Sun Communities(SUI) - 2025 Q3 - Quarterly Results

Financial Performance - Net income attributable to common shareholders for Q3 2025 was $8.5 million, or $0.07 per diluted share, compared to $288.7 million, or $2.31 per diluted share in Q3 2024[16] - Basic earnings per share from continuing operations for Q3 2025 was $(0.05), compared to $(1.23) in Q2 2025[50] - Net income attributable to SUI common shareholders decreased by 97.1% to $8.5 million in Q3 2025 from $288.7 million in Q3 2024[53] - Total revenues for Q3 2025 were $697.2 million, a 2.5% increase from $680.4 million in Q3 2024[53] - Recurring EBITDA for the nine months ended September 30, 2025, was $863.7 million, down from $952.5 million in the same period of 2024, reflecting a decline of approximately 9.3%[56] Funds from Operations (FFO) and Guidance - Core Funds from Operations (Core FFO) for Q3 2025 was $2.28 per share, down from $2.36 in Q3 2024[16] - The company raised its full-year 2025 Core FFO per share guidance by $0.04 to a range of $6.59 to $6.67, reflecting a 0.6% increase at the midpoint[10] - The Company updated its full-year 2025 guidance for diluted EPS to a range of $10.25 to $10.33 and Core FFO per Share to $6.59 to $6.67[32] - FFO per Share for Q3 2025 was $2.18, down from $2.22 in Q3 2024, reflecting a decrease of about 1.8%[54] Property Performance - North America Same Property NOI for manufactured housing (MH) and recreational vehicle (RV) increased by 5.4% year-over-year for Q3 2025[10] - North America Same Property adjusted blended occupancy for MH and RV increased by 130 basis points to 99.2% at September 30, 2025[18] - Same Property Revenues for the quarter ended September 30, 2025, increased to $418.5 million, up 3.5% from $404.5 million in the same quarter of 2024[59] - Real Property NOI for Q3 2025 was $320.2 million, an increase from $304.1 million in Q3 2024, indicating a growth of approximately 5.3%[55] Debt and Capital Structure - As of September 30, 2025, the company had $4.3 billion in debt outstanding with a weighted average interest rate of 3.4%[21] - The total debt as of September 30, 2025, was $4,292.1 million, with a weighted average interest rate of 3.38%[69] - The company reported a net operating income (NOI) margin of 25.6% for the total home sales in the quarter ended September 30, 2025, down from 29.4% in the same quarter of 2024[64] Asset Management - The company completed the acquisition of 14 communities for $457.0 million subsequent to the quarter end[10] - The company owned, operated, or had an interest in a portfolio of 501 developed properties, comprising approximately 174,680 developed sites as of September 30, 2025[47] - The number of properties owned by the company decreased from 521 as of September 30, 2024, to 501 as of September 30, 2025[57] Cash Flow and Distributions - Cash distributions declared per common share were $1.04 for Q3 2025, consistent with Q2 2025[50] - The company paid a one-time special cash distribution of $4.00 per common share during the quarter ended June 30, 2025[50] - The company has cash and cash equivalents of $637.3 million as of September 30, 2025, with $629.5 million restricted for potential future acquisitions[83] Market Trends and Projections - The average rental rate increases expected for 2026 are 5.0% for MH, 4.0% for Annual RV, and 4.1% for the UK[36] - The Same Property NOI growth for North America is expected to be between 3.5% and 7.5%, while the UK Same Property NOI growth is projected to range from (2.0%) to 1.0%[33] - Home sales in North America decreased by 19.6% to $37.8 million for the quarter ended September 30, 2025, compared to $47.0 million in the same quarter of 2024[64] Non-GAAP Measures - The Company utilizes non-GAAP measures such as Net Operating Income (NOI), EBITDA, and Funds from Operations (FFO) to assess performance, which are widely recognized in the real estate industry[93] - FFO adjusts GAAP net income by excluding gains or losses from real estate asset sales and includes real estate-related depreciation and amortization, offering a clearer view of operational performance[100] - Same Property NOI is a key metric for evaluating the performance of the Company's Same Property portfolio, excluding revenues and expenses from home sales[97]