NXRT Recaps Acquisition/Disposition
Activity, Value-Add Results and Issues 2023 Full Year
Guidance
DALLAS, Feb. 21,
2023 /PRNewswire/ -- NexPoint Residential Trust, Inc.
(NYSE: NXRT) reported financial results for the fourth quarter and
year ended December 31, 2022.
Highlights
- NXRT1 reported net loss, FFO2, Core
FFO2 and AFFO2 of $(9.3)M, $73.4M,
$81.8M and $91.4M, respectively, attributable to common
stockholders for the year ended December 31,
2022, compared to net income, FFO, Core FFO, and AFFO of
$23.0M, $63.6M, $62.5M and
$70.9M, respectively, attributable to
common stockholders for the year ended December 31, 2021.
- For the year ended December 31,
2022, 2021-2022 Same Store properties3 average
effective rent, total revenue and NOI2 increased 17.8%,
14.0% and 16.2%, respectively, and occupancy decreased 20 bps over
the prior year period.
- During the year ended December 31,
2022, NXRT acquired two properties totaling 562 units for a
combined purchase price of $143.4
million.
- During the fourth quarter of 2022, the Company completed the
sale of Hollister Place for a sales price of $36.8 million.
- The weighted average effective monthly rent per unit across all
40 properties held as of December 31,
2022 (the "Portfolio"), consisting of 15,127
units4, was $1,480, while
physical occupancy was 94.1%.
- NXRT paid a fourth quarter dividend of $0.42 per share of common stock on December 30, 2022; this cash dividend represented
a $0.04 per share, or 10.5% increase,
over the prior quarter's dividend.
- During 2022, for the properties in the Portfolio, NXRT
completed 2,409 full/partial upgrades and washer dryer, achieving
an average monthly rent premium of $154 and a 24.3% ROI5.
- Since inception, NXRT has completed installation of 7,633 full
and partial upgrades, 4,718 kitchen and laundry appliances and
10,191 technology packages, resulting in $149, $47 and
$45 average monthly rental increase
per unit and 22.0%, 66.9% and 37.2% ROI, respectively.
- During the fourth quarter of 2022, the Company paid down
$260.5 million of principal on its
corporate credit facility and extended the maturity date to
June 30, 2025.
(1)
|
In this release, "we,"
"us," "our," the "Company," "NexPoint Residential Trust," and
"NXRT" each refer to NexPoint Residential Trust, Inc., a Maryland
corporation.
|
(2)
|
FFO, Core FFO, AFFO and
NOI are non-GAAP measures. For a discussion of why we consider
these non-GAAP measures useful and reconciliations of FFO, Core
FFO, AFFO and NOI to net income (loss), see the "Definitions and
Reconciliations of Non-GAAP Measures" and "FFO, Core FFO and AFFO"
sections of this release.
|
(3)
|
We define "Same Store"
properties as properties that were in our Portfolio for the
entirety of the periods being compared. There are 31 properties
encompassing 12,210 units of apartment space in our Same Store pool
for the year ended December 31, 2022 (our "2021-2022" Same
Store" properties). There are 35 properties encompassing 13,227
units of apartment space in our Q4 Same Store pool for the three
months ended December 31, 2022 (our "Q4 Same Store" properties).
The same store unit count excludes 112 units that are currently
down due to fires (Rockledge 20 units, Versailles: 17 units, Arbors
of Brentwood: 16 units, Silverbrook: 16 units, Timber Creek: 16
units, Bella Solara: 8 units, Venue at 8651: 8 units, Six Forks
Station: 6 units, Preserve at Terrell Mill: 3 units and Parc500: 2
units).
|
(4)
|
Total number of units
owned as of December 31, 2022 is 15,127, however 113 units are
currently down due to fires and water damage (Rockledge 20 units,
Versailles: 17 units, Arbors of Brentwood: 16 units, Silverbrook:
16 units, Timber Creek: 16 units, Bella Solara: 8 units, Venue at
8651: 8 units, Six Forks Station: 6 units, Preserve at Terrell
Mill: 3 units, Parc500: 2 units and High House at Cary: 1
unit).
|
(5)
|
We define Return on
Investment ("ROI") as the sum of the actual rent premium divided by
the sum of the total cost.
|
|
|
Full Year 2022 Financial Results
- Total revenues were $264.0
million for the full year 2022, compared to $219.2 million for the full year 2021.
- Net loss for the full year 2022 totaled $(9.3) million, or loss of $(0.36) per diluted share, which included a gain
on sales of real estate of $14.7
million and $97.6 million of
depreciation and amortization expense. This compared to net income
of $23.0 million, or income of
$0.89 per diluted share, which
included a gain on sales of real estate of $46.2 million and $86.9
million of depreciation and amortization expense for the
full year 2021.
- The change in our net loss of $(9.3)
million for the year ended December
31, 2022 as compared to our net income of $23.1 million for the year ended December 31, 2021 primarily relates to decreases
in gains on sales of real estate and increases in depreciation and
total property operating expenses, partially offset by an increase
in total revenues.
- For the full year 2022, NOI was $157.4
million on 40 properties, compared to $128.8 million for the full year 2021 on 39
properties.
- For the full year 2022, Same Store NOI increased 16.2% to
$129.3 million, compared to
$111.3 million for the full year
2021.
- For the full year 2022, FFO totaled $73.4 million, or $2.81 per diluted share, compared to $63.6 million, or $2.47 per diluted share, for the full year 2021.
For the full year 2022, Core FFO totaled $81.8 million, or $3.13 per diluted share, compared to $62.5 million, or $2.43 per diluted share, for the full year 2021.
For the full year 2022, AFFO totaled $91.4
million, or $3.49 per diluted
share, compared to $70.9 million, or
$2.75 per diluted share, for the full
year 2021.
Fourth Quarter 2022 Financial Results
- Total revenues were $69.3 million
for the fourth quarter of 2022, compared to $58.5 million for the fourth quarter of
2021.
- Net income for the fourth quarter of 2022 totaled $3.8 million, or a gain of $0.15 per diluted share, which included
$23.2 million of depreciation and
amortization expense and $15.8
million of interest expense. This compared to net income of
$38.8 million, or income of
$1.50 per diluted share, for the
fourth quarter of 2021, which included $24.5
million of depreciation and amortization expense and
$11.8 million of interest
expense.
- The change in our net income between the periods primarily
relates to a decrease in gains on sales of real estate, increases
in total property operating expenses and depreciation and
amortization expense, partially offset by increases in total
revenues.
- For the fourth quarter of 2022, NOI was $41.8 million on 40 properties, compared to
$34.9 million for the fourth quarter
of 2021 on 39 properties.
- For the fourth quarter of 2022, Q4 Same Store NOI increased
14.4% to $36.9 million, compared to
$32.3 million for the fourth quarter
of 2021.
- For the fourth quarter of 2022, FFO totaled $12.2 million, or $0.47 per diluted share, compared to $17.1 million, or $0.66 per diluted share, for the fourth quarter
of 2021. For the fourth quarter of 2022, Core FFO totaled
$19.5 million, or $0.75 per diluted share, compared to $17.8 million, or $0.69 per diluted share, for the fourth quarter
of 2021. For the fourth quarter of 2022, AFFO totaled $22.0 million, or $0.84 per diluted share, compared to $20.0 million, or $0.77 per diluted share, for the fourth quarter
of 2021.
Fourth Quarter Earnings Conference Call
NXRT will host a call on Tuesday,
February 21, 2023, at 11:00 a.m.
ET (10:00 a.m. CT), to discuss
its full year and fourth quarter 2022 financial results. The
conference call can be accessed live over the phone by dialing
888-660-4430 or, for international callers, +1 646-960-0537 and
using passcode Conference ID: 5001576. A live audio webcast
of the call will be available online at the Company's website,
nxrt.nexpoint.com (under "Resources"). An online replay
will be available shortly after the call on the Company's website
and continue to be available for 60 days.
A replay of the conference call will also be available through
Tuesday, March 7, 2023, by dialing
800- 770- 2030 or, for international callers, +1 647-362-9199 and
entering passcode 5001576.
About NXRT
NexPoint Residential Trust is a publicly traded REIT, with its
shares listed on the New York Stock Exchange under the symbol
"NXRT," primarily focused on acquiring, owning and operating
well-located middle-income multifamily properties with "value-add"
potential in large cities and suburban submarkets of large cities,
primarily in the Southeastern and Southwestern United States. NXRT is externally
advised by NexPoint Real Estate Advisors, L.P., an affiliate of
NexPoint Advisors, L.P., an SEC-registered investment advisor,
which has extensive real estate experience. Our filings with the
Securities and Exchange Commission (the "SEC") are available on our
website, nxrt.nexpoint.com, under the "Financials" tab.
Cautionary Statement Regarding Forward-Looking
Statements
This release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995
that are based on management's current expectations, assumptions
and beliefs. Forward-looking statements can often be identified by
words such as "expect," "anticipate," "estimate," "may," "plan" and
similar expressions, and variations or negatives of these words.
These forward-looking statements include, but are not limited to,
statements regarding NXRT's business and industry in general, the
closing of the sales of Old Farm and Stone
Creek at Old Farm in the first half of 2023 and the paydown
of the remainder of the Corporate Credit Facility and the results
of the paydown and other refinancing activities on the Company's
debt profile, 2023 full year guidance and the related
components and assumptions, including acquisitions and
dispositions, shares outstanding, interest expense and the related
components and same store growth projections, NXRT's net asset
value and the related components and assumptions, estimated
value-add expenditures, debt payments, dispositions, outstanding
debt and shares outstanding, guidance for the first quarter 2023
and the related assumptions, planned value-add programs, including
projected average rent, rent change and return on investment,
expected settlement of interest rate swaps and the effect on the
debt maturity schedule, rehab budgets, and expected acquisitions
and dispositions. They are not guarantees of future results and are
subject to risks, uncertainties and assumptions that could cause
actual results to differ materially from those expressed in any
forward-looking statement, including those described in greater
detail in our filings with the Securities and Exchange Commission,
particularly those described in our Annual Report on Form 10-K.
Readers should not place undue reliance on any forward-looking
statements and are encouraged to review the Company's most recent
Annual Report on Form 10-K and other filings with the SEC for a
more complete discussion of the risks and other factors that could
affect any forward-looking statements. The statements made herein
speak only as of the date of this release and except as required by
law, NXRT does not undertake any obligation to publicly update or
revise any forward-looking statements.
FFO, Core FFO and AFFO
The following table reconciles our calculations of FFO, Core FFO
and AFFO to net income (loss), the most directly comparable GAAP
financial measure, for the years ended December 31, 2022, 2021 and 2020 and for the
three months ended December 31, 2022
and 2021 (in thousands, except per share amounts):
|
|
For the Year Ended
December 31,
|
|
|
For the Three Months
Ended
December 31,
|
|
|
|
2022
|
|
|
2021
|
|
|
2020
|
|
|
2022
|
|
|
2021
|
|
Net income
(loss)
|
|
$
|
(9,291)
|
|
|
$
|
23,106
|
|
|
$
|
44,150
|
|
|
$
|
3,802
|
|
|
$
|
38,831
|
|
Depreciation and
amortization
|
|
|
97,648
|
|
|
|
86,878
|
|
|
|
82,411
|
|
|
|
23,158
|
|
|
|
24,543
|
|
Gain on sales of real
estate
|
|
|
(14,684)
|
|
|
|
(46,214)
|
|
|
|
(69,151)
|
|
|
|
(14,684)
|
|
|
|
(46,214)
|
|
Adjustment for
noncontrolling interests
|
|
|
(276)
|
|
|
|
(191)
|
|
|
|
(172)
|
|
|
|
(48)
|
|
|
|
(51)
|
|
FFO attributable to
common stockholders
|
|
|
73,397
|
|
|
|
63,579
|
|
|
|
57,238
|
|
|
|
12,228
|
|
|
|
17,109
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FFO per share -
basic
|
|
$
|
2.87
|
|
|
$
|
2.53
|
|
|
$
|
2.32
|
|
|
$
|
0.48
|
|
|
$
|
0.68
|
|
FFO per share -
diluted
|
|
$
|
2.81
|
|
|
$
|
2.47
|
|
|
$
|
2.27
|
|
|
$
|
0.47
|
|
|
$
|
0.66
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on extinguishment
of debt and modification costs
|
|
|
8,734
|
|
|
|
912
|
|
|
|
1,470
|
|
|
|
8,734
|
|
|
|
584
|
|
Casualty-related
expenses/(recoveries)
|
|
|
1,119
|
|
|
|
(200)
|
|
|
|
790
|
|
|
|
456
|
|
|
|
72
|
|
Casualty losses
(gains)
|
|
|
(2,506)
|
|
|
|
(2,595)
|
|
|
|
(5,886)
|
|
|
|
(2,149)
|
|
|
|
(216)
|
|
Pandemic
expense
|
(1)
|
|
4
|
|
|
|
50
|
|
|
|
510
|
|
|
|
—
|
|
|
|
4
|
|
Amortization of
deferred financing costs - acquisition term notes
|
|
|
1,083
|
|
|
|
737
|
|
|
|
1,384
|
|
|
|
297
|
|
|
|
238
|
|
Adjustment for
noncontrolling interests
|
|
|
(31)
|
|
|
|
4
|
|
|
|
6
|
|
|
|
(28)
|
|
|
|
(2)
|
|
Core FFO
attributable to common stockholders
|
|
|
81,800
|
|
|
|
62,487
|
|
|
|
55,512
|
|
|
|
19,538
|
|
|
|
17,793
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Core FFO per share -
basic
|
|
$
|
3.19
|
|
|
$
|
2.48
|
|
|
$
|
2.25
|
|
|
$
|
0.76
|
|
|
$
|
0.70
|
|
Core FFO per share -
diluted
|
|
$
|
3.13
|
|
|
$
|
2.43
|
|
|
$
|
2.20
|
|
|
$
|
0.75
|
|
|
$
|
0.69
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
deferred financing costs - long term debt
|
|
|
1,696
|
|
|
|
1,460
|
|
|
|
1,453
|
|
|
|
449
|
|
|
|
379
|
|
Equity-based
compensation expense
|
|
|
7,911
|
|
|
|
6,997
|
|
|
|
5,504
|
|
|
|
2,005
|
|
|
|
1,786
|
|
Adjustment for
noncontrolling interests
|
|
|
(37)
|
|
|
|
(25)
|
|
|
|
(21)
|
|
|
|
(10)
|
|
|
|
(6)
|
|
AFFO attributable to
common stockholders
|
|
|
91,370
|
|
|
|
70,919
|
|
|
|
62,448
|
|
|
|
21,982
|
|
|
|
19,952
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AFFO per share -
basic
|
|
$
|
3.57
|
|
|
$
|
2.82
|
|
|
$
|
2.53
|
|
|
$
|
0.86
|
|
|
$
|
0.79
|
|
AFFO per share -
diluted
|
|
$
|
3.49
|
|
|
$
|
2.75
|
|
|
$
|
2.47
|
|
|
$
|
0.84
|
|
|
$
|
0.77
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding - basic
|
|
|
25,610
|
|
|
|
25,170
|
|
|
|
24,715
|
|
|
|
25,549
|
|
|
|
25,293
|
|
Weighted average
common shares outstanding - diluted
|
(2)
|
|
26,152
|
|
|
|
25,760
|
|
|
|
25,234
|
|
|
|
26,077
|
|
|
|
25,882
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends declared
per common share
|
|
$
|
1.56
|
|
|
$
|
1.40
|
|
|
$
|
1.28
|
|
|
$
|
0.42
|
|
|
$
|
0.38
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
Coverage - diluted
|
(3)
|
-0.23x
|
|
|
0.63x
|
|
|
1.36x
|
|
|
0.36x
|
|
|
3.95x
|
|
FFO Coverage -
diluted
|
(3)
|
1.80x
|
|
|
1.76x
|
|
|
1.77x
|
|
|
1.12x
|
|
|
1.74x
|
|
Core FFO Coverage -
diluted
|
(3)
|
2.01x
|
|
|
1.73x
|
|
|
1.72x
|
|
|
1.78x
|
|
|
1.81x
|
|
AFFO Coverage -
diluted
|
(3)
|
2.24x
|
|
|
1.96x
|
|
|
1.94x
|
|
|
2.01x
|
|
|
2.03x
|
|
(1)
|
Represents additional
cleaning, disinfecting, PPE and other costs incurred at the
properties related to COVID-19 that are not reflective of the
continuing operations of the properties.
|
(2)
|
The Company uses actual
diluted weighted average common shares outstanding when in a
dilutive position for FFO, Core FFO and AFFO.
|
(3)
|
Indicates coverage
ratio of Net Income(Loss)/FFO/Core FFO/AFFO per common share
(diluted) over dividends declared per common share during the
period.
|
|
|
Definitions and Reconciliations of Non-GAAP Measures
Definitions
This presentation contains non-GAAP financial measures. A
"non-GAAP financial measure" is defined as a numerical measure of a
company's financial performance that excludes or includes amounts
so as to be different than the most directly comparable measure
calculated and presented in accordance with GAAP in the statements
of income, balance sheets or statements of cash flows of the
Company. The non-GAAP financial measures used within this
presentation are net operating income ("NOI"), funds from
operations attributable to common stockholders ("FFO"), FFO per
diluted share, Core FFO, Core FFO per diluted share, adjusted FFO
("AFFO"), AFFO per diluted share and net debt.
NOI is used by investors and our management to evaluate and
compare the performance of our properties to other comparable
properties, to determine trends in earnings and to compute the fair
value of our properties. NOI is calculated by adjusting net income
(loss) to add back (1) interest expense (2) advisory and
administrative fees, (3) the impact of depreciation and
amortization expenses as well as gains or losses from the sale of
operating real estate assets that are included in net income
computed in accordance with GAAP, (4) corporate general and
administrative expenses, (5) other gains and losses that are
specific to us including loss on extinguishment of debt and
modification costs, including loss on extinguishment of debt and
modification costs, (6) casualty-related expenses/(recoveries) and
casualty gains (losses) and (7) property general and administrative
expenses that are not reflective of the continuing operations of
the properties or are incurred on behalf of the Company at the
property for expenses such as legal, professional, centralized
leasing service and franchise tax fees. We define "Same Store NOI"
as NOI for our properties that are comparable between periods. We
view Same Store NOI as an important measure of the operating
performance of our properties because it allows us to compare
operating results of properties owned for the entirety of the
current and comparable periods and therefore eliminates variations
caused by acquisitions or dispositions during the periods.
FFO is defined by the National Association of Real Estate
Investment Trusts ("NAREIT"), as net income (loss) computed in
accordance with GAAP, excluding gains or losses from real estate
dispositions, plus real estate depreciation and amortization. We
compute FFO in accordance with NAREIT's definition. Our
presentation differs slightly in that we begin with net income
(loss) before adjusting for amounts attributable to redeemable
noncontrolling interests in the OP and we show the combined amounts
attributable to such noncontrolling interests as an adjustment to
arrive at FFO attributable to common stockholders.
Core FFO makes certain adjustments to FFO, which are either not
likely to occur on a regular basis or are otherwise not
representative of the ongoing operating performance of our
Portfolio. Core FFO adjusts FFO to remove items such as losses on
extinguishment of debt and modification costs (includes prepayment
penalties and defeasance costs incurred on the early payment of
debt, the write-off of unamortized deferred financing costs and
fair market value adjustments of assumed debt related to the
retirement of debt, costs incurred in connection with a debt
modification that are not capitalized as deferred financing costs
and other costs incurred in a debt extinguishment that are
expensed), casualty-related expenses/and recoveries and gains
(losses), pandemic expenses, the amortization of deferred financing
costs incurred in connection with obtaining short-term debt
financing, and the noncontrolling interests (as described above)
related to these items.
AFFO makes certain adjustments to Core FFO in order to arrive at
a more refined measure of the operating performance of our
portfolio. There is no industry standard definition of AFFO and
practice is divergent across the industry. AFFO adjusts Core FFO to
remove items such as equity-based compensation expense and the
amortization of deferred financing costs incurred in connection
with obtaining long-term debt financing, and the noncontrolling
interests related to these items.
Net debt is calculated by subtracting cash and cash equivalents
and restricted cash held for value-add upgrades and green
improvements from total debt outstanding.
We believe that the use of NOI, FFO, Core FFO, AFFO and net
debt, combined with the required GAAP presentations, improves the
understanding of operating results and debt levels of real estate
investment trusts ("REITs") among investors and makes comparisons
of operating results and debt levels among such companies more
meaningful. While NOI, FFO, Core FFO, AFFO and net debt are
relevant and widely used measures of operating performance and debt
levels of REITs, they do not represent cash flows from operations,
net income (loss) or total debt as defined by GAAP and should not
be considered an alternative to those measures in evaluating our
liquidity, operating performance and debt levels. NOI, FFO, Core
FFO and AFFO do not purport to be indicative of cash available to
fund our future cash requirements. We present net debt because we
believe it provides our investors a better understanding of our
leverage ratio. Net debt should not be considered an alternative to
total debt, as we may not always be able to use our available cash
to repay debt. Our computation of NOI, FFO, Core FFO, AFFO and net
debt may not be comparable to NOI, FFO, Core FFO, AFFO and net debt
reported by other REITs. For a more complete discussion of NOI,
FFO, Core FFO and AFFO, see our most recent Annual Report on Form
10-K and our other filings with the SEC.
Reconciliations
NOI and Same Store NOI
The following table, which has not been adjusted for the effects
of noncontrolling interests, reconciles NOI and our Same Store NOI
for the years and three months ended December 31, 2022 and 2021 to net
income (loss), the most directly comparable GAAP financial measure
(in thousands):
|
|
For the Year Ended
December 31,
|
|
|
For the Three Months
Ended
December 31,
|
|
|
|
2022
|
|
|
2021
|
|
|
2022
|
|
|
2021
|
|
Net income
(loss)
|
|
$
|
(9,291)
|
|
|
$
|
23,106
|
|
|
$
|
3,802
|
|
|
$
|
38,831
|
|
Adjustments to
reconcile net income (loss) to NOI
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advisory and
administrative fees
|
|
|
7,547
|
|
|
|
7,631
|
|
|
|
1,932
|
|
|
|
1,925
|
|
Corporate general and
administrative expenses
|
|
|
14,670
|
|
|
|
11,966
|
|
|
|
3,554
|
|
|
|
2,896
|
|
Casualty-related
expenses/(recoveries)
|
(1)
|
|
1,119
|
|
|
|
(199)
|
|
|
|
456
|
|
|
|
73
|
|
Casualty
gains
|
|
|
(2,506)
|
|
|
|
(2,595)
|
|
|
|
(2,149)
|
|
|
|
(216)
|
|
Property general and
administrative expenses
|
(2)
|
|
3,600
|
|
|
|
2,655
|
|
|
|
1,191
|
|
|
|
670
|
|
Depreciation and
amortization
|
|
|
97,648
|
|
|
|
86,878
|
|
|
|
23,158
|
|
|
|
24,543
|
|
Interest
expense
|
|
|
50,587
|
|
|
|
44,623
|
|
|
|
15,783
|
|
|
|
11,793
|
|
Loss on extinguishment
of debt and modification costs
|
|
|
8,734
|
|
|
|
912
|
|
|
|
8,734
|
|
|
|
584
|
|
Gain on sales of real
estate
|
|
|
(14,684)
|
|
|
|
(46,214)
|
|
|
|
(14,684)
|
|
|
|
(46,214)
|
|
NOI
|
|
$
|
157,424
|
|
|
$
|
128,763
|
|
|
$
|
41,777
|
|
|
$
|
34,885
|
|
Less Non-Same
Store
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
(48,318)
|
|
|
|
(30,116)
|
|
|
|
(8,939)
|
|
|
|
(5,267)
|
|
Operating
expenses
|
|
|
20,688
|
|
|
|
13,720
|
|
|
|
4,078
|
|
|
|
2,707
|
|
Operating
income
|
|
|
(515)
|
|
|
|
(1,102)
|
|
|
|
(16)
|
|
|
|
(59)
|
|
Same Store
NOI
|
|
$
|
129,279
|
|
|
$
|
111,265
|
|
|
$
|
36,900
|
|
|
$
|
32,266
|
|
(1)
|
Adjustment to net
income (loss) to exclude certain property operating expenses that
are casualty-related expenses.
|
(2)
|
Adjustment to net
income (loss) to exclude certain property general and
administrative expenses that are not reflective of the continuing
operations of the properties or are incurred on our behalf at the
property for expenses such as legal, professional, centralized
leasing service and franchise tax fees.
|
|
|
The following table, which has not been adjusted for the effects
of noncontrolling interests, reconciles our NOI and our 2020-2022
Same Store NOI for the years ended December
31, 2022, 2021 and 2020 to net income (loss), the most
directly comparable GAAP financial measure (in thousands):
|
|
For the Year Ended
December 31,
|
|
|
|
2022
|
|
|
2021
|
|
|
2020
|
|
Net income
(loss)
|
|
$
|
(9,291)
|
|
|
$
|
23,106
|
|
|
$
|
44,150
|
|
Adjustments to
reconcile net income (loss) to NOI:
|
|
|
|
|
|
|
|
|
|
|
|
|
Advisory and
administrative fees
|
|
|
7,547
|
|
|
|
7,631
|
|
|
|
7,670
|
|
Corporate general and
administrative expenses
|
|
|
14,670
|
|
|
|
11,966
|
|
|
|
10,035
|
|
Casualty-related
expenses/(recoveries)
|
(1)
|
|
1,119
|
|
|
|
(199)
|
|
|
|
789
|
|
Casualty
gains
|
|
|
(2,506)
|
|
|
|
(2,595)
|
|
|
|
(5,886)
|
|
Property general and
administrative expenses
|
(2)
|
|
3,600
|
|
|
|
2,655
|
|
|
|
2,400
|
|
Depreciation and
amortization
|
|
|
97,648
|
|
|
|
86,878
|
|
|
|
82,411
|
|
Interest
expense
|
|
|
50,587
|
|
|
|
44,623
|
|
|
|
44,753
|
|
Loss on extinguishment
of debt and modification costs
|
|
|
8,734
|
|
|
|
912
|
|
|
|
1,470
|
|
Gain on sales of real
estate
|
|
|
(14,684)
|
|
|
|
(46,214)
|
|
|
|
(69,151)
|
|
NOI
|
|
$
|
157,424
|
|
|
$
|
128,763
|
|
|
$
|
118,641
|
|
Less Non-Same
Store
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
(55,285)
|
|
|
|
(35,956)
|
|
|
|
(30,872)
|
|
Operating
expenses
|
|
|
22,604
|
|
|
|
15,384
|
|
|
|
15,026
|
|
Operating
income
|
|
|
(515)
|
|
|
|
(1,102)
|
|
|
|
(1,687)
|
|
Same Store
NOI
|
|
$
|
124,228
|
|
|
$
|
107,089
|
|
|
$
|
101,108
|
|
(1)
|
Adjustment to net
income to exclude certain property operating expenses that are
casualty-related expenses/(recoveries).
|
(2)
|
Adjustment to net
income (loss) to exclude certain property general and
administrative expenses that are not reflective of the continuing
operations of the properties or are incurred on our behalf at the
property for expenses such as legal, professional, centralized
leasing service and franchise tax fees.
|
|
|
Reconciliation of Debt to Net Debt
(dollar amounts in
thousands)
|
|
FY
2022
|
|
|
FY
2021
|
|
|
FY
2020
|
|
Total mortgage
debt
|
|
$
|
1,607,028
|
|
|
$
|
1,281,146
|
|
|
$
|
1,168,078
|
|
Credit
facilities
|
|
|
74,500
|
|
|
|
280,000
|
|
|
|
183,000
|
|
Total Debt
|
|
|
1,681,528
|
|
|
|
1,561,146
|
|
|
|
1,351,078
|
|
Adjustments to arrive
at net debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
(16,762)
|
|
|
|
(49,450)
|
|
|
|
(24,457)
|
|
Restricted cash held
for value-add upgrades and green improvements
|
|
|
(11,894)
|
|
|
|
(11,875)
|
|
|
|
(10,614)
|
|
Net Debt
|
|
$
|
1,652,872
|
|
|
$
|
1,499,821
|
|
|
$
|
1,316,007
|
|
Enterprise Value
(1)
|
|
$
|
2,764,872
|
|
|
$
|
3,637,821
|
|
|
$
|
2,374,007
|
|
Leverage
Ratio
|
|
|
60
|
%
|
|
|
41
|
%
|
|
|
55
|
%
|
(1)
|
Enterprise Value is
calculated as Market Capitalization as of December 31, 2022 plus
Net Debt.
|
|
|
Guidance Reconciliations of NOI, Same Store NOI, FFO, Core
FFO and AFFO
The following table, which has not been adjusted for the effects
of noncontrolling interests, reconciles our 2023 NOI guidance to
our net income (loss) (the most directly comparable GAAP financial
measure) guidance for the year ended December 31, 2023 and for the three months ended
March 31, 2023 (in thousands):
|
|
For the Year
Ended
December 31,
2023
|
|
|
For the Three Months
Ended
March 31, 2023
|
|
|
|
|
Mid-Point
(1)
|
|
|
Mid-Point
(1)
|
|
|
Net income
(loss)
|
|
$
|
28,314
|
|
|
$
|
(6,697)
|
|
|
Adjustments to
reconcile net loss to NOI:
|
|
|
|
|
|
|
|
|
|
Advisory and
administrative fees
|
|
|
7,581
|
|
|
|
1,869
|
|
|
Corporate general and
administrative expenses
|
|
|
16,799
|
|
|
|
3,989
|
|
|
Property general and
administrative expenses
|
(2)
|
|
2,933
|
|
|
|
786
|
|
|
Depreciation and
amortization
|
|
|
93,564
|
|
|
|
24,834
|
|
|
Interest
expense
|
|
|
60,922
|
|
|
|
14,678
|
|
|
Loss on extinguishment
of debt and modification costs
|
|
|
3,079
|
|
|
|
2,276
|
|
|
Gain on sales of real
estate
|
|
|
(43,895)
|
|
|
|
—
|
|
|
NOI
|
(3)
|
$
|
169,297
|
|
|
$
|
41,735
|
|
|
Less Non-Same
Store
|
|
|
|
|
|
|
|
|
|
Revenues
|
(4)
|
|
(16,780)
|
|
|
|
|
|
|
Operating
expenses
|
(4)
|
|
6,835
|
|
|
|
|
|
|
Same Store
NOI
|
(4)
|
$
|
159,352
|
|
|
|
|
|
|
(1)
|
Mid-Point estimates
shown for full year and first quarter 2023 guidance. Assumptions
made for full year and first quarter 2023 NOI guidance include the
Same Store operating growth projections included in the "2023 Full
Year Guidance Summary" section of this release and the effect of
the acquisition and dispositions throughout the fiscal
year.
|
(2)
|
Adjustment to net
income (loss) to exclude certain property general and
administrative expenses that are not reflective of the continuing
operations of the properties or are incurred on our behalf at the
property for expenses such as legal, professional, centralized
leasing service and franchise tax fees.
|
(3)
|
FY 2023 NOI Guidance
considers the forecast dispositions of Old Farm and Stone Creek at
Old Farm, and considers a commensurate volume of capital
recycling.
|
(4)
|
Year-over-year growth
for the Full Year 2023 pro forma Same Store pool (36
properties).
|
|
|
The following table reconciles our FFO, Core FFO and AFFO
guidance to our net income (the most directly comparable GAAP
financial measure) guidance for the year ended December 31, 2023 (in thousands, except per share
data):
|
|
For the Year Ended
December 31, 2023
|
|
|
Mid-Point
|
Net income
|
|
$
|
28,314
|
Depreciation and
amortization
|
|
|
93,564
|
Gain on sales of real
estate
|
|
|
(43,895)
|
Adjustment for
noncontrolling interests
|
|
|
(230)
|
FFO attributable to
common stockholders
|
|
|
77,753
|
FFO per share -
diluted (1)
|
|
$
|
2.97
|
|
|
|
|
Loss on extinguishment
of debt and modification costs
|
|
|
3,079
|
Adjustment for
noncontrolling interests
|
|
|
(9)
|
Core FFO
attributable to common stockholders
|
|
|
80,823
|
Core FFO per share -
diluted (1)
|
|
$
|
3.09
|
|
|
|
|
Amortization of
deferred financing costs - long term debt
|
|
|
3,072
|
Equity-based
compensation expense
|
|
|
9,688
|
Adjustment for
noncontrolling interests
|
|
|
(38)
|
AFFO attributable to
common stockholders
|
|
|
93,545
|
AFFO per share -
diluted (1)
|
|
$
|
3.58
|
|
|
|
|
Weighted average
common shares outstanding - diluted
|
|
|
26,146
|
(1)
|
For purposes of
calculating per share data, we assume a weighted average diluted
share count of approximately 26.3 million for the full year
2023.
|
|
|
The following table reconciles our NOI to our net income (loss)
for the years ended December 31,
2019, 2018, 2017, 2016 and 2015 (in thousands):
|
|
For the Year Ended
December 31,
|
|
|
|
2019
|
|
|
2018
|
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
Net income
(loss)
|
|
$
|
99,438
|
|
|
$
|
(1,614)
|
|
|
$
|
56,359
|
|
|
$
|
25,888
|
|
|
$
|
(10,992)
|
|
Adjustments to
reconcile net income (loss) to NOI:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advisory and
administrative fees
|
|
|
7,500
|
|
|
|
7,474
|
|
|
|
7,419
|
|
|
|
6,802
|
|
|
|
5,565
|
|
Corporate
general and administrative expenses
|
|
|
9,613
|
|
|
|
7,808
|
|
|
|
6,275
|
|
|
|
4,014
|
|
|
|
2,455
|
|
Casualty-related expenses/(recoveries)
|
|
|
(34)
|
|
|
|
(663)
|
|
|
|
(287)
|
|
|
|
151
|
|
|
|
25
|
|
Casualty
losses
|
|
|
3,488
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Property
general and administrative expenses
|
|
|
1,939
|
|
|
|
1,294
|
|
|
|
1,130
|
|
|
|
879
|
|
|
|
1,109
|
|
Depreciation
and amortization
|
|
|
69,086
|
|
|
|
47,470
|
|
|
|
48,752
|
|
|
|
35,643
|
|
|
|
40,801
|
|
Interest
expense
|
|
|
37,385
|
|
|
|
28,572
|
|
|
|
29,576
|
|
|
|
20,167
|
|
|
|
17,817
|
|
Loss on
extinguishment of debt and modification costs
|
|
|
2,869
|
|
|
|
3,576
|
|
|
|
5,719
|
|
|
|
1,722
|
|
|
|
652
|
|
Gain on sales
of real estate
|
|
|
(127,684)
|
|
|
|
(13,742)
|
|
|
|
(78,365)
|
|
|
|
(25,932)
|
|
|
|
—
|
|
Acquisition
costs
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
386
|
|
|
|
2,975
|
|
NOI
|
|
$
|
103,600
|
|
|
$
|
80,175
|
|
|
$
|
76,578
|
|
|
$
|
69,720
|
|
|
$
|
60,407
|
|
|
The following table reconciles our FFO, Core FFO and AFFO to our
net income (loss) for the years ended December 31, 2019, 2018, 2017, 2016 and 2015 (in
thousands):
|
|
For the Year Ended
December 31,
|
|
|
|
2019
|
|
|
2018
|
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
Net income
(loss)
|
|
$
|
99,438
|
|
|
$
|
(1,614)
|
|
|
$
|
56,359
|
|
|
$
|
25,888
|
|
|
$
|
(10,992)
|
|
Depreciation and
amortization
|
|
|
69,086
|
|
|
|
47,470
|
|
|
|
48,752
|
|
|
|
35,643
|
|
|
|
40,801
|
|
Gain on sales of real
estate
|
|
|
(127,684)
|
|
|
|
(13,742)
|
|
|
|
(78,365)
|
|
|
|
(25,932)
|
|
|
|
—
|
|
Adjustment for
noncontrolling interests
|
|
|
(122)
|
|
|
|
(96)
|
|
|
|
(1,695)
|
|
|
|
(4,583)
|
|
|
|
(4,170)
|
|
FFO attributable to
common stockholders
|
|
|
40,718
|
|
|
|
32,018
|
|
|
|
25,051
|
|
|
|
31,016
|
|
|
|
25,639
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FFO per share -
basic
|
|
$
|
1.69
|
|
|
$
|
1.51
|
|
|
$
|
1.19
|
|
|
$
|
1.46
|
|
|
$
|
1.20
|
|
FFO per share -
diluted
|
|
$
|
1.66
|
|
|
$
|
1.48
|
|
|
$
|
1.17
|
|
|
$
|
1.46
|
|
|
$
|
1.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition
costs
|
|
|
2,869
|
|
|
|
—
|
|
|
|
—
|
|
|
|
386
|
|
|
|
2,975
|
|
Loss on extinguishment
of debt and modification costs
|
|
|
(34)
|
|
|
|
3,576
|
|
|
|
5,719
|
|
|
|
1,722
|
|
|
|
652
|
|
Casualty-related
recoveries
|
|
|
3,488
|
|
|
|
(663)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Change in fair value on
derivative instruments - ineffective portion
|
|
|
—
|
|
|
|
—
|
|
|
|
(309)
|
|
|
|
(1,683)
|
|
|
|
—
|
|
Amortization of
deferred financing costs - acquisition term notes
|
|
|
553
|
|
|
|
159
|
|
|
|
403
|
|
|
|
—
|
|
|
|
—
|
|
Adjustment for
noncontrolling interests
|
|
|
(21)
|
|
|
|
(9)
|
|
|
|
(429)
|
|
|
|
(94)
|
|
|
|
(322)
|
|
Core FFO
attributable to common stockholders
|
|
|
47,573
|
|
|
|
35,081
|
|
|
|
30,435
|
|
|
|
31,347
|
|
|
|
28,944
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Core FFO per share -
basic
|
|
$
|
1.97
|
|
|
$
|
1.66
|
|
|
$
|
1.45
|
|
|
$
|
1.48
|
|
|
$
|
1.36
|
|
Core FFO per share -
diluted
|
|
$
|
1.93
|
|
|
$
|
1.62
|
|
|
$
|
1.42
|
|
|
$
|
1.47
|
|
|
$
|
1.36
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
deferred financing costs - long term debt
|
|
|
1,530
|
|
|
|
1,491
|
|
|
|
1,592
|
|
|
|
1,423
|
|
|
|
1,081
|
|
Equity-based
compensation expense
|
|
|
5,130
|
|
|
|
4,198
|
|
|
|
3,108
|
|
|
|
825
|
|
|
|
—
|
|
Adjustment for
noncontrolling interests
|
|
|
(20)
|
|
|
|
(17)
|
|
|
|
(76)
|
|
|
|
(140)
|
|
|
|
(92)
|
|
AFFO attributable to
common stockholders
|
|
|
54,213
|
|
|
|
40,753
|
|
|
|
35,059
|
|
|
|
33,455
|
|
|
|
29,933
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AFFO per share -
basic
|
|
$
|
2.25
|
|
|
$
|
1.92
|
|
|
$
|
1.66
|
|
|
$
|
1.58
|
|
|
$
|
1.41
|
|
AFFO per share -
diluted
|
|
$
|
2.20
|
|
|
$
|
1.88
|
|
|
$
|
1.64
|
|
|
$
|
1.57
|
|
|
$
|
1.41
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding - basic
|
|
|
24,116
|
|
|
|
21,189
|
|
|
|
21,057
|
|
|
|
21,232
|
|
|
|
21,294
|
|
Weighted average
common shares outstanding - diluted
|
|
|
24,593
|
|
|
|
21,667
|
|
|
|
21,399
|
|
|
|
21,314
|
|
|
|
21,294
|
|
|
Contact:
Investor Relations
Kristen Thomas
IR@nexpoint.com
(214) 276-6300
Media inquiries: Pro-Nexpoint@prosek.com
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SOURCE NexPoint Residential Trust, Inc.