Kennedy Wilson Reports Third Quarter 2021 Results
Kennedy Wilson Holdings (NYSE: KW) reported a strong performance for Q3 2021, registering a significant net income of $65.9 million compared to a loss of $25.1 million in Q3 2020. Adjusted EBITDA soared to $202.7 million, up from $76.3 million year-over-year. The company announced a 9% increase in quarterly dividends to $0.24 per share, reflecting confidence in continued growth. Assets under management grew by 17% to $20.5 billion, while estimated annual net operating income reached $413 million, boosted by acquisition activities.
- Net income increased to $65.9 million from a loss of $25.1 million in Q3 2020.
- Adjusted EBITDA rose to $202.7 million, up from $76.3 million year-over-year.
- 9% increase in quarterly dividend to $0.24 per share.
- Assets under management increased by 17% to $20.5 billion.
- Estimated annual net operating income grew to $413 million.
- None.
Company increases quarterly dividend by
|
3Q |
|
YTD |
||||||||||
(Amounts in millions, except per share data) |
2021 |
|
2020 |
|
|
2021 |
|
2020 |
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||||
GAAP Results |
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|
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GAAP Net Income (Loss) to Common Shareholders |
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Per Diluted Share |
0.47 |
|
|
(0.18 |
) |
|
|
1.96 |
|
|
(0.55 |
) |
|
|
|
|
|
|
|
|
|
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Non-GAAP Results |
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|
|
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Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income |
111.9 |
|
|
27.3 |
|
|
|
423.5 |
|
|
84.1 |
|
|
“Our strong 3Q and year-to-date results reflect the tremendous progress we have made in growing our business over the last 18 months," said
3Q Highlights
-
Adjusted EBITDA to
$203 Million $76 Million -
KW's share of recurring property NOI, loan income and fees totaled
$111 million $9 million -
KW's share of gains from the sale of real estate, increases in fair values and promotes totaled
$139 million $130 million
-
KW's share of recurring property NOI, loan income and fees totaled
-
Assets Under Management (AUM) Grows by
17% to$20.5 Billion $17.6 Billion
-
Completed
$1.8 Billion NOI and Fee-Bearing Capital :
|
Gross Transaction Value
|
|
Est. Annual NOI To KW
|
|
|
||||||||
As of 2Q-21 |
|
|
$ |
403 |
|
|
|
$ |
4.5 |
|
|
||
Gross acquisitions and loan investments |
$ |
1,229 |
|
|
17 |
|
|
|
0.4 |
|
|
||
Gross dispositions and loan repayments |
537 |
|
|
(4 |
) |
|
|
(0.1 |
) |
|
|||
Assets stabilized / (unstabilized) |
— |
|
|
(2 |
) |
|
|
— |
|
|
|||
Operations |
— |
|
|
3 |
|
|
|
— |
|
|
|||
FX and other |
— |
|
|
(4 |
) |
|
|
— |
|
|
|||
Total as of 3Q-21 |
$ |
1,766 |
|
|
$ |
413 |
|
|
|
$ |
4.8 |
|
|
-
Estimated Annual NOI Grows by
$10 Million $413 -
Estimated Annual NOI from the stabilized portfolio increased by
$10 million $413 million -
Development and lease-up portfolio expected to add approximately
$105 million
-
Estimated Annual NOI from the stabilized portfolio increased by
-
23% YTD Growth inFee-Bearing Capital :Fee-Bearing Capital totaled$4.8 billion 23% increase YTD. In addition, the Company has approximately$2.1 billion -
24% Growth in Debt Platform in 3Q: Completed loan investments totaling$440 million $151 million 24% growth in 3Q-21. The Company has a9% ownership in its debt platform, which totals$1.6 billion $140 million $1.3 billion Fee-Bearing Capital as of quarter-end.
-
- Multifamily and Office Same Property Performance(1):
|
3Q - 2021 vs. 3Q - 2020 |
YTD - 2021 vs. YTD - 2020 |
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|
Occupancy |
|
Revenue |
|
NOI |
Occupancy |
|
Revenue |
|
NOI |
Multifamily - Market Rate |
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|
|
|
|
|
|
Multifamily - Affordable |
|
|
|
|
|
|
|
|
|
|
Office |
(1.3)% |
|
|
|
|
(1.3)% |
|
|
|
|
Total |
|
|
|
|
|
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|
(1) Excludes minority-held investments |
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3Q-21 Investment Activity
Capital Allocation:
-
In 3Q-21, the Company invested
$295 million 76% to new investments,16% to capex and development initiatives, and8% to share repurchases.
-
For YTD-21, the Company invested
$868 million 78% to new investments,17% to capex and development initiatives, and5% to share repurchases.
-
3Q Acquisitions and Loan Investments Add
$17 Million -
Western U.S. Multifamily Expansion: Acquired two wholly-owned multifamily properties inSeattle, Washington and one wholly-owned property in the greaterDenver, Colorado region totaling 879 units for$399 million $14 million -
Co-investment Portfolio: Acquired
$390 million 12% ownership in, which added$2 million
-
-
3Q Dispositions Totaled
$383 Million -
The Company sold
$295 million 6% . The dispositions resulted in total cash profit of$128 million $14 million
-
The Company sold
Balance Sheet and Capital Markets
-
$1.3 Billion September 30, 2021 , Kennedy Wilson had a total of$841 million $500 million $296 million 3.95% sterling-denominated Kennedy Wilson Europe unsecured bonds maturing in 2022.
-
Unsecured Debt Transactions:
-
The Company issued
$600 million 4.75% unsecured senior notes due 2030. The proceeds were used to fully repay$289 million $296 million 3.95% sterling-denominated Kennedy Wilson Europe unsecured bonds maturing in 2022, which was repaid in 4Q-21.
-
The Company issued
-
Debt Profile: Pro-forma for the 4Q-21 debt repayment described above, Kennedy Wilson's share of debt had a weighted average interest rate of
3.6% per annum and a weighted-average maturity of 6.5 years. Approximately89% of our debt is either fixed or hedged with interest rate caps. -
Share Repurchase Program(2): In 3Q-21, Kennedy Wilson repurchased 1.2 million shares for
$25 million $21.55 September 30, 2021 , the Company had$213 million $500 million March 2018 , the Company has repurchased 15.7 million shares, or approximately10% of its outstanding share count, for$287 million $18.22
-
9% Dividend Increase: The Company announced a9% increase in the common dividend per share to$0.24 $0.96
Footnotes
(1) |
Represents consolidated cash and includes |
(2) |
Future purchases under the program may be made in the open market, in privately negotiated transactions, through the net settlement of the company's restricted stock grants or otherwise, with the amount and timing of the repurchases dependent on market conditions and subject to the Company's discretion. The program does not obligate the Company to repurchase any specific number of shares and, subject to compliance with applicable laws, may be suspended or terminated at any time without prior notice. |
Conference Call and Webcast Details
Kennedy Wilson will hold a live conference call and webcast to discuss results at
The webcast will be available at: https://services.choruscall.com/links/kw211104cCHqAWtJ.html. A replay of the webcast will be available one hour after the original webcast on the Company’s investor relations web site for three months.
About Kennedy Wilson
Kennedy Wilson (NYSE:KW) is a leading global real estate investment company. We own, operate, and invest in real estate both on our own and through our investment management platform. We focus on multifamily and office properties located in the
Consolidated Balance Sheets (Unaudited) (Dollars in millions) |
||||||||||
|
|
|
|
|
||||||
Assets |
|
|
|
|
||||||
Cash and cash equivalents |
|
$ |
840.8 |
|
|
|
$ |
965.1 |
|
|
Accounts receivable |
|
43.2 |
|
|
|
47.9 |
|
|
||
Real estate and acquired in place lease values (net of accumulated depreciation and amortization of |
|
4,836.9 |
|
|
|
4,720.5 |
|
|
||
Unconsolidated investments (including |
|
1,737.9 |
|
|
|
1,289.3 |
|
|
||
Other assets |
|
189.4 |
|
|
|
199.1 |
|
|
||
Loan purchases and originations |
|
126.4 |
|
|
|
107.1 |
|
|
||
Total assets |
|
$ |
7,774.6 |
|
|
|
$ |
7,329.0 |
|
|
|
|
|
|
|
||||||
Liabilities |
|
|
|
|
||||||
Accounts payable |
|
$ |
13.1 |
|
|
|
$ |
30.1 |
|
|
Accrued expenses and other liabilities |
|
549.5 |
|
|
|
531.7 |
|
|
||
Mortgage debt |
|
2,674.3 |
|
|
|
2,589.8 |
|
|
||
KW unsecured debt |
|
1,775.7 |
|
|
|
1,332.2 |
|
|
||
KWE unsecured bonds |
|
929.1 |
|
|
|
1,172.5 |
|
|
||
Total liabilities |
|
5,941.7 |
|
|
|
5,656.3 |
|
|
||
Equity |
|
|
|
|
||||||
Cumulative perpetual preferred stock |
|
295.2 |
|
|
|
295.2 |
|
|
||
Common stock |
|
— |
|
|
|
— |
|
|
||
Additional paid-in capital |
|
1,702.0 |
|
|
|
1,725.2 |
|
|
||
Retained earnings |
|
196.3 |
|
|
|
17.7 |
|
|
||
Accumulated other comprehensive loss |
|
(393.7 |
) |
|
|
(393.6 |
) |
|
||
|
|
1,799.8 |
|
|
|
1,644.5 |
|
|
||
Noncontrolling interests |
|
33.1 |
|
|
|
28.2 |
|
|
||
Total equity |
|
1,832.9 |
|
|
|
1,672.7 |
|
|
||
Total liabilities and equity |
|
$ |
7,774.6 |
|
|
|
$ |
7,329.0 |
|
|
Consolidated Statements of Operations (Unaudited) (Dollars in millions, except share amounts and per share data) |
||||||||||||||||||||
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||||||
Revenue |
|
|
|
|
|
|
|
|
||||||||||||
Rental |
|
$ |
96.1 |
|
|
|
$ |
102.2 |
|
|
|
$ |
279.7 |
|
|
|
$ |
308.8 |
|
|
Hotel |
|
6.2 |
|
|
|
3.1 |
|
|
|
9.2 |
|
|
|
10.4 |
|
|
||||
Investment management and property services fees |
|
9.7 |
|
|
|
8.9 |
|
|
|
27.1 |
|
|
|
25.2 |
|
|
||||
Loans and other |
|
2.4 |
|
|
|
1.3 |
|
|
|
6.2 |
|
|
|
1.5 |
|
|
||||
Total revenue |
|
114.4 |
|
|
|
115.5 |
|
|
|
322.2 |
|
|
|
345.9 |
|
|
||||
Expenses |
|
|
|
|
|
|
|
|
||||||||||||
Rental |
|
32.4 |
|
|
|
33.5 |
|
|
|
97.8 |
|
|
|
102.2 |
|
|
||||
Hotel |
|
3.7 |
|
|
|
2.7 |
|
|
|
7.8 |
|
|
|
10.9 |
|
|
||||
Commission and marketing |
|
0.1 |
|
|
|
0.9 |
|
|
|
0.7 |
|
|
|
2.5 |
|
|
||||
Compensation and related (includes |
|
40.2 |
|
|
|
26.3 |
|
|
|
123.5 |
|
|
|
85.1 |
|
|
||||
General and administrative |
|
8.9 |
|
|
|
8.6 |
|
|
|
24.7 |
|
|
|
26.1 |
|
|
||||
Depreciation and amortization |
|
39.2 |
|
|
|
44.3 |
|
|
|
125.3 |
|
|
|
135.1 |
|
|
||||
Total expenses |
|
124.5 |
|
|
|
116.3 |
|
|
|
379.8 |
|
|
|
361.9 |
|
|
||||
Income from unconsolidated investments |
|
143.1 |
|
|
|
14.9 |
|
|
|
213.9 |
|
|
|
45.0 |
|
|
||||
Gain on sale of real estate, net |
|
15.0 |
|
|
|
4.0 |
|
|
|
417.0 |
|
|
|
47.7 |
|
|
||||
Transaction-related expenses |
|
— |
|
|
|
(0.1 |
) |
|
|
(0.4 |
) |
|
|
(0.6 |
) |
|
||||
Interest expense |
|
(45.3 |
) |
|
|
(50.8 |
) |
|
|
(141.4 |
) |
|
|
(150.0 |
) |
|
||||
Loss on early extinguishment of debt |
|
— |
|
|
|
— |
|
|
|
(38.6 |
) |
|
|
(1.3 |
) |
|
||||
Other income (loss) |
|
0.4 |
|
|
|
0.3 |
|
|
|
(2.6 |
) |
|
|
0.2 |
|
|
||||
Income / (loss) before benefit from (provision for) income taxes |
|
103.1 |
|
|
|
(32.5 |
) |
|
|
390.3 |
|
|
|
(75.0 |
) |
|
||||
(Provision for) benefit from income taxes |
|
(30.6 |
) |
|
|
12.8 |
|
|
|
(98.2 |
) |
|
|
10.3 |
|
|
||||
Net income (loss) |
|
72.5 |
|
|
|
(19.7 |
) |
|
|
292.1 |
|
|
|
(64.7 |
) |
|
||||
Net (income) loss attributable to noncontrolling interests |
|
(2.3 |
) |
|
|
(1.1 |
) |
|
|
(3.5 |
) |
|
|
0.5 |
|
|
||||
Preferred dividends |
|
(4.3 |
) |
|
|
(4.3 |
) |
|
|
(12.9 |
) |
|
|
(12.9 |
) |
|
||||
Net income (loss) attributable to |
|
$ |
65.9 |
|
|
|
$ |
(25.1 |
) |
|
|
$ |
275.7 |
|
|
|
$ |
(77.1 |
) |
|
Basic earnings (loss) per share |
|
|
|
|
|
|
|
|
||||||||||||
Earnings (loss) per share |
|
$ |
0.48 |
|
|
|
$ |
(0.18 |
) |
|
|
$ |
1.98 |
|
|
|
$ |
(0.55 |
) |
|
Weighted average shares outstanding |
|
138,934,754 |
|
|
|
140,119,442 |
|
|
|
138,989,733 |
|
|
|
140,181,438 |
|
|
||||
Diluted earnings (loss) per share |
|
|
|
|
|
|
|
|
||||||||||||
Earnings (loss) per share |
|
$ |
0.47 |
|
|
|
$ |
(0.18 |
) |
|
|
$ |
1.96 |
|
|
|
$ |
(0.55 |
) |
|
Weighted average shares outstanding |
|
139,437,126 |
|
|
|
140,119,442 |
|
|
|
140,565,582 |
|
|
|
140,181,438 |
|
|
||||
Dividends declared per common share |
|
$ |
0.22 |
|
|
|
$ |
0.22 |
|
|
|
$ |
0.66 |
|
|
|
$ |
0.66 |
|
|
(1) Includes impact of the Company allocating income and dividends per basic and diluted share to participating securities. |
||||||||||||||||||||
Adjusted EBITDA (Unaudited) (Dollars in millions) |
||||||||||||||||||
The table below reconciles net income attributable to |
||||||||||||||||||
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||
|
|
|
|
|
||||||||||||||
|
|
2021 |
|
2020 |
|
|
2021 |
|
2020 |
|
||||||||
Net income (loss) attributable to |
|
$ |
65.9 |
|
|
$ |
(25.1 |
) |
|
|
$ |
275.7 |
|
|
$ |
(77.1 |
) |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
||||||||||
Add back (Kennedy Wilson's Share)(1): |
|
|
|
|
|
|
|
|
||||||||||
Interest expense |
|
55.9 |
|
|
57.5 |
|
|
|
167.3 |
|
|
172.4 |
|
|
||||
Loss on early extinguishment of debt |
|
— |
|
|
— |
|
|
|
38.6 |
|
|
1.3 |
|
|
||||
Depreciation and amortization |
|
39.1 |
|
|
44.8 |
|
|
|
125.9 |
|
|
136.7 |
|
|
||||
Provision for (benefit from) income taxes |
|
30.6 |
|
|
(12.8 |
) |
|
|
98.2 |
|
|
(9.6 |
) |
|
||||
Preferred dividends |
|
4.3 |
|
|
4.3 |
|
|
|
12.9 |
|
|
12.9 |
|
|
||||
Share-based compensation |
|
6.9 |
|
|
7.6 |
|
|
|
21.9 |
|
|
24.5 |
|
|
||||
Adjusted EBITDA |
|
$ |
202.7 |
|
|
$ |
76.3 |
|
|
|
$ |
740.5 |
|
|
$ |
261.1 |
|
|
(1) See Appendix for reconciliation of Kennedy Wilson's Share amounts. |
||||||||||||||||||
The table below provides a detailed reconciliation of net income to Adjusted EBITDA.
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||||
|
|
|
|
|
||||||||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||||||
Net income (loss) |
|
$ |
72.5 |
|
|
|
$ |
(19.7 |
) |
|
|
$ |
292.1 |
|
|
|
$ |
(64.7 |
) |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
||||||||||||
Add back: |
|
|
|
|
|
|
|
|
||||||||||||
Interest expense |
|
45.3 |
|
|
|
50.8 |
|
|
|
141.4 |
|
|
|
150.0 |
|
|
||||
Loss on early extinguishment of debt |
|
— |
|
|
|
— |
|
|
|
38.6 |
|
|
|
1.3 |
|
|
||||
Kennedy Wilson's share of interest expense included in unconsolidated investments |
|
11.2 |
|
|
|
7.5 |
|
|
|
28.0 |
|
|
|
24.7 |
|
|
||||
Depreciation and amortization |
|
39.2 |
|
|
|
44.3 |
|
|
|
125.3 |
|
|
|
135.1 |
|
|
||||
Kennedy Wilson's share of depreciation and amortization included in unconsolidated investments |
|
1.1 |
|
|
|
1.7 |
|
|
|
4.2 |
|
|
|
5.2 |
|
|
||||
Provision for (benefit from) income taxes |
|
30.6 |
|
|
|
(12.8 |
) |
|
|
98.2 |
|
|
|
(10.3 |
) |
|
||||
Kennedy Wilson's share of taxes included in unconsolidated investments |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1.1 |
|
|
||||
Share-based compensation |
|
6.9 |
|
|
|
7.6 |
|
|
|
21.9 |
|
|
|
24.5 |
|
|
||||
EBITDA attributable to noncontrolling interests(1) |
|
(4.1 |
) |
|
|
(3.1 |
) |
|
|
(9.2 |
) |
|
|
(5.8 |
) |
|
||||
Adjusted EBITDA |
|
$ |
202.7 |
|
|
|
$ |
76.3 |
|
|
|
$ |
740.5 |
|
|
|
$ |
261.1 |
|
|
(1) |
EBITDA attributable to noncontrolling interest includes |
Adjusted Net Income (Unaudited) (Dollars in millions, except share data) |
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The table below reconciles net income attributable to |
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|
|
Three Months Ended |
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Nine Months Ended |
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|
|
|
|
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|
|
2021 |
|
2020 |
|
|
2021 |
|
2020 |
|
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Net income (loss) attributable to |
|
$ |
65.9 |
|
|
$ |
(25.1 |
) |
|
|
$ |
275.7 |
|
|
$ |
(77.1 |
) |
|
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Non-GAAP adjustments: |
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|
|
|
|
|
|
|
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Add back (Kennedy Wilson's Share)(1): |
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|
|
|
|
|
|
|
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Depreciation and amortization |
|
39.1 |
|
|
44.8 |
|
|
|
125.9 |
|
|
136.7 |
|
|
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Share-based compensation |
|
6.9 |
|
|
7.6 |
|
|
|
21.9 |
|
|
24.5 |
|
|
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Adjusted Net Income |
|
$ |
111.9 |
|
|
$ |
27.3 |
|
|
|
$ |
423.5 |
|
|
$ |
84.1 |
|
|
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|
|
|
|
|
|
|
|
|
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Weighted average shares outstanding for diluted |
|
139,437,126 |
|
|
140,119,442 |
|
|
|
140,565,582 |
|
|
140,181,438 |
|
|
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(1) See Appendix for reconciliation of Kennedy Wilson's Share amounts. |
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The table below provides a detailed reconciliation of net income to Adjusted Net Income.
|
|
Three Months Ended |
|
Nine Months Ended |
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|
|
|
|
|
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|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
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Net income (loss) |
|
$ |
72.5 |
|
|
$ |
(19.7) |
|
|
$ |
292.1 |
|
|
$ |
(64.7) |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
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Add back (less): |
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization |
|
39.2 |
|
|
44.3 |
|
|
125.3 |
|
|
135.1 |
|
||||
Kennedy Wilson's share of depreciation and amortization included in unconsolidated investments |
|
1.1 |
|
|
1.7 |
|
|
4.2 |
|
|
5.2 |
|
||||
Share-based compensation |
|
6.9 |
|
|
7.6 |
|
|
21.9 |
|
|
24.5 |
|
||||
Preferred dividends |
|
(4.3) |
|
|
(4.3) |
|
|
(12.9) |
|
|
(12.9) |
|
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Net income attributable to the noncontrolling interests, before depreciation and amortization(1) |
|
(3.5) |
|
|
(2.3) |
|
|
(7.1) |
|
|
(3.1) |
|
||||
Adjusted Net Income |
|
$ |
111.9 |
|
|
$ |
27.3 |
|
|
$ |
423.5 |
|
|
$ |
84.1 |
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding for diluted |
|
139,437,126 |
|
|
140,119,442 |
|
|
140,565,582 |
|
|
140,181,438 |
|
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(1) |
Includes |
Forward-Looking Statements
Statements made by us in this report and in other reports and statements released by us that are not historical facts constitute "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. These forward-looking statements are necessarily estimates reflecting the judgment of our senior management based on our current estimates, expectations, forecasts and projections and include comments that express our current opinions about trends and factors that may impact future operating results. Disclosures that use words such as "believe," "anticipate," "estimate," "intend," "may," "could," "plan," "expect," "project" or the negative of these, as well as similar expressions, are intended to identify forward-looking statements. These statements are not guarantees of future performance, rely on a number of assumptions concerning future events, many of which are outside of our control, and involve known and unknown risks and uncertainties that could cause our actual results, performance or achievement, or industry results, to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. These risks and uncertainties may include the factors and the risks and uncertainties described elsewhere in this report and other filings with the
Common Definitions
-
“KWH,” "KW," “Kennedy Wilson,” the "Company," "we," "our," or "us" refers to
Kennedy-Wilson Holdings, Inc. and its wholly-owned subsidiaries.
-
“Adjusted EBITDA” represents net income before interest expense, loss on early extinguishment of debt, our share of interest expense included in unconsolidated investments, depreciation and amortization, our share of depreciation and amortization included in unconsolidated investments, provision for (benefit from) income taxes, our share of taxes included in unconsolidated investments, share-based compensation, and EBITDA adjustments attributable to noncontrolling interests.
Please also see the reconciliation to GAAP in the Company’s supplemental financial information included in this release and also available at www.kennedywilson.com. Our management uses Adjusted EBITDA to analyze our business because it adjusts net income for items we believe do not accurately reflect the nature of our business going forward or that relate to non-cash compensation expense or noncontrolling interests. Such items may vary for different companies for reasons unrelated to overall operating performance. Additionally, we believe Adjusted EBITDA is useful to investors to assist them in getting a more accurate picture of our results from operations. However, Adjusted EBITDA is not a recognized measurement under GAAP and when analyzing our operating performance, readers should use Adjusted EBITDA in addition to, and not as an alternative for, net income as determined in accordance with GAAP. Because not all companies use identical calculations, our presentation of Adjusted EBITDA may not be comparable to similarly titled measures of other companies. Furthermore, Adjusted EBITDA is not intended to be a measure of free cash flow for our management’s discretionary use, as it does not remove all non-cash items (such as acquisition-related gains) or consider certain cash requirements such as tax and debt service payments. The amount shown for Adjusted EBITDA also differs from the amount calculated under similarly titled definitions in our debt instruments, which are further adjusted to reflect certain other cash and non-cash charges and are used to determine compliance with financial covenants and our ability to engage in certain activities, such as incurring additional debt and making certain restricted payments.
- "Adjusted Fees" refers to Kennedy Wilson’s gross investment management, property services and research fees adjusted to include Kennedy Wilson's share of fees eliminated in consolidation, Kennedy Wilson’s share of fees in unconsolidated service businesses and performance fees included in unconsolidated investments. Our management uses Adjusted fees to analyze our investment management and real estate services business because the measure removes required eliminations under GAAP for properties in which the Company provides services but also has an ownership interest. These eliminations understate the economic value of the investment management, property services and research fees and makes the Company comparable to other real estate companies that provide investment management and real estate services but do not have an ownership interest in the properties they manage. Our management believes that adjusting GAAP fees to reflect these amounts eliminated in consolidation presents a more holistic measure of the scope of our investment management and real estate services business.
- “Adjusted Net Income” represents net income (loss) before depreciation and amortization, our share of depreciation and amortization included in unconsolidated investments, share-based compensation, preferred dividends and net income attributable to noncontrolling interests, before depreciation and amortization. Please also see the reconciliation to GAAP in the Company’s supplemental financial information included in this release and also available at www.kennedywilson.com.
- “Annual Return on Loans” is a metric that applies to our real estate debt business that represents the sum of annual interest income, transaction fees and the payback of principal for discounted loan purchases, amortized over the life of the loans and divided by the principal balances of the loans.
- "Cap rate" represents the net operating income of an investment for the year preceding its acquisition or disposition, as applicable, divided by the purchase or sale price, as applicable. Cap rates set forth in this presentation only includes data from income-producing properties. We calculate cap rates based on information that is supplied to us during the acquisition diligence process. This information is not audited or reviewed by independent accountants and may be presented in a manner that is different from similar information included in our financial statements prepared in accordance with GAAP. In addition, cap rates represent historical performance and are not a guarantee of future NOI. Properties for which a cap rate is provided may not continue to perform at that cap rate.
-
"Equity partners" refers to non-wholly-owned subsidiaries that we consolidate in our financial statements under
U.S. GAAP and third-party equity providers.
-
"Estimated Annual NOI" is a property-level non-GAAP measure representing the estimated annual net operating income from each property as of the date shown, inclusive of rent abatements (if applicable). The calculation excludes depreciation and amortization expense, and does not capture the changes in the value of our properties that result from use or market conditions, nor the level of capital expenditures, tenant improvements, and leasing commissions necessary to maintain the operating performance of our properties. For the Company’s hotel portfolio, the Company provides a trailing-12 month NOI of
$9.0 million $4.1 million
-
"
Fee-Bearing Capital " represents total third-party committed or invested capital that we manage in our joint-ventures and commingled funds that entitle us to earn fees, including without limitation, asset management fees, construction management fees, acquisition and disposition fees and/or promoted interest, if applicable.
- "Gross Asset Value” refers to the gross carrying value of assets, before debt, depreciation and amortization, and net of noncontrolling interests.
- "Internal Rate of Return" (“IRR”) is based on cumulative contributions and distributions to Kennedy Wilson on each investment that has been sold and is the leveraged internal rate of return on equity invested in the investment. The IRR measures the return to Kennedy Wilson on each investment, expressed as a compound rate of interest over the entire investment period. This return does take into account carried interest, if applicable, but excludes management fees, organizational fees, or other similar expenses.·
- "Net operating income" or "NOI” is a non-GAAP measure representing the income produced by a property calculated by deducting certain property expenses from property revenues. Our management uses net operating income to assess and compare the performance of our properties and to estimate their fair value. Net operating income does not include the effects of depreciation or amortization or gains or losses from the sale of properties because the effects of those items do not necessarily represent the actual change in the value of our properties resulting from our value-add initiatives or changing market conditions. Our management believes that net operating income reflects the core revenues and costs of operating our properties and is better suited to evaluate trends in occupancy and lease rates. Please also see the reconciliation to GAAP in the Company’s supplemental financial information included in this release and also available at www.kennedywilson.com.
- "Noncontrolling interests" represents the portion of equity ownership in a consolidated subsidiary not attributable to Kennedy Wilson.
- "Pro-Rata" represents Kennedy Wilson's share calculated by using our proportionate economic ownership of each asset in our portfolio. Please also refer to the pro-rata financial data in our supplemental financial information.
- "Property NOI" or "Property-level NOI" is a non-GAAP measure calculated by deducting the Company's Pro-Rata share of rental and hotel property expenses from the Company's Pro-Rata rental and hotel revenues. Please also see the reconciliation to GAAP in the Company’s supplemental financial information included in this release and also available at www.kennedywilson.com.
- "Real Estate Assets under Management" ("AUM") generally refers to the properties and other assets with respect to which we provide (or participate in) oversight, investment management services and other advice, and which generally consist of real estate properties or loans, and investments in joint ventures. Our AUM is principally intended to reflect the extent of our presence in the real estate market, not the basis for determining our management fees. Our AUM consists of the total estimated fair value of the real estate properties and other real estate related assets either owned by third parties, wholly-owned by us or held by joint ventures and other entities in which our sponsored funds or investment vehicles and client accounts have invested. Committed (but unfunded) capital from investors in our sponsored funds is not included in our AUM. The estimated value of development properties is included at estimated completion cost.
- "Return on Equity" is a ratio calculated by dividing the net cash distributions of an investment to Kennedy Wilson, after the cost of leverage, if applicable, by the total cash contributions by Kennedy Wilson over the lifetime of the investment.
- “Same property” refers to properties in which Kennedy Wilson has an ownership interest during the entire span of both periods being compared. The same property information presented throughout this report is shown on a cash basis and excludes non-recurring expenses. This analysis excludes properties that are either under development or undergoing lease up as part of our asset management strategy.
Note about Non-GAAP and certain other financial information included in this presentation
In addition to the results reported in accordance with
KW-IR
View source version on businesswire.com: https://www.businesswire.com/news/home/20211103006198/en/
Vice President of Investor Relations
(310) 887-3431
dbhavsar@kennedywilson.com
www.kennedywilson.com
Source:
FAQ
What were the financial results for Kennedy Wilson in Q3 2021?
How much has Kennedy Wilson increased its dividend in Q3 2021?
What is the change in assets under management for Kennedy Wilson?
What is the estimated annual net operating income for Kennedy Wilson as of Q3 2021?
