Sun Communities Inc: Form 10-Q for the period ended Jun 30, 2023
Filed with the SEC on Jul 27, 2023 and accepted by EDGAR at Jul 27, 2023, 16:05 ET.
Management's discussion and analysis
As filed, 76,437 characters, with its headings, lists and tables. Extracted from the main document; charts and exhibits are in the original on sec.gov.
The following discussion and analysis of the consolidated financial condition and results of operations should be read in conjunction with the Consolidated Financial Statements and the accompanying Notes, along with our 2022 Annual Report.
OVERVIEW
We are a fully integrated REIT. As of June 30, 2023, we owned and operated, directly or indirectly, or had an interest in, a portfolio of 671 developed properties located in the U.S., the UK and Canada, including 354 MH communities, 182 RV communities and 135 marinas. We have been in the business of acquiring, operating, developing and expanding MH and RV communities since 1975 and marinas since 2020. We lease individual sites with utilities access for placement of manufactured homes, RVs or boats to our customers. In the U.S., we are also engaged in the marketing, selling and leasing of new and pre-owned homes to current and future residents in our MH communities. In the UK, we also provide holiday home sales and associated site license activities to holiday homeowners in our MH communities. The Rental Program operations within our MH communities support and enhance our occupancy levels, property performance and cash flows.
SIGNIFICANT ACCOUNTING POLICIES
We have identified significant accounting policies that, as a result of the judgments, uncertainties and complexities of the underlying accounting standards and operations involved could result in material changes to our financial condition or results of operations under different conditions or using different assumptions. Details regarding significant accounting policies are described fully in our Annual Report on Form 10-K for the year ended December 31, 2022.
NON-GAAP FINANCIAL MEASURES
In addition to the results reported in accordance with GAAP in our "Results of Operations" below, we have provided information regarding net operating income ("NOI") and funds from operations ("FFO") as supplemental performance measures. We believe NOI and FFO are appropriate measures given their wide use by and relevance to investors and analysts following the real estate industry. NOI provides a measure of rental operations and does not factor in depreciation, amortization and non-property specific expenses such as general and administrative expenses. FFO, reflecting the assumption that real estate values rise or fall with market conditions, principally adjusts for the effects of GAAP depreciation / amortization of real estate assets. In addition, NOI and FFO are commonly used in various ratios, pricing multiples / yields and returns and valuation calculations used to measure financial position, performance and value.
NOI
Total Portfolio NOI - NOI is derived from property operating revenues minus property operating expenses and real estate taxes. NOI is a non-GAAP financial measure that we believe is helpful to investors as a supplemental measure of operating performance because it is an indicator of the return on property investment and provides a method of comparing property performance over time. We use NOI as a key measure when evaluating performance and growth of particular properties and / or groups of properties. The principal limitation of NOI is that it excludes depreciation, amortization, interest expense and non-property specific expenses such as general and administrative expenses, all of which are significant costs. Therefore, NOI is a measure of the operating performance of our properties rather than of the Company overall. We believe that NOI provides enhanced comparability for investor evaluation of properties' performance and growth over time.
We believe that GAAP net income (loss) is the most directly comparable measure to NOI. NOI should not be considered to be an alternative to GAAP net income (loss) as an indication of our financial performance or GAAP cash flow from operating activities as a measure of our liquidity; nor is it indicative of funds available for our cash needs, including our ability to make cash distributions. Because of the inclusion of items such as interest, depreciation and amortization, the use of GAAP net income (loss) as a performance measure is limited as these items may not accurately reflect the actual change in market value of a property, in the case of depreciation and in the case of interest, may not necessarily be linked to the operating performance of a real estate asset, as it is often incurred at a parent company level and not at a property level.
Same Property NOI - This is a management tool used when evaluating performance and growth of our Same Property portfolio. We define same properties as those we have owned and operated continuously since January 1, 2022. Same properties exclude ground-up development properties, acquired properties and properties sold after December 31, 2021. The Same Property data may change from time-to-time depending on acquisitions, dispositions, management discretion, significant transactions or unique situations. Same Property NOI does not include the revenues and expenses related to home sales, and service, retail, dining and entertainment activities at the properties. We believe that Same Property NOI is helpful to investors as a supplemental comparative performance measure of the income generated from the Same Property portfolio from one period to the next.
FFO
FFO is defined by the National Association of Real Estate Investment Trusts ("NAREIT") as GAAP net income (loss), excluding gains (or losses) from sales of depreciable operating property, plus real estate related depreciation and amortization, real estate related impairments, and after adjustments for unconsolidated partnerships and joint ventures. FFO is a non-GAAP financial measure that management believes is a useful supplemental measure of our operating performance. By excluding gains and losses related to sales of previously depreciated operating real estate assets, real estate related to impairment and real estate asset depreciation and amortization (which can vary among owners of identical assets in similar condition based on historical cost accounting and useful life estimates), FFO provides a performance measure that, when compared period-over-period, reflects the impact to operations from trends in occupancy rates, rental rates, and operating costs, providing perspective not readily apparent from GAAP net income (loss). Management believes the use of FFO has been beneficial in improving the understanding of operating results of REITs among the investing public and making comparisons of REIT operating results more meaningful.
Core FFO - In addition, we use FFO excluding certain gain and loss items that management considers unrelated to the operational and financial performance of our core business ("Core FFO").
We believe that FFO and Core FFO provide enhanced comparability for investor evaluations of period-over-period results. We believe that GAAP net income (loss) is the most directly comparable measure to FFO. The principal limitation of FFO is that it does not replace GAAP net income (loss) as a financial performance measure or GAAP cash flow from operating activities as a measure of our liquidity. Because FFO excludes significant economic components of GAAP net income (loss) including depreciation and amortization, FFO should be used as a supplement to GAAP net income (loss) and not as an alternative to it. Furthermore, FFO is not intended as a measure of a REIT's ability to meet debt principal repayments and other cash requirements, nor as a measure of working capital. FFO is calculated in accordance with our interpretation of standards established by NAREIT, which may not be comparable to FFO reported by other REITs that interpret the NAREIT definition differently.
Catastrophic Event-Related Charges - Hurricane Ian
In September 2022, Hurricane Ian made landfall on Florida's western coast. The storm primarily affected three properties in the Fort Myers area, comprising approximately 2,500 sites. These properties sustained significant flooding and wind damage from the hurricane. At other affected MH and RV properties, most of the damage was limited to trees, roofs, fences, skirting and carports. At affected marina properties, docks, buildings, and landscaping sustained wind and water damage.
We maintain property, casualty, flood and business interruption insurance for our community portfolio, subject to customary deductibles and limits. As of June 30, 2023, estimated insurance recoveries of $58.3 million related to Hurricane Ian were recorded in Notes and other receivables, net on the Consolidated Balance Sheets. During the six months ended June 30, 2023, we received insurance recoveries of $26.6 million.
The foregoing estimates are based on current information available, and we continue to assess these estimates. Actual charges and insurance recoveries could vary significantly from these estimates. Any changes to these estimates will be recognized in the period(s) in which they are determined.
Changes in estimated insurance recoveries related to Hurricane Ian during the six months ended June 30, 2023 were primarily the result of $34.8 million incremental costs that exceeded the applicable deductible, net of a $4.8 million reduction due to decrease in estimated property loss.
Expected insurance recoveries for lost earnings and redevelopment costs greater than asset impairment charges for the three Fort Myers, Florida properties were not included in our Consolidated Statements of Operations for the three and six months ended June 30, 2023. We are actively working with our insurer on the related claims. The three Fort Myers, Florida RV communities will require redevelopment, followed by a tenant lease-up period. As such, we currently cannot estimate a date when operating results will be restored to pre-hurricane levels. Our business interruption insurance policy provides for up to 60 months of coverage from the date of restoration.
RESULTS OF OPERATIONS
The following tables reconcile the Net income attributable to SUI common shareholders to NOI and summarize our consolidated financial results for the three and six months ended June 30, 2023 and 2022 (in millions):
| Three Months Ended June 30, 2023 | June 30, 2022 | Six Months Ended June 30, 2023 | June 30, 2022 | |
|---|---|---|---|---|
| Net Income Attributable to SUI Common Shareholders | $89.8 | $74.0 | $59.7 | $74.7 |
| Interest income | (14.0) | (7.3) | (25.4) | (14.1) |
| Brokerage commissions and other revenues, net | (9.8) | (8.6) | (19.3) | (16.6) |
| General and administrative | 62.3 | 62.2 | 126.2 | 117.9 |
| Catastrophic event-related charges, net | (0.1) | 0.1 | 0.9 | 0.1 |
| Business combination expense | 0.2 | 15.0 | 3.0 | 15.5 |
| Depreciation and amortization | 164.1 | 150.1 | 319.7 | 298.0 |
| Asset impairments | 6.5 | 0.1 | 8.9 | 0.7 |
| Loss on extinguishment of debt (see Note 8) | — | 0.1 | — | 0.4 |
| Interest expense | 79.2 | 55.3 | 155.8 | 100.5 |
| Interest on mandatorily redeemable preferred OP units / equity | 0.9 | 1.1 | 1.9 | 2.1 |
| (Gain) / loss on remeasurement of marketable securities (see Note 15) | (5.8) | 32.3 | 14.1 | 66.8 |
| Gain on foreign currency exchanges | (2.7) | (9.0) | — | (6.8) |
| (Gain) / loss on disposition of properties | 0.6 | 0.1 | 2.2 | (13.3) |
| Other (income) / expense, net | 0.8 | (0.4) | 1.8 | 0.2 |
| (Gain) / loss on remeasurement of notes receivable (see Note 4) | 0.1 | — | 1.8 | (0.2) |
| (Income) / loss from nonconsolidated affiliates (see Note 6) | 0.7 | (0.9) | 0.9 | (1.8) |
| (Gain) / loss on remeasurement of investment in nonconsolidated affiliates (see Note 6) | — | (0.4) | 4.5 | (0.5) |
| Current tax expense (see Note 12) | 5.4 | 3.9 | 9.3 | 5.2 |
| Deferred tax benefit (see Note 12) | (7.7) | (0.3) | (12.3) | (0.3) |
| Preferred return to preferred OP units / equity interests | 3.3 | 3.1 | 5.7 | 6.1 |
| Add: Income / (loss) attributable to noncontrolling interests | 4.4 | 4.2 | (0.8) | 2.0 |
| NOI | $378.2 | $374.7 | $658.6 | $636.6 |
| Three Months Ended June 30, 2023 | June 30, 2022 | Six Months Ended June 30, 2023 | June 30, 2022 | |
|---|---|---|---|---|
| Real property NOI | $317.6 | $300.0 | $572.3 | $537.6 |
| Home sales NOI | 41.4 | 49.8 | 64.5 | 68.6 |
| Service, retail, dining and entertainment NOI | 19.2 | 24.9 | 21.8 | 30.4 |
| NOI | $378.2 | $374.7 | $658.6 | $636.6 |
44
Seasonality of Revenue
The RV and marina industries are seasonal in nature, and the results of operations in any one period may not be indicative of results in future periods.
In the RV business, certain properties maintain higher occupancy during the summer months, while other properties maintain higher occupancy during the winter months. Based on the location of our properties with transient RV sites, our portfolio generally produces higher revenues between April and September than between October and March. As of June 30, 2023, we recognized Real property - transient revenue of $39.8 million in the first quarter and $89.4 million in the second quarter. Real property-transient revenue for the year ended December 31, 2022 was recognized as follows:
| Year | Real property - transient revenue (in millions) March 31 | For the Three Months Ended June 30 | September 30 | December 31 | Total | |
|---|---|---|---|---|---|---|
| 2022 | $334.5 | 12.7% | 27.8% | 45.8% | 13.7% | 100.0% |
In the marina business, the majority of our wet slip and dry storage space leases have annual terms that are billed seasonally. Wet slip storage increases during the summer months for the boating season, whereas dry storage increases during the winter season as weather patterns require boat owners to store their vessels on dry docks or within covered racks. As of June 30, 2023, we recognized seasonal real property revenue of $72.5 million in the first quarter and $90.3 million in the second quarter. Seasonal real property revenue for the year ended December 31, 2022 was recognized as follows:
| Year | Seasonal real property revenue (in millions) March 31 | For the Three Months Ended June 30 | September 30 | December 31 | Total | |
|---|---|---|---|---|---|---|
| 2022 | $310.2 | 20.1% | 25.6% | 29.0% | 25.3% | 100.0% |
45
Real Property Operations - Total Portfolio
The following tables reflect certain financial and other information for our real estate operations by segment as of and for the three and six months ended June 30, 2023 and 2022 (in millions, except for statistical information).
| Financial Information Revenues | Three Months Ended June 30, 2023 MH North America UK Total RV Marinas Total | Three Months Ended June 30, 2022 MH North America UK(a) Total RV Marinas Total |
|---|---|---|
| Real property (excluding transient) | $224.0 $28.4 $252.4 $72.7 $105.2 $430.3 | $209.0 $20.0 $229.0 $69.1 $91.9 $390.0 |
| Real property - transient | 0.3 13.4 13.7 75.5 6.7 95.9 | 0.4 12.9 13.3 79.8 5.0 98.1 |
| Total operating revenues | 224.3 41.8 266.1 148.2 111.9 526.2 | 209.4 32.9 242.3 148.9 96.9 488.1 |
| Expenses | ||
| Property operating expenses | 73.0 24.4 97.4 71.7 39.5 208.6 | 66.6 17.5 84.1 70.1 33.9 188.1 |
| Real Property NOI | $151.3 $17.4 $168.7 $76.5 $72.4 $317.6 | $142.8 $15.4 $158.2 $78.8 $63.0 $300.0 |
| Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | |
| MH | MH | |
| Financial Information | North America UK Total RV Marinas Total | North America UK(a) Total RV Marinas Total |
| Revenues | ||
| Real property (excluding transient) | $447.4 $55.9 $503.3 $134.5 $190.5 $828.3 | $417.3 $20.0 $437.3 $129.8 $165.7 $732.8 |
| Real property - transient | 0.8 14.8 15.6 113.3 10.4 139.3 | 0.9 12.9 13.8 121.8 7.5 143.1 |
| Total operating revenues | 448.2 70.7 518.9 247.8 200.9 967.6 | 418.2 32.9 451.1 251.6 173.2 875.9 |
| Expenses | ||
| Property operating expenses | 146.4 46.9 193.3 125.5 76.5 395.3 | 131.9 17.5 149.4 122.7 66.2 338.3 |
| Real Property NOI | $301.8 $23.8 $325.6 $122.3 $124.4 $572.3 | $286.3 $15.4 $301.7 $128.9 $107.0 $537.6 |
| As of June 30, 2023 | As of June 30, 2022 | |
| MH | MH | |
| Other information | North America UK Total RV Marinas Total | North America UK(a) Total RV Marinas Total |
| Number of properties | 299 55 354 182 135 671 | 296 53 349 182 130 661 |
| Sites, wet slips and dry storage spaces | ||
| Sites, wet slips and dry storage spaces(b) | 100,220 17,950 118,170 31,620 48,180 197,970 | 99,180 17,240 116,420 31,770 45,910 194,100 |
| Transient sites | N/M 3,350 3,350 26,920 N/A 30,270 | N/M 3,310 3,310 28,680 N/A 31,990 |
| Total | 100,220 21,300 121,520 58,540 48,180 228,240 | 99,180 20,550 119,730 60,450 45,910 226,090 |
| MH and Annual RV Occupancy | 96.2% 90.1% 95.3% 100.0% N/A 96.3% | 96.3% 91.4% 95.6% 100.0% N/A 96.6% |
N/M = Not meaningful. N/A = Not applicable.
(a) UK amounts for the three and six months ended June 30, 2022 cover April 8, 2022 (date of acquisition) to June 30, 2022.
(b) MH annual sites included 9,721 and 9,204 rental homes in the Company's Rental Program during the three months ended June 30, 2023 and 2022, respectively. Our investment in occupied rental homes at June 30, 2023 was $630.0 million, an increase of 17.8% from $535.0 million at June 30, 2022.
For the three months ended June 30, 2023, the $17.6 million, or 5.9% increase in Real Property NOI as compared to the same period in 2022, consists of $8.2 million from Same Property MH, $2.4 million from Same Property RV, $6.6 million from Same Property Marina, and $0.4 million, net from the UK operations and other recently acquired or developed properties.
For the six months ended June 30, 2023, the $34.7 million, or 6.5% increase in Real Property NOI as compared to the same period in 2022, consists of $15.4 million from Same Property MH, $4.3 million from Same Property RV, $12.8 million from Same Property Marina, and $2.2 million, net from the UK operations and other recently acquired or developed properties.
Real Property Operations - Same Property Portfolio
Same Property refers to properties that we have owned for at least the preceding year, exclusive of properties recently completed or under construction, and other properties as determined by management. The Same Property data may change from time-to-time depending on acquisitions, dispositions, management discretion, significant transactions or unique situations. In order to evaluate the growth of the Same Property portfolio, management has classified certain items differently than our GAAP statement. The reclassification difference between our GAAP statements and our Same Property portfolio is the reclassification of utility revenues from real property revenue to operating expenses. Additionally, prior period Canadian currency figures have been translated at 2022 average exchange rates for constant currency comparability.
The following tables reflect certain financial and other information for our Same Property MH, RV and Marina portfolios as of and for the three and six months ended June 30, 2023 and 2022 (in millions, except for statistical information):
| Financial information Same Property Revenues | Three Months Ended June 30, 2023 MH(a) | RV(a) | Marina | Total | June 30, 2022 MH(a) | RV(a) | Marina | Total | Total Change MH | % Change(c) RV | Marina | Total(d) | |||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Real property (excluding transient) | $206.7 | $67.0 | $84.2 | $357.9 | $193.8 | $57.5 | $78.0 | $329.3 | $28.6 | 6.7% | 16.2% | 8.1% | 8.7% | ||
| Real property - transient | 0.3 | 69.9 | 6.1 | 76.3 | 0.2 | 74.5 | 4.8 | 79.5 | (3.2) | 46.2% | (6.1)% | 27.1% | (4.0)% | ||
| Total Same Property operating revenues | 207.0 | 136.9 | 90.3 | 434.2 | 194.0 | 132.0 | 82.8 | 408.8 | 25.4 | 6.7% | 3.6% | 9.2% | 6.2% | ||
| Same Property Expenses | |||||||||||||||
| Same Property operating expenses(b)(d) | 56.1 | 62.1 | 27.4 | 145.6 | 51.3 | 59.6 | 26.5 | 137.4 | 8.2 | 9.4% | 4.1% | 3.4% | 6.0% | ||
| Real Property NOI(d) | $150.9 | $74.8 | $62.9 | $288.6 | $142.7 | $72.4 | $56.3 | $271.4 | $17.2 | 5.7% | 3.2% | 11.9% | 6.3% | ||
| Other information | 54,243 | 35,055 | |||||||||||||
| Number of properties | 289 | 161 | 119 | 569 | 289 | 161 | 119 | 569 | |||||||
| Sites, wet slips and dry storage spaces | 98,700 | 54,610 | 41,050 | 194,360 | 97,750 | 54,310 | 40,650 | 192,710 |
| Financial information Same Property Revenues | Six Months Ended June 30, 2023 MH(a) | RV(a) | Marina | Total | June 30, 2022 MH(a) | RV(a) | Marina | Total | Total Change MH | % Change(c) RV | Marina | Total(d) | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Real property (excluding transient) | $410.6 | $124.3 | $153.6 | $688.5 | $385.2 | $107.3 | $141.2 | $633.7 | $54.8 | 6.6% | 15.9% | 8.7% | 8.6% | |||
| Real property - transient | 0.6 | 106.0 | 9.6 | 116.2 | 0.7 | 112.7 | 7.2 | 120.6 | (4.4) | (9.5)% | (6.0)% | 33.7% | (3.7)% | |||
| Total Same Property operating revenues | 411.2 | 230.3 | 163.2 | 804.7 | 385.9 | 220.0 | 220.0 | 148.4 | 754.3 | 50.4 | 6.5% | 4.7% | 9.9% | 6.7% | ||
| Same Property Expenses | ||||||||||||||||
| Same Property operating expenses(b)(d) | 110.0 | 109.1 | 54.4 | 273.5 | 100.1 | 103.1 | 52.4 | 255.6 | 17.9 | 9.9% | 5.8% | 3.8% | 7.0% | |||
| Real Property NOI(d) | $301.2 | $121.2 | $108.8 | $531.2 | $285.8 | $116.9 | $96.0 | $498.7 | $32.5 | 5.4% | 3.7% | 13.2% | 6.5% | |||
| Other information | 54,243 | 35,055 | ||||||||||||||
| Number of properties | 289 | 161 | 119 | 569 | 289 | 161 | 119 | 569 | ||||||||
| Sites, wet slips and dry storage spaces | 98,700 | 54,610 | 41,050 | 194,360 | 97,750 | 54,310 | 40,650 | 192,710 |
48
Real Property Operations - Same Property Portfolio (Continued)
(a) Same property results for our MH and RV properties reflect constant currency for comparative purposes. Canadian currency figures in the prior comparative period have been translated at the average exchange rate during the three and six months ended June 30, 2023 of $0.7445 and $0.7420 USD per Canadian dollar, respectively.
(b) We net certain utilities revenues (which include utility reimbursement revenues from residents) against related utility expenses in property operating expenses as follows (in millions):
| Three Months Ended June 30, 2023 MH | RV | Marina | Total | Three Months Ended June 30, 2022 MH | RV | Marina | Total | |
|---|---|---|---|---|---|---|---|---|
| Utility revenue netted against related utility expense | $15.7 | $4.8 | $5.9 | $26.4 | $15.0 | $4.6 | $4.7 | $24.3 |
| Six Months Ended June 30, 2023 MH | RV | Marina | Total | Six Months Ended June 30, 2022 MH | RV | Marina | Total | |
|---|---|---|---|---|---|---|---|---|
| Utility revenue netted against related utility expense | $33.9 | $9.0 | $10.9 | $53.8 | $31.1 | $8.5 | $8.9 | $48.5 |
(c) Percentages are calculated based on unrounded numbers.
(d) Total Same Property operating expenses consist of the following components for the periods shown (in millions), and exclude amounts invested into recently acquired properties to bring them up to the Company's standards.
| Three Months Ended June 30, 2023 | June 30, 2022 | Change | % Change | Six Months Ended June 30, 2023 | June 30, 2022 | Change | % Change | |
|---|---|---|---|---|---|---|---|---|
| Payroll and benefits | $49.0 | $48.2 | $0.8 | 1.7% | $91.4 | $87.9 | $3.5 | 4.0% |
| Real estate taxes | 27.2 | 26.6 | 0.6 | 2.1% | 54.9 | 51.9 | 3.0 | 5.8% |
| Supplies and repairs | 20.9 | 19.5 | 1.4 | 7.2% | 35.1 | 34.0 | 1.1 | 3.1% |
| Utilities | 16.1 | 15.5 | 0.6 | 3.5% | 30.5 | 30.5 | — | 0.1% |
| Legal, state / local taxes, and insurance | 13.8 | 9.3 | 4.5 | 49.2% | 28.0 | 18.9 | 9.1 | 48.6% |
| Other | 18.6 | 18.3 | 0.3 | 1.8% | 33.6 | 32.4 | 1.2 | 3.6% |
| Total Same Property Operating Expenses | $145.6 | $137.4 | $8.2 | 6.0% | $273.5 | $255.6 | $17.9 | 7.0% |
49
Same Property Summary (in whole units)
| Other information | As of June 30, 2023 MH | RV | June 30, 2022 MH | RV |
|---|---|---|---|---|
| Number of properties | 289 | 161 | 289 | 161 |
| Sites | ||||
| MH and Annual RV sites | 98,700 | 31,340 | 97,750 | 29,240 |
| Transient RV sites | N/M | 23,270 | N/M | 25,070 |
| Total | 98,700 | 54,610 | 97,750 | 54,310 |
| MH and Annual RV Occupancy | ||||
| Occupancy(a) | 96.9% | 100.0% | 96.9% | 100.0% |
| Monthly base rent per site | $654 | $577 | $618 | $531 |
| % change in monthly base rent(b) | 5.7% | 8.6% | N/A | N/A |
| Rental Program Statistics included in MH: | ||||
| Number of occupied sites, end of period(c) | 9,640 | N/A | 9,200 | N/A |
| Monthly rent per site - MH Rental Program | $1,261 | N/A | $1,162 | N/A |
| % change(c) | 8.5% | N/A | N/A | N/A |
N/M = Not meaningful. N/A = Not applicable.
(a) Same Property adjusted blended occupancy for MH and RV combined increased to 98.7% at June 30, 2023, from 97.0% at June 30, 2022. The 170 basis point increase was driven by MH expansion fills and the conversion of transient RV sites to annual sites.
(b) Calculated using actual results without rounding.
(c) Occupied rental program sites in Same Property are included in total sites.
For the three months ended June 30, 2023 and 2022:
- The MH segment increase in NOI of $8.2 million, or 5.7%, when compared to the same period in 2022 is primarily due to an increase in Real property (excluding transient) revenue of $12.9 million, or 6.7%, partially offset by an increase in property operating expenses. Real property (excluding transient) revenue increased primarily due to a 5.7% increase in monthly base rent.
- The RV segment increase in NOI of $2.4 million, or 3.2%, when compared to the same period in 2022 is primarily due to an increase in Real property (excluding transient) revenue of $9.5 million, or 16.2%, partially offset by a decrease in Real property-transient revenue of $4.6 million, or 6.1%, and an increase in property operating expenses of $2.5 million, or 4.1%. The increase in Real property - (excluding transient) revenue was primarily due to an 8.6% increase in monthly base rent and conversions of transient RV sites to annual RV sites.
- The Marina segment increase in NOI of $6.6 million, or 11.9%, when compared to the same period in 2022 is primarily due to the $6.2 million, or 8.1%, increase in Real property (excluding transient) revenue.
For the six months ended June 30, 2023 and 2022:
- The MH segment increase in NOI of $15.4 million, or 5.4%, when compared to the same period in 2022 is primarily due to an increase in Real property (excluding transient) revenue of $25.4 million, or 6.6%, partially offset by an increase in property operating expenses. Real property (excluding transient) revenue increased primarily due to a 5.7% increase in monthly base rent.
- The RV segment increase in NOI of $4.3 million, or 3.7%, when compared to the same period in 2022 is primarily due to an increase in Real property (excluding transient) revenue of $17.0 million, or 15.9%, partially offset by a decrease in Real property-transient revenue of $6.7 million, or 6.0%; an increase in property operating expenses by $6.0 million, or 5.8%. The increase in Real property - (excluding transient) revenue was primarily due to an 8.6% increase in monthly base rent and conversions of transient RV sites to annual RV sites.
- The Marina segment increase in NOI of $12.8 million, or 13.2% when compared to the same period in 2022 is primarily due to a $12.4 million, or 8.7% increase in Real property (excluding transient) revenue.
Home Sales Summary
We sell new and pre-owned homes to current and prospective residents and customers in our communities. This inventory is purchased from manufacturers, lenders, dealers, former residents or customers.
The following table reflects certain financial and statistical information for our Home Sales Program for the three and six months ended June 30, 2023 and 2022 (in millions, except for average selling price and statistical information):
| North America | Three Months Ended June 30, 2023 | June 30, 2022 | Change | % Change | Six Months Ended June 30, 2023 | June 30, 2022 | Change | % Change |
|---|---|---|---|---|---|---|---|---|
| Home sales | $62.3 | $82.1 | $(19.8) | (24.1)% | $109.5 | $146.8 | $(37.3) | (25.4)% |
| Home cost and selling expenses | 45.6 | 58.5 | (12.9) | (22.1)% | 82.2 | 104.4 | (22.2) | (21.3)% |
| NOI | $16.7 | $23.6 | $(6.9) | (29.2)% | $27.3 | $42.4 | $(15.1) | (35.6)% |
| NOI margin % | 26.8% | 28.7% | (1.9)% | 24.9% | 28.9% | (4.0)% | ||
| UK(a) | ||||||||
| Home sales | $60.3 | $60.6 | $(0.3) | (0.5)% | $99.4 | $60.6 | $38.8 | 64.0% |
| Home cost and selling expenses | 35.6 | 34.4 | 1.2 | 3.5% | 62.2 | 34.4 | 27.8 | 80.8% |
| NOI | $24.7 | $26.2 | $(1.5) | (5.7)% | $37.2 | $26.2 | $11.0 | 42.0% |
| NOI margin % | 41.0% | 43.2% | (2.2)% | 37.4% | 43.2% | (5.8)% | ||
| Total | ||||||||
| Home sales | $122.6 | $142.7 | $(20.1) | (14.1)% | $208.9 | $207.4 | $1.5 | 0.7% |
| Home cost and selling expenses | 81.2 | 92.9 | (11.7) | (12.6)% | 144.4 | 138.8 | 5.6 | 4.0% |
| NOI | $41.4 | $49.8 | $(8.4) | (16.9)% | $64.5 | $68.6 | $(4.1) | (6.0)% |
| NOI margin % | 33.8% | 34.9% | (1.1)% | 30.9% | 33.1% | (2.2)% | ||
| Units Sold:* | ||||||||
| North America | 684 | 977 | (293) | (30.0)% | 1,273 | 1,814 | (541) | (29.8)% |
| UK(a) | 837 | 753 | 84 | 11.2% | 1,426 | 753 | 673 | 89.4% |
| Total home sales | 1,521 | 1,730 | (209) | (12.1)% | 2,699 | 2,567 | 132 | 5.1% |
| Average Selling Price:* | ||||||||
| North America | $91,082 | $84,033 | $7,049 | 8.4% | $86,017 | $80,926 | $5,091 | 6.3% |
| UK(a) | $72,043 | $80,478 | $(8,435) | (10.5)% | $69,705 | $80,478 | $(10,773) | (13.4)% |
(a) UK amounts for the three and six months ended June 30, 2022 cover the period from April 8, 2022 (date of acquisition) through June 30, 2022.
NOI - North America
For the three months ended June 30, 2023, the 29.2% decrease in NOI is primarily driven by a 30.0% decrease in total home sales volume as compared to the same period in 2022.
For the six months ended June 30, 2023, the 35.6% decrease in NOI is primarily driven by a 29.8% decrease in total home sales volume and a 5.1% decrease in pre-owned home sales gross margin as compared to the same period in 2022.
NOI - UK
For the three months ended June 30, 2023, the 5.7% decrease in NOI is primarily driven by a 10.5% decrease in average selling price, partially offset by an increase in home sales volume, as compared to the same period in 2022.
For the six months ended June 30, 2023, the 42.0% increase in NOI is primarily driven by a full period of activity related to our properties in the UK during the current period as compared to a shorter period of activity from April 8, 2022 through June 30, 2022 due to the acquisition of Park Holidays on April 8, 2022.
Other Items - Statements of Operations(1)
The following table summarizes other income and expenses for the three and six months ended June 30, 2023 and 2022 (in millions):
| Three Months Ended June 30, 2023 | June 30, 2022 | Change | % Change | Six Months Ended June 30, 2023 | June 30, 2022 | Change | % Change | |
|---|---|---|---|---|---|---|---|---|
| Service, retail, dining and entertainment, net | $19.2 | $24.9 | $(5.7) | (22.9)% | $21.8 | $30.4 | $(8.6) | (28.3)% |
| Interest income | $14.0 | $7.3 | $6.7 | 91.8% | $25.4 | $14.1 | $11.3 | 80.1% |
| Brokerage commissions and other, net | $9.8 | $8.6 | $1.2 | 14.0% | $19.3 | $16.6 | $2.7 | 16.3% |
| General and administrative expense | $62.3 | $62.2 | $0.1 | 0.2% | $126.2 | $117.9 | $8.3 | 7.0% |
| Catastrophic event-related charges, net | $(0.1) | $0.1 | $(0.2) | N/M | $0.9 | $0.1 | $0.8 | N/M |
| Business combinations | $0.2 | $15.0 | $(14.8) | (98.7)% | $3.0 | $15.5 | $(12.5) | (80.6)% |
| Depreciation and amortization | $164.1 | $150.1 | $14.0 | 9.3% | $319.7 | $298.0 | $21.7 | 7.3% |
| Asset impairments | $6.5 | $0.1 | $6.4 | N/M | $8.9 | $0.7 | $8.2 | N/M |
| Loss on extinguishment of debt (see Note 8) | $— | $0.1 | $(0.1) | (100.0)% | $— | $0.4 | $(0.4) | (100.0)% |
| Interest expense | $79.2 | $55.3 | $23.9 | 43.2% | $155.8 | $100.5 | $55.3 | 55.0% |
| Interest on mandatorily redeemable preferred OP units / equity | $0.9 | $1.1 | $(0.2) | (18.2)% | $1.9 | $2.1 | $(0.2) | (9.5)% |
| Gain / (loss) on remeasurement of marketable securities (see Note 15) | $5.8 | $(32.3) | $38.1 | N/M | $(14.1) | $(66.8) | $52.7 | (78.9)% |
| Gain on foreign currency exchanges | $2.7 | $9.0 | $(6.3) | (70.0)% | $— | $6.8 | $(6.8) | (100.0)% |
| Gain / (loss) on dispositions of properties | $(0.6) | $(0.1) | $(0.5) | N/M | $(2.2) | $13.3 | $(15.5) | N/M |
| Other income / (expense), net | $(0.8) | $0.4 | $(1.2) | N/M | $(1.8) | $(0.2) | $(1.6) | N/M |
| Gain / (loss) on remeasurement of notes receivable (see Note 4) | $(0.1) | $— | $(0.1) | N/A | $(1.8) | $0.2 | $(2.0) | N/M |
| Income / (loss) from nonconsolidated affiliates (see Note 6) | $(0.7) | $0.9 | $(1.6) | N/M | $(0.9) | $1.8 | $(2.7) | N/M |
| Gain / (loss) on remeasurement of investment in nonconsolidated affiliates (see Note 6) | $— | $0.4 | $(0.4) | (100.0)% | $(4.5) | $0.5 | $(5.0) | N/M |
| Current tax expense (see Note 12) | $(5.4) | $(3.9) | $(1.5) | 38.5% | $(9.3) | $(5.2) | $(4.1) | 78.8% |
| Deferred tax benefit (see Note 12) | $7.7 | $0.3 | $7.4 | N/M | $12.3 | $0.3 | $12.0 | N/M |
| Preferred return to preferred OP units / equity interests | $3.3 | $3.1 | $0.2 | 6.5% | $5.7 | $6.1 | $(0.4) | (6.6)% |
| Income / (loss) attributable to noncontrolling interests | $4.4 | $4.2 | $0.2 | 4.8% | $(0.8) | $2.0 | $(2.8) | N/M |
(1) Only items determined by management to be material, of interest, or unique to the periods disclosed above are explained below.
N/M = Percentage change is not meaningful.
N/A = Percentage change is not applicable.
Service, retail, dining and entertainment, net - for the three and six months ended June 30, 2023, decreased due to increased costs related to retail, dining and entertainment activities at our UK operations and increased costs of providing services at our Marina properties.
Interest income - for the three and six months ended June 30, 2023, increased primarily due to a higher interest rate charged and a larger loan balance provided to a real estate operator to fund investing and financing activities in the current period as compared to the same period in 2022.
Business combinations - for the three and six months ended June 30, 2023, decreased primarily as a result of the decrease in acquisition activity during 2023 as compared to the same period in 2022. Refer to Note 3, "Real Estate Acquisitions and Dispositions," in our accompanying Consolidated Financial Statements for additional information.
Asset impairments - for the three and six months ended June 30, 2023, were primarily due to impairment of a held for sale property with a selling price below carrying value. Refer to Note 3, "Real Estate Acquisitions and Dispositions," in our accompanying Consolidated Financial Statements for additional information.
Interest expense - for the three and six months ended June 30, 2023, increased due to the higher debt balance and increased interest rates as compared to the same period in 2022. Refer to Note 8, "Debt and Line of Credit," of our accompanying Consolidated Financial Statements for additional information.
Gain / (loss) on remeasurement of marketable securities - for the three and six months ended June 30, 2023 was a gain of $5.8 million and loss of $14.1 million, as compared to a loss of $32.3 million and $66.8 million during the same periods in 2022 due to the fluctuation in the price of our publicly traded marketable securities. Refer to Note 15, "Fair Value of Financial Instruments," in our accompanying Consolidated Financial Statements for additional information.
Gain on foreign currency exchanges - for the three months ended June 30, 2023, was a gain of $2.7 million, primarily due to the fluctuation of exchange rates on our foreign currencies. For the three and six months ended June 30, 2023 and 2022, was a gain of $9.0 million and $6.8 million, respectively, primarily due to the U.S. dollar strengthening against the Pound sterling.
Gain / (loss) on dispositions of properties - for the six months ended June 30, 2023, decreased due to the loss on sale of two properties as compared to a gain on the sale of three properties during the same period in 2022. Refer to Note 3, "Real Estate Acquisitions and Dispositions," in our accompanying Consolidated Financial Statements for additional information.
Gain / (loss) on remeasurement of investment in nonconsolidated affiliates - for the six months ended June 30, 2023, was a loss of $4.5 million as compared to a gain of $0.5 million during the same period in 2022 due to the fluctuation of the fair value of our nonconsolidated affiliates. Refer to Note 6, "Investments in Nonconsolidated Affiliates," and Note 15, "Fair Value of Financial Instruments," in our accompanying Consolidated Financial Statements for additional information.
Current tax expense - for the six months ended June 30, 2023, increased primarily due to income tax expense on a full period of activity related to our properties in the UK during the current period as compared to activity from April 8, 2022, acquisition of Park Holidays during the same period in 2022. Refer to Note 3, "Real Estate Acquisitions and Dispositions," in our accompanying Consolidated Financial Statements for additional information.
Deferred tax benefit - for the three and six months ended June 30, 2023, was $7.7 million and $12.3 million resulting from activity related to our acquisition of Park Holidays in the UK. Refer to Note 12, "Income Taxes," in our accompanying Consolidated Financial Statements for additional information.
RECONCILIATION OF NET INCOME ATTRIBUTABLE TO SUI COMMON SHAREHOLDERS TO FFO
The following table reconciles Net income attributable to SUI common shareholders to FFO for the three and six months ended June 30, 2023 and 2022 (in millions, except for per share amounts):
| Three Months Ended June 30, 2023 | June 30, 2022 | Six Months Ended June 30, 2023 | June 30, 2022 | |
|---|---|---|---|---|
| Net Income Attributable to SUI Common Shareholders | $89.8 | $74.0 | $59.7 | $74.7 |
| Adjustments | ||||
| Depreciation and amortization | 163.4 | 149.4 | 318.3 | 297.1 |
| Depreciation on nonconsolidated affiliates | 0.1 | 0.1 | 0.1 | 0.1 |
| Asset impairments | 6.5 | 0.1 | 8.9 | 0.7 |
| (Gain) / loss on remeasurement of marketable securities | (5.8) | 32.3 | 14.1 | 66.8 |
| (Gain) / loss on remeasurement of investment in nonconsolidated affiliates | — | (0.4) | 4.5 | (0.5) |
| (Gain) / loss on remeasurement of notes receivable | 0.1 | — | 1.8 | (0.2) |
| (Gain) / loss on dispositions of properties, including tax effect | 0.8 | 0.1 | 4.3 | (13.3) |
| Add: Returns on preferred OP units | 1.5 | 3.4 | 5.2 | 6.7 |
| Add: Income / (loss) attributable to noncontrolling interests | 3.3 | 4.2 | (1.1) | 2.0 |
| Gain on dispositions of assets, net | (10.6) | (17.2) | (18.5) | (32.3) |
| FFO Attributable to SUI Common Shareholders and Dilutive Convertible Securities(1) | $249.1 | $246.0 | $397.3 | $401.8 |
| Adjustments | ||||
| Business combination expense and other acquisition related costs(2) | 4.9 | 17.8 | 11.4 | 20.9 |
| Loss on extinguishment of debt | — | 0.1 | — | 0.4 |
| Catastrophic event-related charges, net | (0.1) | 0.2 | 0.9 | 0.2 |
| Loss of earnings - catastrophic event-related charges, net(3) | 5.5 | — | 11.0 | — |
| Gain on foreign currency exchanges | (2.7) | (9.0) | — | (6.8) |
| Other adjustments, net(4) | (7.1) | (0.5) | (10.7) | 1.4 |
| Core FFO Attributable to SUI Common Shareholders and Dilutive Convertible Securities(1) | $249.6 | $254.6 | $409.9 | $417.9 |
| Weighted Average Common Shares Outstanding - Diluted | 127.4 | 126.0 | 128.6 | 123.9 |
| FFO Attributable to SUI Common Shareholders and Dilutive Convertible Securities Per Share | $1.95 | $1.95 | $3.09 | $3.24 |
| Core FFO Attributable to SUI Common Shareholders and Dilutive Convertible Securities Per Share | $1.96 | $2.02 | $3.19 | $3.37 |
(1) Excludes the effect of certain anti-dilutive convertible securities.
(2) These costs represent (i) nonrecurring integration expenses associated with acquisitions during the three and six months ended June 30, 2023, and 2022, (ii) costs associated with potential acquisitions that will not close, (iii) costs associated with the termination of the bridge loan commitment during the three months ended March 31, 2022 related to the acquisition of Park Holidays and (iv) business combination expenses incurred to bring recently acquired properties up to the Company's operating standards, including items such as tree trimming and painting costs that do not meet the Company's capitalization policy.
(3) Adjustment related to estimated loss of earnings in excess of the applicable business interruption deductible in relation to our three Florida Keys communities that were impaired by Hurricane Irma and our three Fort Myers Florida RV communities that were impaired by Hurricane Ian, which had not yet been received from our insurer.
(4) Other adjustments, net relates primarily to deferred tax benefits and long term lease termination (benefit)/expense during three and six months ended June 30, 2023 and 2022.
55
LIQUIDITY AND CAPITAL RESOURCES
Short-term Liquidity
Our principal short-term liquidity demands historically have been, and are expected to continue to be, distributions to our shareholders and the unit holders of the Operating Partnership, property acquisitions, development and expansion of our properties, capital improvement of our properties, the purchase of new and pre-owned homes, and debt repayment. We intend to meet our short-term liquidity requirements through available cash balances, cash flows generated from operations, draws on our Senior Credit Facility, and the use of debt and equity offerings under our shelf registration statement. Refer to Note 8, "Debt and Line of Credit," and Note 9, "Equity and Temporary Equity," in our accompanying Consolidated Financial Statements for additional information.
We also intend to continue to strengthen our capital and liquidity positions by focusing on our core fundamentals, which are generating positive cash flows from operations, maintaining appropriate debt levels and leverage ratios, and controlling overhead costs. We take a disciplined approach to selecting the optimal mix of financing sources to meet our liquidity demands and minimize our overall cost of capital. Our investment grade credit ratings of BBB and Baa3 from S&P Global and Moody's, respectively, remain unchanged from the initial rating. We plan to continue to capitalize on our unsecured bond market access to optimize our cost of capital and increase our financial flexibility.
Current market and economic conditions, including relating to, among other things, interest rates, currency fluctuations, equity valuations and inflation, may adversely affect our ability to obtain debt and equity capital in the short term on attractive terms.
Acquisition, development and expansion activities
Subject to market conditions, we intend to continue to identify opportunities to expand our development pipeline and acquire existing properties. We finance acquisitions through available cash, secured financing, draws on our Senior Credit Facility, the assumption of existing debt on properties and the issuance of debt and equity securities. The current higher interest rate environment may make it more expensive to finance acquisitions and fund developments and expansion. We will continue to evaluate acquisition and development opportunities that meet our underwriting criteria.
During the six months ended June 30, 2023, we acquired one MH community totaling 68 sites and 72 development sites, and one marina totaling 24 wet slips and dry storage spaces, for a total purchase price of approximately $107.0 million.
We have been focused on property ground-up development and expansion opportunities adjacent to our existing properties. During the six months ended June 30, 2023, we acquired three land parcels located in the U.S. and the UK for the potential development of nearly 1,250 sites, expanded our existing communities by nearly 250 sites and delivered over 200 sites at three ground-up development properties.
We continue to expand our properties utilizing our inventory of owned and entitled land. We have nearly 15,720 MH and RV sites suitable for future development.
Refer to Note 3, "Real Estate Acquisitions and Dispositions," in our accompanying Consolidated Financial Statements for additional detail on acquisitions completed to date.
Capital Expenditures (excluding Acquisition cost)
Our capital expenditures include lot modifications, growth projects, rebranding, acquisition-related capital expenditures, expansion and development construction costs, rental home purchases and recurring capital expenditures.
Our capital expenditure activity is summarized as follows (in millions):
| Six Months Ended June 30, 2023 | June 30, 2022 | |
|---|---|---|
| Recurring Capital Expenditures | $40.0 | $33.4 |
| Non-Recurring Capital Expenditure and Related Activities | ||
| Lot Modifications | 25.4 | 14.4 |
| Growth Projects | 52.7 | 49.5 |
| Rebranding | 3.4 | 10.7 |
| Capital improvements to recent acquisitions | 135.1 | 123.1 |
| Expansion and Development | 166.6 | 122.7 |
| Rental Program | 143.1 | 59.0 |
| Other | (1.6) | (6.4) |
| Total Non-Recurring Capital Expenditure and Related Activities | 524.7 | 373.0 |
| Total Capital Expenditure and Related Activities | $564.7 | $406.4 |
Recurring capital expenditures
Property recurring capital expenditures are necessary to maintain asset quality, including purchasing and replacing assets used to operate the communities and marinas. Recurring capital expenditures at our MH and RV properties include items such as: major road, driveway and pool improvements; clubhouse renovations; adding or replacing streetlights; playground equipment; signage; maintenance facilities; manager housing and property vehicles. Recurring capital expenditures at our marinas include items such as: dredging, dock repairs and improvements, and equipment maintenance and upgrades. The minimum capitalized amount is five hundred dollars.
Non-Recurring Capital Expenditures and Related Activities
Lot modifications - lot modification capital expenditures are incurred to modify the foundational structures required to set a new home after a previous home has been removed. These expenditures are necessary to create a revenue stream from a new site renter and often improve the quality of the community. Other lot modification expenditures include land improvements added to annual RV sites to aid in the conversion of transient RV guests to annual contracts.
Growth projects - growth projects consist of revenue generating or expense reducing activities at MH, RV and marina properties. These include, but are not limited to, utility efficiency and renewable energy projects, site, slip or amenity upgrades such as the addition of a garage, shed or boat lift, and other special capital projects that substantiate an incremental rental increase.
Rebranding - rebranding includes new signage at our RV communities and costs of building an RV mobile application and updated website.
Acquisitions - Total acquisition investments represent the purchase price paid for operating properties and land parcels for future ground-up development and expansions activities, plus any capital improvements identified during due diligence needed to bring acquired properties up to the Company's operating standards.
Capital improvements subsequent to acquisition often require 24 to 36 months to complete after closing and include upgrading clubhouses; landscaping; new street light systems; new mail delivery systems; pool renovations including larger decks, heaters and furniture; new maintenance facilities; lot modifications; and new signage including main signs and internal road signs.
Expansion and development expenditures - consist primarily of construction costs such as roads, activities, and amenities, and costs necessary to complete home and RV site improvements, such as driveways, sidewalks and landscaping at our MH and RV communities. Expenditures also include costs to rebuild after damage has been incurred at MH, RV or marina properties, and research and development.
Rental program - consists of investment in the acquisition of homes intended for the Rental Program and the purchase of vacation rental homes at our RV communities. Expenditures for these investments depend upon the condition of the markets for repossessions and new home sales, rental homes and vacation rental homes.
Cash Flow Activities
Our cash flow activities are summarized as follows (in millions):
| Six Months Ended June 30, 2023 | June 30, 2022 | |
|---|---|---|
| Net Cash Provided by Operating Activities | $449.9 | $532.0 |
| Net Cash Used for Investing Activities | $(581.8) | $(2,475.8) |
| Net Cash Provided by Financing Activities | $109.4 | $2,056.9 |
| Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash | $0.8 | $(6.6) |
Cash, cash equivalents and restricted cash decreased by $21.7 million from $90.4 million as of December 31, 2022, to $68.7 million as of June 30, 2023.
Operating activities - Net cash provided by operating activities decreased by $82.1 million to $449.9 million for the six months ended June 30, 2023, compared to $532.0 million for the six months ended June 30, 2022. The decrease in operating cash flow was primarily due to an increase in interest expense during the six months ended June 30, 2023 as compared to the corresponding period in 2022 due to the changing macroeconomic environment, partially offset by improved Same Property operating performance at our MH and RV communities and marinas.
Our net cash flows provided by operating activities from continuing operations may be adversely impacted by, among other things:
- the market and economic conditions in our current markets generally, and specifically in the metropolitan areas of our current markets;
- lower occupancy and rental rates of our properties;
- substantial increases in insurance premiums;
- increases in other operating costs, such as wage and benefit costs, real estate taxes and utilities;
- decreased sales of manufactured homes;
- current volatility in economic conditions and the financial markets; and
- the effects of outbreaks of disease and related restrictions on business operations. See "Risk Factors" in Part I, Item 1A of our 2022 Annual Report.
Investing activities - Net cash used for investing activities decreased by $1.9 billion to $581.8 million for the six months ended June 30, 2023, compared to $2.5 billion for the six months ended June 30, 2022. The decrease in Net cash used for investing activities was primarily driven by a decrease in cash deployed to acquire properties during the six months ended June 30, 2023 as compared to the corresponding period in 2022. Refer to the Consolidated Statements of Cash Flows for detail on the net cash used for investing activities during the six months ended June 30, 2023 and 2022. Refer to Note 3, "Real Estate Acquisitions and Dispositions," and Note 4, "Notes and Other Receivables," in our accompanying Consolidated Financial Statements for additional information on acquisitions and issuance of notes and other receivables.
Financing activities - Net cash provided by financing activities decreased by $1.9 billion to $109.4 million for the six months ended June 30, 2023, compared to $2.1 billion for the six months ended June 30, 2022. The decrease in Net cash provided by financing activities was primarily driven by a decrease in borrowings on our Senior Credit Facility, net of repayments, and a decrease in issuance of common stock, OP units and preferred OP units, net, during the six months ended June 30, 2023 as compared to the corresponding period in 2022. Refer to the Consolidated Statements of Cash Flows for detail on the net cash provided by financing activities during the six months ended June 30, 2023 and 2022. Refer to Note 8, "Debt and Line of Credit," and Note 9, "Equity and Temporary Equity," in our accompanying Consolidated Financial Statements for additional information.
We are exposed to interest rate variability associated with our outstanding floating rate debt and any maturing debt that has to be refinanced. Interest rate movements impact our borrowing costs and, while as of June 30, 2023, over 82% of our total debt was fixed rate financing, including the impact of hedge activity, increases in interest costs are likely to adversely affect our financial results.
Equity and Debt Activity
Public Equity Offerings
In November 2021, we entered into the November 2021 Forward Sale Agreements in connection with an underwritten registered public offering of 4,025,000 shares of our common stock at a public offering price of $185.00 per share. In April 2022, we completed the physical settlement of the 4,025,000 shares of common stock and received aggregate net proceeds of $705.4 million. We used the net proceeds to repay borrowings outstanding under our Senior Credit Facility, and for working capital and general corporate purposes.
At the Market Offering Sales Agreement
In December 2021, we entered into an At the Market Offering Sales Agreement (the "Sales Agreement"), with certain sales agents and forward sellers pursuant to which we may sell, from time to time, up to an aggregate gross sales price of $1.25 billion of our common stock through the sales agents, acting as our sales agents or, if applicable, as forward sellers, or directly to the sales agents as principals for their own accounts. We simultaneously terminated our prior sales agreement upon entering into the Sales Agreement. Through June 30, 2023, we had entered into forward sales agreements under our Sales Agreement for an aggregate gross sales price of $160.6 million.
During the three months ended September 30, 2022, we entered into forward sale agreements with respect to 15,000 shares of common stock under our Sales Agreement for $2.6 million. Additionally, we settled all of our outstanding forward sale agreements with respect to 1,526,212 shares of common stock which includes 620,109; 600,503; 290,600; and 15,000 shares of common stock from the three months ended December 31, 2021, March 31, June 30 and September 30, 2022 forward sale agreements, respectively. The net proceeds of $275.5 million from the settlement of these forward sale agreements were used to repay borrowings outstanding under our Senior Credit Facility.
During the three months ended June 30, 2022, we completed the physical settlement of 1,200,000 shares of common stock under our prior at the market offering program and received net proceeds of $229.5 million. Additionally, we entered into forward sales agreements with respect 290,600 shares of common stock for $50.1 million, under our Sales Agreement. These forward sale agreements were settled during the three months ended September 30, 2022.
During the three months ended March 31, 2022, we entered into forward sales agreements with respect to 600,503 shares of common stock for $107.9 million, under our Sales Agreement. These forward sale agreements were settled during the three months ended September 30, 2022.
During the year ended December 31, 2021, we entered into forward sale agreements with respect to 1,820,109 shares of common stock under our prior at the market offering program for $356.5 million. We completed the physical settlement of 1,200,000 and 620,109 shares of common stock during the three months ended June 30, 2022 and September 30, 2022, respectively.
Secured Debt
During the six months ended June 30, 2023, we entered into mortgage term loans totaling $184.1 million related to 27 properties which mature from February 13, 2026 to April 1, 2033, and have a weighted average fixed interest rate of 5.39%. We used the net proceeds to repay borrowings outstanding under our Senior Credit Facility.
During the year ended December 31, 2022, we entered into a new $20.6 million construction loan, which was undrawn as of June 30, 2023 and a $3.4 million mortgage term loan that are jointly secured by one property. Both loans mature on August 10, 2047 and have a fixed interest rate of 3.65%. Additionally, we entered into a mortgage term loan of $226.0 million related to 18 existing encumbered properties which mature between June 15, 2026, and December 15, 2029, and have a fixed interest rate of 4.5%.
During the three months ended September 30, 2022, we repaid $318.0 million of term loans collateralized by 35 properties. These loans had a weighted average interest rate of 4.81% and were set to mature from December 6, 2022 through September 6, 2024.
Senior Unsecured Notes
The following table sets forth certain information regarding our outstanding senior unsecured notes (in millions). All senior unsecured notes include interest payments on a semi-annual basis in arrears.
| Principal Amount | Carrying Amount June 30, 2023 | December 31, 2022 | |
|---|---|---|---|
| 5.7% notes, issued in January 2023 and due in January 2033(1) | $400.0 | $395.5 | N/A |
| 4.2% notes, issued in April 2022 and due in April 2032 | 600.0 | 592.2 | 591.8 |
| 2.3% notes, issued in October 2021 and due in November 2028 | 450.0 | 446.5 | 446.2 |
| 2.7% notes, issued in June 2021 and October 2021, and due in July 2031 | 750.0 | 742.0 | 741.6 |
| Total | $2,200.0 | $2,176.2 | $1,779.6 |
(1) In January 2023, the Operating Partnership issued $400.0 million of senior unsecured notes with an interest rate of 5.7% and a 10-year term, due January 15, 2033 (the "2033 Notes"). Interest on the notes is payable semi-annually in arrears on January 15 and July 15 of each year, beginning on July 15, 2023. The net proceeds from the offering were $395.3 million, after deducting underwriters' discounts and estimated offering expenses. We used the net proceeds from the offering to repay borrowings outstanding under our Senior Credit Facility.
The obligations of the Operating Partnership to pay principal, premiums, if any, and interest on our senior unsecured notes are guaranteed on a senior basis by Sun Communities, Inc. The guarantee is full and unconditional, and the Operating Partnership is a consolidated subsidiary of the Company. Under Rule 3-10 of Regulation S-X, as amended, subsidiary issuers of obligations guaranteed by its parent company are not required to provide separate financial statements, provided that the subsidiary obligor is consolidated into the parent company's consolidated financial statements, the parent guarantee is "full and unconditional" and, subject to certain exceptions, the alternative disclosure required by Rule 13-01 is provided, which includes narrative disclosure and summarized financial information. Accordingly, separate consolidated financial statements of the Operating Partnership have not been presented. Furthermore, as permitted under Rule 13-01(a)(4)(vi), we have excluded the summarized financial information for the Operating Partnership as the assets, liabilities and results of operations of the Operating Partnership are not materially different from the corresponding amounts presented in our consolidated financial statements and management believes such summarized financial information would be repetitive and not provide incremental value to investors.
Line of Credit
In April 2022, the Operating Partnership as borrower, SUI as guarantor, and certain lenders entered into the Credit Facility Amendment, which amended our Senior Credit Facility.
The Credit Facility Amendment increased the aggregate amount of our Senior Credit Facility to $4.2 billion with the ability to upsize the total borrowings by an additional $800.0 million, subject to certain conditions. The increased aggregate amount under the Senior Credit Facility consists of the following: (a) a revolving loan in an amount up to $3.05 billion and (b) a term loan facility of $1.15 billion, with the ability to draw funds from the combined facilities in U.S. dollars, Pound sterling, Euros, Canadian dollars and Australian dollars, subject to certain limitations. The Credit Facility Amendment extended the maturity date of the revolving loan facility to April 7, 2026. At our option that maturity date may be extended two additional six-month periods. In addition, the Credit Facility Amendment established the maturity date of the term loan facility under the Credit Facility Amendment as April 7, 2025, which may not be further extended.
Prior to the Credit Facility Amendment, the Senior Credit Facility permitted aggregate borrowings of up to $2.0 billion, with an accordion feature that allowed for additional commitments of up to $1.0 billion, subject to the satisfaction of certain conditions. Prior to the amendment, $500.0 million of available borrowings under the Senior Credit Facility were scheduled to mature on October 11, 2024, with the remainder scheduled to mature on June 14, 2025.
The Senior Credit Facility bears interest at a floating rate based on the Adjusted Term SOFR, the Adjusted Eurocurrency Rate, the Daily RFR, the Australian BBSY, the Daily SONIA Rate or the Canadian Dollar Offered Rate, as applicable, plus a margin, in all cases, which can range from 0.725% to 1.6%, subject to certain adjustments. As of June 30, 2023, the margins based on our credit ratings were 0.85% on the revolving loan facility and 0.95% on the term loan facility. During the six months ended June 30, 2023 and year ended December 31, 2022, we achieved sustainability related requirements resulting in a favorable 0.04% and 0.01% adjustments, respectively, to both margins.
At the lenders' option, the Senior Credit Facility will become immediately due and payable upon an event of default under the Credit Facility Amendment. We had $884.8 million and $1.1 billion of borrowings outstanding under the revolving loan as of June 30, 2023 and December 31, 2022, respectively. We also had $1.1 billion of borrowings outstanding under the term loan on the Senior Credit Facility as of June 30, 2023 and December 31, 2022, respectively. These balances are recorded in Unsecured debt on the Consolidated Balance Sheets.
The Senior Credit Facility provides us with the ability to issue letters of credit. Our issuance of letters of credit does not increase our borrowings outstanding under the Senior Credit Facility, but does reduce the borrowing amount available. We had $16.7 million and $2.6 million of outstanding letters of credit at June 30, 2023 and December 31, 2022, respectively.
Financial Covenants
Pursuant to the terms of the Senior Credit Facility, we are subject to various financial and other covenants. The most restrictive financial covenants for the Senior Credit Facility are as follows:
| Covenant | Requirement | As of June 30, 2023 |
|---|---|---|
| Maximum leverage ratio | <65.0% | 34.4% |
| Minimum fixed charge coverage ratio | >1.40 | 3.44 |
| Maximum secured leverage ratio | <40.0% | 12.8% |
In addition, we are required to maintain the following covenants with respect to the senior unsecured notes payable:
| Covenant | Requirement | As of June 30, 2023 |
|---|---|---|
| Total debt to total assets | ≤60.0% | 41.0% |
| Secured debt to total assets | ≤40.0% | 18.1% |
| Consolidated income available for debt service to debt service | ≥1.50 | 4.12 |
| Unencumbered total asset value to total unsecured debt | ≥150.0% | 337.2% |
As of June 30, 2023, we were in compliance with the above covenants and do not anticipate that we will be unable to meet these covenants in the near term.
Bridge Loan Termination
In March 2022, we terminated our commitment letter with Citigroup, pursuant to which, Citigroup (on behalf of its affiliates), previously committed to lend us up to £950.0 million in Pound sterling, or approximately $1.2 billion converted at the March 31, 2022 exchange rate (the "Bridge Loan"). As of the date of termination, we did not have any borrowings outstanding under the Bridge Loan.
Derivative Transactions
Our objective and strategy in using interest rate derivatives is to manage exposure to interest rate movements, thereby minimizing the effect of interest rate changes and the effect they could have on future cash outflows (forecasted interest payments) on a forecasted issuance of long-term debt or on outstanding floating rate debt. We do not enter into derivative instruments for speculative purposes.
During the three months ended March 31, 2023, we entered into one interest rate swap contract to hedge variable rate borrowings of £100.0 million (equivalent to $126.6 million as of June 30, 2023). The interest rate swap locked in a total fixed rate, inclusive of spread, of 4.81% through the maturity date of April 7, 2025. We also entered into one forward starting interest rate swap contract with an aggregate notional value of $50.0 million to hedge interest rate risk associated with a potential future debt offering.
During the three months ended March 31, 2023, in connection with the 2033 Notes issuance, we settled two $100.0 million 10-year treasury rate lock contracts and one $50.0 million forward swap totaling $250.0 million and received a net settlement payment of $7.4 million. This lowered the effective interest rate on the 2033 Notes from 5.7% to 5.5%. As of the settlement date, the net accumulated gain included in AOCI is being reclassified into earnings as a reduction to Interest expense on a straight-line basis over the 10-year term of the hedged transaction.
Long-term Financing and Capital Requirements
Long-term Financing
We anticipate meeting our long-term liquidity requirements, such as scheduled debt maturities, large property acquisitions, expansion and development of properties, other nonrecurring capital improvements and Operating Partnership unit redemptions through the long-term unsecured and secured indebtedness and the issuance of certain debt or equity securities subject to market conditions. If current market and economic conditions, including relating to, among other things, interest rates, currency fluctuations, equity valuations and inflation, continue or worsen, our ability to obtain debt and equity capital in the long term on attractive terms may be adversely affected.
As of June 30, 2023 we had unrestricted cash on hand of $49.0 million, $2.1 billion of remaining capacity on the Senior Credit Facility, and a total of 517 unencumbered MH, RV and marina properties.
From time to time, we may also issue shares of our capital stock, issue equity units in our Operating Partnership, issue unsecured notes, obtain other debt financing or sell selected assets. Our ability to finance our long-term liquidity requirements in such a manner will be affected by numerous economic factors affecting the MH, RV and marina industries at the time, including the availability and cost of mortgage debt, our financial condition, the operating history of the properties, the state of the debt and equity markets, and the general national, regional and local economic conditions. When it becomes necessary for us to approach the credit markets, the volatility in those markets could make borrowing more difficult to secure, more expensive or effectively unavailable. In the event our current credit ratings are downgraded, it may become difficult or more expensive to obtain additional financing or refinance existing unsecured indebtedness as maturities become due. See "Risk Factors" in Part I, Item 1A of our 2022 Annual Report. If we are unable to obtain additional debt or equity financing on acceptable terms, our business, results of operations and financial condition would be adversely impacted.
As of June 30, 2023, our net debt to enterprise value was 30.9% (assuming conversion of all common OP units, Series A-1 preferred OP units, Series A-3 preferred OP units, Series C preferred OP units, Series D preferred OP units, Series E preferred OP units, Series F preferred OP units, Series G preferred OP units, Series H preferred OP units, Series J preferred OP units and Series K preferred OP units to shares of common stock). Our debt has a weighted average interest rate of 4.02% and a weighted average years to maturity of 7.1.
Capital Requirements
Certain of our nonconsolidated affiliates, which are accounted for under the equity-method of accounting, have incurred indebtedness. We have not guaranteed the debt of our nonconsolidated affiliates in the arrangements referenced below, nor do we have any obligations to fund this debt should the nonconsolidated affiliates be unable to do so. Refer to Note 6, "Investments in Nonconsolidated Affiliates," in the accompanying Consolidated Financial Statements for additional information about these entities.
GTSC - During September 2019, GTSC entered into a warehouse line of credit with a maximum loan amount of $125.0 million. The line of credit was subsequently amended, with the maximum amount increased to $325.0 million as of December 31, 2022, with an option to increase to $375.0 million subject to the lender's consent. As of June 30, 2023 and December 31, 2022, the aggregate carrying amount of debt, including both our and our partner's share, incurred by GTSC was $293.1 million (of which our proportionate share is $117.2 million), and $275.0 million (of which our proportionate share is $110.0 million), respectively. The debt bears interest at a variable rate based on a Commercial Paper or adjusted SOFR plus a margin ranging from 1.65% to 2.5% per annum and matures on December 15, 2026.
Sungenia JV - During May 2020, Sungenia JV, entered into a debt facility agreement with a maximum loan amount of $27.0 million Australian dollars, or $17.9 million converted at the June 30, 2023 exchange rate. During July 2022, the maximum amount was increased to $50.0 million Australian dollars, or $33.2 million converted at the June 30, 2023 exchange rate. As of June 30, 2023 and December 31, 2022, the aggregate carrying amount of the debt, including both our and our partners' share, incurred by Sungenia JV was $23.2 million (of which our proportionate share is approximately $11.6 million), and $7.9 million (of which our proportionate share is $4.0 million), respectively. The debt bears interest at a variable rate based on the BBSY rate plus a margin ranging from 1.35% to 1.4%, subject to adjustment for additional future commitments, per annum and matures on June 30, 2027.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This report contains various "forward-looking statements" within the meaning of the Securities Act of 1933, as amended (the "Securities Act"), and the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and we intend that such forward-looking statements will be subject to the safe harbors created thereby. For this purpose, any statements contained in this document that relate to expectations, beliefs, projections, future plans and strategies, trends or prospective events or developments and similar expressions concerning matters that are not historical facts are deemed to be forward-looking statements. Words such as "forecasts," "intends," "intend," "intended," "goal," "estimate," "estimates," "expects," "expect," "expected," "project," "projected," "projections," "plans," "predicts," "potential," "seeks," "anticipates," "anticipated," "should," "could," "may," "will," "designed to," "foreseeable future," "believe," "believes," "scheduled," "guidance," "target" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these words. These forward-looking statements reflect our current views with respect to future events and financial performance, but involve known and unknown risks and uncertainties, both general and specific to the matters discussed in this document, some of which are beyond our control. These risks and uncertainties and other factors may cause our actual results to be materially different from any future results expressed or implied by such forward-looking statements. In addition to the risks disclosed under "Risk Factors" in our 2022 Annual Report, and in our other filings with the SEC, from time to time, such risks, uncertainties and other factors include, but are not limited to:
| ∙ | Outbreaks of disease and related restrictions on business operations; |
| ∙ | Changes in general economic conditions, including inflation, deflation and energy costs, the real estate industry and the markets within which we operate; |
| ∙ | Difficulties in our ability to evaluate, finance, complete and integrate acquisitions, developments and expansions successfully; |
| ∙ | Our liquidity and refinancing demands; |
| ∙ | Our ability to obtain or refinance maturing debt; |
| ∙ | Our ability to maintain compliance with covenants contained in our debt facilities and our unsecured notes; |
| ∙ | Availability of capital; |
| ∙ | Changes in foreign currency exchange rates, including between the U.S. dollar and each of the Canadian dollar, Australian dollar and Pound sterling; |
| ∙ | Our ability to maintain rental rates and occupancy levels; |
| ∙ | Our ability to maintain effective internal control over financial reporting and disclosure controls and procedures; |
| ∙ | Increases in interest rates and operating costs, including insurance premiums and real estate taxes; |
| ∙ | Risks related to natural disasters such as hurricanes, earthquakes, floods, droughts and wildfires; |
| ∙ | General volatility of the capital markets and the market price of shares of our capital stock; |
| ∙ | Our ability to maintain our status as a REIT; |
| ∙ | Changes in real estate and zoning laws and regulations; |
| ∙ | Legislative or regulatory changes, including changes to laws governing the taxation of REITs; |
| ∙ | Litigation, judgments or settlements; |
| ∙ | Competitive market forces; |
| ∙ | The ability of purchasers of manufactured homes and boats to obtain financing; and |
| ∙ | The level of repossessions by manufactured home and boat lenders. |
Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made. We undertake no obligation to publicly update or revise any forward-looking statements included or incorporated by reference into this document, whether as a result of new information, future events, changes in our expectations or otherwise, except as required by law.
Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. All written and oral forward-looking statements attributable to us or persons acting on our behalf are qualified in their entirety by these cautionary statements.
Market risk
As filed, 3,815 characters, with its headings, lists and tables. Extracted from the main document; charts and exhibits are in the original on sec.gov.
Market risk is the exposure to loss resulting from changes in market factors such as interest rates, foreign currency exchange rates, commodity prices and equity prices.
Interest Rate Risk
Our principal market risk exposure is interest rate risk. We mitigate this risk by maintaining prudent amounts of leverage, minimizing capital costs and interest expense while continuously evaluating all available debt and equity resources and following established risk management policies and procedures, which include the periodic use of derivatives. Our primary strategy in entering into derivative contracts is to minimize the variability that interest rate changes could have on our future cash flows. From time to time, we employ derivative instruments that effectively convert a portion of our variable rate debt to fixed rate debt. We do not enter into derivative instruments for speculative purposes.
Our variable rate debt totaled $1.4 billion and $1.7 billion as of June 30, 2023 and 2022, respectively, after adjusting for the impact of hedging in place through the use of interest rate swaps. As of June 30, 2023 and 2022, our variable debt bore interest at the Adjusted Term SOFR, the Adjusted Eurocurrency Rate, the Daily RFR, the Australian BBSY rate, the Daily SONIA Rate or the Canadian Dollar Offered Rate, and the Eurodollar rate or Prime rate plus a margin. If the above rate increased or decreased by 1.0%, our interest expense would have increased or decreased by $6.9 million and $6.8 million for the six months ended June 30, 2023 and 2022, respectively, based on the $1.4 billion average balance outstanding under our variable rate debt facilities for the six months ended June 30, 2023 and 2022, respectively. Our variable rate debt, interest expense and average balance outstanding under our variable rate debt facility includes the impact of hedge activity.
Foreign Currency Exchange Rate Risk
Foreign currency exchange rate risk is the risk that fluctuations in currencies against the U.S. dollar will negatively impact our results of operations. We are exposed to foreign currency exchange rate risk as a result of remeasurement and translation of the assets and liabilities of our properties in the UK and Canada, and our equity investment and joint venture in Australia, into U.S. dollars. Fluctuations in foreign currency exchange rates can therefore create volatility in our results of operations and may adversely affect our financial condition.
At June 30, 2023 and December 31, 2022, our shareholder's equity included $900.4 million and $1.2 billion from our investments and operations in the UK, Canada and Australia which collectively represented 11.6% and 14.9% of total shareholder's equity, respectively. Based on our sensitivity analysis, a 10.0% strengthening of the U.S. dollar against the Pound sterling, Canadian dollar and Australian dollar would have caused a reduction of $90.0 million and $117.9 million to our total shareholder's equity at June 30, 2023 and December 31, 2022, respectively.
Capital Market Risk
We are exposed to risks related to the equity capital markets, and our related ability to raise capital through the issuance of our common stock or other equity instruments. We are also exposed to risks related to the debt capital markets, and our related ability to finance our business through borrowings under other financing arrangements. As a REIT, we are required to distribute a significant portion of our taxable income annually, which constrains our ability to accumulate operating cash flow and therefore requires us to utilize debt or equity capital to finance our business. We seek to mitigate these risks by monitoring the debt and equity capital markets to inform our decisions on the amount, timing and terms of capital we raise.
Controls and procedures
As filed, 1,144 characters, with its headings, lists and tables. Extracted from the main document; charts and exhibits are in the original on sec.gov.
Evaluation of disclosure controls and procedures
We maintain disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed in reports filed under the Exchange Act is recorded, processed, summarized and reported within the specified time periods and accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
Our management, with the participation of our CEO and CFO, evaluated the effectiveness of our disclosure controls and procedures (pursuant to Rules 13a-15(e) or 15d-15(e) of the Exchange Act) at June 30, 2023. Based upon this evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of June 30, 2023.
Changes in internal control over financial reporting
There were no changes in our internal control over financial reporting during the three months ended June 30, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Risk factors
As filed, 366 characters, with its headings, lists and tables. Extracted from the main document; charts and exhibits are in the original on sec.gov.
In addition to the other information set forth in this report, you should carefully consider the risk factors described in Part 1, Item 1A., "Risk Factors," in our 2022 Annual Report, which could materially affect our business, financial condition or future results. There have been no material changes to the disclosure on these matters as set forth in such report.
Figures reported in this filing
Standardized line items from the XBRL in this filing, for the period ended 2023-06-30. Comparative periods it repeats are left out.
| Line item | Period | Value | XBRL concept |
|---|---|---|---|
| Revenue | 3 months2023-04-01 to 2023-06-30 | $863.5m | us-gaap:Revenues |
| Revenue | 6 months2023-01-01 to 2023-06-30 | $1.51bn | us-gaap:Revenues |
| Net income | 3 months2023-04-01 to 2023-06-30 | $89.8m | us-gaap:NetIncomeLoss |
| Net income | 6 months2023-01-01 to 2023-06-30 | $59.7m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months2023-04-01 to 2023-06-30 | $0.72 | us-gaap:EarningsPerShareDiluted |
| Diluted EPS | 6 months2023-01-01 to 2023-06-30 | $0.48 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months2023-04-01 to 2023-06-30 | $0.72 | us-gaap:EarningsPerShareBasic |
| Basic EPS | 6 months2023-01-01 to 2023-06-30 | $0.48 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months2023-04-01 to 2023-06-30 | 123,400,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Diluted shares (weighted) | 6 months2023-01-01 to 2023-06-30 | 123,400,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 6 months2023-01-01 to 2023-06-30 | $449.9m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Total assets | At period end2023-06-30 | $17.56bn | us-gaap:Assets |
| Total liabilities | At period end2023-06-30 | $9.47bn | us-gaap:Liabilities |
| Shareholders' equity | At period end2023-06-30 | $7.71bn | us-gaap:StockholdersEquity |
Source: SEC EDGAR, the filing index for accession 0000912593-23-000201. Last ingested by Listed: Oct 27, 2026, 15:31 ET. Listed shows no prices and gives no investment advice.