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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
APRIL 28, 2003
(Date of Report)
MANUFACTURED HOME COMMUNITIES, INC.
(Exact name of registrant as specified in its Charter)
1-11718
(Commission File No.)
MARYLAND 36-3857664
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
TWO NORTH RIVERSIDE PLAZA, CHICAGO, ILLINOIS 60606
(Address of principal executive offices) (Zip Code)
(312) 279-1400
(Registrant's telephone number, including area code)
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ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
The information contained in the attached exhibit is unaudited and
should be read in conjunction with the Registrant's annual and quarterly reports
filed with the Securities and Exchange Commission.
Exhibit 99.1 Manufactured Home Communities, Inc. press release
dated April 22, 2003 "MHC Reports First Quarter
Results".
ITEM 12. DISCLOSURE OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On April 22, 2003, Manufactured Home Communities, Inc. issued a press
release announcing its results of operations for the quarter ended March 31,
2003. This information is furnished as Exhibit 99.1 under this Item 12 of Form
8-K in accordance with interim guidance provided by the Securities and Exchange
Commission in Release No. 33-8216 issued March 27, 2003.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
MANUFACTURED HOME COMMUNITIES, INC.
BY: /s/ John M. Zoeller
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John M. Zoeller
Vice President, Treasurer and
Chief Financial Officer
BY: /s/ Mark Howell
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Mark Howell
Principal Accounting Officer and
Assistant Treasurer
DATE: April 28 2003
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Exhibit 99.1
CONTACT: John Zoeller FOR IMMEDIATE RELEASE
(312) 279-1466 April 22, 2003
MHC REPORTS FIRST QUARTER RESULTS
Continues Solid Performance
CHICAGO, IL - April 22, 2003-- Manufactured Home Communities, Inc.
(NYSE: MHC) today announced results for the quarter ended March 31, 2003.
For the first quarter of 2003, Funds From Operations (FFO) were $18.6
million or $.67 per share on a fully diluted basis compared to $17.9 million or
$.65 per fully diluted share in the same period in 2002. First quarter property
operating revenues were $59.6 million compared to $57.7 million in the first
quarter of 2002. For the first quarter of 2003, average occupancy was 92.3
percent and average monthly base rent per site for the Core Portfolio was
$417.51, up 5.3 percent from $396.60 in the same period last year. First quarter
results reflect a seasonal increase in FFO from Resort Properties (park model /
recreational vehicle properties).
MHC's management projects continued growth in 2003 core property
performance. Through March 31, 2003, Core Portfolio average base rent rate
growth has been approximately 5 percent. Assuming current economic conditions
continue to impact occupancies, overall revenue growth will be approximately 3
percent. Core portfolio operating expenses are expected to grow in excess of CPI
due to continued increases in insurance, real estate taxes and utility expenses.
These projections would result in core NOI growth of approximately 2 to 2.5
percent.
Results for 2003 will continue to be impacted by 1) the 2002 sales of
primarily all-age communities in Michigan, Florida, Minnesota and Ohio coupled
with the 2002 purchases of age-qualified communities in Florida, Arizona, and
Texas, 2) continued competitive housing options impacting occupancy levels at
certain communities and 3) variability in income from home sales operations. In
the age-qualified communities, home sales results could be impacted by the
ability of potential homebuyers to sell their existing residences as well as by
financial markets volatility. In the all-age communities, results from home
sales and occupancy will continue to be impacted by local economic conditions,
lack of affordable manufactured home financing and competition from alternative
housing options including site-built single family housing. Based upon these
factors, MHC projects that growth in FFO per share should be between 0 and 3
percent for the full year of 2003 compared to the full year of 2002.
The forward-looking statements contained in this news release are
subject to certain risks and uncertainties including, but not limited to, the
Company's ability to maintain rental rates and occupancy; the Company's
assumptions about rental and home sales markets; the effect of interest rates as
well as other risks indicated from time to time in the Company's filings with
the Securities and Exchange Commission. The Company assumes no obligation to
update or supplement forward-looking statements that become untrue because of
subsequent events.
Manufactured Home Communities, Inc. owns or has a controlling interest
in 142 quality communities in 21 states consisting of 51,537 sites. MHC is a
self-administered, self-managed, real estate investment trust (REIT) with
headquarters in Chicago.
A live webcast of the Company's conference call discussing these
results will be available via the Company's website in the Investor Info section
at www.mhchomes.com at 10:00 a.m. Central today.
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TABLES FOLLOW
MANUFACTURED HOME COMMUNITIES, INC.
SELECTED FINANCIAL DATA
(UNAUDITED)
(AMOUNTS IN THOUSANDS EXCEPT FOR PER SHARE DATA)
QUARTERS ENDED
MAR. 31, MAR. 31,
2003 2002
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PROPERTY OPERATIONS:
Community base rental income..................... $ 50,167 $ 49,986
Resort base rental income........................ 4,077 2,437
Utility and other income......................... 5,338 5,242
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Property operating revenues................... 59,582 57,665
Property operating and maintenance............... 16,937 16,057
Real estate taxes................................ 4,752 4,577
Property management.............................. 2,352 2,407
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Property operating expenses................... 24,041 23,041
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Income from property operations............... 35,541 34,624
HOME SALES OPERATIONS:
Gross revenues from inventory home sales......... 4,115 4,726
Cost of inventory home sales..................... (3,470) (3,735)
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Gross profit from inventory home sales........ 645 991
Brokered resale revenues, net.................... 376 431
Home selling expenses............................ (1,894) (2,118)
Ancillary services revenues, net................. 482 557
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Income from home sales and other.............. (391) (139)
OTHER INCOME AND EXPENSES:
Interest income.................................. 261 264
Income from unconsolidated joint ventures........ 589 375
General and administrative....................... (1,932) (1,880)
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Operating income (EBITDA)..................... 34,068 33,244
Interest and related amortization................ (12,393) (12,550)
Income from discontinued operations.............. --- 298
Depreciation on corporate assets................. (310) (326)
Income allocated to Preferred OP Units........... (2,813) (2,813)
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FUNDS FROM OPERATIONS (FFO)................... $ 18,552 $ 17,853
Depreciation on real estate and other costs...... (9,033) (8,971)
Gain on sale of properties and other............. --- ---
Income allocated to Common OP Units.............. (1,847) (1,767)
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NET INCOME.................................... $ 7,672 $ 7,115
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NET INCOME PER COMMON SHARE - BASIC................ $ .35 $ .33
NET INCOME PER COMMON SHARE - FULLY DILUTED........ $ .34 $ .32
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FFO PER COMMON SHARE - BASIC....................... $ .68 $ .66
FFO PER COMMON SHARE - FULLY DILUTED............... $ .67 $ .65
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Average Common Shares - Basic...................... 21,918 21,433
Average Common Shares and OP Units - Basic......... 27,276 26,856
Average Common Shares and OP Units - Fully Diluted. 27,740 27,508
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The Company believes that Funds From Operations provide an indicator of
its financial performance and is influenced by both the operations of the
properties and the capital structure of the Company. FFO is defined by the
National Association of Real Estate Investment Trusts ("NAREIT") as net income
(computed in accordance with generally accepted accounting principles ["GAAP"]),
before allocation to minority interests, excluding gains (or losses) from sales
of property, plus real estate depreciation. The Company computes FFO in
accordance with the NAREIT definition, which may differ from the methodology for
calculating FFO utilized by other equity REITs and, accordingly, may not be
comparable to such other REITs.
MANUFACTURED HOME COMMUNITIES, INC.
(UNAUDITED)
AS OF AS OF
SELECTED BALANCE SHEET DATA: MARCH 31, DECEMBER 31,
2003 2002
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(amounts in (amounts in
000's) 000's)
Total real estate, net......................... $ 1,053,343 $ 1,057,909
Cash and cash equivalents...................... $ 12,745 $ 7,270
Total assets................................... $ 1,166,513 $ 1,162,850
Mortgage notes payable......................... $ 574,140 $ 575,370
Unsecured debt................................. $ 186,863 $ 184,863
Total liabilities.............................. $ 820,246 $ 816,730
Minority interest.............................. $ 168,229 $ 168,501
Total shareholder's equity..................... $ 178,038 $ 177,619
AS OF AS OF
MARCH 31, DECEMBER 31,
TOTAL SHARES AND OP UNITS OUTSTANDING: 2003 2002
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Total Common Shares Outstanding............... 22,228,183 22,093,240
Total Common OP Units Outstanding............. 5,355,658 5,359,927
MANUFACTURED HOME ("COMMUNITY") AND AS OF AS OF
PARK MODEL / RECREATIONAL VEHICLE ("RESORT") MARCH 31, DECEMBER 31,
SITE TOTALS: 2003 2002
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Community Sites Owned and Operated............. 43,861 43,906
Community Sites Owned in Joint Ventures........ 1,521 1,521
Resort Sites Owned and Operated................ 6,155 6,155
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TOTAL SITES............................... 51,537 51,582
QUARTERS ENDED
MANUFACTURED HOME SITE AND MAR. 31, MAR. 31,
OCCUPANCY AVERAGES: 2003 2002
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Total Sites................................... 43,861 45,496
Occupied Sites................................ 40,473 42,577
Occupancy %................................... 92.3% 93.6%
Monthly Base Rent Per Site.................... $ 413.17 $ 393.42
Core* Monthly Base Rent Per Site.............. $ 417.51 $ 396.60
(*) Represents rent per site for properties owned in both periods of comparison.
QUARTERS ENDED
MAR. 31, MAR. 31,
HOME SALES: 2003 2002
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New Home Sales Volume......................... 52 57
New Home Sales Gross Revenues................. $ 3,609 $ 4,309
Used Home Sales Volume........................ 35 37
Used Home Sales Gross Revenues................ $ 506 $ 417
Brokered Home Resale Volume................... 260 231
Brokered Home Resale Revenues, net............ $ 376 $ 431
