18% Increase in Quarterly Distribution
LAS
VEGAS, Feb. 22, 2024 /PRNewswire/ -- AMH
(NYSE: AMH) (the "Company"), a leading large-scale integrated
owner, operator and developer of single-family rental homes, today
announced its financial and operating results for the quarter and
full year ended December 31, 2023.
Highlights
- Rents and other single-family property revenues increased 7.3%
year-over-year to $408.7 million for
the fourth quarter of 2023.
- Net income attributable to common shareholders totaled
$76.6 million, or $0.21 per diluted share, for the fourth quarter
of 2023, compared to $87.5 million,
or $0.25 per diluted share, for the
fourth quarter of 2022.
- Core Funds from Operations ("Core FFO") attributable to common
share and unit holders increased 8.8% year-over-year to
$0.43 per FFO share and unit for the
fourth quarter of 2023 and Adjusted Funds from Operations
("Adjusted FFO") attributable to common share and unit holders
increased 9.3% year-over-year to $0.39 per FFO share and unit for the fourth
quarter of 2023.
- Core Net Operating Income ("Core NOI") from Same-Home
properties increased by 6.0% year-over-year for the fourth quarter
of 2023.
- Achieved Same-Home Average Occupied Days Percentage of 96.2% in
the fourth quarter of 2023, while generating 4.5% rate growth on
new leases and 6.2% rate growth on renewals, resulting in 5.7%
blended rate growth.
- Delivered a total of 503 high-quality and energy-efficient
newly constructed homes from our AMH Development Program to our
wholly-owned portfolio and unconsolidated joint ventures in the
fourth quarter of 2023.
- Raised common share dividend by 18% to $0.26 in the first quarter of 2024.
- Subsequent to quarter end, issued first-of-its-kind green bonds
in the single-family rental sector, raising $600.0 million at 5.500% due 2034.
"Our strong fourth quarter results capped off another year of
resilient and durable growth at AMH with Core FFO per share growing
by nearly 8% in 2023," stated David
Singelyn, AMH's Chief Executive Officer. "As we look ahead
to 2024, sustained long-term fundamentals, superior operational
execution supported by strategic initiatives, and consistent
production out of the development program will continue to position
us for both resiliency and long-term value creation."
Fourth Quarter 2023 Financial Results
Net income attributable to common shareholders totaled
$76.6 million, or $0.21 per diluted share, for the fourth quarter
of 2023, compared to $87.5 million,
or $0.25 per diluted share, for the
fourth quarter of 2022. The decrease was primarily due to lower net
gains on property sales, partially offset by higher rental
rates.
Rents and other single-family property revenues increased 7.3%
to $408.7 million for the fourth
quarter of 2023, compared to $380.9 million for the fourth
quarter of 2022. Revenue growth was primarily driven by higher
rental rates.
Core NOI from our total portfolio increased 8.9% to $235.6 million for the fourth quarter of 2023,
compared to $216.4 million for the
fourth quarter of 2022. This growth was driven by a 7.3% increase
in core revenues resulting primarily from higher rental rates,
partially offset by a 4.3% increase in core property operating
expenses.
For the Company's Same-Home portfolio, core revenues increased
5.5% to $302.7 million for the fourth
quarter of 2023, compared to $286.9
million for the fourth quarter of 2022, which was driven by
a 6.1% increase in Average Monthly Realized Rent per property,
partially offset by a 70 basis point decrease in Average Occupied
Days Percentage. Core property operating expenses from Same-Home
properties increased 4.5% to $103.7
million for the fourth quarter of 2023, compared to
$99.2 million for the fourth quarter
of 2022, primarily driven by inflationary increases in repairs and
maintenance ("R&M") and turnover costs, net and property
management expenses, net, partially offset by lower property tax
expense due to the timing of prior year quarterly tax accruals. As
a result, Core NOI from Same-Home properties increased 6.0% to
$199.0 million for the fourth quarter
of 2023, compared to $187.7 million
for the fourth quarter of 2022.
Core FFO attributable to common share and unit holders was
$178.6 million, or $0.43 per FFO share and unit, for the fourth
quarter of 2023, compared to $160.5
million, or $0.40 per FFO
share and unit, for the fourth quarter of 2022. Adjusted FFO
attributable to common share and unit holders was $160.8 million, or $0.39 per FFO share and unit, for the fourth
quarter of 2023, compared to $143.8
million, or $0.35 per FFO
share and unit, for the fourth quarter of 2022. These improvements
were primarily attributable to higher rental rates.
Full Year 2023 Financial Results
Net income attributable to common shareholders totaled
$366.2 million, or $1.01 per diluted share, for the year ended
December 31, 2023, compared to $250.8
million, or $0.71 per diluted
share, for the year ended December 31, 2022. The increase was
primarily due to higher net gains on property sales, higher rental
rates and a larger number of occupied properties.
Rents and other single-family property revenues increased 8.9%
to $1.6 billion for the year ended
December 31, 2023, compared to $1.5
billion for the year ended December 31, 2022. Revenue
growth was primarily driven by higher rental rates and an increase
in our average occupied portfolio which grew to 55,874 homes for
the year ended December 31, 2023, compared to 54,847 homes for
the year ended December 31, 2022.
Core NOI from our total portfolio increased 9.1% to $904.8 million for the year ended
December 31, 2023, compared to $829.6
million for the year ended December 31, 2022. This
growth was driven by a 9.3% increase in core revenues resulting
primarily from higher rental rates and a larger number of occupied
properties, partially offset by a 9.8% increase in core property
operating expenses.
For the Company's Same-Home portfolio, core revenues increased
6.5% to $1.2 billion for the year
ended December 31, 2023, compared to $1.1 billion for the year ended December 31,
2022, which was driven by a 7.1% increase in Average Monthly
Realized Rent per property, partially offset by a 40 basis point
decrease in Average Occupied Days Percentage. Core property
operating expenses from Same-Home properties increased 9.1% to
$420.1 million for the year ended
December 31, 2023, compared to $385.0
million for the year ended December 31, 2022, primarily
driven by increased property tax expense and inflationary increases
in R&M and turnover costs, net and property management
expenses, net. As a result, Core NOI from Same-Home properties
increased 5.1% to $770.5 million for
the year ended December 31, 2023, compared to $732.9 million for the year ended
December 31, 2022.
Core FFO attributable to common share and unit holders was
$688.5 million, or $1.66 per FFO share and unit, for the year ended
December 31, 2023, compared to $618.8
million, or $1.54 per FFO
share and unit, for the year ended December 31, 2022. Adjusted
FFO attributable to common share and unit holders was $609.3 million, or $1.47 per FFO share and unit, for the year ended
December 31, 2023, compared to $550.5
million, or $1.37 per FFO
share and unit, for the year ended December 31, 2022. These
improvements were primarily attributable to higher rental rates and
a larger number of occupied properties.
Portfolio
Average Occupied Days Percentage was 95.0% for the fourth
quarter of 2023, compared to 95.6% for the third quarter of
2023.
Investments
As of December 31, 2023, the Company's wholly-owned
portfolio consisted of 59,332 homes, compared to 59,092 homes as of
September 30, 2023, an increase of
240 homes during the fourth quarter of 2023, which included 456
newly constructed homes delivered through our AMH Development
Program and 25 homes acquired through our National Builder Program
and traditional acquisition channel, partially offset by 241 homes
sold to third parties. During the fourth quarter of
2023, we also developed an additional 47 newly constructed
homes which were delivered to our unconsolidated joint ventures,
aggregating to 503 total program deliveries through our AMH
Development Program. As of December 31, 2023, the Company had
862 properties held for sale and 2,978 properties held in
unconsolidated joint ventures.
Capital Activities, Balance Sheet and Liquidity
During the fourth quarter of 2023, the Company issued 2,799,683
Class A common shares under its at-the-market common share offering
program, receiving net proceeds of $100.2
million after commissions and other expenses of $1.7 million.
As of December 31, 2023, the Company had cash and cash
equivalents of $59.4 million and
total outstanding debt of $4.5
billion, excluding unamortized discounts and unamortized
deferred financing costs, with a weighted-average interest rate of
4.1% and a weighted-average term to maturity of 11.2 years, which
includes $90.0 million of outstanding
borrowings on its $1.25 billion
revolving credit facility. During the fourth quarter of 2023, the
Company generated $69.5 million of
Retained Cash Flow and sold 241 properties generating $72.5 million of net proceeds. Additionally, the
Company's AMH 2014-SFR2 and AMH
2014-SFR3 securitizations, which had
a total balance of $938.6 million as
of December 31, 2023, are scheduled to mature in the fourth
quarter of 2024. In January 2024, the
Company provided notice of its intent to payoff the AMH
2014-SFR2 securitization during the
first quarter of 2024, which had a balance of $461.5 million as of December 31, 2023, of which $25.7 million represents asset-backed
securitization certificates that are held by the Company.
In January 2024, the Company
issued 932,746 Class A common shares under its at-the market common
share offering program, receiving net proceeds of $33.2 million after commissions and other
expenses of $0.5 million.
In January 2024, American Homes 4
Rent, L.P. (the "Operating Partnership"), the entity through which
the Company conducts substantially all of its business and owns,
directly or through subsidiaries, substantially all of its assets,
issued $600.0 million of 5.500%
unsecured senior notes with a maturity date of February 1, 2034, which carry a green bond
designation and were issued under the Company's green finance
framework. Interest on the notes is payable semi-annually in
arrears on February 1 and
August 1 of each year, commencing on
August 1, 2024. The Operating
Partnership received aggregate net proceeds of $595.5 million from these issuances, after
underwriting fees of approximately $3.9 million and a $0.6 million discount, and before estimated
offering costs of $1.5 million.
Pending full allocation of an amount equal to the net proceeds to
finance new or existing projects meeting the eligibility criteria
described in the prospectus supplement related to the offering, the
Operating Partnership intends to allocate the net proceeds to repay
outstanding indebtedness, including the payoff of the AMH
2014-SFR2 securitization and/or
temporarily invest the net proceeds in accordance with the
Company's cash investment policy.
Sustainability Update
The Company's inaugural green bond issuance highlights its focus
on energy efficient and sustainable construction practices as it
contributes much needed inventory to the country's under-supplied
housing landscape.
2024 Guidance
Set forth below are the Company's current expectations with
respect to full year 2024 Core FFO attributable to common share and
unit holders and our underlying assumptions. In reliance on the
exception provided by applicable SEC rules, the Company does not
provide guidance for GAAP net income, the most comparable GAAP
financial measure, or a reconciliation of 2024 Core FFO guidance to
GAAP net income because we are unable to reasonably predict the
following items which are included in GAAP net income: (i) gain on
sale and impairment of single-family properties and other, net for
consolidated properties and unconsolidated joint ventures, (ii)
acquisition and other transaction costs and (iii) hurricane-related
charges, net. The actual amounts for any and all of these items
could significantly impact our 2024 GAAP net income and, as
disclosed in our historical financial results, have significantly
impacted GAAP net income in prior periods.
Guidance Summary
|
|
|
Full Year
2024
|
Core FFO
attributable to common share and unit holders
|
|
|
$1.70 -
$1.76
|
Core FFO attributable
to common share and unit holders growth
|
|
|
2.4% - 6.0%
|
|
|
|
|
Same-Home
|
|
|
|
Core revenues
growth
|
|
|
3.75% -
5.75%
|
Core property
operating expenses growth
|
|
|
5.25% -
7.25%
|
Core NOI
growth
|
|
|
3.00% -
5.00%
|
|
|
|
|
|
Full Year
2024
|
Investment
Program
|
Properties
|
|
Investment
|
Wholly owned
acquisitions
|
—
|
|
—
|
Wholly owned
development deliveries
|
1,825 -
1,975
|
|
$700 - $800
million
|
Wholly owned land and
development pipeline
|
—
|
|
$100 - $150
million
|
Pro rata share of JV
and Property Enhancing Capex
|
—
|
|
$100 - $150
million
|
Total capital
investment (wholly owned and pro rata JV)
|
1,825 -
1,975
|
|
$0.9 - $1.1
billion
|
Total gross capital
investment (JVs at 100%)
|
2,200 -
2,400
|
|
$1.1 - $1.3
billion
|
Full Year 2024 Guidance Commentary
Operating Outlook:
- Same-Home core revenues growth reflects expectation for
continued resiliency in the demand and leasing environment and
includes the following assumptions for the full year 2024: (1)
Average Occupied Days Percentage expectation in the low 96% area,
(2) Average Monthly Realized Rent growth of 5.00% - 5.50% driven by
2024 leasing spreads in the high 4% area and contribution from 2023
leasing earn-in, and (3) bad debt expense to remain consistent with
2023 in the low 1% area as a percentage of rents.
- Same-Home core property operating expenses growth reflects (1)
expectation for moderating but still elevated 2024 property tax
growth between 6.25% and 8.25% and (2) 4.25% to 6.25% growth in all
other core property operating expenses, excluding property taxes,
reflecting the general inflationary environment.
Investment Program:
- Consistent with 2023, the Company's acquisition programs
continue to remain on hold. Until market conditions change, the
Company's current 2024 outlook does not contemplate any material
acquisition activity.
- Investment program outlook contemplates continued consistent
growth from the Company's internal AMH Development Program, which
is expected to deliver between 2,200 to 2,400 total program
deliveries during 2024.
Capital Plan:
- In addition to the Company's $0.9
- $1.1 billion total wholly-owned and
pro rata JV capital investment program, the Company's AMH
2014-SFR2 and AMH 2014-SFR3 securitizations, which had a total
outstanding balance of $938.6 million
as of December 31, 2023, are
scheduled to mature in the fourth quarter of 2024.
- During January 2024, the Company
provided notice of its intent to payoff the AMH 2014-SFR2 securitization during the first quarter of
2024 and plans to payoff the AMH 2014-SFR3 securitization over the course of 2024 based
on capital markets conditions.
- The Company expects to fund its 2024 capital plan through a
combination of Retained Cash Flow, approximately $400 - $500 million
of recycled capital from dispositions, as well as equity and debt
capital, including the equity capital raised on the Company's
at-the-market program in the fourth quarter of 2023 and first
quarter of 2024 and $600 million
green bond issuance in January
2024.
Reconciliation of Core FFO attributable to common share and unit
holders from 2023 to 2024 Guidance Midpoint
|
Per FFO
Share
and Unit
|
2023 Core FFO
attributable to common share and unit holders
|
$
1.66
|
|
|
Same-Home Core
NOI
|
0.08
|
Non-Same-Home Core NOI
(1)
|
0.07
|
Disposition
program
|
(0.02)
|
General and
administrative expense and amortization of IT software assets
(2)
|
(0.01)
|
Financing costs (share
count and interest) (3)
|
(0.05)
|
|
|
2024 Core FFO
attributable to common share and unit holders - Guidance
Midpoint
|
$
1.73
|
2024 Core FFO
attributable to common share and unit holders growth - Guidance
Midpoint
|
4.2 %
|
|
|
(1)
|
Core FFO growth
from Non-Same-Home Core NOI includes (i) contribution from existing
properties not included in the Company's 2024 Same-Home portfolio,
including 2023 wholly-owned property additions, and (ii)
contribution from 2024 wholly-owned property additions.
|
(2)
|
General and
administrative expense and amortization of IT software assets
increase reflects (i) general inflationary environment and (ii)
investments from prior years into IT systems supporting our
industry-leading property management platform.
|
(3)
|
Financing costs (share
count and interest) change is primarily related to the funding of
the Company's investment programs and the refinancing of the 2024
maturing securitizations.
|
Additional Information
A copy of the Company's Fourth Quarter 2023 Earnings Release and
Supplemental Information Package and this press release are
available on our website at www.amh.com, under "Investor
relations." This information has also been furnished to the SEC in
a current report on Form 8-K.
Conference Call
A conference call is scheduled on Friday, February 23, 2024
at 12:00 p.m. Eastern Time to discuss
the Company's financial results for the quarter and full year ended
December 31, 2023 and to provide an update on its business.
The domestic dial-in number is (877) 451-6152 (U.S. and
Canada) and the international
dial-in number is (201) 389-0879 (passcode not required). A
simultaneous audio webcast may be accessed by using the link at
www.amh.com, under "Investor relations." A replay of the conference
call may be accessed through Friday, March
8, 2024 by calling (844) 512-2921 (U.S. and Canada) or (412) 317-6671 (international),
replay passcode number 13742949#, or by using the link
at www.amh.com, under "Investor relations."
About AMH
AMH (NYSE: AMH) is a leading large-scale integrated owner,
operator and developer of single-family rental homes. We're an
internally managed Maryland real
estate investment trust (REIT) focused on acquiring, developing,
renovating, leasing and managing homes as rental properties. Our
goal is to simplify the experience of leasing a home and deliver
peace of mind to households across the country.
In recent years, we've been named one of Fortune's 2023 Best
Workplaces in Real Estate™, a 2023 Great Place to Work®, a 2023
Most Loved Workplace®, a 2023 Top U.S. Homebuilder by Builder100,
and one of America's Most Responsible Companies 2023 and America's
Most Trustworthy Companies 2023 by Newsweek and Statista Inc. As of
December 31, 2023, we owned nearly 60,000 single-family
properties in the Southeast, Midwest, Southwest and Mountain West
regions of the United States.
Additional information about AMH is available on our website at
www.amh.com.
AMH refers to one or more of American Homes 4 Rent, American
Homes 4 Rent, L.P. and their subsidiaries and joint ventures. In
certain states, we operate under AMH Living or American Homes 4
Rent. Please see www.amh.com/dba to learn more.
Forward-Looking Statements
This press release and the accompanying Supplemental Information
Package contain "forward-looking statements." These forward-looking
statements relate to beliefs, expectations or intentions and
similar statements concerning matters that are not of historical
fact and are generally accompanied by words such as "estimate,"
"project," "predict," "believe," "expect," "anticipate," "intend,"
"potential," "plan," "goal," "outlook," "guidance" or other words
that convey the uncertainty of future events or outcomes. Examples
of forward-looking statements contained in this press release
include, among others, our 2024 Guidance, our belief that our
acquisition and homebuilding programs will result in continued
growth and the estimated timing of our development deliveries set
forth in the Supplemental Information Package. The Company has
based these forward-looking statements on its current expectations
and assumptions about future events. While the Company's management
considers these expectations and assumptions to be reasonable, they
are inherently subject to significant business, economic,
competitive, regulatory and other risks, contingencies and
uncertainties, most of which are difficult to predict and many of
which are beyond the Company's control and could cause actual
results to differ materially from any future results, performance
or achievements expressed or implied by these forward-looking
statements. Investors should not place undue reliance on these
forward-looking statements, which speak only as of the date of this
press release. The Company undertakes no obligation to update any
forward-looking statements to conform to actual results or changes
in its expectations, unless required by applicable law. For a
further description of the risks and uncertainties that could cause
actual results to differ from those expressed in these
forward-looking statements, as well as risks relating to the
business of the Company in general, see the "Risk Factors"
disclosed in the Company's Annual Report on Form 10-K for the year
ended December 31, 2023 and in the Company's subsequent
filings with the SEC.
AMH
Consolidated Balance
Sheets
(Amounts in
thousands, except share data)
|
|
|
December 31,
2023
|
|
December 31,
2022
|
|
(Unaudited)
|
|
|
Assets
|
|
|
|
Single-family
properties:
|
|
|
|
Land
|
$
2,234,301
|
|
$
2,197,233
|
Buildings and
improvements
|
10,651,388
|
|
10,127,891
|
Single-family
properties in operation
|
12,885,689
|
|
12,325,124
|
Less: accumulated
depreciation
|
(2,719,970)
|
|
(2,386,452)
|
Single-family
properties in operation, net
|
10,165,719
|
|
9,938,672
|
Single-family
properties under development and development land
|
1,409,424
|
|
1,187,221
|
Single-family
properties and land held for sale, net
|
182,082
|
|
198,716
|
Total real estate
assets, net
|
11,757,225
|
|
11,324,609
|
Cash and cash
equivalents
|
59,385
|
|
69,155
|
Restricted
cash
|
162,476
|
|
148,805
|
Rent and other
receivables
|
42,823
|
|
47,752
|
Escrow deposits,
prepaid expenses and other assets
|
406,138
|
|
331,446
|
Investments in
unconsolidated joint ventures
|
114,198
|
|
107,347
|
Asset-backed
securitization certificates
|
25,666
|
|
25,666
|
Goodwill
|
120,279
|
|
120,279
|
Total assets
|
$
12,688,190
|
|
$
12,175,059
|
|
|
|
|
Liabilities
|
|
|
|
Revolving credit
facility
|
$
90,000
|
|
$
130,000
|
Asset-backed
securitizations, net
|
1,871,421
|
|
1,890,842
|
Unsecured senior notes,
net
|
2,500,226
|
|
2,495,156
|
Accounts payable and
accrued expenses
|
573,660
|
|
484,403
|
Total
liabilities
|
5,035,307
|
|
5,000,401
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
Equity
|
|
|
|
Shareholders'
equity:
|
|
|
|
Class A common shares
($0.01 par value per share, 450,000,000 shares authorized,
364,296,431 and
352,881,826 shares issued and outstanding at December 31, 2023 and
2022, respectively)
|
3,643
|
|
3,529
|
Class B common shares
($0.01 par value per share, 50,000,000 shares authorized, 635,075
shares issued
and
outstanding at December 31, 2023 and 2022)
|
6
|
|
6
|
Preferred shares ($0.01
par value per share, 100,000,000 shares authorized, 9,200,000
shares issued and
outstanding at December 31, 2023 and 2022)
|
92
|
|
92
|
Additional paid-in
capital
|
7,357,848
|
|
6,931,819
|
Accumulated
deficit
|
(394,908)
|
|
(440,791)
|
Accumulated other
comprehensive income
|
843
|
|
1,332
|
Total shareholders'
equity
|
6,967,524
|
|
6,495,987
|
Noncontrolling
interest
|
685,359
|
|
678,671
|
Total equity
|
7,652,883
|
|
7,174,658
|
|
|
|
|
Total liabilities and
equity
|
$
12,688,190
|
|
$
12,175,059
|
AMH
Consolidated
Statements of Operations
(Amounts in
thousands, except share and per share data)
|
|
|
For the Three Months
Ended
December
31,
|
|
For the Years
Ended
December
31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
Rents and other
single-family property revenues
|
$
408,657
|
|
$
380,926
|
|
$
1,623,605
|
|
$
1,490,534
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
|
|
Property operating
expenses
|
142,797
|
|
137,113
|
|
599,459
|
|
552,091
|
Property management
expenses
|
31,112
|
|
28,157
|
|
123,363
|
|
112,698
|
General and
administrative expense
|
18,487
|
|
14,942
|
|
74,615
|
|
68,057
|
Interest
expense
|
35,091
|
|
36,249
|
|
140,198
|
|
134,871
|
Acquisition and other
transaction costs
|
4,260
|
|
5,338
|
|
16,910
|
|
23,452
|
Depreciation and
amortization
|
115,771
|
|
112,843
|
|
456,550
|
|
426,531
|
Hurricane-related
charges, net
|
—
|
|
—
|
|
—
|
|
6,133
|
Total
expenses
|
347,518
|
|
334,642
|
|
1,411,095
|
|
1,323,833
|
|
|
|
|
|
|
|
|
Gain on sale and
impairment of single-family properties and other, net
|
29,082
|
|
57,407
|
|
209,834
|
|
136,459
|
Other income and
expense, net
|
716
|
|
100
|
|
9,798
|
|
6,865
|
|
|
|
|
|
|
|
|
Net income
|
90,937
|
|
103,791
|
|
432,142
|
|
310,025
|
|
|
|
|
|
|
|
|
Noncontrolling
interest
|
10,834
|
|
12,768
|
|
51,974
|
|
36,887
|
Dividends on preferred
shares
|
3,486
|
|
3,486
|
|
13,944
|
|
17,081
|
Redemption of perpetual
preferred shares
|
—
|
|
—
|
|
—
|
|
5,276
|
|
|
|
|
|
|
|
|
Net income attributable
to common shareholders
|
$
76,617
|
|
$
87,537
|
|
$
366,224
|
|
$
250,781
|
|
|
|
|
|
|
|
|
Weighted-average common
shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
362,954,405
|
|
353,857,902
|
|
362,024,968
|
|
349,290,848
|
Diluted
|
363,396,325
|
|
354,185,629
|
|
362,477,216
|
|
349,787,092
|
|
|
|
|
|
|
|
|
Net income attributable
to common shareholders per share:
|
|
|
|
|
|
|
|
Basic
|
$
0.21
|
|
$
0.25
|
|
$
1.01
|
|
$
0.72
|
Diluted
|
$
0.21
|
|
$
0.25
|
|
$
1.01
|
|
$
0.71
|
Defined Terms
Average Monthly Realized Rent
For the related period, Average Monthly Realized Rent is
calculated as the lease component of rents and other single-family
property revenues (i.e., rents from single-family properties)
divided by the product of (a) number of properties and (b) Average
Occupied Days Percentage, divided by the number of months. For
properties partially owned during the period, this calculation is
adjusted to reflect the number of days of ownership.
Average Occupied Days Percentage
The number of days a property is occupied in the period divided
by the total number of days the property is owned during the same
period after initially being placed in-service. This calculation
excludes properties classified as held for sale.
Occupied Property
A property is classified as occupied upon commencement (i.e.,
start date) of a lease agreement, which can occur contemporaneously
with or subsequent to execution (i.e., signature).
Recurring Capital Expenditures
For our Same-Home portfolio, Recurring Capital Expenditures
includes replacement costs and other capital expenditures recorded
during the period that are necessary to help preserve the value and
maintain functionality of our properties. For our total portfolio,
we calculate Recurring Capital Expenditures by multiplying (a)
current period actual Recurring Capital Expenditures per Same-Home
property by (b) our total number of properties, excluding newly
acquired non-stabilized properties and properties classified as
held for sale.
Same-Home Property
A property is classified as Same-Home if it has been stabilized
longer than 90 days prior to the beginning of the earliest period
presented under comparison. A property is removed from Same-Home if
it has been classified as held for sale or has experienced a
casualty loss.
Stabilized Property
A property acquired individually (i.e., not through a bulk
purchase) is classified as stabilized once it has been renovated by
the Company or newly constructed and then initially leased or
available for rent for a period greater than 90 days. Properties
acquired through a bulk purchase are first considered
non-stabilized, as an entire group, until (1) we have owned them
for an adequate period of time to allow for complete on-boarding to
our operating platform, and (2) a substantial portion of the
properties have experienced tenant turnover at least once under our
ownership, providing the opportunity for renovations and
improvements to meet our property standards. After such time has
passed, properties acquired through a bulk purchase are then
evaluated on an individual property basis under our standard
stabilization criteria.
Non-GAAP Financial Measures
This press release and the Fourth Quarter 2023 Earnings Release
and Supplemental Information Package include Funds from Operations
attributable to common share and unit holders ("FFO attributable to
common share and unit holders"), Core FFO attributable to common
share and unit holders, Adjusted FFO attributable to common share
and unit holders, Retained Cash Flow, Core NOI and Same-Home Core
NOI, which are non-GAAP financial measures. We believe these
measures are helpful in understanding our financial performance and
are widely used in the REIT industry. Because other REITs may not
compute these financial measures in the same manner, they may not
be comparable among REITs. In addition, these metrics are not
substitutes for net income or loss or net cash flows from operating
activities, as defined by GAAP, as measures of our operating
performance, liquidity or ability to pay dividends. Reconciliations
of these non-GAAP financial measures to the most directly
comparable GAAP measures are included in this press release and in
the Fourth Quarter 2023 Earnings Release and Supplemental
Information Package.
Funds from Operations attributable to common
share and unit holders and Retained Cash Flow
FFO attributable to common share and unit holders is a non-GAAP
financial measure that we calculate in accordance with the
definition approved by the National Association of Real Estate
Investment Trusts, which defines FFO as net income or loss
calculated in accordance with GAAP, excluding gains and losses from
sales or impairment of real estate, plus real estate-related
depreciation and amortization (excluding amortization of deferred
financing costs and depreciation of non-real estate assets), and
after adjustments for unconsolidated partnerships and joint
ventures to reflect FFO on the same basis.
Core FFO attributable to common share and unit holders is a
non-GAAP financial measure that we use as a supplemental measure of
our performance. We compute this metric by adjusting FFO
attributable to common share and unit holders for (1) acquisition
and other transaction costs incurred with business combinations and
the acquisition or disposition of properties as well as
nonrecurring items unrelated to ongoing operations, (2) noncash
share-based compensation expense, (3) hurricane-related charges,
net, which result in material charges to our single-family property
portfolio, (4) gain or loss on early extinguishment of debt and (5)
the allocation of income to our perpetual preferred shares in
connection with their redemption.
Adjusted FFO attributable to common share and unit holders is a
non-GAAP financial measure that we use as a supplemental measure of
our performance. We compute this metric by adjusting Core FFO
attributable to common share and unit holders for (1) Recurring
Capital Expenditures that are necessary to help preserve the value
and maintain functionality of our properties and (2) capitalized
leasing costs incurred during the period. As a portion of our homes
are recently developed, acquired and/or renovated, we estimate
Recurring Capital Expenditures for our entire portfolio by
multiplying (a) current period actual Recurring Capital
Expenditures per Same-Home Property by (b) our total number of
properties, excluding newly acquired non-stabilized properties and
properties classified as held for sale.
We present FFO attributable to common share and unit holders, as
well as on a per FFO share and unit basis, because we consider this
metric to be an important measure of the performance of real estate
companies, as do many investors and analysts in evaluating the
Company. We believe that FFO attributable to common share and unit
holders provides useful information to investors because this
metric excludes depreciation, which is included in computing net
income and assumes the value of real estate diminishes predictably
over time. We believe that real estate values fluctuate due to
market conditions and in response to inflation. We also believe
that Core FFO and Adjusted FFO attributable to common share and
unit holders, as well as on a per FFO share and unit basis, provide
useful information to investors because they allow investors to
compare our operating performance to prior reporting periods
without the effect of certain items that, by nature, are not
comparable from period to period.
FFO shares and units include weighted-average common shares and
operating partnership units outstanding, as well as potentially
dilutive securities.
Retained Cash Flow is a non-GAAP financial measure that we
believe is helpful as a supplemental measure in assessing the
Company's liquidity. This metric is computed by reducing Adjusted
FFO attributable to common share and unit holders by common
distributions.
FFO, Core FFO and Adjusted FFO attributable to common share and
unit holders and Retained Cash Flow are not substitutes for net
income or net cash provided by operating activities, each as
determined in accordance with GAAP, as a measure of our operating
performance, liquidity or ability to pay dividends. These metrics
also are not necessarily indicative of cash available to fund
future cash needs. Because other REITs may not compute these
measures in the same manner, they may not be comparable among
REITs.
The following is a reconciliation of net income or loss
attributable to common shareholders to FFO attributable to common
share and unit holders, Core FFO attributable to common share and
unit holders, Adjusted FFO attributable to common share and unit
holders and Retained Cash Flow for the three months and the years
ended December 31, 2023 and 2022 (amounts in thousands, except
share and per share data):
|
For the Three Months
Ended
December
31,
|
|
For the Years
Ended
December
31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
Net income attributable
to common shareholders
|
$
76,617
|
|
$
87,537
|
|
$
366,224
|
|
$
250,781
|
Adjustments:
|
|
|
|
|
|
|
|
Noncontrolling
interests in the Operating Partnership
|
10,834
|
|
12,768
|
|
51,974
|
|
36,887
|
Gain on sale and
impairment of single-family properties and other, net
|
(29,082)
|
|
(57,407)
|
|
(209,834)
|
|
(136,459)
|
Adjustments for
unconsolidated joint ventures
|
1,331
|
|
466
|
|
3,711
|
|
344
|
Depreciation and
amortization
|
115,771
|
|
112,843
|
|
456,550
|
|
426,531
|
Less: depreciation and
amortization of non-real estate assets
|
(4,515)
|
|
(3,710)
|
|
(17,417)
|
|
(13,358)
|
FFO attributable to
common share and unit holders
|
$
170,956
|
|
$
152,497
|
|
$
651,208
|
|
$
564,726
|
Adjustments:
|
|
|
|
|
|
|
|
Acquisition, other
transaction costs and other
|
4,260
|
|
5,338
|
|
16,910
|
|
23,452
|
Noncash share-based
compensation - general and administrative
|
2,494
|
|
1,966
|
|
16,379
|
|
15,318
|
Noncash share-based
compensation - property management
|
879
|
|
715
|
|
4,030
|
|
3,861
|
Hurricane-related
charges, net
|
—
|
|
—
|
|
—
|
|
6,133
|
Redemption of
perpetual preferred shares
|
—
|
|
—
|
|
—
|
|
5,276
|
Core FFO attributable
to common share and unit holders
|
$
178,589
|
|
$
160,516
|
|
$
688,527
|
|
$
618,766
|
Recurring Capital
Expenditures
|
(17,019)
|
|
(16,020)
|
|
(76,098)
|
|
(65,636)
|
Leasing
costs
|
(745)
|
|
(718)
|
|
(3,113)
|
|
(2,586)
|
Adjusted FFO
attributable to common share and unit holders
|
$
160,825
|
|
$
143,778
|
|
$
609,316
|
|
$
550,544
|
Common
distributions
|
(91,375)
|
|
(73,132)
|
|
(365,552)
|
|
(289,854)
|
Retained Cash
Flow
|
$
69,450
|
|
$
70,646
|
|
$
243,764
|
|
$
260,690
|
|
|
|
|
|
|
|
|
Per FFO share and
unit:
|
|
|
|
|
|
|
|
FFO attributable to
common share and unit holders
|
$
0.41
|
|
$
0.38
|
|
$
1.57
|
|
$
1.41
|
Core FFO attributable
to common share and unit holders
|
$
0.43
|
|
$
0.40
|
|
$
1.66
|
|
$
1.54
|
Adjusted FFO
attributable to common share and unit holders
|
$
0.39
|
|
$
0.35
|
|
$
1.47
|
|
$
1.37
|
|
|
|
|
|
|
|
|
Weighted-average FFO
shares and units:
|
|
|
|
|
|
|
|
Common shares
outstanding
|
362,954,405
|
|
353,857,902
|
|
362,024,968
|
|
349,290,848
|
Share-based
compensation plan and forward sale equity contracts
(1)
|
913,602
|
|
674,400
|
|
828,424
|
|
906,762
|
Operating partnership
units
|
51,376,980
|
|
51,376,980
|
|
51,376,980
|
|
51,376,980
|
Total weighted-average
FFO shares and units
|
415,244,987
|
|
405,909,282
|
|
414,230,372
|
|
401,574,590
|
|
|
(1)
|
Reflects the effect of
potentially dilutive securities issuable upon the assumed
vesting/exercise of restricted stock units and stock options and
the dilutive effect of forward sale equity contracts under the
treasury stock method.
|
The following is a reconciliation of net income per common
share–diluted to FFO attributable to common share and unit
holders, Core FFO attributable to common share and unit holders and
Adjusted FFO attributable to common share and unit holders on a per
share and unit basis for the three months and the years ended
December 31, 2023 and 2022:
|
For the Three Months
Ended
December
31,
|
|
For the Years
Ended
December
31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
Net income per common
share–diluted
|
$
0.21
|
|
$
0.25
|
|
$
1.01
|
|
$
0.71
|
Adjustments:
|
|
|
|
|
|
|
|
Conversion from GAAP
share count
|
(0.03)
|
|
(0.03)
|
|
(0.13)
|
|
(0.09)
|
Noncontrolling
interests in the Operating Partnership
|
0.03
|
|
0.03
|
|
0.13
|
|
0.09
|
Gain on sale and
impairment of single-family properties and other, net
|
(0.07)
|
|
(0.14)
|
|
(0.51)
|
|
(0.34)
|
Adjustments for
unconsolidated joint ventures
|
—
|
|
—
|
|
0.01
|
|
—
|
Depreciation and
amortization
|
0.28
|
|
0.28
|
|
1.10
|
|
1.07
|
Less: depreciation and
amortization of non-real estate assets
|
(0.01)
|
|
(0.01)
|
|
(0.04)
|
|
(0.03)
|
FFO attributable to
common share and unit holders
|
$
0.41
|
|
$
0.38
|
|
$
1.57
|
|
$
1.41
|
Adjustments:
|
|
|
|
|
|
|
|
Acquisition, other
transaction costs and other
|
0.01
|
|
0.02
|
|
0.04
|
|
0.06
|
Noncash share-based
compensation - general and administrative
|
0.01
|
|
—
|
|
0.04
|
|
0.03
|
Noncash share-based
compensation - property management
|
—
|
|
—
|
|
0.01
|
|
0.01
|
Hurricane-related
charges, net
|
—
|
|
—
|
|
—
|
|
0.02
|
Redemption of
perpetual preferred shares
|
—
|
|
—
|
|
—
|
|
0.01
|
Core FFO attributable
to common share and unit holders
|
$
0.43
|
|
$
0.40
|
|
$
1.66
|
|
$
1.54
|
Recurring Capital
Expenditures
|
(0.04)
|
|
(0.05)
|
|
(0.18)
|
|
(0.16)
|
Leasing
costs
|
—
|
|
—
|
|
(0.01)
|
|
(0.01)
|
Adjusted FFO
attributable to common share and unit holders
|
$
0.39
|
|
$
0.35
|
|
$
1.47
|
|
$
1.37
|
Core Net Operating Income
Core NOI, which we also present separately for our Same-Home
portfolio, is a supplemental non-GAAP financial measure that we
define as core revenues, which is calculated as rents and other
single-family property revenues, excluding expenses reimbursed by
tenant charge-backs, less core property operating expenses, which
is calculated as property operating and property management
expenses, excluding noncash share-based compensation expense and
expenses reimbursed by tenant charge-backs.
Core NOI also excludes (1) gain or loss on early extinguishment
of debt, (2) hurricane-related charges, net, which result in
material charges to our single-family property portfolio, (3) gains
and losses from sales or impairments of single-family properties
and other, (4) depreciation and amortization, (5) acquisition and
other transaction costs incurred with business combinations and the
acquisition or disposition of properties as well as nonrecurring
items unrelated to ongoing operations, (6) noncash share-based
compensation expense, (7) interest expense, (8) general and
administrative expense, and (9) other income and expense, net. We
believe Core NOI provides useful information to investors about the
operating performance of our single-family properties without the
impact of certain operating expenses that are reimbursed through
tenant charge-backs.
Core NOI and Same-Home Core NOI should be considered only as
supplements to net income or loss as a measure of our performance
and should not be used as measures of our liquidity, nor are they
indicative of funds available to fund our cash needs, including our
ability to pay dividends or make distributions. Additionally, these
metrics should not be used as substitutes for net income or loss or
net cash flows from operating activities (as computed in accordance
with GAAP).
The following are reconciliations of core revenues, Same-Home
core revenues, core property operating expenses, Same-Home core
property operating expenses, Core NOI and Same-Home Core NOI to
their respective GAAP metrics for the three months and the years
ended December 31, 2023 and 2022
(amounts in thousands):
|
For the Three Months Ended
December 31,
|
|
For the Years Ended
December 31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
Core revenues and Same-Home core
revenues
|
|
|
|
|
|
|
|
Rents and other
single-family property revenues
|
$
408,657
|
|
$
380,926
|
|
$
1,623,605
|
|
$
1,490,534
|
Tenant
charge-backs
|
(48,506)
|
|
(45,183)
|
|
(215,555)
|
|
(202,606)
|
Core
revenues
|
360,151
|
|
335,743
|
|
1,408,050
|
|
1,287,928
|
Less: Non-Same-Home
core revenues
|
(57,440)
|
|
(48,808)
|
|
(217,456)
|
|
(170,017)
|
Same-Home core
revenues
|
$
302,711
|
|
$
286,935
|
|
$
1,190,594
|
|
$
1,117,911
|
|
|
|
|
|
|
|
|
|
|
Core property operating expenses and Same-Home core
property operating expenses
|
|
|
|
|
Property operating
expenses
|
$
142,797
|
|
$
137,113
|
|
$
599,459
|
|
$
552,091
|
Property management
expenses
|
31,112
|
|
28,157
|
|
123,363
|
|
112,698
|
Noncash share-based
compensation - property management
|
(879)
|
|
(715)
|
|
(4,030)
|
|
(3,861)
|
Expenses reimbursed by
tenant charge-backs
|
(48,506)
|
|
(45,183)
|
|
(215,555)
|
|
(202,606)
|
Core property
operating expenses
|
124,524
|
|
119,372
|
|
503,237
|
|
458,322
|
Less: Non-Same-Home
core property operating expenses
|
(20,788)
|
|
(20,133)
|
|
(83,153)
|
|
(73,306)
|
Same-Home core
property operating expenses
|
$
103,736
|
|
$
99,239
|
|
$
420,084
|
|
$
385,016
|
|
|
|
|
|
|
|
|
|
|
Core NOI and Same-Home Core NOI
|
|
|
|
|
|
|
|
|
|
Net income
|
$
90,937
|
|
$
103,791
|
|
$
432,142
|
|
$
310,025
|
Hurricane-related
charges, net
|
—
|
|
—
|
|
—
|
|
6,133
|
Gain on sale and
impairment of single-family properties and other, net
|
(29,082)
|
|
(57,407)
|
|
(209,834)
|
|
(136,459)
|
Depreciation and
amortization
|
115,771
|
|
112,843
|
|
456,550
|
|
426,531
|
Acquisition and other
transaction costs
|
4,260
|
|
5,338
|
|
16,910
|
|
23,452
|
Noncash share-based
compensation - property management
|
879
|
|
715
|
|
4,030
|
|
3,861
|
Interest
expense
|
35,091
|
|
36,249
|
|
140,198
|
|
134,871
|
General and
administrative expense
|
18,487
|
|
14,942
|
|
74,615
|
|
68,057
|
Other income and
expense, net
|
(716)
|
|
(100)
|
|
(9,798)
|
|
(6,865)
|
Core NOI
|
235,627
|
|
216,371
|
|
904,813
|
|
829,606
|
Less: Non-Same-Home
Core NOI
|
(36,652)
|
|
(28,675)
|
|
(134,303)
|
|
(96,711)
|
Same-Home Core
NOI
|
$
198,975
|
|
$
187,696
|
|
$
770,510
|
|
$
732,895
|
Contact:
AMH Investor Relations
Phone: (855) 794-2447
Email: investors@amh.com
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SOURCE AMH