PHILADELPHIA--(BUSINESS WIRE)--
Independence Realty Trust, Inc. (“IRT”) (NYSE MKT: IRT) today announced
third quarter 2013 financial results.
Highlights
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Core funds from operations (“CFFO”) increased 50% to $1.3 million for
the quarter ended September 30, 2013 from $0.9 million for the quarter
ended September 30, 2012.
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CFFO per share increased 6% to $0.17 for the quarter ended September
30, 2013 from $0.16 for the quarter ended September 30, 2012.
-
Operating income increased 52% to $1.2 million for the quarter ended
September 30, 2013 from $0.8 million for the quarter ended September
30, 2012.
-
Total revenues grew 18% to $4.8 million for the quarter ended
September 30, 2013 from $4.0 million for the quarter ended September
30, 2012.
-
On August 16, 2013, IRT completed its underwritten public offering
selling 4,000,000 shares of IRT common stock for $8.50 per share
raising gross proceeds of $34.0 million and listed IRT common stock on
the NYSE MKT under the symbol “IRT”. After giving effect to this
offering, the percent of IRT’s outstanding common stock held by RAIT
Financial Trust, IRT’s largest stockholder and the parent company of
IRT’s external advisor, was reduced from 99% to 60%.
-
On September 19, 2013, IRT acquired a 354 unit apartment community
located in Cumberland, Indiana, a suburb of Indianapolis, for a
purchase price of $13.25 million.
-
IRT declared a fourth quarter 2013 monthly cash dividends of $0.05333
per share per month or $0.16 for the fourth quarter of 2013.
-
On October 25, 2013, IRT entered into a $20 million secured revolving
credit agreement with The Huntington National Bank to acquire
properties. The facility bears interest at LIBOR plus 2.75%.
Third Quarter 2013 Results
IRT reported CFFO, a non-GAAP financial measure, for the three-month
period ended September 30, 2013 of $1.3 million, or $0.17 per share -
diluted based on 7.6 million weighted-average shares outstanding –
diluted, as compared to CFFO for the three-month period ended September
30, 2012 of $0.9 million, or $0.16 per share – diluted based on 5.6
million weighted-average shares outstanding – diluted. IRT reported a
net income allocable to common stock for the three-month period ended
September 30, 2013 of $0.3 million, or $0.03 per share - diluted based
on 7.6 million weighted-average shares outstanding – diluted, as
compared to net loss allocable to common stock for the three-month
period ended September 30, 2012 of $0.03 million, or $0.09 loss per
share – diluted based on 0.3 million weighted-average shares outstanding
– diluted.
IRT reported CFFO for the nine-month period ended September 30, 2013 of
$4.0 million, or $0.64 per share - diluted based on 6.3 million
weighted-average shares outstanding – diluted, as compared to CFFO for
the nine-month period ended September 30, 2012 of $2.9 million, or $0.53
per share – diluted based on 5.5 million weighted-average shares
outstanding – diluted. IRT reported a net income allocable to common
stock for the nine-month period ended September 30, 2013 of $0.3
million, or $0.08 per share - diluted based on 3.9 million
weighted-average shares outstanding – diluted, as compared to net loss
allocable to common stock for the nine-month period ended September 30,
2012 of $0.07 million, or $0.26 loss per share – diluted based on 0.3
million weighted-average shares outstanding – diluted.
A reconciliation of IRT's reported net income (loss) to its funds from
operations (“FFO”) and CFFO is included as Schedule I to this release.
Schedule I also includes management's rationale for the usefulness of
each of these non-GAAP financial measures.
Third Quarter Acquisition
On September 19, 2013, IRT acquired an apartment community located in
Cumberland, Indiana, a suburb of Indianapolis, for a purchase price of
$13.25 million. The 354-unit community was constructed in 1970 and
substantially renovated over the past three years. During this three
year period, the previous owner invested more than $3.5 million into the
property, which included upgrades to the unit interiors and common
areas. The property consists of a mix of one, two, three and
four-bedroom townhome and garden style-apartments.
Distributions
On July 25, 2013, IRT’s Board of Directors declared monthly cash
dividends for the third quarter of 2013 on IRT’s shares of common stock
in the amount of $0.05333 per share per month. The month for which each
dividend was declared is set forth below, with the relevant amount per
share, record date and payment date set forth opposite the month:
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Month | | | | Amount | | | | Record Date | | | | Payment Date |
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| July 2013 | | | | $0.05333 | | | | 8/5/2013 | | | | 8/15/2013 |
| August 2013 | | | | $0.05333 | | | | 8/30/2013 | | | | 9/13/2013 |
| September 2013 | | | | $0.05333 | | | | 9/30/2013 | | | | 10/15/2013 |
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On October 10, 2013, IRT’s Board of Directors declared monthly cash
dividends for the fourth quarter of 2013 on IRT’s shares of common stock
in the amount of $0.05333 per share per month. The month for which each
dividend was declared is set forth below, with the relevant amount per
share, record date and payment date set forth opposite the month:
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Month | | | | Amount | | | | Record Date | | | | Payment Date |
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| October 2013 | | | | $0.05333 | | | | 10/31/2013 | | | | 11/15/2013 |
| November 2013 | | | | $0.05333 | | | | 11/29/2013 | | | | 12/16/2013 |
| December 2013 | | | | $0.05333 | | | | 12/31/2013 | | | | 01/15/2014 |
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| Key Statistics |
(Unaudited and dollars in thousands, except per share and per unit
information)
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As of or For the Three-Month Periods Ended
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| | September | | | June 30, | | | March 31, | | | December | | | September |
| | 30, 2013 |
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| 2013 |
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| 2013 |
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| 31, 2012 |
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| 30, 2012 |
| Financial Statistics: | | | | | | | | | | | | | | |
|
Total revenue
| | $4,787 | | | $4,700 | | | $4,688 | | | $4,512 | | | $4,041 |
|
Earnings (loss) per share-diluted
| | $0.03 | | | $0.01 | | | $0.01 | | | $(0.19) | | | $(0.09) |
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Funds from Operations (“FFO”) per share
| | $0.17 | | | $0.23 | | | $0.23 | | | $0.17 | | | $0.15 |
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Core funds from operations (“CFFO”) per share
| | $0.17 | | | $0.23 | | | $0.23 | | | $0.18 | | | $0.16 |
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Dividends declared per common share
| | $0.16 | | | $0.16 | | | $0.15 | | | $0.15 | | | $0.15 |
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| Apartment Property Portfolio: | | | | | | | | | | | | | | |
|
Reported investments in real estate at cost
| | $166,665 | | | $154,040 | | | $153,717 | | | $153,565 | | | $138,009 |
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Net operating income
| | $2,373 | | | $2,459 | | | $2,523 | | | $2,354 | | | $1,942 |
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Number of properties owned
| |
9
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8
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8
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8
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7
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Multifamily units owned
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2,358
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2,004
| | |
2,004
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2,004
| | |
1,812
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Portfolio average occupancy
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94.1%
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94.2%
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93.6%
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92.0%
| | |
92.4%
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Average monthly effective rent per unit (1) | | $788 | | | $788 | | | $791 | | | $787 | | | $759 |
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(1)
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Average monthly effective rent per occupied unit represents the
average monthly rent collected for all occupied units after giving
effect to tenant concessions. We do not report average effective
rent per unit in the month of acquisition as it is not
representative of a full month of operations.
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| Properties |
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The following table presents an overview of our apartment
portfolio as of September 30, 2013:
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| | | | | | | | | | | | | | | | | | Average Monthly |
| | | | | | | | | Year | | | | | | | | | Effective |
| | | | | | Purchase | | | Built or | | | | | | Average | | | Rent per |
| Property Name | | | Location | | | Date | | | Renovated(1) | | | Units(2) | | | Occupancy(3) | | | Occupied Unit(4) |
| Belle Creek | | | Henderson, Colorado | | | 4/29/2011 | | |
2011
| | |
162(5) | | |
97.5%
| | |
$
|
920
|
| Berkshire Square | | | Indianapolis, Indiana | | | 9/19/2013 | | |
2012
| | |
354
| | |
98.0%
| | | |
-(6) |
| Centrepoint | | | Tucson, Arizona | | | 12/16/2011 | | |
2006
| | |
320
| | |
92.5%
| | | |
817
|
| Copper Mill | | | Austin, Texas | | | 4/29/2011 | | |
2010
| | |
320
| | |
97.5%
| | | |
728
|
| Crestmont | | | Marietta, Georgia | | | 4/29/2011 | | |
2010
| | |
228
| | |
93.9%
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705
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Cumberland Glen
| | | Smyrna, Georgia | | | 4/29/2011 | | |
2010
| | |
222
| | |
93.7%
| | | |
666
|
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Heritage Trace
| | | Newport News, Virginia | | | 4/29/2011 | | |
2010
| | |
200
| | |
90.5%
| | | |
725
|
| Runaway Bay | | | Indianapolis, Indiana | | | 10/11/2012 | | |
2002
| | |
192
| | |
88.5%
| | | |
923
|
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Tresa at Arrowhead
| | | Phoenix, Arizona | | | 4/29/2011 | | |
2006
| | |
360
| | |
94.7%
| | |
|
827
|
| | | | | | | | | | | |
2,358
| | |
94.1%
| | |
$
|
789
|
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(1)
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All dates are for the year in which a renovation program was
completed, except for Runaway Bay, which is the year construction
was completed. The year construction was completed for each of the
other properties is: Belle Creek - 2002; Berkshire Square – 1970;
Centrepoint - 1995; Copper Mill - 1984; Crestmont - 1987; Cumberland
Glen - 1987; Heritage Trace - 1973; and Tresa at Arrowhead - 1998.
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(2)
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Units represent the total number of apartment units available for
rent at September 30, 2013.
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(3)
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Average occupancy for each of our properties is calculated as (i)
total units rented as of September 30, 2013 divided by (ii) total
units available as of September 30, 2013, expressed as a percentage.
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(4)
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Average monthly effective rent per occupied unit represents the
average monthly rent for all occupied units for the nine months
ended September 30, 2013.
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(5)
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Does not include 6,256 square feet of retail space in six units, of
which 1,010 square feet of space is occupied by Jupiter for use as
the leasing office. The remaining 5,246 square feet of space is 100%
occupied by five tenants with an average monthly base rent of
$1,564, or $16.50 per square foot per year.
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(6)
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We do not report average effective rent per unit in the month of
acquisition as it is not representative of a full month of
operations.
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Conference Call
All interested parties can listen to the live conference call webcast at
9:00 AM EDT on Friday, November 1, 2013 from the investor relations
section of the IRT website at www.irtreit.com
or by dialing 866.578.5771, access code 74662446. For those who are not
available to listen to the live call, the replay will be available
shortly following the live call on IRT’s website and telephonically
until Friday, November 8, 2013, by dialing 888.286.8010, access code
36182789.
About Independence Realty Trust, Inc.
Independence Realty Trust, Inc. (NYSE MKT: IRT) is a real estate
investment trust that seeks to own well-located apartment properties in
geographic submarkets that it believes support strong occupancy and the
potential for growth in rental rates. IRT seeks to provide stockholders
with attractive risk-adjusted returns, with an emphasis on distributions
and capital appreciation. IRT is externally advised by a wholly-owned
subsidiary of RAIT Financial Trust (NYSE: RAS).
Forward-Looking Statements
This press release may contain certain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended. Such
forward-looking statements can generally be identified by our use of
forward-looking terminology such as "may," “trend”, "will," "expect,"
"intend," "anticipate," "estimate," "believe," "continue," “seek” or
other similar words. Because such statements include risks,
uncertainties and contingencies, actual results may differ materially
from the expectations, intentions, beliefs, plans or predictions of the
future expressed or implied by such forward-looking statements. These
risks, uncertainties and contingencies include, but are not limited to,
those disclosed in IRT’s filings with the Securities and Exchange
Commission. IRT undertakes no obligation to update these forward-looking
statements to reflect events or circumstances after the date hereof or
to reflect the occurrence of unanticipated events, except as may be
required by law.
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| Independence Realty Trust, Inc. |
|
Consolidated Statements of Operations
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(Dollars in thousands, except share and per share information)
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(unaudited)
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| |
| |
| | For the Three-Month | | For the Nine-Month |
| | Period Ended | | Period Ended |
| | September 30 | | September 30 |
| | 2013 |
| 2012 | | 2013 |
| 2012 |
| Revenues: | | |
| | | |
| |
|
Rental income
| |
$
|
4,259
| |
$
|
3,609
| |
$
|
12,655
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$
|
10,827
|
|
Tenant reimbursement and other property income
| | |
225
| | |
202
| | |
668
| | |
596
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Other income
| |
| 303 | |
| 230 | |
| 852 | |
| 694 |
|
Total revenue
| | |
4,787
| | |
4,041
| | |
14,175
| | |
12,117
|
| Expenses: | | | | | | | | |
|
Property operating expenses
| | |
2,414
| | |
2,099
| | |
6,820
| | |
5,908
|
|
General and administrative expenses
| | |
103
| | |
201
| | |
374
| | |
700
|
|
Asset Management Fees
| | |
4
| | |
54
| | |
165
| | |
160
|
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Acquisition expenses
| | |
50
| | |
52
| | |
50
| | |
92
|
|
Depreciation and amortization
| |
| 1,008 | |
| 840 | |
| 3,107 | |
| 2,471 |
|
Total expenses
| |
| 3,579 | |
| 3,246 | |
| 10,516 | |
| 9,331 |
| Operating income | | |
1,208
| | |
795
| | |
3,659
| | |
2,786
|
|
Interest expense
| |
| (906) | |
| (809) | |
| (2,693) | |
| (2,408) |
| Net income (loss): | | |
302
| | |
(14)
| | |
966
| | |
378
|
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Income allocated to preferred stock
| | |
(2)
| | |
(4)
| | |
(10)
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(12)
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Income (loss) allocated to non-controlling interests
| |
| (45) | |
| (10) | |
| (649) | |
| (434) |
| Net income (loss) allocable to common stock | | $ | 255 | | $ | (28) | | $ | 307 | | $ | (68) |
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| Earnings (loss) per share: | | | | | | | | |
|
Basic
| | $ | 0.03 | | $ | (0.09) | | $ | 0.08 | | $ | (0.26) |
|
Diluted
| | $ | 0.03 | | $ | (0.09) | | $ | 0.08 | | $ | (0.26) |
| Weighted-average shares: | | | | | | | | |
|
Basic
| |
| 7,643,540 | |
| 324,359 | |
| 3,875,331 | |
| 256,883 |
|
Diluted
| |
| 7,643,540 | |
| 324,359 | |
| 3,875,331 | |
| 256,883 |
| Dividends declared per common share | | $ | 0.16 | | $ | 0.15 | | $ | 0.47 | | $ | 0.45 |
| | | | | | | |
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| Independence Realty Trust, Inc. |
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Consolidated Balance Sheets
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(Dollars in thousands, except share and per share information)
|
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(unaudited)
|
| | | |
|
| | As of | | As of |
| | September 30, | | December 31, |
| | 2013 |
| 2012 |
| Assets: | | | | |
|
Investments in real estate:
| | | | |
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Investments in real estate at cost
| |
$
|
166,665
| |
$
|
153,565
|
|
Accumulated depreciation
| |
| (14,805) | |
| (12,283) |
|
Investments in real estate, net
| | |
151,860
| | |
141,282
|
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Cash and cash equivalents
| | |
16,526
| | |
2,533
|
|
Restricted cash
| | |
1,076
| | |
1,150
|
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Accounts receivable and other assets
| | |
1,035
| | |
345
|
|
Deferred costs and Intangible assets, net of accumulated
amortization of $475 and $147, respectively
| |
|
1,528
| |
|
887
|
| Total assets | | $ | 172,025 | | $ | 146,197 |
| | | |
|
| Liabilities and Equity: | | | | |
|
Mortgage indebtedness
| |
$
|
92,284
| |
$
|
92,413
|
|
Accounts payable and accrued expenses
| | |
2,329
| | |
1,986
|
|
Accrued interest payable
| | |
31
| | |
32
|
|
Dividends payable
| | |
514
| | |
499
|
|
Other liabilities
| |
| 652 | |
| 416 |
| Total liabilities | | |
95,810
| | |
95,346
|
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| Equity: | | | | |
|
Stockholders’ equity:
| | | | |
Preferred stock, $0.01 par value; 50,000,000 shares authorized, 0
and 125 shares issued and outstanding, respectively
| | |
-
| | |
-
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Common stock, $0.01 par value; 300,000,000 shares authorized,
9,643,540 and 345,063 shares issued and outstanding, respectively
| | |
96
| | |
3
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Additional paid in capital
| | |
78,182
| | |
3,490
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Retained earnings (accumulated deficit)
| |
|
(2,063)
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|
(401)
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Total stockholders’ equity
| | |
76,215
| | |
3,092
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Non-controlling interests
| |
|
-
|
|
|
47,759
|
| Total equity | |
|
76,215
|
|
|
50,851
|
| Total liabilities and equity | |
$
|
172,025
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$
|
146,197
|
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Schedule I
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| Independence Realty Trust, Inc. |
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Reconciliation of Net income (loss) Allocable to Common Stock and
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Funds From Operations (“FFO”) and
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Core Funds From Operations (“CFFO”) (1)
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(Dollars in thousands, except share and per share amounts)
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(unaudited)
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| | For the Three-Month Period Ended | | For the Nine-Month Period Ended |
| | September 30, |
| September 30, |
| | 2013 |
|
|
| 2012 |
|
|
| 2013 |
|
|
| 2012 |
|
|
| | | | Per Share | | | | Per Share | | |
| Per Share |
| |
| Per Share |
| | Amount | | (2) | | Amount | | (3) | | Amount | | (2) | | Amount | | (3) |
| Funds From Operations: | | | | | | | | | | | | | | | | |
|
Net income (loss)
| | $302 | | $0.04 | | $(14) | | $0.00 | | $966 | | $0.15 | | $378 | | $0.07 |
|
Adjustments:
| | | | | | | | | | | | | | | | |
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Income allocated to preferred shares
| |
(2)
| |
0.00
| |
(4)
| |
0.00
| |
(10)
| |
0.00
| |
(12)
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0.00
|
|
Income allocated to preferred units
| |
(45)
| |
(0.01)
| |
-
| |
-
| |
(88)
| |
(0.01)
| |
-
| |
-
|
|
Real estate depreciation and amortization
| |
1,008
|
|
0.13
|
|
840
|
|
0.15
|
|
3,107
|
|
0.49
|
|
2,471
|
|
0.45
|
|
Funds From Operations
| | $1,263 |
| $0.17 |
| $822 |
| $0.15 |
| $3,975 |
| $0.63 |
| $2,837 |
| $0.52 |
| | | | | | | | | | | | | | | |
|
| Core Funds From Operations: | | | | | | | | | | | | | | | | |
|
Funds From Operations
| | $1,263 | | $0.17 | | $822 | | $0.15 | | $3,975 | | $0.63 | | $2,837 | | $0.52 |
|
Adjustments:
| | | | | | | | | | | | | | | | |
|
Acquisition fees and expenses
| |
50
|
|
0.00
|
|
52
|
|
0.01
|
|
50
|
|
0.01
|
|
92
|
|
0.01
|
|
Core Funds From Operations
| | $1,313 |
| $0.17 |
| $874 |
| $0.16 |
| $4,025 |
| $0.64 |
| $2,929 |
| $0.53 |
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(1)
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IRT believes that FFO and Core FFO, each of which is a non-GAAP
measure, are additional appropriate measures of the operating
performance of a REIT and IRT in particular. IRT computes FFO in
accordance with the standards established by the National
Association of Real Estate Investment Trusts, or NAREIT, as net
income or loss allocated to common stock (computed in accordance
with GAAP), excluding real estate-related depreciation and
amortization expense, gains or losses on sales of real estate and
the cumulative effect of changes in accounting principles.
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Core FFO is a computation made by analysts and investors to measure
a real estate company’s operating performance by removing the effect
of items that do not reflect ongoing property operations, including
acquisition expenses, expensed costs related to the issuance of
shares of our common stock and equity-based compensation expenses,
from the determination of FFO. IRT incurs acquisition expenses in
connection with acquisitions of real estate properties and expense
those costs when incurred in accordance with U.S. GAAP. As these
expenses are one-time and reflective of investing activities rather
than operating performance, IRT adds back these costs to FFO in
determining Core FFO.
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IRT’s calculation of Core FFO differs from the methodology used
for calculating Core FFO by certain other REITs and, accordingly,
IRT’s Core FFO may not be comparable to Core FFO reported by other
REITs. IRT’s management utilizes FFO and Core FFO as measures of
IRT’s operating performance, and believes they are also useful to
investors, because they facilitate an understanding of IRT’s
operating performance after adjustment for certain non-cash items,
such as depreciation and amortization expenses, and acquisition
expenses and pursuit costs that are required by GAAP to be
expensed but may not necessarily be indicative of current
operating performance and that may not accurately compare IRT’s
operating performance between periods. Furthermore, although FFO,
Core FFO and other supplemental performance measures are defined
in various ways throughout the REIT industry, IRT also believes
that FFO and Core FFO may provide IRT and our investors with an
additional useful measure to compare IRT’s financial performance
to certain other REITs. IRT also uses Core FFO for purposes of
determining the quarterly incentive fee, if any, payable to our
advisor beginning with the second quarter of 2013. Neither FFO nor
Core FFO is equivalent to net income or cash generated from
operating activities determined in accordance with GAAP.
Furthermore, FFO and Core FFO do not represent amounts available
for management’s discretionary use because of needed capital
replacement or expansion, debt service obligations or other
commitments or uncertainties. Neither FFO nor Core FFO should be
considered as an alternative to net income as an indicator of
IRT’s operating performance or as an alternative to cash flow from
operating activities as a measure of IRT’s liquidity.
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(2)
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Based on 7,643,540 and 6,309,900 weighted-average shares
outstanding-diluted for the three-month and nine-month periods ended
September 30, 2013. This includes 5,274,900 limited partnership
units that were exchanged for common stock on May 7, 2013.
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(3)
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Based on 5,599,259 and 5,531,783 weighted-average shares
outstanding-diluted for the three-month and nine-month periods ended
September 30, 2012. This includes 5,274,900 limited partnership
units that were exchangeable for common stock as of September 30,
2012.
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Independence Realty Trust, Inc. Contact
Andres Viroslav,
215-243-9000
aviroslav@irtreit.com
Source: Independence Realty Trust, Inc.