UMH Properties(UMH) - 2024 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Normalized FFO for Q4 2024 was $0.24 per share, up 4$0.23 per share in Q4 2023. For the full year, normalized FFO was $0.93 per share, an 8$0.86 in 2023 [9][25]. - Rental and related income for Q4 2024 increased to $53.3 million, an 8$49.2 million in Q4 2023. For the full year, it rose from $189.7 million in 2023 to$207 million in 2024, a 9% increase [26]. - Community NOI for Q4 2024 was $31.1 million, up 8$28.7 million in Q4 2023, and for the full year, it increased from $108.4 million in 2023 to$119.7 million in 2024, a 10% increase [28]. Business Line Data and Key Metrics Changes - Same property income increased by 8% for Q4 and 9% for the full year, with same property NOI growth of 8% for Q4 and 10% for the year [14][28]. - The rental home program added 565 homes in 2024, bringing the total to 10,300 rental homes, with a 94% occupancy rate [15][17]. Market Data and Key Metrics Changes - The company anticipates further occupancy growth in 2025, projecting to add another 800 homes or more [16]. - The sales division achieved gross sales of $33.5 million in 2024, an 8$31.2 million in 2023 [17]. Company Strategy and Development Direction - The company has a long-term value-add business plan, focusing on generating future income through vacant land and new home setups [11]. - The acquisition pipeline has grown, with four communities under contract, totaling 457 sites, and a purchase price of $39.1 million [19][20]. - The company aims to continue upgrading and adding to the supply of affordable housing, with a focus on community expansions and new developments [37][40]. Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the acquisition market in 2025, anticipating that high-interest rates may lead to more reasonable community prices [19]. - The company expects normalized FFO guidance for 2025 to be in the range of$0.96 to $1.04 per share [36]. Other Important Information - The company ended the year with$99.7 million in cash and cash equivalents and $260 million available on its credit facility [29]. - The total market capitalization increased to approximately$2.5 billion at year-end, up 23% from the previous year [33]. Q&A Session Summary Question: Details on the four acquisitions under contract - The company has four communities under contract, two in New Jersey and two in Maryland, with a total purchase price of $39.2 million [44][47]. Question: Expected interest rates for refinancing with Fannie Mae - The company anticipates refinancing rates to be in the 5.5% to 5.75% range [51]. Question: Factors affecting 2025 guidance range - Key factors include home sales and acquisitions, with potential for exceeding previous sales figures [61][62]. Question: Confidence in accelerating rental home additions - The company has a better starting inventory and anticipates faster growth in the rental home program [90]. Question: Changes in buyer demographics - The widening affordability gap has led to higher credit quality among buyers, with more cash purchases expected [122]. Question: Update on single-family housing developments - A preliminary agreement has been made with a luxury homebuilder for a potential JV to develop 131 acres in New Jersey [148].