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UMH PROPERTIES, INC. REPORTS RESULTS FOR THE FIRST QUARTER ENDED MARCH 31, 2021

05/06/2021

FREEHOLD, NJ, May 06, 2021 (GLOBE NEWSWIRE) -- UMH Properties, Inc. (NYSE:UMH) reported Total Income for the quarter ended March 31, 2021 of $43.1 million as compared to $37.6 million for the quarter ended March 31, 2020, representing an increase of 15%. Net Income Attributable to Common Shareholders amounted to $6.8 million or $0.16 per diluted share for the quarter ended March 31, 2021 as compared to a Net Loss of $42.8 million or $1.04 per diluted share for the quarter ended March 31, 2020.

Funds from Operations Attributable to Common Shareholders (“FFO”), was $8.4 million or $0.19 per diluted share for the quarter ended March 31, 2021 as compared to $6.1 million or $0.15 per diluted share for the quarter ended March 31, 2020. Normalized Funds from Operations Attributable to Common Shareholders (“Normalized FFO”), was $8.7 million or $0.20 per diluted share for the quarter ended March 31, 2021, as compared to $6.1 million or $0.15 per diluted share for the quarter ended March 31, 2020. 

A summary of significant financial information for the three months ended March 31, 2021 and 2020 is as follows (in thousands except per share amounts):

    For the Three Months Ended  
    March 31,  
    2021     2020  
             
Total Income   $ 43,132     $ 37,573  
Total Expenses   $ 36,188     $ 31,819  
Increase (Decrease) in Fair Value of Marketable Securities   $ 10,219     $ (38,593 )
Net Income (Loss) Attributable to Common Shareholders   $ 6,839     $ (42,838 )
Net Income (Loss) Attributable to Common
Shareholders per Diluted Common Share
  $ 0.16     $ (1.04 )
FFO (1)   $ 8,381     $ 6,089  
FFO (1) per Diluted Common Share   $ 0.19     $ 0.15  
Normalized FFO (1)   $ 8,701     $ 6,089  
Normalized FFO (1) per Diluted Common Share   $ 0.20     $ 0.15  
Diluted Weighted Average Shares Outstanding     43,275       41,173  

A summary of significant balance sheet information as of March 31, 2021 and December 31, 2020 is as follows (in thousands):

    March 31,

2021
    December 31,

2020
 
             
             
Gross Real Estate Investments   $ 1,127,528     $ 1,108,483  
Marketable Securities at Fair Value   $ 108,155     $ 103,172  
Total Assets   $ 1,120,024     $ 1,087,214  
Mortgages Payable, net   $ 468,833     $ 469,279  
Loans Payable, net   $ 75,790     $ 87,009  
Total Shareholders’ Equity   $ 545,248     $ 501,808  
                 

Samuel A. Landy, President and CEO, commented on the results of the first quarter of 2021.

“We are pleased to announce another solid quarter of operating results and an excellent start to 2021. During the quarter, we: 

  • Increased Rental and Related Income by 13%;
  • Increased Community Net Operating Income (“NOI”) by 14%;
  • Increased Normalized Funds from Operations (“Normalized FFO”) by 43% and Normalized FFO per share by 33%;
  • Improved our Operating Expense ratio by 80 basis points to 44.3%;
  • Increased Same Property NOI by 16%;
  • Increased Same Property Occupancy by 320 basis points from 83.1% to 86.3%;
  • Increased our rental home portfolio by 218 homes from yearend 2020 to approximately 8,500 total rental homes, representing an increase of 3%;
  • Increased rental home occupancy by 80 basis points from 94.6% at yearend 2020 to 95.4% at quarter end;
  • Increased Sales of Manufactured Homes by 37%;
  • Acquired two communities containing approximately 337 homesites for a total cost of approximately $8.0 million;
  • Raised our quarterly common stock dividend by 5.5% to $0.19 per share or $0.76 annually;
  • Issued and sold approximately 352,000 shares of Common Stock through an At-the-Market Sale Program for our Common Stock at a weighted average price of $19.08 per share, generating gross proceeds of $6.7 million and net proceeds of $6.6 million, after offering expenses;
  • Issued and sold, through At-the-Market Sale Programs for our Preferred Stock, 1.3 million shares of Series D Preferred Stock at a weighted average price of $24.85 per share, generating total gross proceeds of $31.4 million and total net proceeds of $30.9 million, after offering expenses;
  • Reduced our Net Debt to Total Market Capitalization from 34% at yearend 2020 to 29% at quarter end;
  • Subsequent to quarter end, issued and sold approximately 2.1 million shares of Common Stock through an At-the-Market Sale Program for our Common Stock at a weighted average price of $19.41 per share, generating gross proceeds of $39.8 million and net proceeds of $39.2 million, after offering expenses; and
  • Subsequent to quarter end, issued and sold, through At-the-Market Sale Programs for our Preferred Stock, 911,000 shares of Series D Preferred Stock at a weighted average price of $24.93 per share, generating total gross proceeds of $22.7 million and total net proceeds of $22.4 million, after offering expenses.”

Mr. Landy stated, “We are proud of the results that we were able to achieve in 2020 and are happy to report that we have produced similar results for the first quarter of 2021. Normalized FFO was $0.20 for the quarter representing an increase of 33% year over year. During the quarter, we raised our common stock dividend 5.5% to $0.19 per quarter or $0.76 per year.” 

“UMH continues to deliver industry leading operating results. These results highlight the strong demand for affordable housing in all of our markets. Same property occupancy was up 320 basis points year over year to 86.3%. This increase in occupancy was the result of the addition of 218 new rental homes to our portfolio and a 37% increase in home sales. Our occupancy gains and rent increases generated same store NOI growth of 16%.” 

“These results are only possible because of our years of hard work laying the foundation for tremendous earnings growth and value appreciation. Our business plan has created a runway for us to deliver organic growth for years to come. We currently have 3,500 vacant sites within our existing communities that we intend on filling with homes for rent and sale. We also have 1,800 acres of undeveloped land that can be developed into 7,200 home sites. We also continue to seek additional external growth opportunities. During the quarter, we closed on the acquisitions of two communities containing 337 sites for a total purchase price of $8 million. These acquisitions are in new markets, Alabama and South Carolina, and we intend on acquiring additional communities in these states. Our internal and external growth opportunities pave the way for continued FFO and dividend growth for the foreseeable future.” 

UMH Properties, Inc. will host its First Quarter 2021 Financial Results Webcast and Conference Call. Senior management will discuss the results, current market conditions and future outlook on Friday, May 7, 2021 at 10:00 a.m. Eastern Time. 

The Company’s 2021 first quarter financial results being released herein will be available on the Company’s website at www.umh.reit in the “Financials” section. 

To participate in the webcast, select the webcast icon on the homepage of the Company’s website at www.umh.reit, in the Upcoming Events section. Interested parties can also participate via conference call by calling toll free 877-513-1898 (domestically) or 412-902-4147 (internationally). 

The replay of the conference call will be available at 12:00 p.m. Eastern Time on Friday, May 7, 2021. It will be available until August 1, 2021 and can be accessed by dialing toll free 877-344-7529 (domestically) and 412-317-0088 (internationally) and entering the passcode 10153820. A transcript of the call and the webcast replay will be available at the Company's website, www.umh.reit

UMH Properties, Inc., which was organized in 1968, is a public equity REIT that owns and operates 126 manufactured home communities containing approximately 23,800 developed homesites. These communities are located in New Jersey, New York, Ohio, Pennsylvania, Tennessee, Indiana, Michigan, Maryland, Alabama and South Carolina. In addition, the Company owns a portfolio of REIT securities. 

Certain statements included in this press release which are not historical facts may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements are based on the Company’s current expectations and involve various risks and uncertainties. Although the Company believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the Company can provide no assurance those expectations will be achieved. The risks and uncertainties that could cause actual results or events to differ materially from expectations are contained in the Company’s annual report on Form 10-K and described from time to time in the Company’s other filings with the SEC. The Company undertakes no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events, or otherwise. 

Note: 

(1) Non-GAAP Information: We assess and measure our overall operating results based upon an industry performance measure referred to as Funds from Operations Attributable to Common Shareholders (“FFO”), which management believes is a useful indicator of our operating performance. FFO is used by industry analysts and investors as a supplemental operating performance measure of a REIT. FFO, as defined by The National Association of Real Estate Investment Trusts (“NAREIT”), represents net income (loss) attributable to common shareholders, as defined by accounting principles generally accepted in the United States of America (“U.S. GAAP”), excluding extraordinary items, as defined under U.S. GAAP, gains or losses from sales of previously depreciated real estate assets, impairment charges related to depreciable real estate assets, the change in the fair value of marketable securities, and the gain or loss on the sale of marketable securities plus certain non-cash items such as real estate asset depreciation and amortization. Included in the NAREIT FFO White Paper - 2018 Restatement, is an option pertaining to assets incidental to our main business in the calculation of NAREIT FFO to make an election to include or exclude gains and losses on the sale of these assets, such as marketable equity securities, and include or exclude mark-to-market changes in the value recognized on these marketable equity securities. In conjunction with the adoption of the FFO White Paper - 2018 Restatement, for all periods presented, we have elected to exclude the gains and losses realized on marketable securities investments and the change in the fair value of marketable securities from our FFO calculation. NAREIT created FFO as a non-U.S. GAAP supplemental measure of REIT operating performance. We define Normalized Funds from Operations Attributable to Common Shareholders (“Normalized FFO”), as FFO excluding certain one-time charges. FFO and Normalized FFO should be considered as supplemental measures of operating performance used by REITs. FFO and Normalized FFO exclude historical cost depreciation as an expense and may facilitate the comparison of REITs which have a different cost basis. However, other REITs may use different methodologies to calculate FFO and Normalized FFO and, accordingly, our FFO and Normalized FFO may not be comparable to all other REITs. The items excluded from FFO and Normalized FFO are significant components in understanding the Company’s financial performance. 

FFO and Normalized FFO (i) do not represent Cash Flow from Operations as defined by U.S. GAAP; (ii) should not be considered as alternatives to net income (loss) as a measure of operating performance or to cash flows from operating, investing and financing activities; and (iii) are not alternatives to cash flow as a measure of liquidity. 

The reconciliation of the Company’s U.S. GAAP net loss to the Company’s FFO and Normalized FFO for the three months ended March 31, 2021 and 2020 are calculated as follows (in thousands):

 

 

    Three Months Ended  
    3/31/21     3/31/20  
Net Income (Loss) Attributable to Common Shareholders   $ 6,839     $ (42,838 )
Depreciation Expense     11,008       10,227  
Loss on Sales of Depreciable Assets     23       107  
(Increase) Decrease in Fair Value of Marketable Securities     (10,219 )     38,593  
Loss on Sales of Marketable Securities, net     730       -0-  
FFO Attributable to Common Shareholders     8,381       6,089  
Non- Recurring Other Expense (2)     320       -0-  
Normalized FFO Attributable to Common Shareholders   $ 8,701     $ 6,089  

The diluted weighted shares outstanding used in the calculation of FFO per Diluted Common Share and Normalized FFO per Diluted Common Share were 3.2 million shares for the three months ended March 31, 2021 and 41.5 million for the three months ended March 31, 2020. Common stock equivalents resulting from stock options in the amount of 898,000 shares for the three months ended March 31, 2020 are included in the diluted weighted shares outstanding. Common stock equivalents resulting from stock options in the amount of 355,000 shares for the three months ended March 31, 2020 were excluded from the computation of Diluted Net Loss per Share as their effect would have been anti-dilutive.

The following are the cash flows provided (used) by operating, investing and financing activities for the three months ended March 31, 2021 and 2020 (in thousands)

    2021     2020  
Operating Activities   $ 13,215     $ 17,295  
Investing Activities     (18,726 )     (20,477 )
Financing Activities     16,971       6,387  

(2) Consists of special bonus and restricted stock grants for the August 2020 groundbreaking Fannie Mae financing.

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Contact: Nelli Madden
732-577-9997

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