Earnings Review and Free Research Report: EPR Properties’ Revenue Soared 25.3%, Adjusted FFO Climbed 10.3%
Research Desk Line-up: GGP Inc. Post Earnings Coverage
LONDON, UK / ACCESSWIRE / August 23, 2017 /Pro-Trader Daily has just published a free post-earnings coverage on EPR Properties (NYSE: EPR), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=EPR, following the Company's release of its second quarter fiscal 2017 operating results on August 03, 2017. The real estate investment trust outperformed top- and bottom-line expectations and raised its investment spending forecast for 2017. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:
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For the three months ended June 30, 2017, EPR Properties' total revenue surged 25% to $147.8 million compared to revenue of $118.0 million for Q2 2016. The Company's revenue number exceeded Wall Street's expectations of $114.1 million.
Net income available to EPR Properties common shareholders was $74.6 million, or $1.02 per diluted common share, for Q2 2017 compared to $49.2 million, or $0.77 per diluted common share, for Q2 2016.
During Q2 2017, EPR Properties' funds from operations (FFO) were $85.0 million, or $1.15 per diluted common share, compared to $72.2 million, or $1.13 per diluted common share, for Q2 2016. The Company's adjusted FFO (AFFO) for the reported quarter was $94.9 million, or $1.29 per diluted common share, compared to $74.7 million, or $1.17 per diluted common share, for the prior year's same quarter, representing a 10% increase in per share results. EPR Properties' AFFO numbers topped Wall Street's expectations of $1.24 per share.
As of June 30, 2017, EPR Properties' investment portfolio consisted of the following:
- EPR Properties' Entertainment segment included investments in 144 megaplex theatre properties, 7 entertainment retail centers, and 8 family entertainment centers. The Company's portfolio of owned entertainment properties consisted of 12.4 million square feet and was 99% leased, including megaplex theatres that were 100% leased.
- EPR Properties' Education segment consisted of investments in 67 public charter schools, 59 early education centers, and 14 private schools. The Company's portfolio of owned education properties consisted of 4.2 million square feet and was 99% leased. EPR Properties' Recreation segment comprised of investments in 26 ski areas, 20 attractions, 27 golf entertainment complexes, and 5 other recreation facilities. The Company's portfolio of owned recreation properties was 100% leased.
- As of June 30, 2017, EPR Properties' combined owned portfolio consisted of 19.3 million square feet which was 99.3% leased. The Company also had a total of $271.7 million invested in property under development.
For Q2 2017, EPR Properties' investment totaled $936.1 million, bringing the year-to-date investment spending to $1.2 billion.
During Q2 2017, EPR Properties' Entertainment investment spending totaled $84.1 million, including spending on build-to-suit development and redevelopment of megaplex theatres, entertainment retail centers, and family entertainment centers, as well as $47.9 million in acquisitions of three megaplex theatres. The Company's Education investment spending during the reported quarter were $76.3 million, including amount spent on build-to-suit development and redevelopment of public charter schools, early education centers, and private schools, as well as $19.7 million in acquisitions of three early education centers and one public charter school and an investment of $21.4 million in mortgage notes receivable.
EPR Properties' recreation investment spending totaled $775.6 million during Q2 2017, including the transaction with CNL Lifestyle Properties Inc. and funds affiliated with Och-Ziff Real Estate valued at $730.8 million. Additionally, build-to-suit development of golf entertainment complexes and attractions and redevelopment of ski areas were included in recreation investment spending.
During Q2 2017, EPR Properties sold seven properties, four in the Education segment and three in the Entertainment segment, for total proceeds of approximately $112.4 million and recognized a net gain on sale of real estate of $25.5 million. Dispositions and mortgage note payoff (excluding principal amortization) totaled $134.5 million for H1 2017.
Balance Sheet Update
At June 30, 2017, EPR Properties had a net debt to adjusted EBITDA ratio of 5.28x. The Company had $70.9 million of unrestricted cash on hand and no balance outstanding under its $650 million unsecured revolving credit facility at June 30, 2017.
During Q2 2017, EPR Properties prepaid in full four mortgage notes payable totaling $30.2 million. Additionally, the Company prepaid in full a mortgage note payable of $87.0 million that was secured by 11 theatre properties. In connection with this note payoff, the Company recorded a gain on early extinguishment of debt of $1.0 million.
On May 23, 2017, the Company issued $450.0 million in senior unsecured notes due on June 01, 2027. The notes bear interest at an annual rate of 4.50% and are guaranteed by certain of the Company's subsidiaries. The Company used the net proceeds from the note offering to pay down its unsecured revolving credit facility and for general business purposes, including funding the Company's ongoing pipeline of acquisition and build-to-suit projects.
EPR Properties re-affirmed it's 2017 guidance for AFFO in the range of $5.05 to $5.20. The Company raised its 2017 investment spending guidance to a band of $1.45 billion to $1.50 billion from $1.30 billion to $1.35 billion. Disposition proceeds are expected to total between $175.0 million to $250.0 million for 2017.
At the close of trading session on Tuesday, August 22, 2017, EPR Properties' stock price slightly fell 0.50% to end the day at $67.30. A total volume of 517.01 thousand shares were exchanged during the session, which was above the 3-month average volume of 516.88 thousand shares. The Company's shares are trading at a PE ratio of 19.82 and have a dividend yield of 6.06%. At Tuesday's closing price, the stock's net capitalization stands at $5.01 billion.
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