UMH PROPERTIES, INC. REPORTS RESULTS FOR THE YEAR ENDED AND THE FOURTH QUARTER ENDED DECEMBER 31, 2020
UMH Properties reported a 12% increase in Total Income for 2020, reaching $163.6 million. The company's Net Income attributable to shareholders showed a significant loss of $29.8 million, or $0.72 per diluted share. For Q4 2020, Total Income rose 13% to $42.8 million, with a net income of $15.6 million, recovering from a Q4 2019 loss. Key achievements included a 20% rise in Net Operating Income and a 5.5% dividend hike to $0.76 per share. The company actively expanded its rental home portfolio and improved its occupancy rates amidst the pandemic.
- Total Income increased by 12% to $163.6 million for 2020.
- Net Operating Income (NOI) grew by 20%.
- Normalized Funds from Operations (FFO) increased by 16% year-over-year.
- Rental home portfolio expanded by 858 homes, reaching approximately 8,300 homes.
- Dividends raised by 5.5% to $0.76 per share.
- Net Income attributable to common shareholders showed a loss of $29.8 million for 2020.
- Total expenses rose to $135.3 million, up from $126.6 million in 2019.
- Decline in fair value of marketable securities by $14.1 million.
FREEHOLD, NJ, March 10, 2021 (GLOBE NEWSWIRE) -- UMH Properties, Inc. (NYSE:UMH) reported Total Income of
Funds from Operations Attributable to Common Shareholders (“FFO”) was
A summary of significant financial information for the three and twelve months ended December 31, 2020 and 2019 is as follows (in thousands except per share amounts):
| For the Three Months Ended | |||||||
| December 31, | |||||||
| 2020 | 2019 | ||||||
| Total Income | $ | 42,829 | $ | 37,744 | |||
| Total Expenses | $ | 34,382 | $ | 31,856 | |||
| Increase (Decrease) in Fair Value of Marketable Securities | $ | 17,802 | $ | (563 | ) | ||
| Net Income (Loss) Attributable to Common Shareholders | $ | 15,591 | $ | (3,433 | ) | ||
| Net Income (Loss) Attributable to Common Shareholders per Diluted Common Share | $ | 0.38 | $ | (0.08 | ) | ||
| FFO (1) | $ | 8,544 | $ | 7,006 | |||
| FFO (1) per Diluted Common Share | $ | 0.20 | $ | 0.17 | |||
| Normalized FFO (1) | $ | 8,544 | $ | 7,059 | |||
| Normalized FFO (1) per Diluted Common Share | $ | 0.20 | $ | 0.17 | |||
| Weighted Average Shares Outstanding | 42,390 | 40,929 | |||||
| For the Twelve Months Ended | |||||||
| December 31, | |||||||
| 2020 | 2019 | ||||||
| Total Income | $ | 163,609 | $ | 146,591 | |||
| Total Expenses | $ | 135,296 | $ | 126,582 | |||
| Increase (Decrease) in Fair Value of Marketable Securities | $ | (14,119 | ) | $ | 14,915 | ||
| Net Income (Loss) Attributable to Common Shareholders | $ | (29,759 | ) | $ | 2,566 | ||
| Net Income (Loss) Attributable to Common Shareholders per Diluted Common Share | $ | (0.72 | ) | $ | 0.06 | ||
| FFO (1) | $ | 26,283 | $ | 24,573 | |||
| FFO (1) per Diluted Common Share | $ | 0.63 | $ | 0.61 | |||
| Normalized FFO (1) | $ | 29,154 | $ | 25,207 | |||
| Normalized FFO (1) per Diluted Common Share | $ | 0.70 | $ | 0.63 | |||
| Weighted Average Shares Outstanding | 41,395 | 40,203 | |||||
A summary of significant balance sheet information as of December 31, 2020 and 2019 is as follows (in thousands):
| December 31, 2020 | December 31, 2019 | ||||
| Gross Real Estate Investments | $ | 1,108,483 | $ | 1,015,281 | |
| Marketable Securities at Fair Value | $ | 103,172 | $ | 116,186 | |
| Total Assets | $ | 1,087,214 | $ | 1,025,453 | |
| Mortgages Payable, net | $ | 469,279 | $ | 373,658 | |
| Loans Payable, net | $ | 87,009 | $ | 83,686 | |
| Total Shareholders’ Equity | $ | 501,808 | $ | 546,339 | |
Samuel A. Landy, President and CEO, commented on the 2020 results.
“2020 will be viewed as a transformational year for UMH Properties. Despite the uncertainties caused by COVID-19, we were able to generate exceptional results on all fronts. Our accomplishments during the year include:
- Increased Rental and Related Income by
11% ; - Increased Community Net Operating Income (“NOI”) by
20% ; - Increased Normalized Funds from Operations (“Normalized FFO”) by
16% and Normalized FFO per share by11% ; - Improved our Operating Expense ratio by 390 basis points to
44.1% ; - Increased Same Property NOI by
15% ; - Increased Same Property Occupancy by 718 sites from
83.6% to86.8% or 320 basis points; - Increased our rental home portfolio by 858 homes to approximately 8,300 total rental homes, representing an increase of
12% ; - Increased rental home occupancy by 230 basis points from
92.3% to94.6% ; - Increased Sales of Manufactured Homes by
13% ; - Acquired two communities containing approximately 310 homesites for a total cost of approximately
$7.8 million ; - Completed the financing of 28 unencumbered communities with Fannie Mae for proceeds of approximately
$106 million , with a maturity of 10 years and a 30-year amortization at a fixed rate of2.62% ; - Issued and sold approximately 135,000 shares of Common Stock through an At-the-Market Sale Program for our Common Stock at a weighted average price of
$14.60 per share, generating gross proceeds of$2.0 million and net proceeds of$1.7 million , after offering expenses; - Issued and sold, through At-the-Market Sale Programs for our Preferred Stock, 134,000 shares of Series C Preferred Stock at a weighted average price of
$24.96 per share and 3.8 million shares of Series D Preferred Stock at a weighted average price of$24.98 per share, generating total gross proceeds of$97.8 million and total net proceeds of$96.1 million , after offering expenses; - Redeemed all 3.8 million issued and outstanding shares of our
8.0% Series B Cumulative Redeemable Preferred Stock for$96.1 million with proceeds from our2.62% Fannie Mae financing, resulting in a savings of over$5 million annually; - Reduced the weighted average interest rate on our mortgages payable from
4.1% to3.8% year over year; - Subsequent to year end, issued and sold 768,000 additional shares of Series D Preferred Stock at a weighted average price of
$24.80 per share through our At-the-Market Sale Program for our Preferred Stock, generating gross proceeds of$19.1 million and net proceeds of$18.8 million , after offering expenses; - Subsequent to year end, acquired two communities containing approximately 340 homesites for a total cost of approximately
$8.0 million ; and - Subsequent to year end, raised our dividend by
5.5% to an annualized rate of$0.76 per share.”
“2020 was a challenging year in all respects, but our team produced results that we are very proud of. Most importantly, our rent collections remained stable and at pre-pandemic levels and we were able to maintain rental home occupancy rates of
“The pandemic increased demand for housing in our communities. We increased our rental home portfolio by 858 homes. Home sales also improved by
“We also made progress on the financing front. We completed the financing of 28 unencumbered communities generating proceeds of
“During the year, we acquired two communities containing approximately 310 developed homesites for an aggregate cost of
“UMH continues to build upon the foundation that we have laid over the past few years. These results allowed us to confidently raise our dividend by
UMH Properties, Inc. will host its Fourth Quarter and Year Ended December 31, 2020 Financial Results Webcast and Conference Call. Senior management will discuss the results, current market conditions and future outlook on Thursday, March 11, 2021 at 10:00 a.m. Eastern Time.
The Company’s fourth quarter and year ended December 31, 2020 financial results being released herein will be available on the Company’s website at www.umh.reit in the “Financials” section.
To participate in the webcast, select the microphone icon found on the homepage www.umh.reit to access the call. Interested parties can also participate via conference call by calling toll free 877-513-1898 (domestically) or 412-902-4147 (internationally).
The replay of the conference call will be available at 12:00 p.m. Eastern Time on Thursday, March 11, 2021. It will be available until May 1, 2021, and can be accessed by dialing toll free 877-344-7529 (domestically) and 412-317-0088 (internationally) and entering the passcode 10151272. A transcript of the call and the webcast replay will be available at the Company's website, www.umh.reit.
UMH Properties, Inc., which was organized in 1968, is a public equity REIT that owns and operates 126 manufactured home communities containing approximately 23,800 developed homesites. These communities are located in New Jersey, New York, Ohio, Pennsylvania, Tennessee, Indiana, Michigan, Maryland, Alabama and South Carolina. In addition, the Company owns a portfolio of REIT securities.
Certain statements included in this press release which are not historical facts may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements are based on the Company’s current expectations and involve various risks and uncertainties. Although the Company believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the Company can provide no assurance those expectations will be achieved. The risks and uncertainties that could cause actual results or events to differ materially from expectations are contained in the Company’s annual report on Form 10-K and described from time to time in the Company’s other filings with the SEC. The Company undertakes no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events, or otherwise.
Note:
(1) Non-GAAP Information: We assess and measure our overall operating results based upon an industry performance measure referred to as Funds from Operations Attributable to Common Shareholders (“FFO”), which management believes is a useful indicator of our operating performance. FFO is used by industry analysts and investors as a supplemental operating performance measure of a REIT. FFO, as defined by The National Association of Real Estate Investment Trusts (“NAREIT”), represents net income (loss) attributable to common shareholders, as defined by accounting principles generally accepted in the United States of America (“U.S. GAAP”), excluding extraordinary items, as defined under U.S. GAAP, gains or losses from sales of previously depreciated real estate assets, impairment charges related to depreciable real estate assets, and the change in the fair value of marketable securities plus certain non-cash items such as real estate asset depreciation and amortization. Included in the NAREIT FFO White Paper - 2018 Restatement, is an option pertaining to assets incidental to our main business in the calculation of NAREIT FFO to make an election to include or exclude gains and losses on the sale of these assets, such as marketable equity securities, and include or exclude mark-to-market changes in the value recognized on these marketable equity securities. In conjunction with the adoption of the FFO White Paper - 2018 Restatement, for all periods presented, we have elected to exclude the change in the fair value of marketable securities from our FFO calculation. Prior to the adoption of the FFO White Paper – 2018 Restatement, we utilized Core Funds from Operations (Core FFO), which we defined as FFO, excluding the change in the fair value of marketable securities. NAREIT created FFO as a non-U.S. GAAP supplemental measure of REIT operating performance. We define Normalized Funds from Operations Attributable to Common Shareholders (“Normalized FFO”), as FFO, excluding gains and losses realized on marketable securities investments and certain one-time charges. FFO and Normalized FFO should be considered as supplemental measures of operating performance used by REITs. FFO and Normalized FFO exclude historical cost depreciation as an expense and may facilitate the comparison of REITs which have a different cost basis. However, other REITs may use different methodologies to calculate FFO and Normalized FFO and, accordingly, our FFO and Normalized FFO may not be comparable to all other REITs. The items excluded from FFO and Normalized FFO are significant components in understanding the Company’s financial performance.
FFO and Normalized FFO (i) do not represent Cash Flow from Operations as defined by U.S. GAAP; (ii) should not be considered as alternatives to net income (loss) as a measure of operating performance or to cash flows from operating, investing and financing activities; and (iii) are not alternatives to cash flow as a measure of liquidity.
The reconciliation of the Company’s U.S. GAAP net income (loss) to the Company’s FFO and Normalized FFO for the three and twelve months ended December 31, 2020 and 2019 are calculated as follows (in thousands except footnotes):
| Three Months Ended | Twelve Months Ended | |||||||||||||||||
| 12/31/20 | 12/31/19 | 12/31/20 | 12/31/19 | |||||||||||||||
| Net Income (Loss) Attributable to Common Shareholders | $ | 15,591 | $ | (3,433 | ) | $ | (29,759 | ) | $ | 2,566 | ||||||||
| Depreciation Expense | 10,716 | 9,801 | 41,707 | 36,811 | ||||||||||||||
| Loss on Sales of Property and Equipment | 39 | 75 | 216 | 111 | ||||||||||||||
| (Increase) Decrease in Fair Value of Marketable Securities | (17,802 | ) | 563 | 14,119 | (14,915 | ) | ||||||||||||
| FFO Attributable to Common Shareholders | 8,544 | 7,006 | 26,283 | 24,573 | ||||||||||||||
| Redemption of Preferred Stock | -0- | -0- | 2,871 | -0- | ||||||||||||||
| Non-Recurring Other Expense (2) | -0- | 53 | -0- | 634 | ||||||||||||||
| Normalized FFO Attributable to Common Shareholders | $ | 8,544 | $ | 7,059 | $ | 29,154 | $ | 25,207 | ||||||||||
The diluted weighted shares outstanding used in the calculation of FFO per Diluted Common Share and Normalized FFO per Diluted Common Share were 42.4 million and 41.7 million shares for the three and twelve months ended December 31, 2020, respectively, and 41.4 million and 40.2 million shares for the three and twelve months ended December 31, 2019, respectively. Common stock equivalents resulting from stock options in the amount of 636,000 and 350,000 shares for the three and twelve months ended December 31, 2020, respectively, and 456,000 and 294,000 shares for the three and twelve months ended December 31, 2019, respectively, are included in the diluted weighted shares outstanding. Common stock equivalents for the twelve months ended December 31, 2020 and three months ended December 31, 2019 were excluded from the computation of the Diluted Net Income (Loss) per Share as their effect would be anti-dilutive.
The following are the cash flows provided (used) by operating, investing and financing activities for the twelve months ended December 31, 2020 and 2019 (in thousands):
| 2020 | 2019 | |||||||
| Operating Activities | $ | 69,037 | $ | 38,516 | ||||
| Investing Activities | (103,770 | ) | (122,350 | ) | ||||
| Financing Activities | 44,330 | 90,053 |
(2) Consists of utility billing dispute over a prior 10-year period (
| Contact: Nelli Madden |
| 732-577-9997 |
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