Independence Realty Trust Announces Second Quarter 2024 Financial Results and Increases Midpoint of Full Year 2024 Same Store NOI, EPS, and Core FFO Guidance Ranges
Independence Realty Trust (NYSE: IRT) announced its Q2 2024 financial results, highlighting a slight decline in net income to $10.4 million compared to $10.7 million in Q2 2023. EPS remained stable at $0.05, while core funds from operations (CFFO) stood at $63.6 million, consistent with last year's figures. Same-store net operating income (NOI) saw a 2.8% increase.
IRT completed renovations on 378 units, achieving a 15.7% ROI. The company disposed of one property for $28.5 million and used the proceeds to repay debt. Additionally, IRT reported a 3.6% revenue growth and a 120-basis point increase in occupancy to 95.4%.
The company raised the midpoint of its full-year 2024 guidance for NOI, EPS, and Core FFO, with projected EPS now between $0.36 and $0.38. A $0.16 per share dividend was declared, payable on July 19, 2024.
Independence Realty Trust (NYSE: IRT) ha annunciato i risultati finanziari per il secondo trimestre del 2024, evidenziando un lieve calo del reddito netto, che si attesta a 10,4 milioni di dollari rispetto ai 10,7 milioni di dollari del secondo trimestre del 2023. L'EPS è rimasto stabile a 0,05 dollari, mentre i fondi core dalle operazioni (CFFO) ammontano a 63,6 milioni di dollari, in linea con i dati dell'anno scorso. Il reddito operativo netto (NOI) per le stesse aperture ha registrato un incremento del 2,8%.
IRT ha completato la ristrutturazione di 378 unità, ottenendo un ROI del 15,7%. L'azienda ha venduto una proprietà per 28,5 milioni di dollari e ha utilizzato il ricavato per ripagare il debito. Inoltre, IRT ha riportato una crescita dei ricavi del 3,6% e un aumento di 120 punti base nell'occupazione, raggiungendo il 95,4%.
L'azienda ha alzato il punto medio delle previsioni per l'intero anno 2024 riguardo NOI, EPS e Core FFO, con un EPS previsto ora compreso tra 0,36 e 0,38 dollari. È stato dichiarato un dividendo di 0,16 dollari per azione, pagabile il 19 luglio 2024.
Independence Realty Trust (NYSE: IRT) anunció sus resultados financieros del segundo trimestre de 2024, destacando una ligera disminución en los ingresos netos a 10,4 millones de dólares en comparación con 10,7 millones de dólares en el segundo trimestre de 2023. El EPS se mantuvo estable en 0,05 dólares, mientras que los fondos operativos centrales (CFFO) llegaron a 63,6 millones de dólares, consistente con las cifras del año pasado. Los ingresos operativos netos (NOI) mismos reportaron un incremento del 2,8%.
IRT completó la renovación de 378 unidades, logrando un ROI del 15,7%. La compañía vendió una propiedad por 28,5 millones de dólares y utilizó los ingresos para pagar deudas. Además, IRT reportó un crecimiento del 3,6% en los ingresos y un aumento de 120 puntos básicos en la ocupación, alcanzando el 95,4%.
La compañía elevó el punto medio de su orientación para el año completo de 2024 en cuanto a NOI, EPS y Core FFO, con un EPS proyectado ahora entre 0,36 y 0,38 dólares. Se declaró un dividendo de 0,16 dólares por acción, que se pagará el 19 de julio de 2024.
Independence Realty Trust (NYSE: IRT)는 2024년 2분기 재무 결과를 발표하며, 2023년 2분기 대비 순이익이 1억 4백만 달러에서 1억 4만 달러로 약간 감소했음을 강조했습니다. EPS는 0.05달러로 안정세를 유지했으며, 주요 운영 기금(CFFO)은 6천 3백 6십만 달러로, 지난해와 일치했습니다. 오프닝 같은 매장에서의 순 운영 소득(NO이)은 2.8% 증가했습니다.
IRT는 378개의 단위를 개조하였으며, 15.7% ROI를 달성하였습니다. 회사는 2850만 달러에 한 부동산을 처분하였고, 이 수익금을 사용하여 부채를 상환하였습니다. 또한 IRT는 3.6%의 수익 성장과 95.4%로 120 베이시스 포인트의 점유율 증가를 보고하였습니다.
회사는 NOI, EPS 및 Core FFO에 대한 2024년 전체 연도 가이던스의 중간값을 상향 조정하였으며, EPS는 이제 0.36달러에서 0.38달러로 예상되고 있습니다. 2024년 7월 19일에 지급될 주당 0.16달러의 배당금이 선언되었습니다.
Independence Realty Trust (NYSE: IRT) a annoncé ses résultats financiers pour le deuxième trimestre de 2024, soulignant une légère baisse du revenu net à 10,4 millions de dollars contre 10,7 millions de dollars au deuxième trimestre de 2023. L'EPS est resté stable à 0,05 dollar, tandis que les fonds d'exploitation principaux (CFFO) s'élevaient à 63,6 millions de dollars, en cohérence avec les chiffres de l'année précédente. Le revenu opérationnel net (NOI) des mêmes établissements a enregistré une augmentation de 2,8 %.
IRT a terminé les rénovations de 378 unités, obtenant un retour sur investissement (ROI) de 15,7 %. La société a cédé un bien immobilier pour 28,5 millions de dollars et a utilisé le produit pour rembourser ses dettes. De plus, IRT a rapporté une croissance des revenus de 3,6 % et une augmentation de 120 points de base de l'occupation à 95,4 %.
La société a relevé le point médian de ses prévisions pour l'année entière 2024 concernant le NOI, l'EPS et le Core FFO, avec un EPS projeté maintenant entre 0,36 et 0,38 dollar. Un dividende de 0,16 dollar par action a été déclaré, payable le 19 juillet 2024.
Independence Realty Trust (NYSE: IRT) gab die finanziellen Ergebnisse für das zweite Quartal 2024 bekannt und hob einen leichten Rückgang des Nettogewinns auf 10,4 Millionen US-Dollar hervor, im Vergleich zu 10,7 Millionen US-Dollar im zweiten Quartal 2023. Der EPS blieb mit 0,05 US-Dollar stabil, während die Kernmittel aus dem Betrieb (CFFO) sich auf 63,6 Millionen US-Dollar beliefen, was den Werten des Vorjahres entspricht. Das Netto Betriebsergebnis (NOI) der gleichen Geschäfte verzeichnete einen Anstieg von 2,8 %.
IRT schloss die Renovierung von 378 Einheiten ab und erzielte eine Rendite von 15,7 %. Das Unternehmen verkaufte eine Immobilie für 28,5 Millionen US-Dollar und verwendete die Erlöse zur Tilgung von Schulden. Zudem meldete IRT ein Umsatzwachstum von 3,6 % und einen Anstieg der Belegung um 120 Basispunkte auf 95,4 %.
Das Unternehmen erhöhte den Mittelpunkt seiner Jahresprognose 2024 für NOI, EPS und Core FFO, wobei der projizierte EPS nun zwischen 0,36 und 0,38 US-Dollar liegt. Eine Dividende von 0,16 US-Dollar pro Aktie wurde erklärt, die am 19. Juli 2024 zahlbar ist.
- Same-store NOI growth of 2.8% in Q2 2024
- Revenue growth of 3.6% in Q2 2024
- Occupancy increased by 120 basis points to 95.4%
- Completed renovations on 378 units with a 15.7% ROI
- EPS guidance raised to $0.36-$0.38
- Net income decreased to $10.4 million from $10.7 million in Q2 2023
- Adjusted EBITDA decreased to $83.6 million from $89.2 million in Q2 2023
- Property operating expenses increased by 4.9%
Insights
Independence Realty Trust's Q2 2024 results show a mixed performance with some positive indicators. The 2.8% same-store NOI growth and 3.6% increase in rental revenue are encouraging signs, especially given the challenging market conditions. However, the flat Core FFO per share of
The company's focus on occupancy, which increased by 120 basis points to
The increase in guidance midpoints for NOI, EPS and Core FFO is a positive signal, indicating management's confidence in the company's performance for the remainder of 2024. However, investors should note the slight decrease in NOI margin and the challenges in achieving expected rental rate growth.
The completion of the Portfolio Optimization and Deleveraging Strategy, resulting in
Overall, while facing industry-wide headwinds, IRT appears to be navigating the market effectively through strategic occupancy management and targeted investments in its portfolio.
The multifamily market dynamics reflected in IRT's Q2 2024 results highlight some interesting trends. The company's ability to achieve
The blended lease-over-lease effective rental rate growth of
IRT's value-add program continues to show strong results, with a
The company's guidance for Q3 2024, projecting effective rent growth for new leases between
The successful execution of the Portfolio Optimization and Deleveraging Strategy, coupled with ongoing capital recycling efforts, demonstrates IRT's proactive approach to portfolio management. This strategy could prove beneficial in maintaining a competitive edge in evolving market conditions.
Second Quarter Highlights
-
Net income available to common shares of
$10.4 million $10.7 million -
Earnings per diluted share of
$0.05 $0.05 -
Same-store portfolio net operating income (“NOI”) growth of
2.8% for the quarter ended June 30, 2024 compared to the quarter ended June 30, 2023. -
Core Funds from Operations (“CFFO”) of
$63.6 million $63.7 million $0.28 $0.28 -
Adjusted EBITDA of
$83.6 million $89.2 million -
Value add program completed renovations at 378 units during the quarter ended June 30, 2024, achieving a weighted average return on investment during the quarter of
15.7% .
Included later in this press release are definitions of NOI, CFFO, Adjusted EBITDA and other Non-GAAP financial measures and reconciliations of such measures to their most comparable financial measures as calculated and presented in accordance with GAAP, as well as, discussion of our same-store methodology.
Management Commentary
“Our results for the second quarter of 2024 highlight our strategy of driving occupancy, which was up 120 basis points year-over-year,” said Scott Schaeffer, Chairman and CEO of IRT. “While industry-wide factors impacted our ability to achieve expected rental rate growth during the first half of this year, we stayed focused on resident retention and occupancy and delivered
Same-Store Portfolio(1) Operating Results
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Three Months Ended June 30, 2024 Compared to Three Months Ended June 30, 2023 |
Six Months Ended June 30, 2024 Compared to Six Months Ended June 30, 2023 |
Rental and other property revenue |
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Property operating expenses |
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NOI |
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Portfolio average occupancy |
120 bps increase to |
120 bps increase to |
Portfolio average rental rate |
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NOI Margin |
40 bps decrease to |
60 bps decrease to |
| (1) | Same-store portfolio includes 108 properties, which represent 32,153 units. |
Operating Metrics
The table below summarizes operating metrics for the same-store portfolio for the applicable periods.
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2Q 2024 |
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July 2024(3) |
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Same-Store Portfolio(1) |
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Average Occupancy |
95.4 |
% |
95.2 |
% |
(4) |
Lease Over Lease Effective Rental Rate Growth:(2) |
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New Leases |
(1.0 |
)% |
(3.3 |
)% |
(5) |
Renewal Leases |
3.5 |
% |
2.9 |
% |
(5) |
Blended |
1.8 |
% |
0.2 |
% |
(5) |
Resident Retention Rate |
55.8 |
% |
55.4 |
% |
|
Same-Store Portfolio excluding Ongoing Value Add |
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|
|
||
Average Occupancy |
95.6 |
% |
95.6 |
% |
(4) |
Lease Over Lease Effective Rental Rate Growth:(2) |
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|
|
||
New Leases |
(1.6 |
)% |
(3.8 |
)% |
|
Renewal Leases |
3.4 |
% |
2.9 |
% |
|
Blended |
1.6 |
% |
0.1 |
% |
|
Resident Retention Rate |
55.3 |
% |
56.0 |
% |
|
Value Add (26 properties with Ongoing Value Add) |
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|
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||
Average Occupancy |
94.8 |
% |
94.3 |
% |
(4) |
Lease Over Lease Effective Rental Rate Growth:(2) |
|
|
|
||
New Leases (all) |
1.0 |
% |
(2.2 |
)% |
|
1st generation renovation leases (6) |
6.3 |
% |
5.5 |
% |
|
Renewal Leases |
3.5 |
% |
3.0 |
% |
|
Blended |
2.7 |
% |
0.5 |
% |
|
Resident Retention Rate |
57.3 |
% |
53.8 |
% |
|
(1) |
Same-store portfolio includes 108 properties, which represent 32,153 units. |
(2) |
Lease-over-lease effective rent growth represents the change in effective monthly rent, as adjusted for concessions, for each unit that had a prior lease and current lease that are for a term of 9-13 months. |
(3) |
July 2024 average occupancy is through July 30, 2024. New, renewal, and blended lease rates, and resident retention are for leases commencing during July 2024 that were signed as of July 30, 2024. |
(4) |
As of July 30, 2024, same-store portfolio occupancy was |
(5) |
For the full third quarter 2024, we expect effective rent growth for new leases to be - |
(6) |
1st generation renovation leases are a subset of new leases at value add properties and represent the first new lease in a unit after a completed renovation. |
Value Add Program
We completed renovations on 378 units during the quarter ended June 30, 2024, achieving a return on investment of
Investment Activity
Properties Held for Sale and Dispositions
As of June 30, 2024, we had one property classified as held for sale and had sold one property during the three months ended June 30, 2024.
-
Reserve at Creekside,
Chattanooga, Tennessee : Sales of properties under our Portfolio Optimization and Deleveraging Strategy concluded with the sale of our tenth and final property on April 30, 2024, for a gross sales price of$28.5 million $15.0 million $13.3 million $525.3 million $517.1 million
-
Tapestry Park,
Birmingham Alabama : During the three months ended March 31, 2024, in connection with our capital recycling program, we identified this property as held for sale and recognized a loss on impairment of$15.1 million $70.8 million Tampa, Florida during the third quarter 2024.
Capital Expenditures
For the three months ended June 30, 2024, recurring capital expenditures for the total portfolio were
Dividend Distribution
On June 10, 2024, our Board of Directors declared a quarterly dividend of
2024 EPS, FFO and CFFO Guidance
We increased the midpoint of our 2024 earnings per diluted share, FFO, CFFO per share, and same-store NOI guidance ranges, while updating our interest expense, transaction volume, and capital expenditure guidance. Earnings per diluted share is now projected to be in the range of
|
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Previous Guidance |
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Current Guidance |
|
Change at Midpoint |
|||||||||||||
2024 Full Year EPS and CFFO Guidance(1)(2) |
|
Low |
|
High |
|
Low |
|
High |
|
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Earnings per share |
|
$ |
0.34 |
|
|
$ |
0.38 |
|
|
$ |
0.36 |
|
|
$ |
0.38 |
|
|
$ |
0.01 |
Adjustments: |
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|
|
|
|
|
|
|
|
|
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Depreciation and amortization |
|
|
0.87 |
|
|
|
0.87 |
|
|
|
0.87 |
|
|
|
0.87 |
|
|
|
— |
Gain on sale of real estate assets(3) |
|
|
(0.05 |
) |
|
|
(0.05 |
) |
|
|
(0.05 |
) |
|
|
(0.05 |
) |
|
— |
|
FFO per share |
|
|
1.16 |
|
|
|
1.20 |
|
|
|
1.18 |
|
|
|
1.20 |
|
|
|
0.01 |
Loan (premium accretion) discount amortization, net |
|
|
(0.04 |
) |
|
|
(0.04 |
) |
|
|
(0.04 |
) |
|
|
(0.04 |
) |
|
|
— |
CFFO per share |
|
$ |
1.12 |
|
|
$ |
1.16 |
|
|
$ |
1.14 |
|
|
$ |
1.16 |
|
|
$ |
0.01 |
(1) |
This guidance, including the underlying assumptions presented in the table below, constitutes forward-looking information. Actual full year 2024 EPS, FFO, and CFFO could vary significantly from the projections presented. See “Forward-Looking Statements”. Our guidance is based on the key guidance assumptions detailed below. |
(2) |
Per share guidance is based on 230.9 million weighted average shares and units outstanding. |
(3) |
Gain on sale of real estate assets includes the gains on sale (losses on impairment) recognized during the first quarter of 2024. |
2024 Guidance Assumptions
Our key guidance assumptions for 2024 are enumerated below. See the definitions at the end of this release for further information regarding our same-store definitions.
Same-Store Portfolio |
Previous 2024 Outlook(1) |
Current 2024 Outlook(1) |
Change at Midpoint |
Number of properties/units |
108 properties / 32,153 units |
108 properties / 32,153 units |
— |
Property revenue growth |
|
|
(0.6)% |
Controllable operating expense growth |
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|
(1.15)% |
Real estate tax and insurance expense growth |
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|
(5.5)% |
Total operating expense growth |
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(2.9)% |
NOI growth |
|
|
|
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|
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|
Corporate Expenses |
|
|
|
General and administrative & property management expenses |
|
|
— |
Interest expense(2) |
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|
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Transaction/Investment Volume(3) |
|
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|
Acquisition volume |
|
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Disposition volume |
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Capital Expenditures |
|
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Recurring |
|
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— |
Value add & non-recurring |
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Development |
|
|
— |
(1) |
This guidance, including the underlying assumptions, constitutes forward-looking information. Actual results could vary significantly from the projections presented. See “Forward-Looking Statements”. |
(2) |
Interest expense includes amortization of deferred financing costs but excludes loan premium accretion, net. As a result of purchase accounting we recorded loan premiums, net, that are accreted into and reduce GAAP interest expense over the remaining term of the associated debt. However, loan premium accretion is excluded from CFFO. |
(3) |
Acquisition volume reflects one property in |
Selected Financial Information
See the schedules at the end of this earnings release for selected financial information for IRT.
Non-GAAP Financial Measures and Definitions
We disclose the following non-GAAP financial measures in this earnings release: FFO, CFFO, NOI and Adjusted EBITDA. Included at the end of this release are definitions of these non-GAAP financial measures and a reconciliation of our reported net income to our FFO and CFFO, a reconciliation of our same-store NOI to our reported net income, a reconciliation of our Adjusted EBITDA to net income, and management’s rationales for the usefulness of each of these and other non-GAAP financial measures used in this release.
Conference Call
All interested parties can listen to the live conference call webcast at 9:00 AM ET on Thursday, August 1, 2024 from the investor relations section of the IRT website at www.irtliving.com or by dialing 1.888.440.3307, access code 1963990. For those who are not available to listen to the live call, the replay will be available shortly following the live call from the investor relations section of IRT’s website until the next earnings release. A replay of the conference call can also be accessed telephonically until Thursday, August 8, 2024 by dialing 1.800.770.2030, access code 1963990.
Supplemental Information
We produce supplemental information that includes details regarding the performance of the portfolio, financial information, non-GAAP financial measures, same-store information and other useful information for investors. The supplemental information is available via our website, www.irtliving.com, through the "Investor Relations" section.
About Independence Realty Trust, Inc.
Independence Realty Trust, Inc. (NYSE: IRT) is a real estate investment trust that owns and operates multifamily communities, across non-gateway
Forward-Looking Statements
This release contains certain 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. Such forward-looking statements include, but are not limited to, our earnings guidance, and the assumptions underlying such guidance, and anticipated enhancements to our financial results and future growth from our Portfolio Optimization and Deleveraging Strategy. All statements in this release that address financial and operating performance, events or developments that we expect or anticipate will occur or be achieved in the future are forward-looking statements.
Our forward-looking statements are not guarantees of future performance and involve estimates, projections, forecasts and assumptions, including as to matters that are not within our control, and are subject to risks and uncertainties including, without limitation, risks and uncertainties related to changes in market demand for rental apartment homes and pricing pressures, including from competitors, that could lead to declines in occupancy and rent levels, uncertainty and volatility in capital and credit markets, including changes that reduce availability, and increase costs, of capital, unexpected changes in our intention or ability to repay certain debt prior to maturity, increased costs on account of inflation, increased competition in the labor market, failure to realize cost savings, efficiencies and other benefits that we expect to result from our Portfolio Optimization and Deleveraging Strategy, inability to sell certain assets, including those assets designated as held for sale, within the time frames or at the pricing levels expected, failure to achieve expected benefits from the redeployment of proceeds from asset sales, delays in completing, and cost overruns incurred in connection with, our value add initiatives and failure to achieve rent increases and occupancy levels on account of the value add initiatives, unexpected impairments or impairments in excess of our estimates, increased regulations generally and specifically on the rental housing market, including legislation that may regulate rents and fees or delay or limit our ability to evict non-paying residents, risks endemic to real estate and the real estate industry generally, the impact of potential outbreaks of infectious diseases and measures intended to prevent the spread or address the effects thereof, the effects of natural and other disasters, unknown or unexpected liabilities, including the cost of legal proceedings, costs and disruptions as the result of a cybersecurity incident or other technology disruption, unexpected capital needs, inability to obtain appropriate insurance coverages at reasonable rates, or at all, or losses from catastrophes in excess of our insurance coverages, and share price fluctuations. Please refer to the documents filed by us with the SEC, including specifically the “Risk Factors” sections of our Annual Report on Form 10-K for the year ended December 31, 2023, and our other filings with the SEC, which identify additional factors that could cause actual results to differ from those contained in forward-looking statements.
These forward-looking statements are based upon the beliefs and expectations of our management at the time of this release and our actual results may differ materially from the expectations, intentions, beliefs, plans or predictions of the future expressed or implied by such forward-looking statements. We undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as may be required by law.
Schedule I Independence Realty Trust, Inc. Selected Financial Information Dollars in thousands, except per share data (unaudited) |
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For the Three Months Ended |
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Jun 30, 2024 |
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Mar 31, 2024 |
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Dec 31, 2023 |
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Sep 30, 2023 |
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Jun 30, 2023 |
Selected Financial Information: |
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Operating Statistics: |
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Net income (loss) available to common shares |
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Earnings (loss) per share -- diluted |
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Rental and other property revenue |
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Property operating expenses |
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NOI |
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NOI margin |
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Adjusted EBITDA |
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FFO per share |
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CFFO per share |
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Dividends per share |
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CFFO payout ratio |
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Portfolio Data: |
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Total gross assets |
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Total number of operating properties (a) |
110 |
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111 |
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116 |
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120 |
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119 |
Total units (a) |
32,685 |
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32,877 |
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34,431 |
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35,427 |
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35,249 |
Portfolio period end occupancy (a) |
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Portfolio average occupancy (a) |
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Portfolio average effective monthly rent, per unit (a) |
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Same-store portfolio period end occupancy (b) |
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Same-store portfolio average occupancy (b) |
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Same-store portfolio average effective monthly rent, per unit (b) |
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Capitalization: |
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Total debt (c) |
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Common share price, period end |
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|
Market equity capitalization |
|
|
|
|
|
|
|
|
|
Total market capitalization |
|
|
|
|
|
|
|
|
|
Total debt/total gross assets |
|
|
|
|
|
|
|
|
|
Net debt to Adjusted EBITDA (d) |
6.5x |
|
6.7x |
|
6.7x |
|
7.0x |
|
7.2x |
Interest coverage |
4.8x |
|
4.1x |
|
4.1x |
|
4.3x |
|
4.0x |
Common shares and OP Units: |
|
|
|
|
|
|
|
|
|
Shares outstanding |
225,122,235 |
|
225,070,396 |
|
224,706,731 |
|
224,695,566 |
|
224,697,889 |
OP units outstanding |
5,941,643 |
|
5,941,643 |
|
5,946,571 |
|
5,946,571 |
|
5,946,571 |
Common shares and OP units outstanding |
231,063,878 |
|
231,012,039 |
|
230,653,302 |
|
230,642,137 |
|
230,644,460 |
Weighted average common shares and OP units |
230,734,872 |
|
230,570,707 |
|
230,452,570 |
|
230,444,945 |
|
230,369,086 |
(a) |
Excludes our development projects (Destination at Arista and Flatirons Flats). See the definitions at the end of this release. |
(b) |
Same-store portfolio consists of 108 properties, which represent 32,153 units. |
(c) |
Includes indebtedness associated with real estate held for sale, as applicable. |
(d) |
Reflects net debt to Adjusted EBITDA, which is annualized for each period presented, including adjustments for the timing of acquisitions and dispositions impacting quarterly EBITDA. For the five quarters ended June 30, 2024, net debt to Adjusted EBITDA excluding adjustments for timing of acquisitions and dispositions was 6.6x, 6.5x, 6.5x, 7.0x, and 7.2x, respectively. |
Schedule II Independence Realty Trust, Inc. Reconciliation of Net Income (Loss) to Funds from Operations and Core Funds From Operations Dollars in thousands, except per share data (unaudited) |
|||||||||||||||
|
For the Three Months Ended June 30, |
|
For the Six Months Ended June 30, |
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Funds From Operations (FFO): |
|
|
|
|
|
|
|
||||||||
Net income |
$ |
10,555 |
|
|
$ |
10,988 |
|
|
$ |
28,515 |
|
|
$ |
19,861 |
|
Add-Back (Deduct): |
|
|
|
|
|
|
|
||||||||
Real estate depreciation and amortization |
|
53,757 |
|
|
|
53,701 |
|
|
|
107,149 |
|
|
|
106,989 |
|
Our share of real estate depreciation and amortization from investments in unconsolidated real estate entities |
|
598 |
|
|
|
575 |
|
|
|
1,196 |
|
|
|
994 |
|
Loss on impairment (gain on sale) of real estate assets, net, excluding prepayment gains |
|
336 |
|
|
|
— |
|
|
|
(9,273 |
) |
|
|
(314 |
) |
FFO |
$ |
65,246 |
|
|
$ |
65,264 |
|
|
$ |
127,587 |
|
|
$ |
127,530 |
|
FFO per share |
$ |
0.28 |
|
|
$ |
0.28 |
|
|
$ |
0.55 |
|
|
$ |
0.55 |
|
CORE Funds From Operations (CFFO): |
|
|
|
|
|
|
|
||||||||
FFO |
$ |
65,246 |
|
|
$ |
65,264 |
|
|
$ |
127,587 |
|
|
$ |
127,530 |
|
Add-Back (Deduct): |
|
|
|
|
|
|
|
||||||||
Other depreciation and amortization |
|
370 |
|
|
|
283 |
|
|
|
701 |
|
|
|
531 |
|
Casualty losses |
|
465 |
|
|
|
680 |
|
|
|
2,767 |
|
|
|
831 |
|
Loan (premium accretion) discount amortization, net |
|
(2,283 |
) |
|
|
(2,737 |
) |
|
|
(4,679 |
) |
|
|
(5,493 |
) |
Prepayment (gains) penalties on asset dispositions |
|
(184 |
) |
|
|
— |
|
|
|
(1,105 |
) |
|
|
(670 |
) |
Gain on extinguishment of debt |
|
— |
|
|
|
— |
|
|
|
(203 |
) |
|
|
— |
|
Other expense (income), net |
|
— |
|
|
|
192 |
|
|
|
1 |
|
|
|
234 |
|
Restructuring costs |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3,213 |
|
CFFO |
$ |
63,614 |
|
|
$ |
63,682 |
|
|
$ |
125,069 |
|
|
$ |
126,176 |
|
CFFO per share |
$ |
0.28 |
|
|
$ |
0.28 |
|
|
$ |
0.54 |
|
|
$ |
0.55 |
|
Weighted-average shares and units outstanding |
|
230,734,872 |
|
|
|
230,369,086 |
|
|
|
230,652,876 |
|
|
|
230,278,208 |
|
Schedule III Independence Realty Trust, Inc. Reconciliation of Net Income (Loss) to Same-Store Net Operating Income (a) Dollars in thousands (unaudited) |
|||||||||||||||||||
|
For the Three Months Ended |
||||||||||||||||||
|
Jun 30, 2024 |
|
Mar 31, 2024 |
|
Dec 31, 2023 |
|
Sep 30, 2023 |
|
Jun 30, 2023 |
||||||||||
Net income (loss) |
$ |
10,555 |
|
|
$ |
17,961 |
|
|
$ |
(41,654 |
) |
|
$ |
3,986 |
|
|
$ |
10,988 |
|
Other revenue |
|
(298 |
) |
|
|
(203 |
) |
|
|
(316 |
) |
|
|
(232 |
) |
|
|
(354 |
) |
Property management expenses |
|
7,666 |
|
|
|
7,499 |
|
|
|
6,660 |
|
|
|
7,232 |
|
|
|
6,818 |
|
General and administrative expenses |
|
6,244 |
|
|
|
8,381 |
|
|
|
5,043 |
|
|
|
3,660 |
|
|
|
5,910 |
|
Depreciation and amortization expense |
|
54,127 |
|
|
|
53,721 |
|
|
|
55,902 |
|
|
|
55,546 |
|
|
|
53,984 |
|
Casualty losses |
|
465 |
|
|
|
2,301 |
|
|
|
59 |
|
|
|
35 |
|
|
|
680 |
|
Interest expense |
|
17,460 |
|
|
|
20,603 |
|
|
|
23,537 |
|
|
|
22,033 |
|
|
|
22,227 |
|
Loss on impairment (gain on sale) of real estate assets, net |
|
152 |
|
|
|
(10,530 |
) |
|
|
56,263 |
|
|
|
11,268 |
|
|
|
— |
|
(Gain) loss on extinguishment of debt |
|
— |
|
|
|
(203 |
) |
|
|
124 |
|
|
|
— |
|
|
|
— |
|
Other loss (income), net |
|
— |
|
|
|
1 |
|
|
|
79 |
|
|
|
369 |
|
|
|
72 |
|
Loss from investments in unconsolidated real estate entities |
|
850 |
|
|
|
829 |
|
|
|
1,330 |
|
|
|
1,178 |
|
|
|
1,205 |
|
NOI |
$ |
97,221 |
|
|
$ |
100,360 |
|
|
$ |
107,027 |
|
|
$ |
105,075 |
|
|
$ |
101,530 |
|
Less: Non same-store portfolio NOI |
|
2,293 |
|
|
|
5,989 |
|
|
|
9,863 |
|
|
|
10,123 |
|
|
|
9,155 |
|
Same-store portfolio NOI |
$ |
94,928 |
|
|
$ |
94,371 |
|
|
$ |
97,164 |
|
|
$ |
94,952 |
|
|
$ |
92,375 |
|
(a) |
Same-store portfolio consists of 108 properties, which represent 32,153 units. |
Schedule IV Independence Realty Trust, Inc. Reconciliation of Net Income (Loss) to Adjusted EBITDA and Interest Coverage Ratio Dollars in thousands (unaudited) |
||||||||||||||||
|
Three Months Ended |
|||||||||||||||
|
Jun 30, 2024 |
|
Mar 31, 2024 |
|
Dec 31, 2023 |
|
Sep 30, 2023 |
|
Jun 30, 2023 |
|||||||
Net income (loss) |
$ |
10,555 |
|
$ |
17,961 |
|
|
$ |
(41,654 |
) |
|
$ |
3,986 |
|
$ |
10,988 |
Add-Back (Deduct): |
|
|
|
|
|
|
|
|
|
|||||||
Interest expense |
|
17,460 |
|
|
20,603 |
|
|
|
23,537 |
|
|
|
22,033 |
|
|
22,227 |
Depreciation and amortization |
|
54,127 |
|
|
53,721 |
|
|
|
55,902 |
|
|
|
55,546 |
|
|
53,984 |
Casualty losses |
|
465 |
|
|
2,301 |
|
|
|
59 |
|
|
|
35 |
|
|
680 |
Loss on impairment (gain on sale) of real estate assets, net |
|
152 |
|
|
(10,530 |
) |
|
|
56,263 |
|
|
|
11,268 |
|
|
— |
(Gain) loss on extinguishment of debt |
|
— |
|
|
(203 |
) |
|
|
124 |
|
|
|
— |
|
|
— |
Loss from investments in unconsolidated real estate entities |
|
850 |
|
|
829 |
|
|
|
1,330 |
|
|
|
1,178 |
|
|
1,205 |
Other loss (income), net |
|
— |
|
|
1 |
|
|
|
79 |
|
|
|
369 |
|
|
72 |
Adjusted EBITDA |
$ |
83,609 |
|
$ |
84,683 |
|
|
$ |
95,640 |
|
|
$ |
94,415 |
|
$ |
89,156 |
|
|
|
|
|
|
|
|
|
|
|||||||
INTEREST COST: |
|
|
|
|
|
|
|
|
|
|||||||
Interest expense |
$ |
17,460 |
|
$ |
20,603 |
|
|
$ |
23,537 |
|
|
$ |
22,033 |
|
$ |
22,227 |
|
|
|
|
|
|
|
|
|
|
|||||||
INTEREST COVERAGE: |
4.8x |
|
4.1x |
|
4.1x |
|
4.3x |
|
4.0x |
|||||||
|
For the Three Months Ended June 30, |
|
For the Six Months Ended June 30, |
||||||||||
|
2024 |
|
2023 |
|
|
2024 |
|
|
|
2023 |
|
||
Net income (loss) |
$ |
10,555 |
|
$ |
10,988 |
|
$ |
28,515 |
|
|
$ |
19,861 |
|
Add-Back (Deduct): |
|
|
|
|
|
|
|
||||||
Interest expense |
|
17,460 |
|
|
22,227 |
|
|
38,063 |
|
|
|
44,351 |
|
Depreciation and amortization |
|
54,127 |
|
|
53,984 |
|
|
107,850 |
|
|
|
107,520 |
|
Casualty losses |
|
465 |
|
|
680 |
|
|
2,767 |
|
|
|
831 |
|
Loss on impairment (gain on sale) of real estate assets, net |
|
152 |
|
|
— |
|
|
(10,378 |
) |
|
|
(985 |
) |
Gain on extinguishment of debt |
|
— |
|
|
— |
|
|
(203 |
) |
|
|
— |
|
Loss from investments in unconsolidated real estate entities |
|
850 |
|
|
1,205 |
|
|
1,679 |
|
|
|
1,981 |
|
Other loss (income), net |
|
— |
|
|
72 |
|
|
1 |
|
|
|
(21 |
) |
Restructuring costs |
|
— |
|
|
— |
|
|
— |
|
|
|
3,213 |
|
Adjusted EBITDA |
$ |
83,609 |
|
$ |
89,156 |
|
$ |
168,294 |
|
|
$ |
176,751 |
|
|
|
|
|
|
|
|
|
||||||
INTEREST COST: |
|
|
|
|
|
|
|
||||||
Interest expense |
$ |
17,460 |
|
$ |
22,227 |
|
$ |
38,063 |
|
|
$ |
44,351 |
|
|
|
|
|
|
|
|
|
||||||
INTEREST COVERAGE: |
4.8x |
|
4.0x |
|
4.4x |
|
4.0x |
||||||
|
||
Schedule V Independence Realty Trust, Inc. Definitions |
Average Effective Monthly Rent per Unit
Average effective rent per unit represents the average of gross rent amounts, divided by the average occupancy (in units) for the period presented. We believe average effective rent is a helpful measurement in evaluating average pricing. This metric, when presented, reflects the average effective rent per month.
Average Occupancy
Average occupancy represents the average occupied units for the reporting period divided by the average of total units available for rent for the reporting period.
Development Property
A development property is a property that is either currently under development or is in lease-up prior to reaching overall occupancy of
EBITDA and Adjusted EBITDA
Each of EBITDA and Adjusted EBITDA is a non-GAAP financial measure. EBITDA is defined as net income before interest expense including amortization of deferred financing costs, income tax expense, and depreciation and amortization expenses. Adjusted EBITDA is EBITDA before certain other non-cash or non-operating gains or losses related to items such as loss on impairment (gain on sale) of real estate, debt extinguishments and acquisition related debt extinguishment expenses, casualty (gains) losses, income (loss) from investments in unconsolidated real estate entities, and restructuring costs. We consider each of EBITDA and Adjusted EBITDA to be an appropriate supplemental measure of performance because it eliminates interest, income taxes, depreciation and amortization, and other non-cash or non-operating gains and losses, which permits investors to view income from operations without these non-cash or non-operating items. Our calculation of Adjusted EBITDA differs from the methodology used for calculating Adjusted EBITDA by certain other REITs and, accordingly, our Adjusted EBITDA may not be comparable to Adjusted EBITDA reported by other REITs.
Funds From Operations (“FFO”) and Core Funds From Operations (“CFFO”)
We believe that FFO and CFFO, each of which is a non-GAAP financial measure, are additional appropriate measures of the operating performance of a REIT and us in particular. We compute FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts (“NAREIT”), as net income or loss allocated to common shares (computed in accordance with GAAP), excluding real estate-related depreciation and amortization expense, loss on impairment (gain on sale) of real estate and the cumulative effect of changes in accounting principles. While our calculation of FFO is in accordance with NAREIT’s definition, it may differ from the methodology for calculating FFO utilized by other REITs and, accordingly, may not be comparable to FFO computations of such other REITs.
CFFO is a computation made by analysts and investors to measure a real estate company’s operating performance by removing the effect of items that do not reflect ongoing property operations, including depreciation and amortization of other items not included in FFO, and other non-cash or non-operating gains or losses related to items such as casualty (gains) losses, loan premium accretion and discount amortization, debt extinguishment costs, and restructuring costs from the determination of FFO.
Our calculation of CFFO may differ from the methodology used for calculating CFFO by other REITs and, accordingly, our CFFO may not be comparable to CFFO reported by other REITs. Our management utilizes FFO and CFFO as measures of our operating performance, and believe they are also useful to investors, because they facilitate an understanding of our operating performance after adjustment for certain non-cash or non-recurring items that are required by GAAP to be expensed but may not necessarily be indicative of current operating performance and our operating performance between periods. Furthermore, although FFO, CFFO and other supplemental performance measures are defined in various ways throughout the REIT industry, we believe that FFO and CFFO may provide us and our investors with an additional useful measure to compare our financial performance to certain other REITs. Neither FFO nor CFFO is equivalent to net income or cash generated from operating activities determined in accordance with GAAP. Furthermore, FFO and CFFO do not represent amounts available for management’s discretionary use because of needed capital replacement or expansion, debt service obligations or other commitments or uncertainties. Accordingly, FFO and CFFO do not measure whether cash flow is sufficient to fund all of our cash needs, including principal amortization and capital improvements. Neither FFO nor CFFO should be considered as an alternative to net income or any other GAAP measurement as an indicator of our operating performance or as an alternative to cash flow from operating, investing, and financing activities as a measure of our liquidity.
Interest Coverage
Interest coverage is a ratio computed by dividing Adjusted EBITDA by interest expense.
Net Debt
Net debt, a non-GAAP financial measure, equals total consolidated debt less cash and cash equivalents and loan premiums and discounts. The following table provides a reconciliation of total consolidated debt to net debt (dollars in thousands).
|
|
As of |
||||||||||||||||||
|
|
Jun 30, 2024 |
|
Mar 31, 2024 |
|
Dec 31, 2023 |
|
Sep 30, 2023 |
|
Jun 30, 2023 |
||||||||||
Total debt |
|
$ |
2,252,559 |
|
|
$ |
2,277,098 |
|
|
$ |
2,549,409 |
|
|
$ |
2,715,710 |
|
|
$ |
2,650,805 |
|
Less: cash and cash equivalents |
|
|
(21,034 |
) |
|
|
(21,275 |
) |
|
|
(22,852 |
) |
|
|
(17,216 |
) |
|
|
(14,349 |
) |
Less: loan discounts and premiums, net |
|
|
(37,253 |
) |
|
|
(39,804 |
) |
|
|
(44,483 |
) |
|
|
(50,772 |
) |
|
|
(53,520 |
) |
Total net debt |
|
$ |
2,194,272 |
|
|
$ |
2,216,019 |
|
|
$ |
2,482,074 |
|
|
$ |
2,647,722 |
|
|
$ |
2,582,936 |
|
We present net debt and net debt to Adjusted EBITDA because management believes it is a useful measure of our credit position and progress toward reducing leverage. The calculation is limited because we may not always be able to use cash to repay debt on a dollar for dollar basis.
Net Operating Income
We believe that Net Operating Income (“NOI”), a non-GAAP financial measure, is a useful measure of our operating performance. We define NOI as total property revenues less total property operating expenses, excluding interest expense, depreciation and amortization, casualty related costs and gains, property management expenses, general and administrative expenses, net gains on sale of assets, and restructuring costs.
Other REITs may use different methodologies for calculating NOI, and accordingly, our NOI may not be comparable to other REITs. We believe that this measure provides an operating perspective not immediately apparent from GAAP operating income or net income. We use NOI to evaluate our performance on a same-store and non same-store basis because NOI measures the core operations of property performance by excluding corporate level expenses and other items not related to property operating performance and captures trends in rental housing and property operating expenses. However, NOI should only be used as an alternative measure of our financial performance.
Non Same-Store Properties and Non Same-Store Portfolio
Properties that did not meet the definition of a same-store property as of the beginning of the previous year.
Same-Store Properties and Same-Store Portfolio
We review our same-store portfolio at the beginning of each calendar year. Properties are added into the same-store portfolio if they were owned and not a development property at the beginning of the previous year. Properties that are held for sale or have been sold are excluded from the same-store portfolio.
Rent Premium on Value Add Renovations
The rent premium reflects the per unit per month difference between the rental rate on the renovated unit excluding the impact of upfront concessions, if any, and the market rent for an unrenovated unit as of the date presented, as determined by management consistent with its customary rent-setting and evaluation procedures. We believe excluding the impact of upfront concessions from our rental rates when comparing to the market rental rates for unrenovated units makes the comparison most relevant and the resulting premium provides management with an indicator of the increased rent generated by the unit renovation.
Renovation Costs per Unit
Renovation costs per unit includes all costs to renovate the interior units and make certain exterior renovations, including clubhouses and amenities. Interior costs per unit are based on units leased. Exterior costs per unit are based on total units at the community. Excludes overhead costs to support and manage the value add program as those costs relate to the entire program and cannot be allocated to individual projects.
Return on Investment (“ROI”) on Value Add Renovations
ROI is calculated using the Rent Premium per unit per month, multiplied by 12, divided by the interior renovation costs per unit or the total renovation costs, as applicable. We use ROI on value add renovation projects to measure the profitability of a renovation project relative to other projects or relative to other uses of our capital.
Total Gross Assets
Total Gross Assets equals total assets plus accumulated depreciation and accumulated amortization, including fully depreciated or amortized real estate and real estate related assets. The following table provides a reconciliation of total assets to total gross assets (dollars in thousands).
|
|
As of |
|||||||||||||
|
|
Jun 30, 2024 |
|
Mar 31, 2024 |
|
Dec 31, 2023 |
|
Sep 30, 2023 |
|
Jun 30, 2023 |
|||||
Total assets |
|
$ |
5,940,261 |
|
$ |
5,972,848 |
|
$ |
6,280,175 |
|
$ |
6,577,790 |
|
$ |
6,517,400 |
Plus: accumulated depreciation (a) |
|
|
674,236 |
|
|
630,743 |
|
|
606,404 |
|
|
570,966 |
|
|
523,446 |
Plus: accumulated amortization |
|
|
69,532 |
|
|
69,998 |
|
|
73,975 |
|
|
76,691 |
|
|
76,558 |
Total gross assets |
|
$ |
6,684,029 |
|
$ |
6,673,589 |
|
$ |
6,960,554 |
|
$ |
7,225,447 |
|
$ |
7,117,404 |
(a) |
Includes accumulated depreciation associated with real estate held for sale, as applicable. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240731692039/en/
Independence Realty Trust, Inc.
Edelman Smithfield
Ted McHugh and Lauren Torres
917-365-7979
IRT@edelman.com
Source: Independence Realty Trust, Inc.
FAQ
What were Independence Realty Trust's Q2 2024 earnings per share?
How did Independence Realty Trust's net income for Q2 2024 compare to Q2 2023?
What was the growth in same-store net operating income (NOI) for IRT in Q2 2024?
What is the new EPS guidance for Independence Realty Trust in 2024?
What was the second quarter 2024 dividend declared by Independence Realty Trust?
