Equity LifeStyle Properties(US:ELS)2022-04-26 16:00Financial Performance - For the quarter ended March 31, 2022, net income available for Common Stockholders increased by $17.7 million, or 27.1%, to $82.9 million, compared to $65.2 million for the same period in 2021[85]. - FFO available for Common Stock and OP Unit holders increased by $20.3 million, or 16.8%, to $140.9 million for the quarter ended March 31, 2022, compared to $120.6 million for the same period in 2021[86]. - Normalized FFO available for Common Stock and OP Unit holders increased by $18.8 million, or 15.3%, to $141.4 million for the quarter ended March 31, 2022, compared to $122.6 million for the same period in 2021[87]. - Income from property operations for the quarter ended March 31, 2022, was $171,180,000, compared to $149,004,000 for the same quarter in 2021, representing a year-over-year increase of approximately 14.9%[110]. - Funds from Operations (FFO) available for Common Stock and OP Unit holders for Q1 2022 was $140,886,000, up from $120,555,000 in Q1 2021, indicating a growth of about 16.8%[110]. - Normalized FFO for Q1 2022 was $141,402,000, compared to $122,584,000 in Q1 2021, reflecting an increase of approximately 15.4%[110]. - Net income available for Common Stockholders for Q1 2022 was $82,906,000, compared to $65,240,000 in Q1 2021, showing a rise of about 27.2%[110]. Revenue Growth - Core Portfolio property operating revenues, excluding deferrals, increased by 9.5%, while property operating expenses increased by 10.3%, resulting in a 9.0% increase in income from property operations[88]. - RV and marina rental income in the Core Portfolio increased by 21.4% for the quarter ended March 31, 2022, driven by seasonal demand recovery[90]. - Annual membership subscription revenue increased by $1.5 million, or 11%, reflecting a 5.3% increase in Thousand Trails Camping members[91]. - New home sales increased by 35.9%, with 261 new home sales during the quarter ended March 31, 2022, compared to 192 in the same period in 2021[92]. - Gross revenues from new home sales reached $25.530 million, a 78.1% increase compared to the same quarter in 2021[121]. - Total new home sales volume increased by 35.9%, with 261 new homes sold in the quarter[121]. - Income from home sales and other operations increased by $1.147 million, or 82.9%, compared to the previous year[121]. Property Operations - The average occupancy in the Core Portfolio was 95.1% for the quarter ended March 31, 2022, consistent with the previous quarter, with an increase of 191 sites in homeowner occupancy[89]. - MH base rental income in the Core Portfolio rose by $8.2 million, or 5.6%, driven by a 5.1% growth from rate increases and a 0.5% growth from occupancy gains[115]. - RV and marina base rental income increased by $16.997 million, or 21.4%, primarily due to a 64.8% increase in Seasonal RV and marina base rental income[116]. - Utility and other income increased by $2.9 million, or 12.2%, attributed to higher utility income across various regions[118]. - Property operating expenses, excluding deferrals and property management, rose by $11.3 million, or 10.3%, mainly due to increases in utility expenses and property payroll[119]. - The average monthly base rental income per Site in the Core Portfolio increased to approximately $747, up from $711 in the prior year[115]. Investments and Acquisitions - Gross investment in real estate increased by $82.8 million to $7,071.9 million as of March 31, 2022, primarily due to acquisitions and capital improvements[93]. - The company acquired multiple properties, including six RV communities and eleven marinas in 2021, contributing to the growth of its Core Portfolio[103]. - The company completed the acquisition of the remaining interest in the Voyager RV Resort joint venture on October 14, 2021, which is included in the total sites[97]. - Total capital improvements amounted to $83.6 million in Q1 2022, compared to $56.8 million in Q1 2021, reflecting increased investments in property upgrades and development[142]. Cash Flow and Financing - Net cash provided by operating activities rose by $4.0 million to $177.3 million in Q1 2022, attributed to a $22.2 million increase in income from property operations[140]. - Net cash used in investing activities decreased by $246.5 million to $105.2 million in Q1 2022, due to a reduction in acquisition spending[141]. - Net cash used in financing activities was $157.4 million in Q1 2022, a decrease from $245.8 million in Q1 2021, primarily due to lower net debt proceeds[143]. - As of March 31, 2022, the company had a borrowing capacity of $431.0 million under its Line of Credit[134]. - The company closed on a $200.0 million senior unsecured term loan during Q1 2022, maturing on January 21, 2027[132]. - The company expects to meet short-term liquidity requirements through available cash and net cash provided by operating activities[134]. Legal and Regulatory Matters - The company faces risks related to the COVID-19 pandemic, including its impact on employment rates and the economy[158]. - The company has filed a complaint seeking declaratory relief regarding its obligations under the ground leases[150]. - The Nicholsons filed a demand for arbitration regarding the lease obligations, which the company disputes[151]. - The Nicholsons have made demands for the Operating Partnership to deliver the property free of subtenancies upon lease expiration, which the company believes is unlawful[149]. - The City of San Jose approved a new designation for Westwinds as a Mobile Home Park, which requires further amendments for any change in use[153]. - The ground leases for Westwinds expire on August 31, 2022, with no extension options[146]. - As of March 31, 2022, the company reported no off-balance sheet arrangements[155]. Accounting and Reporting - The Core Portfolio income from property operations excludes deferrals and property management, providing a clearer view of operational performance[103]. - The company emphasizes the importance of Non-GAAP financial measures, such as FFO and Normalized FFO, for evaluating its operating performance[99]. - There have been no significant changes to the company's critical accounting policies and estimates during the quarter ended March 31, 2022[156].