expense costs of $1,000 for floating rate indebtedness[407]. - An increase of 0.50% in interest rates would lead to an annual increase in interest expense of $2,000[407]. - A 0.75% increase in interest rates would result in an annual increase to interest expense of $3,000[407]. - A 1.00% increase in interest rates would cause an annual increase in interest expense of $4,000[407]. Real Estate Portfolio - As of December 31, 2024, the real estate portfolio consisted of 35 properties with 12,984 units, approximately 94.7% occupancy, and a weighted average monthly effective rent of $1,491 per occupied unit[31]. - The company completed full and partial renovations on 8,348 units, resulting in an average monthly rental increase of $175 per unit and an average renovation cost of $10,123 per unit[41]. - The average effective monthly rent per unit is calculated as the average contractual rent for commenced leases minus tenant concessions, divided by the number of units under commenced leases[33]. - The company intends to acquire primarily Class B multifamily properties at discounts to replacement costs, targeting markets with strong job growth and household formation[34]. - The company plans to hold multifamily properties for at least three years, with potential early sales if market conditions are favorable[43]. Cash Position and Financial Strategy - The company had a cash position of $53.9 million as of December 31, 2024, with $3.2 million reserved for future renovations and $27.6 million for lender-required escrows and security deposits[33]. - The company aims to reduce leverage to 40-45% loan-to-value over time by increasing property values and refinancing long-term holdings[35]. Management and Advisory Fees - The company is externally managed by an adviser that has a fiduciary responsibility to maximize long-term stockholder value[50]. - The advisory fee on Contributed Assets is capped at $4.5 million per calendar year to limit fees post Spin-Off[54]. - The administrative fee on Contributed Assets is capped at $890,000 per calendar year, while New Assets are not subject to this cap[58]. - The Expense Cap for reimbursement of Adviser Operating Expenses and fees is set at 1.5% of Average Real Estate Assets per calendar year[62]. - The Advisory Agreement has a one-year term and was unanimously renewed by the Board on February 24, 2025[63]. - BH operates and leases properties for the company, charging a management fee of approximately 3% of monthly gross income from each property[71]. - The management fee calculation includes all receipts from property operations, excluding insurance or condemnation awards[76]. - BH receives a construction supervision fee of 5-6% of total project costs if it performs these services[76]. - The company is required to indemnify its Adviser and reimburse reasonable expenses in certain proceedings[68]. - The Adviser is obligated to provide sufficient resources to manage the company's operations despite engaging in other business ventures[69]. - The Advisory Agreement may be terminated with 30 to 60 days' written notice by either party[64]. Risk Management - The company expects to manage exposure to interest rate risk by maintaining a mix of fixed and floating rates for its indebtedness[405]. - The company is exposed to credit risk in derivative financial instruments due to potential failure of counterparties to perform[408]. - Credit risk arises when the fair value of a derivative financial instrument is positive, indicating that counterparties owe the company[408]. - The company aims to minimize credit risk by transacting with major financial institutions that have high credit ratings[408]. Compliance and Operations - The company believes it operates its properties in substantial compliance with the Fair Housing Act, which prohibits discrimination in housing[84]. - The company has conducted Phase I Environmental Site Assessments at all properties, with no known past or present contamination identified that would materially affect business operations[88]. - The company maintains comprehensive general liability coverage on its properties, with limits customary within the industry[92]. - The company competes with numerous housing alternatives, including rental apartments, condominiums, and single-family homes, affecting its ability to lease units and set rental rates[94]. - The company has two employees as of December 31, 2024, and maintains a workplace free from discrimination or harassment[96].

Financial Data and Key Metrics Changes - For Q4 2024, the company reported a net loss of $26.9 million or $1.06 per diluted share on total revenue of $63.8 million, compared to a net income of $18.4 million or $0.70 per diluted share on total revenue of $68.9 million in Q4 2023, indicating a significant decline in profitability [13] - Net operating income (NOI) for Q4 2024 was $38.9 million, down 7.6% from $42.2 million in Q4 2023 [13] - Core FFO for Q4 2024 was $17.7 million or $0.68 per diluted share, compared to $0.75 per diluted share in Q4 2023 [15] - For the full year 2024, net income was $1.1 million or $0.04 per diluted share, down from $44.3 million or $1.59 per diluted share in 2023 [16] Business Line Data and Key Metrics Changes - Same-store rental income increased by 90 basis points, while same-store occupancy remained stable at 94.7% [14] - The company completed 58 renovations in Q4 2024, achieving an average monthly rent premium of $150 and a 19.2% return on investment [15] - For the full year, same-store rental income increased by 2.3% and same-store NOI improved by 90 basis points despite rising expenses [17] Market Data and Key Metrics Changes - Occupancy rates in key markets showed growth, with DFW and Charlotte finishing at 96.3% and 97% respectively [28] - Notable growth markets included Las Vegas at 8.6%, Orlando at 6.8%, and Raleigh at 5.2% [32] - The company expects top-performing revenue markets in 2025 to be South Florida, Las Vegas, Raleigh, Nashville, and Atlanta, with growth projections of 2% to 4% [36] Company Strategy and Development Direction - The company plans to continue its value-add strategy, targeting 15% to 20% returns on investment for renovations [39] - In 2025, the company anticipates completing 425 full interior upgrades at an average cost of $18,000 per unit, generating a $269 average monthly premium [40] - The company is focused on margin expansion and increased resident satisfaction, with expectations for a transition year leading to growth in 2026 and 2027 [44] Management's Comments on Operating Environment and Future Outlook - Management noted that bad debt has improved, with expectations of further reductions in 2025 [49] - The company is being conservative in its guidance, factoring in potential interest rate changes and market conditions [64] - The management expressed confidence in the Raleigh market despite current pressures, anticipating improvements in the second half of the year [52] Other Important Information - The company reported a NAV per share range of $44.56 to $58.52, with a midpoint of $51.54, reflecting stability in capital markets [19] - The company has $373 million of available liquidity as it heads into 2025, with plans to finalize a recasting of the corporate credit facility [43] - The board declared a quarterly dividend of $0.51 per share, payable on March 31, 2025 [25] Q&A Session Summary Question: What drove the positive rental income result in Atlanta despite occupancy declines? - Management indicated that higher options and the rollout of bulk WiFi contributed to total revenue growth, offsetting some occupancy losses [48] Question: What caused the decrease in occupancy in the Raleigh-Durham market? - Management attributed the decline to supply pressures and personnel changes, but remains optimistic about the market's future [51] Question: Are there any changes to the renovation plans based on current market conditions? - Management confirmed that renovations are prioritized in markets where rates can still be pushed, with plans to double the output compared to the previous year [55] Question: How will swap expirations affect interest expenses in 2025? - Management noted that expiring swaps and a decline in spreads would provide a benefit, reducing total interest expenses [63]

Financial Data and Key Metrics Changes - The net loss for Q4 2024 was $26.9 million or $1.06 per diluted share, compared to a net income of $18.4 million or $0.70 per diluted share in Q4 2023, reflecting a significant decline in profitability [8] - Total revenue for Q4 2024 was $63.8 million, down from $68.9 million in the same period in 2023 [8] - For the full year 2024, net income was $1.1 million or $0.04 per diluted share, compared to $44.3 million or $1.59 per diluted share in 2023 [10] - Core FFO for Q4 2024 was $17.7 million or $0.68 per diluted share, down from $0.75 per diluted share in Q4 2023 [9] - The company reported a NAV per share range of $44.56 to $58.52, with a midpoint of $51.54, reflecting stability in capital markets [11] Business Line Data and Key Metrics Changes - Net operating income (NOI) for Q4 2024 was $38.9 million on 35 properties, down from $42.2 million on 38 properties in Q4 2023, marking a 7.6% decrease [8] - Same store rental income increased by 2.3% for the full year, while same store occupancy remained stable at 98.7% [10] - The company completed 58 renovations in Q4 2024, achieving an average monthly rent premium of $150 and a 19.2% return on investment [9] Market Data and Key Metrics Changes - Occupancy rates in the DFW and Charlotte markets showed significant growth, finishing the year at 96.4% [17] - The same store NOI margin for the full year 2024 was 61.61%, with five of the ten same store markets growing NOI by at least 3% [20] Company Strategy and Development Direction - The company plans to continue its value-add business strategy, focusing on renovations and upgrades to drive rent growth [9][24] - Guidance for 2025 includes expectations for same store NOI growth to range from a 3.5% decline to a 50 basis point increase, with a midpoint projecting a 1.5% reduction year over year [21] - The company is prioritizing renovations in markets where it can push rates, particularly in South Florida and Raleigh [32] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential for growth in 2026 and 2027, particularly in the second half of the year [26] - The company noted a positive trend in bad debt, expecting improvement in 2025 [30] - Management acknowledged challenges in certain markets, such as Raleigh, but remains confident in the long-term outlook [31] Other Important Information - The company paid a dividend of $0.51 per share on December 31, 2024, with a payout ratio of 68% of core FFO [12] - NXRT has $373 million of available liquidity as it heads into 2025, providing flexibility for future investments [25] Q&A Session Summary Question: What drove the positive rental income result in Atlanta despite occupancy declines? - Management indicated that higher occupancy and the rollout of bulk WiFi contributed to total revenue growth in Atlanta [28][29] Question: Can you explain the decrease in occupancy in the Raleigh-Durham market? - Management noted that increased supply and personnel changes affected occupancy, but they remain optimistic about the market's recovery [30][31] Question: Any updates on the full interior upgrades plan? - Management confirmed that they are prioritizing renovations in markets with potential for rate increases and expect to double the output compared to last year [32][33] Question: How will interest expense be affected in 2025? - Management highlighted a $0.12 benefit from swap expirations and a reduction in total interest expense due to improved terms [36][38]

Core Viewpoint - NexPoint Residential Trust Inc. reported a decline in revenue for the quarter ended December 2024, with a slight earnings surprise but a negative EPS surprise compared to analyst expectations [1]. Financial Performance - Revenue for the quarter was $63.79 million, down 7% year-over-year, and exceeded the Zacks Consensus Estimate by 0.31% [1]. - Earnings per share (EPS) was $0.78, compared to $0.70 in the same quarter last year, but fell short of the consensus estimate of $0.80 by 2.50% [1]. - Rental income was reported at $61.57 million, which was below the two-analyst average estimate of $63.15 million, reflecting a year-over-year decline of 7.9% [4]. - Other income was $1.26 million, also below the two-analyst average estimate of $1.86 million, marking a year-over-year decrease of 25.8% [4]. - The diluted net earnings per share was reported at -$1.06, compared to the four-analyst average estimate of -$0.61 [4]. Market Performance - Shares of NexPoint Residential Trust Inc. have returned -1.2% over the past month, slightly outperforming the Zacks S&P 500 composite's -1.8% change [3]. - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3].

Financial Performance - NexPoint Residential Trust Inc. reported quarterly funds from operations (FFO) of $0.78 per share, missing the Zacks Consensus Estimate of $0.80 per share, but showing an increase from $0.77 per share a year ago, resulting in an FFO surprise of -2.50% [1] - The company posted revenues of $63.79 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 0.31%, although this is a decrease from year-ago revenues of $68.56 million [2] - The current consensus FFO estimate for the coming quarter is $0.78 on revenues of $64.15 million, and for the current fiscal year, it is $3.19 on revenues of $260.08 million [7] Market Performance - NexPoint Residential Trust Inc. shares have lost approximately 6.7% since the beginning of the year, contrasting with the S&P 500's gain of 1.7% [3] - The company has surpassed consensus FFO estimates two times over the last four quarters [2] Industry Outlook - The REIT and Equity Trust - Residential industry, to which NexPoint belongs, is currently in the bottom 25% of the Zacks industry rankings, indicating potential challenges ahead [8] - The outlook for the industry can significantly impact the performance of NexPoint's stock [8]

Financial Performance - For the year ended December 31, 2024, net income attributable to common stockholders was $1.1 million, a decrease from $44.3 million in 2023[5]. - Total revenues for the full year 2024 were $259.7 million, down from $277.5 million in 2023[12]. - For the fourth quarter of 2024, total revenues were $63.8 million, compared to $68.9 million for the same quarter in 2023[12]. - For the full year 2024, FFO totaled $44.5 million, or $1.69 per diluted share, compared to $71.4 million, or $2.72 per diluted share, in 2023[12]. - For the full year 2024, NOI was $157.0 million, down from $167.4 million in 2023[12]. - Net income for 2024 is reported at $1,114 million, a significant decrease from $44,433 million in 2023[23]. - Total revenues decreased to $259,701 thousand in FY 2024 from $277,526 thousand in FY 2023, representing a decline of 6.9%[38]. - Net income attributable to common stockholders was $1,110 thousand in FY 2024, a significant drop from $44,264 thousand in FY 2023[38]. - Same Store NOI growth was 0.9% in FY 2024 compared to the previous year[38]. - Total revenues for the year ended December 31, 2024, were $257,486,000, a decrease of $19,557,000 or 7.1% compared to $277,043,000 in 2023[60]. - The company reported a total NOI of $157.035 million for 2024, down 6.2% from $167.404 million in 2023[72]. Rental Income and Occupancy - The weighted average effective monthly rent per unit across all properties was $1,491, with physical occupancy at 94.7% as of December 31, 2024[5]. - Same Store Rental Income increased by $20,270 million, representing a 9.4% growth compared to 2022[27]. - Same Store Average Rent per Unit decreased by $25, or 1.7%, from $1,508 in 2022 to $1,483 in 2024[27]. - Same Store Ending Occupancy remained stable at 94.7% for both 2024 and 2023, up from 94.1% in 2022[27]. - Same Store rental income increased by $5,500,000 or 2.3% to $246,688,000 in 2024 from $241,188,000 in 2023[60]. - The occupancy rate for Same Store properties remained stable at approximately 94.7% as of December 31, 2024, unchanged from 2023[70]. Dividends and Shareholder Returns - A fourth quarter dividend of $0.51 per share was paid, representing a 10.3% increase over the prior quarter's dividend[5]. - Dividends declared per common share increased to $1.90 in FY 2024 from $1.72 in FY 2023[38]. - Dividends declared per common share increased to $1.89726 in 2024 from $1.72242 in 2023, a rise of 10.1%[82]. Debt and Capital Structure - The company refinanced mortgage debt totaling $1,469,425 million across 34 properties with a floating interest rate of 5.62%[31]. - The company has a total outstanding mortgage debt of $1,503,242,000, with a weighted average interest rate of 5.62% across various floating rate loans[92]. - The leverage ratio (Total Debt to Market Capitalization plus Total Debt) improved to 59% in FY 2024 from 64% in FY 2023[38]. - The company has entered into interest rate swap agreements totaling a notional amount of $1,067,500,000, with an average fixed rate of 0.9807%[94]. - The company has a total of $2,523,650 in interest rate cap agreements outstanding, with strike rates ranging from 2.74% to 8.91%[96]. - The company has multiple floating rate interest rate caps maturing between 2025 and 2027, with notional amounts ranging from $18,690 to $248,185[96]. Property Sales and Acquisitions - The company completed the sales of three properties for a combined price of $166.8 million during 2024[5]. - The company has disposed of properties with a total sales price of $1,237,675,000, resulting in a total gain on sale of $497,939,000[103]. - The NAVA Portfolio, which includes multiple properties, was sold for $116,000,000, generating a gain of $48,046,000[104]. - The highest acquisition price for a single property was $354,583,000 for Avant at Pembroke Pines, comprising 1,520 units[101]. Future Guidance - NXRT's 2025 guidance for earnings per diluted share ranges from $(1.33) to $(1.05) with a midpoint of $(1.19)[42]. - Core FFO per diluted share guidance for 2025 is projected between $2.56 and $2.83, with a midpoint of $2.70[42]. - Same Store rental income growth is expected to range from -0.5% to 1.0% for 2025[42]. - Total revenue growth for Same Store properties is projected between -0.2% and 1.3%[42]. - Same Store NOI is expected to decline between -3.5% and increase by 0.5%[42]. - The estimated 2025 NOI guidance is between $148.67 million and $154.90 million[46].

Core Insights - NexPoint Residential Trust, Inc. (NXRT) reported a net income of $1.1 million for the year ended December 31, 2024, a significant decrease from $44.3 million in 2023, primarily due to lower gains on real estate sales and rental income [5][12] - Total revenues for 2024 were $259.7 million, down from $277.5 million in 2023, reflecting a challenging market environment [12] - The company completed the sale of three properties for a total of $166.8 million during 2024, contributing to its overall financial performance [5] Financial Performance - For the full year 2024, Funds from Operations (FFO) totaled $44.5 million, down from $71.4 million in 2023, while Core FFO was $73.1 million compared to $76.6 million in the previous year [12][15] - The Average Effective Rent per unit across all properties was $1,491, with a physical occupancy rate of 94.7% as of December 31, 2024 [5][12] - The company paid a fourth-quarter dividend of $0.51 per share, marking a 10.3% increase from the previous quarter, and has increased its dividend per share by 147.6% since inception [5][12] Operational Highlights - The Same Store properties experienced a 2.0% increase in total revenue and a 0.9% increase in Net Operating Income (NOI) for 2024 [5][12] - NXRT completed 388 upgrades and installations in 2024, achieving an average monthly rent premium of $153 and a 24.7% return on investment [5] - The company repurchased 438,678 shares at an average price of $33.19 per share, representing a 36% discount to the midpoint of its Q4'24 Net Asset Value [5] Guidance and Future Outlook - For 2025, NXRT anticipates a net loss of approximately $31.5 million, with projected FFO of $64.1 million and Core FFO of $71.1 million [33] - The company expects to maintain its focus on value-add opportunities in middle-income multifamily properties, particularly in the Southeastern and Southwestern United States [13][33]

Core Viewpoint - NexPoint Residential Trust (NXRT) has shown significant upside potential, with a 30% upside identified in its discounted market valuation, despite challenges such as external management and high floating-rate debt [2][3]. Company Performance - NXRT's performance has ranked near the top of the multifamily REIT sector over the past year, attributed to management's successful execution of strategic initiatives, including profitable property sales and debt reduction [3][5]. - The company has effectively recycled capital through property sales, resulting in a total portfolio return of approximately 37.85% [4]. Debt Management - NXRT has refinanced and paid down debt, reducing costs and extending maturities, with total debt amounting to approximately $1.46 billion at a weighted average interest rate of 5.58% [5][6]. Market Positioning - NXRT owns 12,984 apartment units across 10 markets in the Southeastern and Southwestern United States, strategically positioned in high-demand areas [9][11]. - The company has exited Houston but maintains a presence in the top four markets identified by Marcus & Millichap, which are expected to perform well financially in 2025 [11]. Rental Market Dynamics - The disparity in rental prices between Class A and Class B apartments is significant, with a gap of $510 per month, which may drive increased demand for NXRT's Class B+ portfolio [12][13]. - As new supply is absorbed in these markets, both occupancy and rents are expected to rise, benefiting NXRT's operational performance [14]. Valuation Metrics - Despite a nearly 30% increase in share price, NXRT remains significantly discounted compared to its multifamily peers, with a P/AFFO ratio of 13.2, below the sector mean of 17.9 [16][17]. - NXRT's shares are priced at 77% of consensus Net Asset Value (NAV), indicating a valuation advantage compared to the sector average [18][19]. Dividend Growth - NXRT has raised its dividend for the ninth time since its IPO in 2015, indicating a strong commitment to returning value to shareholders [20][21].

Core Viewpoint - NexPoint Residential Trust, Inc. has announced the final income allocations for its 2024 dividend distributions on common stock, detailing the taxable and non-taxable components of the dividends [1][2]. Dividend Distribution Summary - The total dividend distribution for 2024 amounts to $1.89726 per share, with $1.28868 classified as taxable ordinary income and $0.60858 as return of capital [1]. - The breakdown of the dividends per share for each quarter is as follows: - Q1: $0.46242 ordinary income, $0.31409 unrecaptured Section 1250 gain, $0.19558 return of capital - Q2: $0.46242 ordinary income, $0.31409 unrecaptured Section 1250 gain, $0.19558 return of capital - Q3: $0.46242 ordinary income, $0.31409 unrecaptured Section 1250 gain, $0.19558 return of capital - Q4: $0.51000 ordinary income, $0.34641 unrecaptured Section 1250 gain, $0.21571 return of capital [1]. - 100% of the taxable ordinary income is treated as a qualified REIT dividend for Section 199A purposes [1]. Company Overview - NexPoint Residential Trust is a publicly traded Real Estate Investment Trust (REIT) focused on acquiring, owning, and operating middle-income multifamily properties with value-add potential in major urban and suburban markets, primarily in the Southeastern and Southwestern United States [3]. - The company is externally advised by NexPoint Real Estate Advisors, L.P., which is affiliated with NexPoint Advisors, L.P., an SEC-registered investment advisor with extensive real estate experience [3].