Invitation Homes Reports Second Quarter 2022 Results

Rhea-AI Summary

Invitation Homes reported its Q2 2022 results, with revenues up 13.4% to $557 million and net income rising 83.9% to $111 million. Core FFO per share increased 13.2% to $0.42, while AFFO per share rose 11.9% to $0.36. Same Store NOI grew 12.4%, driven by 10.4% Core Revenue growth and 6.2% Core Operating Expenses growth. The company acquired 955 homes for $426 million and announced guidance increases for FY 2022, including a range of $1.66 to $1.72 for Core FFO per share and Same Store NOI growth of 10.0% to 11.5%. A quarterly dividend of $0.22 per share was also declared.

Positive

• Total revenues increased 13.4% year-over-year to $557 million.
• Net income available to common stockholders rose 83.9% to $111 million.
• Core FFO per share increased 13.2% to $0.42; AFFO per share up 11.9% to $0.36.
• Same Store NOI grew 12.4% year-over-year.
• Acquisitions totaled 955 homes for $426 million during the quarter.
• FY 2022 guidance increased for Core FFO to $1.66 - $1.72 per share.

Negative

• Average occupancy decreased to 98.0%, down 40 basis points year-over-year.

DALLAS--(BUSINESS WIRE)-- Invitation Homes Inc. (NYSE: INVH) ("Invitation Homes" or the "Company"), the nation's premier single-family home leasing company, today announced its Q2 2022 financial and operating results.

Second Quarter 2022 Highlights

• Year over year, total revenues increased 13.4% to $557 million, property operating and maintenance costs increased 8.7% to $191 million, net income available to common stockholders increased 83.9% to $111 million, and net income per diluted common share increased 71.2% to $0.18.

• Year over year, Core FFO per share increased 13.2% to $0.42, and AFFO per share increased 11.9% to $0.36.

• Same Store NOI increased 12.4% year over year on 10.4% Same Store Core Revenues growth and 6.2% Same Store Core Operating Expenses growth.

• Same Store Average Occupancy was 98.0%, down 40 basis points year over year.

• Same Store new lease rent growth of 16.7% and Same Store renewal rent growth of 10.2% drove Same Store blended rent growth of 11.8%, up 380 basis points year over year.

• Acquisitions by the Company and the Company's joint ventures totaled 955 homes for $426 million while dispositions totaled 183 homes for $74 million.

• As previously announced, the Company entered into a new $725 million seven-year unsecured term loan on June 22, 2022. The sustainability-linked term loan bears interest at rates based on the Company’s senior unsecured credit rating, which equated to an interest rate of Adjusted Term SOFR plus 124 basis points at the time of closing based on the Company’s current credit ratings.

• As previously announced, the Company closed a public offering on April 5, 2022 of $600 million aggregate principal amount of 4.150% senior notes due in 2032 (the "Notes"). The Notes were priced at 99.739% of the principal amount and will mature on April 15, 2032. Net proceeds were used to voluntarily prepay secured indebtedness.

President & Chief Executive Officer Dallas Tanner comments:

"We're pleased to deliver another outstanding quarter of resident service and financial results. Strong housing market fundamentals across the country continue to drive year over year new lease and renewal rent growth, while occupancy, resident retention and income-to-rent ratio for new residents remain strong. We're proud to offer high-quality, professionally managed homes and a valuable housing choice to the increasing share of Americans who want to lease a home. As a result of excellent execution through the first half of the year, and supply and demand fundamentals remaining favorable in our markets, we have increased our guidance expectations for the full year. Our new guidance includes a 100 basis point increase at the midpoint for Same Store NOI to a range of 10.0% to 11.5%, and a $0.03 per share increase at the midpoint for Core FFO to a range of $1.66 to $1.72 per share."

Financial Results

Net Income, FFO, Core FFO, and AFFO Per Share — Diluted
		Q2 2022			Q2 2021			YTD 2022			YTD 2021
Net income		$	0.18		$	0.11		$	0.33		$	0.21
FFO			0.39			0.32			0.77			0.65
Core FFO			0.42			0.37			0.82			0.73
AFFO			0.36			0.32			0.71			0.63

Net Income

Net income per share for Q2 2022 was $0.18, compared to net income per share of $0.11 for Q2 2021. Total revenues and total property operating and maintenance expenses for Q2 2022 were $557 million and $191 million, respectively, compared to $492 million and $175 million, respectively, for Q2 2021.

Net income per share for YTD 2022 was $0.33, compared to net income per share of $0.21 for YTD 2021. Total revenues and total property operating and maintenance expenses for YTD 2022 were $1,090 million and $373 million, respectively, compared to $967 million and $344 million, respectively, for YTD 2021.

Core FFO

Year over year, Core FFO per share for Q2 2022 increased 13.2% to $0.42, primarily due to NOI growth.

Year over year, Core FFO per share for YTD 2022 increased 13.4% to $0.82, primarily due to NOI growth.

AFFO

Year over year, AFFO per share for Q2 2022 increased 11.9% to $0.36, primarily due to the increase in Core FFO per share described above.

Year over year, AFFO per share for YTD 2022 increased 11.9% to $0.71, primarily due to the increase in Core FFO per share described above.

Operating Results

Same Store Operating Results Snapshot
Number of homes in Same Store Portfolio:		75,215
		Q2 2022		Q2 2021		YTD 2022		YTD 2021
Core Revenues growth (year over year)		10.4 %				10.0 %
Core Operating Expenses growth (year over year)		6.2 %				5.3 %
NOI growth (year over year)		12.4 %				12.2 %
Average Occupancy		98.0 %		98.4 %		98.1 %		98.4 %
Bad debt % of gross rental revenues (1)		0.7 %		1.7 %		1.2 %		1.9 %
Turnover Rate		5.8 %		6.8 %		10.3 %		12.1 %
Rental Rate Growth (lease-over-lease):
Renewals		10.2 %		5.8 %		10.0 %		5.1 %
New Leases		16.7 %		13.7 %		15.8 %		11.1 %
Blended		11.8 %		8.0 %		11.4 %		6.8 %

(1)

Invitation Homes reserves residents' accounts receivables balances that are aged greater than 30 days as bad debt, under the rationale that a resident's security deposit should cover approximately the first 30 days of receivables. For all resident receivables balances aged greater than 30 days, the amount reserved as bad debt is 100% of outstanding receivables from the resident, less the amount of the resident's security deposit on hand. For the purpose of determining age of receivables, charges are considered to be due based on the terms of the original lease, not based on a payment plan if one is in place. All rental revenues and other property income, in both Total Portfolio and Same Store Portfolio presentations, are reflected net of bad debt.

Revenue Collections Update
		Q2 2022		Q1 2022		Q4 2021		Q3 2021		Pre-COVID Average (2)
Revenues collected % of revenues due: (1)
Revenues collected in same month billed		92 %		91 %		92 %		92 %		96 %
Late collections of prior month billings		7 %		6 %		6 %		5 %		3 %
Total collections		99 %		97 %		98 %		97 %		99 %

(1)		Includes both rental revenues and other property income. Rent is considered to be due based on the terms of the original lease, not based on a payment plan if one is in place. Security deposits retained to offset rents due are not included as revenue collected. See "Same Store Operating Results Snapshot," footnote (1), for detail on the Company's bad debt policy.
(2)		Represents the period from October 2019 to March 2020.

Same Store NOI

For the Same Store Portfolio of 75,215 homes, Same Store NOI for Q2 2022 increased 12.4% year over year on Same Store Core Revenues growth of 10.4% and Same Store Core Operating Expenses growth of 6.2%.

YTD 2022 Same Store NOI increased 12.2% year over year on Same Store Core Revenues growth of 10.0% and Same Store Core Operating Expenses growth of 5.3%.

Same Store Core Revenues

Same Store Core Revenues growth for Q2 2022 of 10.4% year over year was primarily driven by a 9.4% increase in Average Monthly Rent, a 100 basis points year over year improvement in bad debt as a percentage of gross rental revenue, and a 19.9% increase in other income, net of resident recoveries.

YTD 2022 Same Store Core Revenue growth of 10.0% year over year was primarily driven by an 8.9% increase in average monthly rent, a 70 basis points year over year improvement in bad debt as a percentage of gross rental revenues, and a 31.6% increase in other income, net of resident recoveries.

Same Store Core Operating Expenses

Same Store Core Operating Expenses for Q2 2022 increased 6.2% year over year, primarily driven by a 4.4% increase in Same Store fixed expenses and a 15.2% increase in repairs and maintenance expense, net of resident recoveries.

YTD 2022 Same Store Core operating expenses increased 5.3% year over year, primarily driven by a 4.2% increase in Same Store fixed expenses and a 16.9% increase in repairs and maintenance expense, net of resident recoveries.

Investment Management Activity

Acquisitions for Q2 2022 totaled 955 homes for $426 million through diversified acquisition channels. This included 511 wholly owned homes for $227 million in addition to 444 homes for $199 million in the Company's joint ventures. Dispositions for Q2 2022 included 176 wholly owned homes for gross proceeds of $70 million and seven homes for gross proceeds of $4 million in the Company's joint ventures.

Year to date through June 30, 2022, the Company acquired 1,777 homes for $766 million, including 1,029 wholly owned homes for $445 million and 748 homes for $321 million in the Company's joint ventures. The Company also sold 330 homes for $128 million, including 317 wholly owned homes for $122 million and 13 homes for $6 million in the Company's joint ventures.

Balance Sheet and Capital Markets Activity

As of June 30, 2022, the Company had $1,848 million in available liquidity through a combination of unrestricted cash and undrawn capacity on its revolving credit facility and term loan. The Company's total indebtedness as of June 30, 2022 was $7,826 million, consisting of $5,200 million of unsecured debt and $2,626 million of secured debt. Net debt / TTM adjusted EBITDAre was 5.9x at June 30, 2022, down from 6.2x as of December 31, 2021.

As previously announced, the Company entered into a new $725 million seven-year unsecured term loan on June 22, 2022. The sustainability-linked term loan bears interest at rates based on the Company’s senior unsecured credit rating, which equated to an interest rate of Adjusted Term SOFR plus 124 basis points at the time of closing based on the Company’s current credit ratings. Pricing of the term loan benefited from the Company meeting certain ESG performance targets as determined via an independent third-party evaluation, similar to its existing five-year unsecured credit facility. The new seven-year delayed draw term loan allowed the Company to elect to receive a portion of the proceeds at closing, with the opportunity to receive the remaining proceeds in up to three additional draws over a six month period. The Company received proceeds of $150 million in its initial draw at closing, and used these initial proceeds, along with cash on hand, as part of a series of transactions to fully repay its IH 2018-2 securitization.

As previously announced, the Company closed a public offering on April 5, 2022 of $600 million aggregate principal amount of 4.150% senior notes due in 2032. The Notes were priced at 99.739% of the principal amount and will mature on April 15, 2032. Net proceeds were used to voluntarily prepay secured indebtedness.

Dividend

As previously announced on July 22, 2022, the Company's Board of Directors declared a quarterly cash dividend of $0.22 per share of common stock. The dividend will be paid on or before August 26, 2022, to stockholders of record as of the close of business on August 9, 2022.

FY 2022 Guidance Update

FY 2022 Guidance
		Current		Previous
		FY 2022		FY 2022
		Guidance		Guidance
Core FFO per share — diluted		$1.66 - $1.72		$1.62 - $1.70
AFFO per share — diluted		$1.41 - $1.47		$1.38 - $1.46
Same Store Core Revenues growth		9.0% - 10.0%		8.0% - 9.0%
Same Store Core Operating Expenses growth		6.0% - 7.0%		5.5% - 6.5%
Same Store NOI growth		10.0% - 11.5%		9.0% - 10.5%

Note: The Company does not provide guidance for the most comparable GAAP financial measures of net income (loss), total revenues, and property operating and maintenance expense, or a reconciliation of the forward-looking non-GAAP financial measures of Core FFO per share, AFFO per share, Same Store Core Revenues growth, Same Store Core Operating Expenses growth, and Same Store NOI growth to the comparable GAAP financial measures because it is unable to reasonably predict certain items contained in the GAAP measures, including non-recurring and infrequent items that are not indicative of the Company's ongoing operations. Such items include, but are not limited to, impairment on depreciated real estate assets, net (gain)/loss on sale of previously depreciated real estate assets, share-based compensation, casualty loss, non-Same Store revenues, and non-Same Store operating expenses. These items are uncertain, depend on various factors, and could have a material impact on the Company's GAAP results for the guidance period.

Earnings Conference Call Information

Invitation Homes has scheduled a conference call at 11:00 a.m. Eastern Time on July 28, 2022, to discuss results for the second quarter of 2022. The domestic dial-in number is 1-844-200-6205, and the international dial-in number is 1-929-526-1599. The access code is 842872. An audio webcast may be accessed at www.invh.com. A replay of the call will be available through August 25, 2022, and can be accessed by calling 1-866-813-9403 (domestic) or 1-929-458-6194 (international) and using the replay access code 769236, or by using the link at www.invh.com.

Supplemental Information

The full text of the Earnings Release and Supplemental Information referenced in this release are available on Invitation Homes' Investor Relations website at www.invh.com.

Glossary & Reconciliations of Non-GAAP Financial and Other Operating Measures

Financial and operating measures found in the Earnings Release and Supplemental Information include certain measures used by Invitation Homes management that are measures not defined under accounting principles generally accepted in the United States ("GAAP"). These measures are defined herein and, as applicable, reconciled to the most comparable GAAP measures.

About Invitation Homes

Invitation Homes is the nation's premier single-family home leasing company, meeting changing lifestyle demands by providing access to high-quality, updated homes with valued features such as close proximity to jobs and access to good schools. The company's mission, "Together with you, we make a house a home," reflects its commitment to providing homes where individuals and families can thrive and high-touch service that continuously enhances residents' living experiences.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which include, but are not limited to, statements related to the Company's expectations regarding the performance of the Company's business, its financial results, its liquidity and capital resources, and other non-historical statements. In some cases, you can identify these forward-looking statements by the use of words such as “outlook,” “guidance,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “projects,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties, including, among others, risks inherent to the single-family rental industry and the Company's business model, macroeconomic factors beyond the Company's control, competition in identifying and acquiring properties, competition in the leasing market for quality residents, increasing property taxes, homeowners’ association and insurance costs, the Company's dependence on third parties for key services, risks related to the evaluation of properties, poor resident selection and defaults and non-renewals by the Company's residents, performance of the Company's information technology systems, risks related to the Company's indebtedness, and risks related to the potential negative impact of unfavorable global and United States economic conditions (including inflation and interest rates), uncertainty in financial markets, geopolitical tensions, natural disasters, climate change, and public health crises, including the ongoing COVID-19 pandemic, on the Company’s financial condition, results of operations, cash flows, business, associates, and residents. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. The Company believes these factors include, but are not limited to, those described under Part I. Item 1A. “Risk Factors” of the Annual Report on Form 10-K for the year ended December 31, 2021, as such factors may be updated from time to time in the Company's periodic filings with the Securities and Exchange Commission (the "SEC"), which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release and in the Company's other periodic filings. The forward-looking statements speak only as of the date of this press release, and the Company expressly disclaims any obligation or undertaking to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except to the extent otherwise required by law.

Consolidated Balance Sheets
($ in thousands, except shares and per share data)
		June 30, 2022				December 31, 2021
		(unaudited)
Assets:
Investments in single-family residential properties, net		$	17,125,185			$	16,935,322
Cash and cash equivalents			272,708				610,166
Restricted cash			206,888				208,692
Goodwill			258,207				258,207
Investments in unconsolidated joint ventures			244,730				130,395
Other assets, net			399,266				395,064
Total assets		$	18,506,984			$	18,537,846
Liabilities:
Mortgage loans, net		$	2,211,739			$	3,055,853
Secured term loan, net			401,421				401,313
Unsecured notes, net			2,516,359				1,921,974
Term loan facilities, net			2,624,412				2,478,122
Revolving facility			—				—
Convertible senior notes, net			—				141,397
Accounts payable and accrued expenses			237,915				193,633
Resident security deposits			171,413				165,167
Other liabilities			61,736				341,583
Total liabilities			8,224,995				8,699,042
Equity:
Stockholders' equity
Preferred stock, $0.01 par value per share, 900,000,000 shares authorized, none outstanding as of June 30, 2022 and December 31, 2021			—				—
Common stock, $0.01 par value per share, 9,000,000,000 shares authorized, 610,359,909 and 601,045,438 outstanding as of June 30, 2022 and December 31, 2021, respectively			6,104				6,010
Additional paid-in capital			11,113,146				10,873,539
Accumulated deficit			(860,275	)			(794,869	)
Accumulated other comprehensive loss			(20,285	)			(286,938	)
Total stockholders' equity			10,238,690				9,797,742
Non-controlling interests			43,299				41,062
Total equity			10,281,989				9,838,804
Total liabilities and equity		$	18,506,984			$	18,537,846

Consolidated Statements of Operations
($ in thousands, except shares and per share amounts)
		Q2 2022				Q2 2021				YTD 2022				YTD 2021
		(unaudited)				(unaudited)				(unaudited)
Revenues:
Rental revenues		$	505,936			$	449,113			$	989,931			$	887,246
Other property income			48,605				41,505				94,809				77,826
Management fee revenues			2,759				1,015				4,870				1,786
Total revenues			557,300				491,633				1,089,610				966,858
Expenses:
Property operating and maintenance			190,680				175,422				372,949				343,795
Property management expense			21,814				17,696				42,781				33,538
General and administrative			19,342				19,828				36,981				36,778
Interest expense			74,840				80,764				149,229				164,170
Depreciation and amortization			158,572				145,280				314,368				289,781
Impairment and other			1,355				980				2,870				1,336
Total expenses			466,603				439,970				919,178				869,398
Gains (losses) on investments in equity securities, net			(172	)			(7,002	)			(3,204	)			(10,142	)
Other, net			(3,827	)			(1,903	)			(3,233	)			(1,673	)
Gain on sale of property, net of tax			27,508				17,919				45,534				32,403
Income (loss) from investments in unconsolidated joint ventures			(2,701	)			11				(5,021	)			362
Net income			111,505				60,688				204,508				118,410
Net income attributable to non-controlling interests			(542	)			(350	)			(930	)			(705	)
Net income attributable to common stockholders			110,963				60,338				203,578				117,705
Net income available to participating securities			(148	)			(96	)			(368	)			(191	)
Net income available to common stockholders — basic and diluted		$	110,815			$	60,242			$	203,210			$	117,514
Weighted average common shares outstanding — basic			610,331,643				567,931,472				608,381,768				567,655,034
Weighted average common shares outstanding — diluted			611,620,475				569,283,166				609,775,270				569,056,182
Net income per common share — basic		$	0.18			$	0.11			$	0.33			$	0.21
Net income per common share — diluted		$	0.18			$	0.11			$	0.33			$	0.21
Dividends declared per common share		$	0.22			$	0.17			$	0.44			$	0.34

Average Monthly Rent

Average monthly rent represents average monthly rental income per home for occupied properties in an identified population of homes over the measurement period, and reflects the impact of non-service rental concessions and contractual rent increases amortized over the life of the lease.

Average Occupancy

Average occupancy for an identified population of homes represents (i) the total number of days that the homes in such population were occupied during the measurement period, divided by (ii) the total number of days that the homes in such population were owned during the measurement period.

Core Operating Expenses

Core operating expenses for an identified population of homes reflect property operating and maintenance expenses, excluding any expenses recovered from residents.

Core Revenues

Core revenues for an identified population of homes reflects total revenues, net of any resident recoveries.

EBITDA, EBITDAre, and Adjusted EBITDAre

EBITDA, EBITDAre, and Adjusted EBITDAre are supplemental, non-GAAP measures often utilized to evaluate the performance of real estate companies. The Company defines EBITDA as net income or loss computed in accordance with accounting principles generally accepted in the United States (“GAAP”) before the following items: interest expense; income tax expense; depreciation and amortization; and adjustments for unconsolidated joint ventures. National Association of Real Estate Investment Trusts ("Nareit") recommends as a best practice that REITs that report an EBITDA performance measure also report EBITDAre. The Company defines EBITDAre, consistent with the Nareit definition, as EBITDA, further adjusted for gain on sale of property, net of tax and impairment on depreciated real estate investments. Adjusted EBITDAre is defined as EBITDAre before the following items: share-based compensation expense; severance; casualty (gains) losses, net; (gains) losses on investments in equity securities, net; and other income and expenses. EBITDA, EBITDAre, and Adjusted EBITDAre are used as supplemental financial performance measures by management and by external users of the Company's financial statements, such as investors and commercial banks. Set forth below is additional detail on how management uses EBITDA, EBITDAre, and Adjusted EBITDAre as measures of performance.

The GAAP measure most directly comparable to EBITDA, EBITDAre, and Adjusted EBITDAre is net income or loss. EBITDA, EBITDAre, and Adjusted EBITDAre are not used as measures of the Company's liquidity and should not be considered alternatives to net income or loss or any other measure of financial performance presented in accordance with GAAP. The Company's EBITDA, EBITDAre, and Adjusted EBITDAre may not be comparable to the EBITDA, EBITDAre, and Adjusted EBITDAre of other companies due to the fact that not all companies use the same definitions of EBITDA, EBITDAre, and Adjusted EBITDAre. Accordingly, there can be no assurance that the Company's basis for computing these non-GAAP measures is comparable with that of other companies. See below for a reconciliation of GAAP net income to EBITDA, EBITDAre, and Adjusted EBITDAre.

Funds from Operations (FFO), Core Funds from Operations (Core FFO), and Adjusted Funds from Operations (AFFO)

FFO, Core FFO, and Adjusted FFO are supplemental, non-GAAP measures often utilized to evaluate the performance of real estate companies. FFO is defined by Nareit as net income or loss (computed in accordance with GAAP) excluding gains or losses from sales of previously depreciated real estate assets, plus depreciation, amortization and impairment of real estate assets, and adjustments for unconsolidated joint ventures. In calculating per share amounts, Core FFO and AFFO reflect convertible debt securities in the form in which they were outstanding during the period.

The Company believes that FFO is a meaningful supplemental measure of the operating performance of its business because historical cost accounting for real estate assets in accordance with GAAP assumes that the value of real estate assets diminishes predictably over time, as reflected through depreciation and amortization. Because real estate values have historically risen or fallen with market conditions, management considers FFO an appropriate supplemental performance measure as it excludes historical cost depreciation and amortization, impairment on depreciated real estate investments, gains or losses related to sales of previously depreciated homes, as well non-controlling interests, from GAAP net income or loss.

The GAAP measure most directly comparable to Core FFO and Adjusted FFO is net income or loss. Core FFO and Adjusted FFO are not used as measures of the Company's liquidity and should not be considered alternatives to net income or loss or any other measure of financial performance presented in accordance with GAAP. The Company's Core FFO and Adjusted FFO may not be comparable to the Core FFO and Adjusted FFO of other companies due to the fact that not all companies use the same definition of Core FFO and Adjusted FFO. Accordingly, there can be no assurance that the Company's basis for computing this non-GAAP measures is comparable with that of other companies. See "Reconciliation of FFO, Core FFO, and Adjusted FFO" for a reconciliation of GAAP net income to FFO, Core FFO, and Adjusted FFO.

Net Operating Income (NOI)

NOI is a non-GAAP measure often used to evaluate the performance of real estate companies. The Company defines NOI for an identified population of homes as rental revenues and other property income less property operating and maintenance expense (which consists primarily of property taxes, insurance, HOA fees (when applicable), market-level personnel expenses, repairs and maintenance, leasing costs, and marketing expense). NOI excludes: interest expense; depreciation and amortization; property management expense; general and administrative expense; impairment and other; gain on sale of property, net of tax; (gains) losses on investments in equity securities, net; other income and expenses; management fee revenues; and income from investments in unconsolidated joint ventures.

The GAAP measure most directly comparable to NOI is net income or loss. NOI is not used as a measure of liquidity and should not be considered as an alternative to net income or loss or any other measure of financial performance presented in accordance with GAAP. The Company's NOI may not be comparable to the NOI of other companies due to the fact that not all companies use the same definition of NOI. Accordingly, there can be no assurance that the Company's basis for computing this non-GAAP measure is comparable with that of other companies.

The Company believes that Same Store NOI is also a meaningful supplemental measure of the Company's operating performance for the same reasons as NOI and is further helpful to investors as it provides a more consistent measurement of the Company's performance across reporting periods by reflecting NOI for homes in its Same Store Portfolio.

See below for a reconciliation of GAAP net income to NOI for the Company's total portfolio and NOI for its Same Store Portfolio.

Recurring Capital Expenditures or Recurring CapEx

Recurring Capital Expenditures or Recurring CapEx represents general replacements and expenditures required to preserve and maintain the value and functionality of a home and its systems as a single-family rental.

Rental Rate Growth

Rental rate growth for any home represents the percentage difference between the monthly rent from an expiring lease and the monthly rent from the next lease, and, in each case, reflects the impact of any amortized non-service rent concessions and amortized contractual rent increases. Leases are either renewal leases, where the Company's current resident chooses to stay for a subsequent lease term, or a new lease, where the Company's previous resident moves out and a new resident signs a lease to occupy the same home.

Revenue Collections

Revenue collections represent the total cash received in a given period for rental revenues and other property income (including receipt of late payments that were billed in prior months) divided by the total amounts billed in that period. When a payment plan is in place with a resident, amounts are considered to be billed at the time they would have been billed based on the terms of the original lease, not the terms of the payment plan. "Historical average" revenue collections as a percentage of billings refer to revenue collections as a percentage of billings for the period from October 2019 through and including March 2020.

Same Store / Same Store Portfolio

Same Store or Same Store portfolio includes, for a given reporting period, wholly owned homes that have been stabilized and seasoned, excluding homes that have been sold, homes that have been identified for sale to an owner occupant and have become vacant, homes that have been deemed inoperable or significantly impaired by casualty loss events or force majeure, homes acquired in portfolio transactions that are deemed not to have undergone renovations of sufficiently similar quality and characteristics as the existing Invitation Homes Same Store portfolio, and homes in markets that the Company has announced an intent to exit where the Company no longer operates a significant number of homes.

Homes are considered stabilized if they have (i) completed an initial renovation and (ii) entered into at least one post-initial renovation lease. An acquired portfolio that is both leased and deemed to be of sufficiently similar quality and characteristics as the existing Invitation Homes Same Store portfolio may be considered stabilized at the time of acquisition.

Homes are considered to be seasoned once they have been stabilized for at least 15 months prior to January 1^st of the year in which the Same Store portfolio was established.

The Company believes presenting information about the portion of its portfolio that has been fully operational for the entirety of a given reporting period and its prior year comparison period provides investors with meaningful information about the performance of the Company's comparable homes across periods and about trends in its organic business.

Total Homes / Total Portfolio

Total homes or total portfolio refers to the total number of homes owned, whether or not stabilized, and excludes any properties previously acquired in purchases that have been subsequently rescinded or vacated. Unless otherwise indicated, total homes or total portfolio refers to the wholly owned homes and excludes homes owned in joint ventures.

Turnover Rate

Turnover rate represents the number of instances that homes in an identified population become unoccupied in a given period, divided by the number of homes in such population.

Reconciliation of FFO, Core FFO, and AFFO
($ in thousands, except shares and per share amounts) (unaudited)
FFO Reconciliation		Q2 2022				Q2 2021				YTD 2022				YTD 2021
Net income available to common stockholders		$	110,815			$	60,242			$	203,210			$	117,514
Net income available to participating securities			148				96				368				191
Non-controlling interests			542				350				930				705
Depreciation and amortization on real estate assets			156,433				143,607				310,073				286,391
Impairment on depreciated real estate investments			36				93				137				524
Net gain on sale of previously depreciated investments in real estate			(27,508	)			(17,919	)			(45,534	)			(32,403	)
Depreciation and net gain on sale of investments in unconsolidated joint ventures			916				142				1,416				(90	)
FFO		$	241,382			$	186,611			$	470,600			$	372,832
Core FFO Reconciliation		Q2 2022				Q2 2021				YTD 2022				YTD 2021
FFO		$	241,382			$	186,611			$	470,600			$	372,832
Non-cash interest expense, including the Company's share from unconsolidated joint ventures			6,498				8,169				12,968				16,787
Share-based compensation expense			7,989				9,206				14,635				15,020
Severance expense			189				160				207				274
Casualty (gains) losses, net			1,319				887				2,733				812
Losses on investments in equity securities, net			172				7,002				3,204				10,142
Core FFO		$	257,549			$	212,035			$	504,347			$	415,867
AFFO Reconciliation		Q2 2022				Q2 2021				YTD 2022				YTD 2021
Core FFO		$	257,549			$	212,035			$	504,347			$	415,867
Recurring capital expenditures, including the Company's share from unconsolidated joint ventures			(37,544	)			(28,714	)			(70,374	)			(53,189	)
Adjusted FFO		$	220,005			$	183,321			$	433,973			$	362,678
Net income available to common stockholders
Weighted average common shares outstanding — diluted			611,620,475				569,283,166				609,775,270				569,056,182
Net income per common share — diluted		$	0.18			$	0.11			$	0.33			$	0.21
FFO
Numerator for FFO per common share — diluted		$	241,382			$	190,955			$	470,600			$	381,520
Weighted average common shares and OP Units outstanding — diluted			614,569,431				587,982,707				612,648,238				587,906,276
FFO per share — diluted		$	0.39			$	0.32			$	0.77			$	0.65
Core FFO and Adjusted FFO
Weighted average common shares and OP Units outstanding — diluted			614,569,431				572,822,015				612,648,238				572,745,584
Core FFO per share — diluted		$	0.42			$	0.37			$	0.82			$	0.73
AFFO per share — diluted		$	0.36			$	0.32			$	0.71			$	0.63

Reconciliation of Total Revenues to Same Store Core Revenues, Quarterly
(in thousands) (unaudited)
		Q2 2022				Q1 2022				Q4 2021				Q3 2021				Q2 2021
Total revenues (Total Portfolio)		$	557,300			$	532,310			$	520,225			$	509,532			$	491,633
Management fee revenues			(2,759	)			(2,111	)			(1,753	)			(1,354	)			(1,015	)
Total portfolio resident recoveries			(29,394	)			(28,762	)			(26,967	)			(27,972	)			(26,076	)
Total Core Revenues (Total Portfolio)			525,147				501,437				491,505				480,206				464,542
Non-Same Store Core Revenues			(41,868	)			(34,771	)			(31,647	)			(29,343	)			(26,974	)
Same Store Core Revenues		$	483,279			$	466,666			$	459,858			$	450,863			$	437,568
Reconciliation of Total Revenues to Same Store Total Revenues and Same Store Core Revenues, YTD
(in thousands) (unaudited)
		YTD 2022				YTD 2021
Total revenues (Total Portfolio)		$	1,089,610			$	966,858
Management fee revenues			(4,870	)			(1,786	)
Total portfolio resident recoveries			(58,156	)			(50,816	)
Total Core Revenues (Total Portfolio)			1,026,584				914,256
Non-Same Store Core Revenues			(76,639	)			(50,575	)
Same Store Core Revenues		$	949,945			$	863,681

Reconciliation of Property Operating and Maintenance Expenses to Same Store Core Operating Expenses, Quarterly
(in thousands) (unaudited)
		Q2 2022				Q1 2022				Q4 2021				Q3 2021				Q2 2021
Property operating and maintenance expenses (Total Portfolio)		$	190,680			$	182,269			$	177,883			$	184,484			$	175,422
Total Portfolio resident recoveries			(29,394	)			(28,762	)			(26,967	)			(27,972	)			(26,076	)
Core Operating Expenses (Total Portfolio)			161,286				153,507				150,916				156,512				149,346
Non-Same Store Core Operating Expenses			(12,425	)			(12,029	)			(10,411	)			(9,258	)			(9,232	)
Same Store Core Operating Expenses		$	148,861			$	141,478			$	140,505			$	147,254			$	140,114
Reconciliation of Property Operating and Maintenance to Same Store Operating Expenses and Same Store Core Operating Expenses, YTD
(in thousands) (unaudited)
		YTD 2022				YTD 2021
Property operating and maintenance expenses (Total Portfolio)		$	372,949			$	343,795
Total Portfolio resident recoveries			(58,156	)			(50,816	)
Core Operating Expenses (Total Portfolio)			314,793				292,979
Non-Same Store Core Operating Expenses			(24,454	)			(17,337	)
Same Store Core Operating Expenses		$	290,339			$	275,642

Reconciliation of Net Income to Same Store NOI, Quarterly
(in thousands) (unaudited)
		Q2 2022				Q1 2022				Q4 2021				Q3 2021				Q2 2021
Net income available to common stockholders		$	110,815			$	92,395			$	74,476			$	69,108			$	60,242
Net income available to participating securities			148				220				67				69				96
Non-controlling interests			542				388				328				318				350
Interest expense			74,840				74,389				79,121				79,370				80,764
Depreciation and amortization			158,572				155,796				151,660				150,694				145,280
Property management expense			21,814				20,967				20,173				17,886				17,696
General and administrative			19,342				17,639				19,668				19,369				19,828
Impairment and other			1,355				1,515				3,046				4,294				980
Gain on sale of property, net of tax			(27,508	)			(18,026	)			(14,558	)			(13,047	)			(17,919	)
Losses on investments in equity securities, net			172				3,032				3,597		0		(4,319	)	0		7,002
Other, net			3,827				(594	)			2,654				1,508				1,903
Management fee revenues			(2,759	)			(2,111	)			(1,753	)			(1,354	)			(1,015	)
(Income) loss from investments in unconsolidated joint ventures			2,701				2,320				2,110				(202	)			(11	)
NOI (Total Portfolio)			363,861				347,930				340,589				323,694				315,196
Non-Same Store NOI			(29,443	)			(22,742	)			(21,236	)			(20,085	)			(17,742	)
Same Store NOI		$	334,418			$	325,188			$	319,353			$	303,609			$	297,454
Reconciliation of Net Income to NOI and Same Store NOI, YTD
(in thousands) (unaudited)
		YTD 2022				YTD 2021
Net income available to common stockholders		$	203,210			$	117,514
Net income available to participating securities			368				191
Non-controlling interests			930				705
Interest expense			149,229				164,170
Depreciation and amortization			314,368				289,781
Property management expense			42,781				33,538
General and administrative			36,981				36,778
Impairment and other			2,870				1,336
Gain on sale of property, net of tax			(45,534	)			(32,403	)
Losses on investments in equity securities, net			3,204				10,142
Other, net			3,233				1,673
Management fee revenues			(4,870	)			(1,786	)
(Income) loss from investments in unconsolidated joint ventures			5,021				(362	)
NOI (Total Portfolio)			711,791				621,277
Non-Same Store NOI			(52,185	)			(33,238	)
Same Store NOI		$	659,606			$	588,039

Reconciliation of Net Income to EBITDA, EBITDAre, and Adjusted EBITDAre
(in thousands, unaudited)
		Q2 2022				Q2 2021				YTD 2022				YTD 2021
Net income available to common stockholders		$	110,815			$	60,242			$	203,210			$	117,514
Net income available to participating securities			148				96				368				191
Non-controlling interests			542				350				930				705
Interest expense			74,840				80,764				149,229				164,170
Interest expense in unconsolidated joint ventures			859				225				1,451				299
Depreciation and amortization			158,572				145,280				314,368				289,781
Depreciation and amortization of real estate assets in unconsolidated joint ventures			1,114				246				1,752				350
EBITDA			346,890				287,203				671,308				573,010
Gain on sale of property, net of tax			(27,508	)			(17,919	)			(45,534	)			(32,403	)
Impairment on depreciated real estate investments			36				93				137				524
Net gain on sale of investments in unconsolidated joint ventures			(186	)			(104	)			(316	)			(440	)
EBITDAre			319,232				269,273				625,595				540,691
Share-based compensation expense			7,989				9,206				14,635				15,020
Severance			189				160				207				274
Casualty (gains) losses, net			1,319				887				2,733				812
(Gains) losses on investments in equity securities, net			172				7,002				3,204				10,142
Other, net			3,827				1,903				3,233				1,673
Adjusted EBITDAre		$	332,728			$	288,431			$	649,607			$	568,612
		Trailing Twelve Months (TTM) Ended
		June 30, 2022				December 31, 2021
Net income available to common stockholders		$	346,794			$	261,098
Net income available to participating securities			504				327
Non-controlling interests			1,576				1,351
Interest expense			307,720				322,661
Interest expense in unconsolidated joint ventures			2,361				1,209
Depreciation and amortization			616,722				592,135
Depreciation and amortization of real estate assets in unconsolidated joint ventures			2,706				1,304
EBITDA			1,278,383				1,180,085
Gain on sale of property, net of tax			(73,139	)			(60,008	)
Impairment on depreciated real estate investments			263				650
Net gain on sale of investments in unconsolidated joint ventures			(926	)			(1,050	)
EBITDAre			1,204,581				1,119,677
Share-based compensation expense			26,785				27,170
Severance			990				1,057
Casualty (gains) losses, net			9,947				8,026
(Gains) losses on investments in equity securities, net			2,482				9,420
Other, net			7,395				5,835
Adjusted EBITDAre		$	1,252,180			$	1,171,185

Reconciliation of Net Debt / Trailing Twelve Months (TTM) Adjusted EBITDAre
(in thousands, except for ratio) (unaudited)
		As of				As of
		June 30, 2022				December 31, 2021
Mortgage loans, net		$	2,211,739			$	3,055,853
Secured term loan, net			401,421				401,313
Unsecured notes, net			2,516,359				1,921,974
Term loan facility, net			2,624,412				2,478,122
Revolving facility			—				—
Convertible senior notes, net			—				141,397
Total Debt per Balance Sheet			7,753,931				7,998,659
Retained and repurchased certificates			(116,940	)			(159,110	)
Cash, ex-security deposits and letters of credit (1)			(306,049	)			(649,722	)
Deferred financing costs, net			57,448				50,146
Unamortized discounts on note payable			14,316				13,605
Net Debt (A)		$	7,402,706			$	7,253,578
		For the Trailing Twelve				For the Trailing Twelve
		Months (TTM) Ended				Months (TTM) Ended
		June 30, 2022				December 31, 2021
Adjusted EBITDAre (B)		$	1,252,180			$	1,171,185
Net Debt / TTM Adjusted EBITDAre (A / B)		5.9x				6.2x

(1)

Represents cash and cash equivalents and the portion of restricted cash that excludes security deposits and letters of credit

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20220727005523/en/

Investor Relations Contact

Scott McLaughlin

844.456.INVH (4684)

IR@InvitationHomes.com

Media Relations Contact

Kristi DesJarlais

972.421.3587

Media@InvitationHomes.com

Source: Invitation Homes Inc.

FAQ

What were Invitation Homes' Q2 2022 financial results?

Invitation Homes reported Q2 2022 revenues of $557 million, net income of $111 million, and Core FFO per share of $0.42.

How did the Same Store NOI perform for Invitation Homes in Q2 2022?

Same Store NOI for Q2 2022 increased 12.4% year-over-year, driven by 10.4% Core Revenue growth.

What is the FY 2022 guidance for Invitation Homes?

The FY 2022 guidance includes Core FFO per share ranging from $1.66 to $1.72 and Same Store NOI growth of 10.0% to 11.5%.

How many homes did Invitation Homes acquire in Q2 2022?

In Q2 2022, Invitation Homes acquired 955 homes for $426 million.

What was the dividend declared by Invitation Homes for Q2 2022?

Invitation Homes declared a quarterly cash dividend of $0.22 per share, payable on or before August 26, 2022.