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Dec 31, 2022

Sun Communities Q4 2022 Earnings Report

Sun Communities reported mixed Q4 2022 results with a decrease in net income but an increase in Core FFO. The company highlighted strong demand and strategic investments driving solid performance, along with record RV conversions.

Key Takeaways

Sun Communities reported a net income of $4.7 million, or $0.04 per diluted share, for Q4 2022, compared to $12.9 million, or $0.11 per diluted share, for the same period in 2021. Core FFO was $1.33 per share, a 1.5% increase year-over-year. The company reported strong demand and accretive investments drive continued solid performance. They are expecting total Same Property NOI growth of 4.9% - 5.9% in 2023.

Net income attributable to common shareholders was $4.7 million, or $0.04 per diluted share.

Core FFO was $1.33 per Share, representing a 1.5% increase as compared to the corresponding period in 2021.

Same Property NOI for MH and RV properties increased by 4.4%.

Record volume of transient-to-annual RV conversions propel record gains in revenue producing sites.

Total Revenue
$674M
Previous year: $542M
+24.3%
EPS
$1.33
Previous year: $1.31
+1.5%
RV Occupancy
100%
Previous year: 100%
+0.0%
Gross Profit
$296M
Previous year: $259M
+14.4%
Cash and Equivalents
$72.8M
Previous year: $65.8M
+10.6%
Total Assets
$17.1B
Previous year: $13.5B
+26.6%

Sun Communities

Sun Communities

Sun Communities Revenue by Segment

Forward Guidance

The Company is establishing full-year and first quarter 2023 guidance for diluted EPS and Core FFO per Share.

Positive Outlook

  • Expecting Total Same Property NOI Growth of 4.9% - 5.9% during the year ending December 31, 2023.
  • Total Expected NOI from Real Property: Change in 2023 Revenues Real property (excluding transient) 9.8% - 10.2%
  • Real property (transient) 0.9% - 2.1%
  • Increase in revenue producing sites 2,800 - 3,100
  • Vacant site additions from expansions and ground-up developments 1,000 - 1,300

Challenges Ahead

  • Diluted EPS $(0.03) - $0.02 for the first quarter ending March 31, 2023
  • Total property operating expenses 13.5% - 13.9%
  • General and administrative expenses $256.5 - $261.6 millions
  • NOI from real property and home sales(a) $155.5 - $165.1 millions
  • Total Same Property NOI(1) growth during the first quarter ending March 31, 2023 is 3.3% - 4.4%.

Revenue & Expenses

Visualization of income flow from segment revenue to net income