NXRT Recaps Disposition Activity, Value-Add Results and Issues 2024 Full Year Guidance
DALLAS, Feb. 20, 2024 /PRNewswire/ — NexPoint Residential Trust, Inc. (NYSE:NXRT) reported financial results for the fourth quarter and year ended December 31, 2023.
Highlights
- NXRT1 reported net income, FFO2, Core FFO2 and AFFO2 of $44.3M, $71.4M, $73.5M and $84.4M, respectively, attributable to common stockholders for the year ended December 31, 2023, compared to net loss, FFO, Core FFO, and AFFO of $(9.3)M, $73.4M, $81.8M and $91.4M, respectively, attributable to common stockholders for the year ended December 31, 2022.
- For the year ended December 31, 2023, 2022-2023 Same Store properties3 average effective rent, total revenue and NOI2 increased 0.1%, 7.1% and 8.2%, respectively, and occupancy increased 60 bps over the prior year period.
- During the year ended December 31, 2023, the Company completed the sales of Silverbrook and Timber Creek for a combined sales price of $119.0 million.
- The weighted average effective monthly rent per unit across all 38 properties held as of December 31, 2023 (the “Portfolio”), consisting of 14,133 units4, was $1,502, while physical occupancy was 94.7%.
- NXRT paid a fourth quarter dividend of $0.46242 per share of common stock on December 29, 2023; this cash dividend represented a $0.04242 per share, or 10.1% increase, over the prior quarter’s dividend. Since inception, NXRT has increased the dividend per share by 124.5%.
- During 2023, for the properties in the Portfolio, NXRT completed 2,073 full/partial upgrades and washer/dryer installation, achieving an average monthly rent premium of $190 and a 21.4% ROI5.
- Since inception, NXRT has completed installation of 8,534 full and partial upgrades, 4,761 kitchen and laundry appliances and 12,348 technology packages, resulting in $169, $49 and $43 average monthly rental increase per unit and 20.9%, 64.7% and 37.8% ROI, respectively.
- During the year ended December 31, 2023, the Company paid down $50.5 million of principal on its corporate credit facility.
|
(1) |
In this release, “we,” “us,” “our,” the “Company,” “NexPoint Residential Trust,” and “NXRT” each refer to NexPoint Residential Trust, Inc., a Maryland corporation. |
|
(2) |
FFO, Core FFO, AFFO and NOI are non-GAAP measures. For a discussion of why we consider these non-GAAP measures useful and reconciliations of FFO, Core FFO, AFFO and NOI to net income (loss), see the “Definitions and Reconciliations of Non-GAAP Measures” and “FFO, Core FFO and AFFO” sections of this release. |
|
(3) |
We define “Same Store” properties as properties that were in our Portfolio for the entirety of the periods being compared. There are 33 properties encompassing 12,378 units of apartment space in our Same Store pool for the year ended December 31, 2023 (our “2022-2023″ Same Store” properties). There are 35 properties encompassing 12,940 units of apartment space in our Q4 Same Store pool for the three months ended December 31, 2023 (our “Q4 Same Store” properties). The same store unit count excludes 44 units that are currently down due to fires (Rockledge: 20 units, Bella Solara: 8 units, Six Forks Station: 8 units, Versailles II: 7 units and Bloom: 1 unit). |
|
(4) |
Total number of units owned as of December 31, 2023 is 14,133, however 45 units are currently down due to fires and water damage (Rockledge: 20 units, Bella Solara: 8 units, Six Forks Station: 8 units, Versailles II: 7 units, Bloom: 1 unit and Old Farm: 1 unit). |
|
(5) |
We define Return on Investment (“ROI”) as the sum of the actual rent premium divided by the sum of the total cost. |
Full Year 2023 Financial Results
- Total revenues were $277.5 million for the full year 2023, compared to $264.0 million for the full year 2022.
- Net income for the full year 2023 totaled $44.3 million, or income of $1.69 per diluted share, which included a gain on sales of real estate of $67.9 million and $95.2 million of depreciation and amortization expense. This compared to net loss of $(9.3) million, or loss of $(0.36) per diluted share, which included a gain on sales of real estate of $14.7 million and $97.6 million of depreciation and amortization expense for the full year 2022.
- The change in our net income of $44.4 million for the year ended December 31, 2023 as compared to our net loss of $(9.3) million for the year ended December 31, 2022 primarily relates to increases in gains on sales of real estate and total revenues, partially offset by an increase in interest expense.
- For the full year 2023, NOI was $167.4 million on 38 properties, compared to $157.4 million for the full year 2022 on 40 properties.
- For the full year 2023, Same Store NOI increased 8.2% to $145.0 million, compared to $134.0 million for the full year 2022.
- For the full year 2023, FFO totaled $71.4 million, or $2.72 per diluted share, compared to $73.4 million, or $2.81 per diluted share, for the full year 2022. For the full year 2023, Core FFO totaled $73.5 million, or $2.80 per diluted share, compared to $81.8 million, or $3.13 per diluted share, for the full year 2022. For the full year 2023, AFFO totaled $84.4 million, or $3.22 per diluted share, compared to $91.4 million, or $3.49 per diluted share, for the full year 2022.
Fourth Quarter 2023 Financial Results
- Total revenues were $68.9 million for the fourth quarter of 2023, compared to $69.3 million for the fourth quarter of 2022.
- Net income for the fourth quarter of 2023 totaled $18.4 million, or income of $0.70 per diluted share, which included $24.3 million of depreciation and amortization expense and $18.3 million of interest expense. This compared to net income of $3.8 million, or income of $0.15 per diluted share, for the fourth quarter of 2022, which included $23.2 million of depreciation and amortization expense and $15.8 million of interest expense.
- The change in our net income of $18.4 million for the fourth quarter of 2023 as compared to our net income of $3.8 primarily relates to increases in gains on sales of real estate, partially offset by an increase in interest expense.
- For the fourth quarter of 2023, NOI was $42.2 million on 38 properties, compared to $41.8 million for the fourth quarter of 2022 on 40 properties.
- For the fourth quarter of 2023, Q4 Same Store NOI increased 4.5% to $39.1 million, compared to $37.4 million for the fourth quarter of 2022.
- For the fourth quarter of 2023, FFO totaled $17.8 million, or $0.68 per diluted share, compared to $12.2 million, or $0.47 per diluted share, for the fourth quarter of 2022. For the fourth quarter of 2023, Core FFO totaled $17.4 million, or $0.66 per diluted share, compared to $19.5 million, or $0.75 per diluted share, for the fourth quarter of 2022. For the fourth quarter of 2023, AFFO totaled $20.1 million, or $0.77 per diluted share, compared to $22.0 million, or $0.84 per diluted share, for the fourth quarter of 2022.
Fourth Quarter Earnings Conference Call
NXRT will host a call on Tuesday, February 20, 2024, at 11:00 a.m. ET (10:00 a.m. CT), to discuss its full year and fourth quarter 2023 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 available online at the Company’s website, nxrt.nexpoint.com (under “Resources”). An online replay will be available shortly after the call on the Company’s website and continue to be available for 60 days.
A replay of the conference call will also be available through Tuesday, March 5, 2024, by dialing 800- 770- 2030 or, for international callers, +1 647-362-9199 and entering passcode 5001576.
About NXRT
NexPoint Residential Trust is a publicly traded REIT, with its shares listed on the New York Stock Exchange under the symbol “NXRT,” primarily focused on acquiring, owning and operating well-located middle-income multifamily properties with “value-add” potential in large cities and suburban submarkets of large cities, primarily in the Southeastern and Southwestern United States. NXRT is externally advised by NexPoint Real Estate Advisors, L.P., an affiliate of NexPoint Advisors, L.P., an SEC-registered investment advisor, which has extensive real estate experience. Our filings with the Securities and Exchange Commission (the “SEC”) are available on our website, nxrt.nexpoint.com, under the “Financials” tab.
Cautionary Statement Regarding Forward-Looking Statements
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on management’s current expectations, assumptions and beliefs. Forward-looking statements can often be identified by words such as “expect,” “anticipate,” “estimate,” “may,” “plan,” “believe” and similar expressions, and variations or negatives of these words. These forward-looking statements include, but are not limited to, statements regarding NXRT’s business and industry in general, pro-forma debt allocation and capital structure and related assumptions, including paydowns of property level debt in connection with dispositions and the paydown of the Company’s Corporate Credit Facility (as defined below) in Q1 2024 with the net proceeds from the sale of Old Farm, forecasted submarket deliveries, 2024 full year guidance and the related components and assumptions, including acquisitions and dispositions, shares outstanding, interest expense and the related components and same store growth projections, NXRT’s net asset value and the related components and assumptions, estimated value-add expenditures, estimated proceeds from dispositions, debt payments, dispositions, outstanding debt and shares outstanding, guidance for the first quarter 2024 and the related assumptions, planned value-add programs, including projected average rehab costs, rent change and return on investment, expected settlement of interest rate swaps and the effect on the debt maturity schedule, rehab budgets, and expected acquisitions and dispositions, related timing, expected sales prices, estimated investment returns and net cash proceeds. They are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statement, including those described in greater detail in our filings with the Securities and Exchange Commission, particularly those described in our Annual Report on Form 10-K. Readers should not place undue reliance on any forward-looking statements and are encouraged to review the Company’s most recent Annual Report on Form 10-K and other filings with the SEC for a more complete discussion of the risks and other factors that could affect any forward-looking statements. The statements made herein speak only as of the date of this release and except as required by law, NXRT does not undertake any obligation to publicly update or revise any forward-looking statements.
FFO, Core FFO and AFFO
The following table reconciles our calculations of FFO, Core FFO and AFFO to net income (loss), the most directly comparable GAAP financial measure, for the years ended December 31, 2023, 2022 and 2021 and for the three months ended December 31, 2023 and 2022 (in thousands, except per share amounts):
|
For the Year Ended December 31, |
For the Three Months Ended |
|||||||||||||||||||
|
2023 |
2022 |
2021 |
2023 |
2022 |
||||||||||||||||
|
Net income (loss) |
$ |
44,433 |
$ |
(9,291) |
$ |
23,106 |
$ |
18,421 |
$ |
3,802 |
||||||||||
|
Depreciation and amortization |
95,186 |
97,648 |
86,878 |
24,251 |
23,158 |
|||||||||||||||
|
Gain on sales of real estate |
(67,926) |
(14,684) |
(46,214) |
(24,836) |
(14,684) |
|||||||||||||||
|
Adjustment for noncontrolling interests |
(273) |
(276) |
(191) |
(68) |
(48) |
|||||||||||||||
|
FFO attributable to common stockholders |
71,420 |
73,397 |
63,579 |
17,768 |
12,228 |
|||||||||||||||
|
FFO per share – basic |
$ |
2.78 |
$ |
2.87 |
$ |
2.53 |
$ |
0.69 |
$ |
0.48 |
||||||||||
|
FFO per share – diluted |
$ |
2.72 |
$ |
2.81 |
$ |
2.47 |
$ |
0.68 |
$ |
0.47 |
||||||||||
|
Loss on extinguishment of debt and modification costs |
2,409 |
8,734 |
912 |
316 |
8,734 |
|||||||||||||||
|
Casualty-related expenses/(recoveries) |
(2,214) |
1,119 |
(199) |
(882) |
456 |
|||||||||||||||
|
Casualty losses (gains) |
856 |
(2,506) |
(2,595) |
(124) |
(2,149) |
|||||||||||||||
|
Gain on forfeited deposits |
(250) |
— |
— |
— |
— |
|||||||||||||||
|
Amortization of deferred financing costs – acquisition term notes |
1,321 |
1,083 |
737 |
330 |
297 |
|||||||||||||||
|
Adjustment for noncontrolling interests |
(8) |
(31) |
4 |
1 |
(28) |
|||||||||||||||
|
Core FFO attributable to common stockholders |
73,534 |
81,796 |
62,438 |
17,409 |
19,538 |
|||||||||||||||
|
Core FFO per share – basic |
$ |
2.87 |
$ |
3.19 |
$ |
2.48 |
$ |
0.68 |
$ |
0.76 |
||||||||||
|
Core FFO per share – diluted |
$ |
2.80 |
$ |
3.13 |
$ |
2.42 |
$ |
0.66 |
$ |
0.75 |
||||||||||
|
Amortization of deferred financing costs – long term debt |
1,624 |
1,696 |
1,460 |
402 |
449 |
|||||||||||||||
|
Equity-based compensation expense |
9,287 |
7,911 |
6,997 |
2,332 |
2,005 |
|||||||||||||||
|
Adjustment for noncontrolling interests |
(41) |
(37) |
(25) |
(11) |
(10) |
|||||||||||||||
|
AFFO attributable to common stockholders |
84,404 |
91,366 |
70,870 |
20,132 |
21,982 |
|||||||||||||||
|
AFFO per share – basic |
$ |
3.29 |
$ |
3.57 |
$ |
2.82 |
$ |
0.78 |
$ |
0.86 |
||||||||||
|
AFFO per share – diluted |
$ |
3.22 |
$ |
3.49 |
$ |
2.75 |
$ |
0.77 |
$ |
0.84 |
||||||||||
|
Weighted average common shares outstanding – basic |
25,654 |
25,610 |
25,170 |
25,674 |
25,549 |
|||||||||||||||
|
Weighted average common shares outstanding – diluted |
(1) |
26,245 |
26,151 |
25,760 |
26,298 |
26,077 |
||||||||||||||
|
Dividends declared per common share |
$ |
1.72242 |
$ |
1.56 |
$ |
1.40375 |
$ |
0.46242 |
$ |
0.42 |
||||||||||
|
Net income (loss) Coverage – diluted |
(2) |
0.98x |
-0.23x |
0.63x |
1.51x |
0.36x |
||||||||||||||
|
FFO Coverage – diluted |
(2) |
1.58x |
1.80x |
1.76x |
1.46x |
1.12x |
||||||||||||||
|
Core FFO Coverage – diluted |
(2) |
1.63x |
2.01x |
1.73x |
1.43x |
1.78x |
||||||||||||||
|
AFFO Coverage – diluted |
(2) |
1.87x |
2.24x |
1.96x |
1.66x |
2.01x |
||||||||||||||
|
(1) |
The Company uses actual diluted weighted average common shares outstanding when in a dilutive position for FFO, Core FFO and AFFO. |
|
(2) |
Indicates coverage ratio of Net Income (Loss)/FFO/Core FFO/AFFO per common share (diluted) over dividends declared per common share during the period. |
Definitions and Reconciliations of Non-GAAP Measures
Definitions
This presentation contains non-GAAP financial measures. A “non-GAAP financial measure” is defined as a numerical measure of a company’s financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with GAAP in the statements of income, balance sheets or statements of cash flows of the Company. The non-GAAP financial measures used within this presentation are net operating income (“NOI”), funds from operations attributable to common stockholders (“FFO”), FFO per diluted share, Core FFO, Core FFO per diluted share, adjusted FFO (“AFFO”), AFFO per diluted share and net debt.
NOI is used by investors and our management to evaluate and compare the performance of our properties to other comparable properties, to determine trends in earnings and to compute the fair value of our properties. NOI is calculated by adjusting net income (loss) to add back (1) interest expense (2) advisory and administrative fees, (3) the impact of : (a) depreciation and amortization expenses and (b) gains or losses from the sale of operating real estate assets that are included in net income computed in accordance with GAAP, (4) corporate general and administrative expenses, (5) other gains and losses that are specific to us including loss on extinguishment of debt and modification costs, (6) casualty-related expenses/(recoveries) and casualty gains (losses), (7) gain on forfeited deposits, (8) equity in earnings from affiliate and (9) property general and administrative expenses that are not reflective of the continuing operations of the properties or are incurred on behalf of the Company at the property for expenses such as legal, professional, centralized leasing service and franchise tax fees. We define “Same Store NOI” as NOI for our properties that are comparable between periods. We view Same Store NOI as an important measure of the operating performance of our properties because it allows us to compare operating results of properties owned for the entirety of the current and comparable periods and therefore eliminates variations caused by acquisitions or dispositions during the periods.
FFO is defined by the National Association of Real Estate Investment Trusts (“NAREIT”), as net income (loss) computed in accordance with GAAP, excluding gains or losses from real estate dispositions, plus real estate depreciation and amortization. We compute FFO in accordance with NAREIT’s definition. Our presentation differs slightly in that we begin with net income (loss) before adjusting for amounts attributable to redeemable noncontrolling interests in the OP and we show the combined amounts attributable to such noncontrolling interests as an adjustment to arrive at FFO attributable to common stockholders.
Core FFO makes certain adjustments to FFO, which are either not likely to occur on a regular basis or are otherwise not representative of the ongoing operating performance of our Portfolio. Core FFO adjusts FFO to remove items such as losses on extinguishment of debt and modification costs (includes prepayment penalties and defeasance costs incurred on the early payment of debt, the write-off of unamortized deferred financing costs and fair market value adjustments of assumed debt related to the retirement of debt, costs incurred in connection with a debt modification that are not capitalized as deferred financing costs and other costs incurred in a debt extinguishment that are expensed), casualty-related expenses/and recoveries and gains (losses), gain on forfeited deposits, the amortization of deferred financing costs incurred in connection with obtaining short-term debt financing, and the noncontrolling interests (as described above) related to these items.
AFFO makes certain adjustments to Core FFO in order to arrive at a more refined measure of the operating performance of our portfolio. There is no industry standard definition of AFFO and practice is divergent across the industry. AFFO adjusts Core FFO to remove items such as equity-based compensation expense and the amortization of deferred financing costs incurred in connection with obtaining long-term debt financing, and the noncontrolling interests related to these items.
Net debt is calculated by subtracting cash and cash equivalents and restricted cash held for value-add upgrades and green improvements from total debt outstanding.
We believe that the use of NOI, FFO, Core FFO, AFFO and net debt, combined with the required GAAP presentations, improves the understanding of operating results and debt levels of real estate investment trusts (“REITs”) among investors and makes comparisons of operating results and debt levels among such companies more meaningful. While NOI, FFO, Core FFO, AFFO and net debt are relevant and widely used measures of operating performance and debt levels of REITs, they do not represent cash flows from operations, net income (loss) or total debt as defined by GAAP and should not be considered an alternative to those measures in evaluating our liquidity, operating performance and debt levels. NOI, FFO, Core FFO and AFFO do not purport to be indicative of cash available to fund our future cash requirements. We present net debt because we believe it provides our investors a better understanding of our leverage ratio. Net debt should not be considered an alternative to total debt, as we may not always be able to use our available cash to repay debt. Our computation of NOI, FFO, Core FFO, AFFO and net debt may not be comparable to NOI, FFO, Core FFO, AFFO and net debt reported by other REITs. For a more complete discussion of NOI, FFO, Core FFO and AFFO, see our most recent Annual Report on Form 10-K and our other filings with the SEC.
Reconciliations
NOI and Same Store NOI
The following table, which has not been adjusted for the effects of noncontrolling interests, reconciles NOI and our 2022-2023 and our Q4 Same Store NOI for the years and three months ended December 31, 2023 and 2022 to net income (loss), the most directly comparable GAAP financial measure (in thousands):
|
For the Year Ended December 31, |
For the Three Months Ended |
|||||||||||||||
|
2023 |
2022 |
2023 |
2022 |
|||||||||||||
|
Net income (loss) |
$ |
44,433 |
$ |
(9,291) |
$ |
18,421 |
$ |
3,802 |
||||||||
|
Adjustments to reconcile net income (loss) to NOI |
||||||||||||||||
|
Advisory and administrative fees |
7,645 |
7,547 |
1,863 |
1,932 |
||||||||||||
|
Corporate general and administrative expenses |
16,663 |
14,670 |
3,920 |
3,554 |
||||||||||||
|
Casualty-related expenses/(recoveries) |
(1) |
(2,214) |
1,119 |
(882) |
456 |
|||||||||||
|
Casualty losses (gains) |
856 |
(2,506) |
(124) |
(2,149) |
||||||||||||
|
Gain on forfeited deposits |
(250) |
— |
— |
— |
||||||||||||
|
Property general and administrative expenses |
(2) |
3,701 |
3,600 |
1,005 |
1,191 |
|||||||||||
|
Depreciation and amortization |
95,186 |
97,648 |
24,251 |
23,158 |
||||||||||||
|
Interest expense |
67,106 |
50,587 |
18,256 |
15,783 |
||||||||||||
|
Equity in earnings of affiliate |
(205) |
— |
(28) |
— |
||||||||||||
|
Loss on extinguishment of debt and modification costs |
2,409 |
8,734 |
316 |
8,734 |
||||||||||||
|
Gain on sales of real estate |
(67,926) |
(14,684) |
(24,836) |
(14,684) |
||||||||||||
|
NOI |
$ |
167,404 |
$ |
157,424 |
$ |
42,162 |
$ |
41,777 |
||||||||
|
Less Non-Same Store |
||||||||||||||||
|
Revenues |
(41,581) |
(44,017) |
(6,071) |
(9,298) |
||||||||||||
|
Operating expenses |
19,327 |
21,101 |
2,974 |
5,073 |
||||||||||||
|
Operating income |
(151) |
(488) |
(5) |
(160) |
||||||||||||
|
Same Store NOI |
$ |
144,999 |
$ |
134,020 |
$ |
39,060 |
$ |
37,392 |
||||||||
|
(1) |
Adjustment to net income (loss) to exclude certain property operating expenses that are casualty-related expenses/(recoveries). |
|
(2) |
Adjustment to net income (loss) to exclude certain property general and administrative expenses that are not reflective of the continuing operations of the properties or are incurred on our behalf at the property for expenses such as legal, professional, centralized leasing service and franchise tax fees. |
The following table, which has not been adjusted for the effects of noncontrolling interests, reconciles our NOI and our 2021-2023 Same Store NOI for the years ended December 31, 2023, 2022 and 2021 to net income (loss), the most directly comparable GAAP financial measure (in thousands):
|
For the Year Ended December 31, |
||||||||||||
|
2023 |
2022 |
2021 |
||||||||||
|
Net income (loss) |
$ |
44,433 |
$ |
(9,291) |
$ |
23,106 |
||||||
|
Adjustments to reconcile net income (loss) to NOI: |
||||||||||||
|
Advisory and administrative fees |
7,645 |
7,547 |
7,631 |
|||||||||
|
Corporate general and administrative expenses |
16,663 |
14,670 |
11,966 |
|||||||||
|
Casualty-related expenses/(recoveries) |
(1) |
(2,214) |
1,119 |
(199) |
||||||||
|
Casualty losses (gains) |
856 |
(2,506) |
(2,595) |
|||||||||
|
Gain on forfeited deposits |
(250) |
— |
— |
|||||||||
|
Property general and administrative expenses |
(2) |
3,701 |
3,600 |
2,539 |
||||||||
|
Depreciation and amortization |
95,186 |
97,648 |
86,878 |
|||||||||
|
Interest expense |
67,106 |
50,587 |
44,623 |
|||||||||
|
Equity in earnings of affiliate |
(205) |
— |
— |
|||||||||
|
Loss on extinguishment of debt and modification costs |
2,409 |
8,734 |
912 |
|||||||||
|
Gain on sales of real estate |
(67,926) |
(14,684) |
(46,214) |
|||||||||
|
NOI |
$ |
167,404 |
$ |
157,424 |
$ |
128,647 |
||||||
|
Less Non-Same Store |
||||||||||||
|
Revenues |
(64,731) |
(65,875) |
(46,236) |
|||||||||
|
Operating expenses |
28,203 |
29,116 |
21,355 |
|||||||||
|
Operating income |
(285) |
(930) |
(1,303) |
|||||||||
|
Same Store NOI |
$ |
130,591 |
$ |
119,735 |
$ |
102,463 |
||||||
|
(1) |
Adjustment to net income (loss) to exclude certain property operating expenses that are casualty-related expenses/(recoveries). |
|
(2) |
Adjustment to net income (loss) to exclude certain property general and administrative expenses that are not reflective of the continuing operations of the properties or are incurred on our behalf at the property for expenses such as legal, professional, centralized leasing service and franchise tax fees. |
Reconciliation of Debt to Net Debt
|
(dollar amounts in thousands) |
FY 2023 |
FY 2022 |
FY 2021 |
|||||||||
|
Total mortgage debt |
$ |
1,551,236 |
$ |
1,607,028 |
$ |
1,281,146 |
||||||
|
Credit facilities |
24,000 |
74,500 |
280,000 |
|||||||||
|
Total Debt |
1,575,236 |
1,681,528 |
1,561,146 |
|||||||||
|
Adjustments to arrive at net debt: |
||||||||||||
|
Cash and cash equivalents |
(12,367) |
(16,762) |
(49,450) |
|||||||||
|
Restricted cash held for value-add upgrades and green improvements |
(2,929) |
(11,894) |
(11,875) |
|||||||||
|
Net Debt |
$ |
1,559,940 |
$ |
1,652,872 |
$ |
1,499,821 |
||||||
|
Enterprise Value (1) |
$ |
2,443,940 |
$ |
2,764,872 |
$ |
3,637,821 |
||||||
|
Leverage Ratio |
64 |
% |
60 |
% |
41 |
% |
||||||
|
(1) |
Enterprise Value is calculated as Market Capitalization as of December 31, 2023 plus Net Debt. |
Guidance Reconciliations of NOI, Same Store NOI, FFO, Core FFO and AFFO
The following table, which has not been adjusted for the effects of noncontrolling interests, reconciles our 2024 NOI guidance to our net income (the most directly comparable GAAP financial measure) guidance for the year ended December 31, 2024 and for the three months ended March 31, 2024 (in thousands):
|
For the Year Ended December 31, 2024 |
For the Three Months |
||||||||
|
Mid-Point (1) |
Mid-Point (1) |
||||||||
|
Net income |
$ |
18,524 |
$ |
22,434 |
|||||
|
Adjustments to reconcile net loss to NOI: |
|||||||||
|
Advisory and administrative fees |
7,675 |
1,908 |
|||||||
|
Corporate general and administrative expenses |
18,135 |
4,128 |
|||||||
|
Property general and administrative expenses |
(2) |
4,818 |
1,206 |
||||||
|
Depreciation and amortization |
99,126 |
25,767 |
|||||||
|
Interest expense |
57,140 |
14,670 |
|||||||
|
Loss on extinguishment of debt and modification costs |
805 |
550 |
|||||||
|
Equity in earnings of affiliate |
(240) |
(60) |
|||||||
|
Gain on sales of real estate |
(49,427) |
(30,243) |
|||||||
|
NOI |
(3) |
$ |
156,556 |
$ |
40,360 |
||||
|
Less Non-Same Store |
|||||||||
|
Revenues |
(4) |
(7,016) |
|||||||
|
Operating expenses |
(4) |
3,194 |
|||||||
|
Same Store NOI |
(4) |
$ |
152,734 |
||||||
|
(1) |
Mid-Point estimates shown for full year and first quarter 2024 guidance. Assumptions made for full year and first quarter 2024 NOI guidance include the Same Store operating growth projections included in the “2024 Full Year Guidance Summary” section of this release and the effect of the acquisition and dispositions throughout the fiscal year. |
|
(2) |
Adjustment to net income to exclude certain property general and administrative expenses that are not reflective of the continuing operations of the properties or are incurred on our behalf at the property for expenses such as legal, professional, centralized leasing service and franchise tax fees. |
|
(3) |
FY 2024 NOI Guidance considers the forecast dispositions of Old Farm, Stone Creek at Old Farm and Radbourne Lake, and considers a commensurate volume of capital recycling. |
|
(4) |
Year-over-year growth for the Full Year 2024 pro forma Same Store pool (35 properties). |
The following table reconciles our FFO, Core FFO and AFFO guidance to our net income (the most directly comparable GAAP financial measure) guidance for the year ended December 31, 2024 (in thousands, except per share data):
|
For the Year Ended |
||||
|
Mid-Point |
||||
|
Net income |
$ |
18,524 |
||
|
Depreciation and amortization |
99,126 |
|||
|
Gain on sales of real estate |
(49,427) |
|||
|
Adjustment for noncontrolling interests |
(297) |
|||
|
FFO attributable to common stockholders |
67,926 |
|||
|
FFO per share – diluted (1) |
$ |
2.66 |
||
|
Loss on extinguishment of debt and modification costs |
805 |
|||
|
Amortization of deferred financing costs – acquisition term notes |
872 |
|||
|
Adjustment for noncontrolling interests |
(3) |
|||
|
Core FFO attributable to common stockholders |
69,600 |
|||
|
Core FFO per share – diluted (1) |
$ |
2.72 |
||
|
Amortization of deferred financing costs – long term debt |
1,656 |
|||
|
Equity-based compensation expense |
10,395 |
|||
|
Adjustment for noncontrolling interests |
(48) |
|||
|
AFFO attributable to common stockholders |
81,603 |
|||
|
AFFO per share – diluted (1) |
$ |
3.19 |
||
|
Weighted average common shares outstanding – diluted |
25,559 |
|||
|
(1) |
For purposes of calculating per share data, we assume a weighted average diluted share count of approximately 25.6 million for the full year 2024. |
The following table reconciles our NOI to our net income (loss) for the years ended December 31, 2020, 2019, 2018, 2017, 2016 and 2015 (in thousands):
|
For the Year Ended December 31, |
||||||||||||||||||||||||
|
2020 |
2019 |
2018 |
2017 |
2016 |
2015 |
|||||||||||||||||||
|
Net income (loss) |
$ |
44,150 |
$ |
99,438 |
$ |
(1,614) |
$ |
56,359 |
$ |
25,888 |
$ |
(10,992) |
||||||||||||
|
Adjustments to reconcile net income (loss) to NOI: |
||||||||||||||||||||||||
|
Advisory and administrative fees |
7,670 |
7,500 |
7,474 |
7,419 |
6,802 |
5,565 |
||||||||||||||||||
|
Corporate general and administrative expenses |
10,035 |
9,613 |
7,808 |
6,275 |
4,014 |
2,455 |
||||||||||||||||||
|
Casualty-related expenses/(recoveries) |
789 |
(34) |
(663) |
(287) |
151 |
25 |
||||||||||||||||||
|
Casualty losses |
(5,886) |
3,488 |
— |
— |
— |
— |
||||||||||||||||||
|
Property general and administrative expenses |
2,400 |
1,939 |
1,294 |
1,130 |
879 |
1,109 |
||||||||||||||||||
|
Depreciation and amortization |
82,411 |
69,086 |
47,470 |
48,752 |
35,643 |
40,801 |
||||||||||||||||||
|
Interest expense |
44,753 |
37,385 |
28,572 |
29,576 |
20,167 |
17,817 |
||||||||||||||||||
|
Loss on extinguishment of debt and modification costs |
1,470 |
2,869 |
3,576 |
5,719 |
1,722 |
652 |
||||||||||||||||||
|
Gain on sales of real estate |
(69,151) |
(127,684) |
(13,742) |
(78,365) |
(25,932) |
— |
||||||||||||||||||
|
Acquisition costs |
— |
— |
— |
— |
386 |
2,975 |
||||||||||||||||||
|
NOI |
$ |
118,641 |
$ |
103,600 |
$ |
80,175 |
$ |
76,578 |
$ |
69,720 |
$ |
60,407 |
||||||||||||
The following table reconciles our FFO, Core FFO and AFFO to our net income (loss) for the years ended December 31, 2020, 2019, 2018, 2017, 2016 and 2015 (in thousands):
|
For the Year Ended December 31, |
||||||||||||||||||||||||
|
2020 |
2019 |
2018 |
2017 |
2016 |
2015 |
|||||||||||||||||||
|
Net income (loss) |
$ |
44,150 |
$ |
99,438 |
$ |
(1,614) |
$ |
56,359 |
$ |
25,888 |
$ |
(10,992) |
||||||||||||
|
Depreciation and amortization |
82,411 |
69,086 |
47,470 |
48,752 |
35,643 |
40,801 |
||||||||||||||||||
|
Gain on sales of real estate |
(69,151) |
(127,684) |
(13,742) |
(78,365) |
(25,932) |
— |
||||||||||||||||||
|
Adjustment for noncontrolling interests |
(172) |
(122) |
(96) |
(1,695) |
(4,583) |
(4,170) |
||||||||||||||||||
|
FFO attributable to common stockholders |
57,238 |
40,718 |
32,018 |
25,051 |
31,016 |
25,639 |
||||||||||||||||||
|
FFO per share – basic |
$ |
2.32 |
$ |
1.69 |
$ |
1.51 |
$ |
1.19 |
$ |
1.46 |
$ |
1.20 |
||||||||||||
|
FFO per share – diluted |
$ |
2.27 |
$ |
1.66 |
$ |
1.48 |
$ |
1.17 |
$ |
1.46 |
$ |
1.20 |
||||||||||||
|
Acquisition costs |
1,470 |
2,869 |
— |
— |
386 |
2,975 |
||||||||||||||||||
|
Loss on extinguishment of debt and modification costs |
790 |
(34) |
3,576 |
5,719 |
1,722 |
652 |
||||||||||||||||||
|
Casualty-related expenses/(recoveries) |
(5,886) |
3,488 |
(663) |
— |
— |
— |
||||||||||||||||||
|
Change in fair value on derivative instruments – ineffective portion |
510 |
— |
— |
(309) |
(1,683) |
— |
||||||||||||||||||
|
Amortization of deferred financing costs – acquisition term notes |
1,384 |
553 |
159 |
403 |
— |
— |
||||||||||||||||||
|
Adjustment for noncontrolling interests |
6 |
(21) |
(9) |
(429) |
(94) |
(322) |
||||||||||||||||||
|
Core FFO attributable to common stockholders |
55,512 |
47,573 |
35,081 |
30,435 |
31,347 |
28,944 |
||||||||||||||||||
|
Core FFO per share – basic |
$ |
2.25 |
$ |
1.97 |
$ |
1.66 |
$ |
1.45 |
$ |
1.48 |
$ |
1.36 |
||||||||||||
|
Core FFO per share – diluted |
$ |
2.20 |
$ |
1.93 |
$ |
1.62 |
$ |
1.42 |
$ |
1.47 |
$ |
1.36 |
||||||||||||
|
Amortization of deferred financing costs – long term debt |
1,453 |
1,530 |
1,491 |
1,592 |
1,423 |
1,081 |
||||||||||||||||||
|
Equity-based compensation expense |
5,504 |
5,130 |
4,198 |
3,108 |
825 |
— |
||||||||||||||||||
|
Adjustment for noncontrolling interests |
(21) |
(20) |
(17) |
(76) |
(140) |
(92) |
||||||||||||||||||
|
AFFO attributable to common stockholders |
62,448 |
54,213 |
40,753 |
35,059 |
33,455 |
29,933 |
||||||||||||||||||
|
AFFO per share – basic |
$ |
2.53 |
$ |
2.25 |
$ |
1.92 |
$ |
1.66 |
$ |
1.58 |
$ |
1.41 |
||||||||||||
|
AFFO per share – diluted |
$ |
2.47 |
$ |
2.20 |
$ |
1.88 |
$ |
1.64 |
$ |
1.57 |
$ |
1.41 |
||||||||||||
|
Weighted average common shares outstanding – basic |
24,715 |
24,116 |
21,189 |
21,057 |
21,232 |
21,294 |
||||||||||||||||||
|
Weighted average common shares outstanding – diluted |
25,234 |
24,593 |
21,667 |
21,399 |
21,314 |
21,294 |
||||||||||||||||||
Contact:
Investor Relations
Kristen Thomas
IR@nexpoint.com
(214) 276-6300
Media inquiries: Pro-Nexpoint@prosek.com
View original content to download multimedia:https://www.prnewswire.com/news-releases/nexpoint-residential-trust-inc-reports-fourth-quarter-and-full-year-2023-results-302066021.html
SOURCE NexPoint Residential Trust, Inc.
