National Storage Affiliates Trust Reports Fourth Quarter and Full Year 2022 Results

Rhea-AI Summary

National Storage Affiliates Trust (NSA) reported strong fourth quarter and full year 2022 results. For Q4 2022, net income surged 17.4% to $50.4 million, while diluted earnings per share reached $0.31, up from $0.25 in Q4 2021. Core FFO rose 10.9% to $90.9 million, equivalent to $0.71 per share. Same store NOI increased by 9.4% for Q4 2022. Full year 2022 net income rose to $183.8 million, a 25.1% increase, with Core FFO up 24.3% to $363 million. The company expanded its credit facility and repurchased over $90 million in shares. The board declared a quarterly dividend of $0.55, marking a 22.2% increase year-over-year.

Positive

• Net income increased 17.4% to $50.4 million in Q4 2022.
• Core FFO grew 10.9% to $90.9 million for Q4 2022.
• Full year net income rose 25.1% to $183.8 million.
• Core FFO increased 24.3% to $363 million for full year 2022.
• Same store NOI increased 9.4% in Q4 and 14.9% for the full year 2022.
• Expanded borrowing capacity of credit facility by $405 million.
• Declared a quarterly cash dividend of $0.55, up 22.2% from 2021.

Negative

• Same store occupancy decreased by 450 basis points year-over-year to 90.5%.

GREENWOOD VILLAGE, Colo.--(BUSINESS WIRE)-- National Storage Affiliates Trust ("NSA" or the "Company") (NYSE: NSA) today reported the Company’s fourth quarter and full year 2022 results.

Fourth Quarter 2022 Highlights

• Reported net income of $50.4 million for the fourth quarter of 2022, an increase of 17.4% compared to the fourth quarter of 2021. Reported diluted earnings per share of $0.31 for the fourth quarter of 2022 compared to $0.25 for the fourth quarter of 2021.

• Reported core funds from operations ("Core FFO") of $90.9 million, or $0.71 per share for the fourth quarter of 2022, an increase of 10.9% per share compared to the fourth quarter of 2021.

• Reported an increase in same store net operating income ("NOI") of 9.4% for the fourth quarter of 2022 compared to the same period in 2021, driven by a 7.4% increase in same store total revenues partially offset by an increase of 1.6% in same store property operating expenses.

• Reported same store period-end occupancy of 90.5% as of December 31, 2022, a decrease of 450 basis points compared to December 31, 2021.

• Acquired two wholly-owned self storage properties for approximately $39.9 million during the fourth quarter of 2022. Consideration for these acquisitions included the issuance of $32.1 million of OP equity.

• Repurchased 1,032,251 of the Company's common shares for approximately $40.0 million under the previously announced share repurchase program.

Full Year 2022 Highlights

• Reported net income of $183.8 million for full year 2022, an increase of 25.1% compared to full year 2021. Reported diluted earnings per share of $0.99 for full year 2022 compared to $0.98 for full year 2021.

• Reported Core FFO of $363.0 million, or $2.81 per share for full year 2022, an increase of 24.3% per share compared to full year 2021.

• Reported an increase in same store NOI of 14.9% for full year 2022 compared to full year 2021, driven by a 12.1% increase in same store total revenues partially offset by an increase of 4.8% in same store property operating expenses.

• Acquired 45 wholly-owned self storage properties for approximately $569.2 million during full year 2022. Consideration for these acquisitions included the issuance of $68.9 million of OP equity.

Highlights Subsequent to Quarter-End

• Entered into an agreement on January 3, 2023, with lenders to increase the total borrowing capacity under the Company's credit facility by $405.0 million to $1.955 billion, and used incremental borrowings under the credit facility to retire $300.0 million of its $375.0 million of debt maturing in 2023.

• One of the Company's participating regional operators ("PROs"), Move It Self Storage and its controlled affiliates ("Move It"), retired effective January 1, 2023. As a result of the retirement, on January 1, 2023, management of the Company's 72 properties in the Move It managed portfolio was transferred to NSA and the Move It brand name and related intellectual property were internalized by the Company. In addition, NSA will no longer pay supervisory and administrative fees or reimbursements to Move It and on January 1, 2023, issued a notice of non-voluntary conversion to cause all subordinated performance units related to Move It's managed portfolio to convert into OP units. As part of the internalization, a majority of Move It's employees were offered and provided employment by the Company to continue managing Move It's portfolio of properties as members of NSA's existing property management platform.

• On February 24, 2023, the Company entered into an agreement with affiliates of Personal Mini, one of the Company's PROs, to acquire a portfolio of 15 properties located in Florida for approximately $145.0 million, subject to receipt of approval from the selling entity's shareholders and other customary closing conditions. The Company expects to complete the acquisition in the first quarter of 2023.

“NSA had another exceptional year with annual same store growth of nearly 15%, second highest in our history,” commented Tamara Fischer, Chief Executive Officer. “Our strong organic growth combined with our opportunistic acquisition strategy resulted in over 24% annual growth in core FFO per share. We believe these results demonstrate the strength of our team, the benefits of our geographically diverse portfolio, as well as the ongoing advantages of our differentiated PRO structure."

Dave Cramer, President and Chief Operating Officer, stated, “We’re pleased with our strategies to balance rate and occupancy which produced double digit revenue growth of over 12% for the year, second highest in our history. I look forward to 2023 as we continue our focus on people, processes and platforms which will allow us to deliver growth and optimize value for all of our stakeholders.”

Financial Results

($ in thousands, except per share and unit data)	Three Months Ended December 31,									Year Ended December 31,
		2022			2021		Growth				2022			2021		Growth
Net income	$	50,377		$	42,895		17.4	%		$	183,765		$	146,935		25.1	%
Funds From Operations ("FFO")(1)	$	89,890		$	77,917		15.4	%		$	353,893		$	255,393		38.6	%
Add back acquisition costs		368			1,019		(63.9	)%			2,745			1,941		41.4	%
Add back casualty-related expenses		634			—		—	%			6,388			—		—	%
Core FFO(1)	$	90,892		$	78,936		15.1	%		$	363,026		$	257,334		41.1	%
Earnings per share - basic	$	0.31		$	0.25		24.0	%		$	0.99		$	1.13		(12.4	)%
Earnings per share - diluted	$	0.31		$	0.25		24.0	%		$	0.99		$	0.98		1.0	%
FFO per share and unit(1)	$	0.70		$	0.63		11.1	%		$	2.74		$	2.24		22.3	%
Core FFO per share and unit(1)	$	0.71		$	0.64		10.9	%		$	2.81		$	2.26		24.3	%

(1)

Non-GAAP financial measures, including FFO, Core FFO and NOI, are defined in the Glossary in the supplemental financial information and, where appropriate, reconciliations of these measures and other non-GAAP financial measures to their most directly comparable GAAP measures are included in the Schedules to this press release and in the supplemental financial information.

Net income increased $7.5 million for the fourth quarter of 2022 and increased by $36.8 million for the year ended December 31, 2022 ("year-to-date") as compared to the same periods in 2021. The increases resulted primarily from additional NOI generated from the 45 wholly-owned self storage properties acquired during the year ended December 31, 2022, same store NOI growth, increases in management fees and other revenue, and an increase in equity in earnings from the Company's unconsolidated real estate ventures, partially offset by increases in depreciation and amortization, interest expense and general administrative expenses.

The increases in FFO and Core FFO for the fourth quarter of 2022 and year-to-date were primarily the result of incremental NOI from properties acquired during the year ended December 31, 2022 and same store NOI growth, partially offset by an increase in interest expense.

Same Store Operating Results (628 Stores)

($ in thousands, except per square foot data)	Three Months Ended December 31,											Year Ended December 31,
		2022				2021			Growth				2022				2021			Growth
Total revenues	$	139,470			$	129,910			7.4	%		$	548,739			$	489,338			12.1	%
Property operating expenses		34,350				33,810			1.6	%			140,724				134,276			4.8	%
Net Operating Income (NOI)	$	105,120			$	96,100			9.4	%		$	408,015			$	355,062			14.9	%
NOI Margin		75.4	%			74.0	%		1.4	%			74.4	%			72.6	%		1.8	%
Average Occupancy		91.4	%			95.6	%		(4.2	)%			93.8	%			94.7	%		(0.9	)%
Average Annualized Rental Revenue Per Occupied Square Foot	$	15.44			$	13.74			12.4	%		$	14.80			$	13.05			13.4	%

Year-over-year same store total revenues increased 7.4% for the fourth quarter of 2022 and 12.1% year-to-date as compared to the same periods in 2021. The increase for the fourth quarter was driven primarily by a 12.4% increase in average annualized rental revenue per occupied square foot, partially offset by a 4.2% decrease in average occupancy. The year-to-date increase was driven primarily by a 13.4% increase in average annualized rental revenue per occupied square foot, partially offset by a 90 basis point decrease in average occupancy. Markets which generated above portfolio average same store total revenue growth include: Riverside-San Bernardino, Atlanta, and McAllen-Edinburg. Markets which generated below portfolio average same store total revenue growth include: Portland, New Orleans and Kansas City.

Year-over-year same store property operating expenses increased 1.6% for the fourth quarter of 2022 and 4.8% year-to-date as compared to the same periods in 2021. The increases primarily resulted from increases in marketing, utilities, and year-to-date property tax expense offset by a decrease in personnel costs.

Investment Activity

During the fourth quarter, NSA invested $39.9 million in the acquisition of two wholly-owned self storage properties consisting of approximately 196,000 rentable square feet configured in approximately 1,800 storage units. Total consideration for these acquisitions included approximately $7.6 million of net cash, the issuance of approximately $16.2 million of OP units, $15.9 million of SP units and the assumption of approximately $0.2 million of other liabilities.

Balance Sheet

During the fourth quarter, NSA repurchased 1,032,251 of the Company's common shares for approximately $40.0 million under the previously announced share repurchase program. For the full year 2022, the Company repurchased 1,986,175 shares for approximately $90.0 million. Under the program, the Company has remaining capacity of approximately $310.0 million out of a total of $400.0 million authorized.

On January 3, 2023, the Company entered into a third amended and restated credit agreement which expands the total borrowing capacity of its credit facility by $405.0 million to $1.955 billion with an accordion feature to expand the total borrowing capacity to $2.5 billion. The maturity date of the revolving line of credit is now January 2027 versus the previous maturity date of January 2024, while the total borrowing capacity was increased to $950.0 million from $650.0 million. In connection with the credit facility recast, the Company retired its $125.0 million term loan due January 2023 and its $175.0 million term loan facility due in June 2023, and converted LIBOR-based borrowings to SOFR. The Company funded the retirements with $230.0 million of incremental borrowings on existing term loans and $70.0 million of borrowings on its revolving line of credit. In Schedule 4 of the supplemental financial information, the Company has presented its debt summary as of December 31, 2022, giving pro forma effect for the credit facility recast, debt retirements, and an interest rate swap that was effective starting February 1, 2023.

Common Share Dividends

On November 9, 2022, NSA's Board of Trustees declared a quarterly cash dividend of $0.55 per common share, representing a 22.2% increase from the fourth quarter 2021. The fourth quarter 2022 dividend was paid on December 30, 2022 to shareholders of record as of December 15, 2022.

For full year 2022, NSA's Board of Trustees declared cash dividends of $2.15 per common share, representing a 35.2% increase from 2021.

2023 Guidance

The following table outlines NSA's Core FFO per share guidance estimates and related assumptions for the year ended December 31, 2023.

	Ranges for Full Year 2023			Actual Results for Full Year 2022
	Low	High
Core FFO per share(1)	$2.78	$2.86		$2.81
Same store operations(2)
Total revenue growth	3.75%	5.25%		12.1%
Property operating expenses growth	4.50%	6.00%		4.8%
NOI growth	3.00%	5.50%		14.9%
General and administrative expenses
General and administrative expenses (excluding equity-based compensation), in millions	$53.0	$55.0		$53.1
Equity-based compensation, in millions	$6.5	$7.0		$6.3
Management fees and other revenue, in millions	$28.0	$30.0		$27.6
Core FFO from unconsolidated real estate ventures, in millions	$25.0	$26.5		$24.8
Subordinated performance unit distributions, in millions	$51.0	$53.0		$58.8
Acquisitions of self storage properties, in millions	$200.0	$400.0		$569.2

	Ranges for Full Year 2023
	Low			High
Earnings (loss) per share - diluted	$1.25			$1.31
Impact of the difference in weighted average number of shares and GAAP accounting for noncontrolling interests, two-class method and treasury stock method	0.07			0.02
Add real estate depreciation and amortization, including NSA's share of unconsolidated venture real estate depreciation and amortization	1.83			1.91
FFO attributable to subordinated unitholders	(0.38	)		(0.41	)
Add loss on early extinguishment of debt	—			0.01
Add acquisition costs and NSA's share of unconsolidated real estate venture acquisition costs	0.01			0.02
Core FFO per share and unit	$2.78			$2.86
(1) The table above provides a reconciliation of the range of estimated earnings (loss) per share - diluted to estimated Core FFO per share and unit.
(2) 2023 guidance reflects NSA's 2023 same store pool comprising 834 stores. 2022 actual results reflect NSA's 2022 same store pool comprising 628 stores.

Supplemental Financial Information

The full text of this earnings release and supplemental financial information, including certain financial information referenced in this release, are available on NSA's website at http://ir.nationalstorageaffiliates.com/quarterly-reporting and as exhibit 99.1 to the Company's Form 8-K furnished to the SEC on February 27, 2023.

Non-GAAP Financial Measures & Glossary

This press release contains certain non-GAAP financial measures. These non-GAAP measures are presented because NSA's management believes these measures help investors understand NSA's business, performance and ability to earn and distribute cash to its shareholders by providing perspectives not immediately apparent from net income (loss). These measures are also frequently used by securities analysts, investors and other interested parties. The presentations of FFO, Core FFO and NOI in this press release are not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. In addition, NSA's method of calculating these measures may be different from methods used by other companies, and, accordingly, may not be comparable to similar measures as calculated by other companies that do not use the same methodology as NSA. These measures, and other words and phrases used herein, are defined in the Glossary in the supplemental financial information and, where appropriate, reconciliations of these measures and other non-GAAP financial measures to their most directly comparable GAAP measures are included in the Schedules to this press release and in the supplemental financial information.

Quarterly Teleconference and Webcast

The Company will host a conference call at 1:00 pm Eastern Time on Tuesday, February 28, 2023 to discuss its fourth quarter 2022 financial results. At the conclusion of the call, management will accept questions from certified financial analysts. All other participants are encouraged to listen to a webcast of the call by accessing the link found on the Company's website at www.nationalstorageaffiliates.com.

Conference Call and Webcast:

Date/Time: Tuesday, February 28, 2023, 1:00 pm ET

Webcast available at: www.nationalstorageaffiliates.com

Domestic (Toll Free US & Canada): 877.407.9711

International: 412.902.1014

A replay of the webcast will be available for 30 days on NSA's website at www.nationalstorageaffiliates.com.

Upcoming Industry Conference

NSA management is scheduled to participate in Citi's 2023 Global Property CEO Conference on March 6 - 8, 2023 in Hollywood, Florida.

About National Storage Affiliates Trust

National Storage Affiliates Trust is a real estate investment trust headquartered in Greenwood Village, Colorado, focused on the ownership, operation and acquisition of self storage properties predominantly located within the top 100 metropolitan statistical areas throughout the United States. As of December 31, 2022, the Company held ownership interests in and operated 1,101 self storage properties located in 42 states and Puerto Rico with approximately 71.8 million rentable square feet. NSA is one of the largest owners and operators of self storage properties among public and private companies in the United States. For more information, please visit the Company’s website at www.nationalstorageaffiliates.com. NSA is included in the MSCI US REIT Index (RMS/RMZ), the Russell 1000 Index of Companies and the S&P MidCap 400 Index.

NOTE REGARDING FORWARD LOOKING STATEMENTS

Certain statements contained in this press release constitute forward-looking statements as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are intended to be covered by the safe harbor provided by the same. Forward-looking statements are subject to substantial risks and uncertainties, many of which are difficult to predict and are generally beyond the Company's control. These forward-looking statements include information about possible or assumed future results of the Company's business, financial condition, liquidity, results of operations, plans and objectives. Changes in any circumstances may cause the Company's actual results to differ significantly from those expressed in any forward-looking statement. When used in this release, the words "believe," "expect," "anticipate," "estimate," "plan," "continue," "intend," "should," "may" or similar expressions are intended to identify forward-looking statements. Statements regarding the following subjects, among others, may be forward-looking: market trends in the Company's industry, interest rates, inflation, the debt and lending markets or the general economy; the Company's business and investment strategy; the acquisition of properties, including those under contract and the Company's ability to execute on its acquisition pipeline; the timing of acquisitions under contract; the internalization of retiring participating regional operators ("PROs") into the Company; and the Company's guidance estimates for the year ended December 31, 2023. For a further list and description of such risks and uncertainties, see the Company's most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the Securities and Exchange Commission, and the other documents filed by the Company with the Securities and Exchange Commission. The forward-looking statements, and other risks, uncertainties and factors are based on the Company's beliefs, assumptions and expectations of its future performance, taking into account all information currently available to the Company. Forward-looking statements are not predictions of future events. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

National Storage Affiliates Trust Consolidated Statements of Operations (in thousands, except per share amounts) (unaudited)
	Three Months Ended December 31,								Year Ended December 31,
		2022				2021				2022				2021
REVENUE
Rental revenue	$	195,985			$	161,690			$	748,814			$	541,547
Other property-related revenue		6,224				5,643				25,131				19,750
Management fees and other revenue		6,513				6,257				27,624				24,374
Total revenue		208,722				173,590				801,569				585,671
OPERATING EXPENSES
Property operating expenses		53,347				44,542				211,025				155,265
General and administrative expenses		15,345				14,301				59,311				51,001
Depreciation and amortization		57,564				50,854				233,158				158,312
Other		1,186				1,152				8,537				2,853
Total operating expenses		127,442				110,849				512,031				367,431
OTHER (EXPENSE) INCOME
Interest expense		(34,633	)			(19,787	)			(110,599	)			(72,062	)
Equity in earnings of unconsolidated real estate ventures		2,155				1,679				7,745				5,294
Acquisition costs		(368	)			(1,019	)			(2,745	)			(1,941	)
Non-operating expense		(352	)			(344	)			(951	)			(906	)
Gain on sale of self storage properties		3,332				—				5,466				—
Other expense, net		(29,866	)			(19,471	)			(101,084	)			(69,615	)
Income before income taxes		51,414				43,270				188,454				148,625
Income tax expense		(1,037	)			(375	)			(4,689	)			(1,690	)
Net income		50,377				42,895				183,765				146,935
Net income attributable to noncontrolling interests		(19,117	)			(17,422	)			(80,028	)			(41,682	)
Net income attributable to National Storage Affiliates Trust		31,260				25,473				103,737				105,253
Distributions to preferred shareholders		(3,382	)			(3,277	)			(13,425	)			(13,104	)
Net income attributable to common shareholders	$	27,878			$	22,196			$	90,312			$	92,149
Earnings per share - basic	$	0.31			$	0.25			$	0.99			$	1.13
Earnings per share - diluted	$	0.31			$	0.25			$	0.99			$	0.98
Weighted average shares outstanding - basic		90,627				89,763				91,239				81,195
Weighted average shares outstanding - diluted		90,627				89,763				91,239				134,538

National Storage Affiliates Trust Consolidated Balance Sheets (dollars in thousands, except per share amounts) (unaudited)
	December 31,				December 31,
		2022				2021
ASSETS
Real estate
Self storage properties	$	6,391,572			$	5,798,188
Less accumulated depreciation		(772,661	)			(578,717	)
Self storage properties, net		5,618,911				5,219,471
Cash and cash equivalents		35,312				25,013
Restricted cash		6,887				2,862
Debt issuance costs, net		1,393				2,433
Investment in unconsolidated real estate ventures		227,441				188,187
Other assets, net		156,228				102,417
Operating lease right-of-use assets		23,835				22,211
Total assets	$	6,070,007			$	5,562,594
LIABILITIES AND EQUITY
Liabilities
Debt financing	$	3,551,179			$	2,940,931
Accounts payable and accrued liabilities		80,377				59,262
Interest rate swap liabilities		483				33,757
Operating lease liabilities		25,741				23,981
Deferred revenue		23,213				22,208
Total liabilities		3,680,993				3,080,139
Equity
Preferred shares of beneficial interest, par value $0.01 per share. 50,000,000 authorized, 9,017,588 and 8,736,719 issued and outstanding at December 31, 2022 and December 31, 2021, respectively, at liquidation preference		225,439				218,418
Common shares of beneficial interest, par value $0.01 per share. 250,000,000 shares authorized, 89,842,145 and 91,198,929 shares issued and outstanding at December 31, 2022 and December 31, 2021, respectively		898				912
Additional paid-in capital		1,777,984				1,866,773
Distributions in excess of earnings		(396,650	)			(291,263	)
Accumulated other comprehensive income (loss)		40,530				(19,611	)
Total shareholders' equity		1,648,201				1,775,229
Noncontrolling interests		740,813				707,226
Total equity		2,389,014				2,482,455
Total liabilities and equity	$	6,070,007			$	5,562,594

Reconciliation of Net Income to FFO and Core FFO (in thousands, except per share and unit amounts) (unaudited)
	Three Months Ended December 31,								Year Ended December 31,
		2022				2021				2022				2021
Net income	$	50,377			$	42,895			$	183,765			$	146,935
Add (subtract):
Real estate depreciation and amortization		57,227				50,526				231,870				156,930
Company's share of unconsolidated real estate venture real estate depreciation and amortization		4,461				3,845				17,072				15,408
Gain on sale of self storage properties		(3,332	)			—				(5,466	)			—
Distributions to preferred shareholders and unitholders		(3,653	)			(3,519	)			(14,510	)			(14,070	)
FFO attributable to subordinated performance unitholders(1)		(15,190	)			(15,830	)			(58,838	)			(49,810	)
FFO attributable to common shareholders, OP unitholders, and LTIP unitholders		89,890				77,917				353,893				255,393
Add:
Acquisition costs		368				1,019				2,745				1,941
Casualty-related expenses(2)		634				—				6,388				—
Core FFO attributable to common shareholders, OP unitholders, and LTIP unitholders	$	90,892			$	78,936			$	363,026			$	257,334
Weighted average shares and units outstanding - FFO and Core FFO:(3)
Weighted average shares outstanding - basic		90,627				89,763				91,239				81,195
Weighted average restricted common shares outstanding		25				34				27				33
Weighted average effect of forward offering agreement(4)		—				—				—				100
Weighted average OP units outstanding		35,601				30,681				35,421				30,127
Weighted average DownREIT OP unit equivalents outstanding		1,925				1,925				1,925				1,925
Weighted average LTIP units outstanding		476				523				514				542
Total weighted average shares and units outstanding - FFO and Core FFO		128,654				122,926				129,126				113,922
FFO per share and unit	$	0.70			$	0.63			$	2.74			$	2.24
Core FFO per share and unit	$	0.71			$	0.64			$	2.81			$	2.26

(1)		Amounts represent distributions declared for subordinated performance unitholders and DownREIT subordinated performance unitholders for the periods presented.
(2)		These casualty-related expenses are recorded in the line item "Other" within operating expenses in our consolidated statement of operations.
(3)		NSA combines OP units and DownREIT OP units with common shares because, after the applicable lock-out periods, OP units in the Company's operating partnership are redeemable for cash or, at NSA's option, exchangeable for common shares on a one-for-one basis and DownREIT OP units are also redeemable for cash or, at NSA's option, exchangeable for OP units in the Company's operating partnership on a one-for-one basis, subject to certain adjustments in each case. Subordinated performance units, DownREIT subordinated performance units and LTIP units may also, under certain circumstances, be convertible into or exchangeable for common shares (or other units that are convertible into or exchangeable for common shares). See footnote(5) for additional discussion of subordinated performance units, DownREIT subordinated performance units, and LTIP units in the calculation of FFO and Core FFO per share and unit.
(4)		Represents the dilutive effect of the forward offering from the application of the treasury stock method.

Reconciliation of Earnings Per Share - Diluted to FFO and Core FFO Per Share and Unit (in thousands, except per share and unit amounts) (unaudited)
	Three Months Ended December 31,								Year Ended December 31,
		2022				2021				2022				2021
Earnings per share - diluted	$	0.31			$	0.25			$	0.99			$	0.98
Impact of the difference in weighted average number of shares(5)		(0.08	)			(0.07	)			(0.28	)			0.18
Impact of GAAP accounting for noncontrolling interests, two-class method and treasury stock method(6)		0.15				0.14				0.62				—
Add real estate depreciation and amortization		0.44				0.41				1.79				1.38
Add Company's share of unconsolidated real estate venture real estate depreciation and amortization		0.03				0.03				0.13				0.14
Subtract gain on sale of self storage properties		(0.03	)			—				(0.05	)			—
FFO attributable to subordinated performance unitholders		(0.12	)			(0.13	)			(0.46	)			(0.44	)
FFO per share and unit		0.70				0.63				2.74				2.24
Add acquisition costs		—				0.01				0.02				0.02
Add casualty-related expenses		0.01				—				0.05				—
Core FFO per share and unit	$	0.71			$	0.64			$	2.81			$	2.26

(5)		Adjustment accounts for the difference between the weighted average number of shares used to calculate diluted earnings per share and the weighted average number of shares used to calculate FFO and Core FFO per share and unit. Diluted earnings per share is calculated using the two-class method for the company's restricted common shares and the treasury stock method for certain unvested LTIP units, and assumes the conversion of vested LTIP units into OP units on a one-for-one basis and the hypothetical conversion of subordinated performance units, and DownREIT subordinated performance units into OP units, even though such units may only be convertible into OP units (i) after a lock-out period and (ii) upon certain events or conditions. For additional information about the conversion of subordinated performance units and DownREIT subordinated performance units into OP units, see Note 10 to the Company's most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission. The computation of weighted average shares and units for FFO and Core FFO per share and unit includes all restricted common shares and LTIP units that participate in distributions and excludes all subordinated performance units and DownREIT subordinated performance units because their effect has been accounted for through the allocation of FFO to the related unitholders based on distributions declared.
(6)		Represents the effect of adjusting the numerator to consolidated net income (loss) prior to GAAP allocations for noncontrolling interests, after deducting preferred share and unit distributions, and before the application of the two-class method and treasury stock method, as described in footnote(5).

Net Operating Income (dollars in thousands) (unaudited)
	Three Months Ended December 31,								Year Ended December 31,
		2022				2021				2022				2021
Net income	$	50,377			$	42,895			$	183,765			$	146,935
(Subtract) add:
Management fees and other revenue		(6,513	)			(6,257	)			(27,624	)			(24,374	)
General and administrative expenses		15,345				14,301				59,311				51,001
Other		1,186				1,152				8,537				2,853
Depreciation and amortization		57,564				50,854				233,158				158,312
Interest expense		34,633				19,787				110,599				72,062
Equity in earnings of unconsolidated real estate ventures		(2,155	)			(1,679	)			(7,745	)			(5,294	)
Acquisition costs		368				1,019				2,745				1,941
Income tax expense		1,037				375				4,689				1,690
Gain on sale of self storage properties		(3,332	)			—				(5,466	)			—
Non-operating expense		352				344				951				906
Net Operating Income	$	148,862			$	122,791			$	562,920			$	406,032

EBITDA and Adjusted EBITDA (dollars in thousands) (unaudited)
	Three Months Ended December 31,							Year Ended December 31,
		2022				2021			2022				2021
Net income	$	50,377			$	42,895		$	183,765			$	146,935
Add:
Depreciation and amortization		57,564				50,854			233,158				158,312
Company's share of unconsolidated real estate venture depreciation and amortization		4,461				3,845			17,072				15,408
Interest expense		34,633				19,787			110,599				72,062
Income tax expense		1,037				375			4,689				1,690
EBITDA		148,072				117,756			549,283				394,407
Add (subtract):
Acquisition costs		368				1,019			2,745				1,941
Gain on sale of self storage properties		(3,332	)			—			(5,466	)			—
Casualty related expenses (recoveries)		634				—			6,388				—
Equity-based compensation expense		1,588				1,374			6,258				5,462
Adjusted EBITDA	$	147,330			$	120,149		$	559,208			$	401,810

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20230227005732/en/

National Storage Affiliates Trust

Investor/Media Relations

George Hoglund, CFA

Vice President - Investor Relations

720.630.2160

ghoglund@nsareit.net

Source: National Storage Affiliates Trust

FAQ

What were NSA's fourth quarter 2022 earnings results?

NSA reported a net income of $50.4 million for Q4 2022, a 17.4% increase from Q4 2021, and diluted earnings per share of $0.31.

How did NSA's Core FFO perform in 2022?

NSA reported a Core FFO of $363 million for the full year 2022, a 24.3% increase compared to 2021.

What is the dividend declared by NSA for Q4 2022?

NSA declared a quarterly cash dividend of $0.55 per share, representing a 22.2% increase from the previous year.

What changes did NSA make to its credit facility recently?

NSA increased its credit facility borrowing capacity by $405 million to a total of $1.955 billion.

What caused the decrease in NSA's same store occupancy in 2022?

NSA experienced a 450 basis point decrease in same store occupancy year-over-year, dropping to 90.5% as of December 31, 2022.