Garrett Motion Announces Successful Repricing of Term Loan
Not for distribution to U.S. newswire services or dissemination in the United States. TORONTO, Aug. 06, 2025 (GLOBE NEWSWIRE) — Flagship Communities Real Estate Investment Trust (“Flagship” or the “REIT”) (TSX: MHC.U; MHC.UN) today released its second quarter 2025 results. The financial results of the REIT are prepared in accordance with International Accounting Standard 34 (“IAS 34”), Interim Financial Reporting, as issued by the International Accounting Standards Board (the “IASB”). Results are shown in U.S. dollars, unless otherwise noted. Second Quarter 2025 ResultsCompared to Second Quarter 2024 Results
Rental revenue and related income was $25.1 million, an increase of 18.1% compared to $21.2 millionSame Community Revenue1 was $22.7 million, up 12.2% compared to $20.2 millionNet income and comprehensive income was $35.1 million compared to $43.5 millionNet Operating Income (“NOI”) was $16.7 million, up 18.7% compared to $14.1 millionSame Community NOI1 was $15.0 million, an increase of 14.2%, compared to $13.1 millionNOI Margin1 was 66.6% compared to 66.2%Same Community NOI Margin1 was 66.0%, compared to 64.8%Funds from operations (“FFO”) per unit (diluted)2 was $0.385 compared to $0.330, which was an increase of $0.055 per unit, or 16.7O adjusted per unit (diluted)2 was $0.357 compared to $0.314, which was an increase of $0.043 per unit, or 13.7% Adjusted funds from operations (“AFFO”) per unit (diluted)2 was $0.353 compared to $0.292, which was an increase of $0.061 per unit, or 20.9% AFFO adjusted per unit (diluted)2 was $0.326 compared to $0.276, which was an increase of $0.050 per unit, or 18.1% Rent Collections1 were 99.2%, compared to 98.7%The integration process for the seven Manufactured Housing Communities (“MHC”) in Tennessee and West Virginia acquired by Flagship has continued. Occupancy levels have steadily increased in West Virginia and new home sales have continued to advance in the Nashville, Tennessee market. Flagship also recently added an amenities package and new clubhouse in one of the Nashville communitiesFlagship’s Derby Hills Pointe community in Alexandria, Kentucky was recognized as the 2025 Community of the Year by the Kentucky Manufactured Housing Institute (“KMHI”). This is the fourth consecutive year Flagship has won the KMHI Community of the Year awardAs at June 30, 2025NAV1 and NAV per Unit1 were $727.9 million and $28.96, respectively, compared to $670.8 million and $26.71 as at December 31, 2024, respectively Debt to Gross Book Value1 was 36.5%, compared to 38.1% as at December 31, 2024Total portfolio Occupancy1 was 85.1%, compared to 83.5% as at December 31, 2024Same Community1 Occupancy1 was 85.5%, an increase of 1.2% from 84.3% as at December 31, 2024 1See “Other Real Estate Industry Metrics” 2See “Non-IFRS Financial Measures” “During the second quarter, our operations continued to perform according to plan, which has set us up nicely to have another great year in 2025,” said Kurt Keeney, President and CEO. “In addition to growing our top-line and Same Community metrics as well as occupancy levels, we continue to demonstrate the consistency and stability of the MHC sector, which for the past 25 years has outperformed all other real estate sectors.” Financial Summary($000s except per unit amounts) For the three months ended Jun. 30, 2025For the three months ended Jun. 30, 2024Variance For the six months ended Jun. 30, 2025For the six months ended Jun. 30, 2024VarianceRental revenue and related income25,067 21,232 18.1,848 41,152 21.1%Same Community Revenue122,665 20,199 12.2,149 40,119 12.5quisitions Revenue12,402 1,033 132.5%4,699 1,033 354.9%Net income and comprehensive income35,091 43,456 (19.2),550 54,580 (16.5%)NOI, total portfolio16,684 14,060 18.7,087 27,397 20.8%Same Community NOI114,956 13,094 14.2,153 26,431 14.1quisitions NOI11,728 966 78.9%2,934 966 203.7%NOI Margin1, total portfolio66.6.2%0.4.4.6%(0.2)%Same Community NOI Margin166.0.8%1.2.8.9%0.9quisitions NOI Margin171.9.6%(21.7).4.6%(31.2)O29,669 7,938 21.8,021 12,292 46.6O per unit20.385 0.330 16.7%0.717 0.544 31.8O adjusted28,975 7,538 19.1,555 14,415 21.8O adjusted per unit20.357 0.314 13.7%0.699 0.638 9.6FO28,882 7,028 26.4,453 10,525 56.3FO per unit20.353 0.292 20.9%0.655 0.466 40.6FO Payout Ratio243.6.7%(12.3).1.8%(25.0)FO adjusted28,188 6,628 23.5,987 12,648 26.4FO adjusted per unit20.326 0.276 18.1%0.636 0.560 13.6FO adjusted Payout Ratio247.3.7%(10.2).5.2%(7.1)%Weighted average units (diluted)25,131,790 24,033,350 1,098,440 25,126,553 22,590,314 2,536,239 1. See “Other Real Estate Industry Metrics” 2. See “Non-IFRS Financial Measures” Financial Overview Rental revenue and related income in the second quarter of 2025 was $25.1 million, up 18.1% compared to the same period last year. This increase was primarily driven by Acquisitions as well as lot rent increases and Occupancy increases across the portfolio. Same Community Revenue for the second quarter of 2025 was $22.7 million, approximately $2.5 million higher than the same period last year. This increase was a result of increasing monthly lot rent year over year, growth in Same Community Occupancy, increased utility reimbursements, and ancillary revenue agreements. Net income and comprehensive income for the three months ended June 30, 2025 was $35.1 million, which was $8.4 million less than the same period last year, as a result of the fair value adjustments on investment properties and Class B Units of Flagship Operating, LLC (“Class B Units”) being $9.5 million less than in the same period in 2024. NOI and NOI Margin for the second quarter of 2025 were $16.7 million and 66.6%, respectively, compared to $14.1 million and 66.2% during the second quarter of 2024. Same Community NOI Margin for the second quarter ended June 30, 2025 was 66.0%, which was an increase of 1.2% over the same period last year as a result of lower repairs and maintenance expenses as well as increased utility recapture. While NOI saw an increase from ancillary services, NOI Margins were negatively impacted due to these ancillary services having a lower margin than what has historically been achieved by the REIT. Same Community Occupancy was 85.5% as at June 30, 2025. During the year ended December 31, 2024, two communities completed an expansion that resulted in an addition of 81 and 31 lots, respectively, with capacity for more lots as opportunities allow. The addition of these 112 lots decreased Same Community Occupancy by approximately (0.6)% as at June 30, 2025, but the REIT expects to have these lots occupied, and to add additional lots to meet demand, in the normal course of business. Adjusted for the impact of this expansion, total portfolio Occupancy and Same Community Occupancy would have been 85.6% and 86.1%, respectively, as at June 30, 2025. FFO for the second quarter of 2025 was $9.7 million, an increase of 21.8% from the second quarter of 2024. FFO per unit for the three months ended June 30, 2025 and 2024 was $0.385 and $0.330 respectively, an increase of 16.7%. FFO adjusted was $9.0 million for the second quarter of 2025, a 19.1% increase compared to the same period last year. FFO adjusted per unit for the second quarter of 2025 was $0.357, a 13.7% increase compared to the same period in 2024. AFFO for the second quarter of 2025 was $8.9 million, an increase of 26.4% from the second quarter of 2024. AFFO per unit for the three months ended June 30, 2025 was $0.353, an increase of 20.9% from the same period last year. AFFO adjusted was $8.2 million for the second quarter of 2025, a 23.5% increase compared to the same period last year. AFFO adjusted per unit for the second quarter of 2025 was $0.326, an 18.1% increase compared to the same period in 2024. Rent Collections for the second quarter of 2025 were 99.2%, an increase of 0.5% compared to the same period last year. As at June 30, 2025 the REIT’s Weighted Average Mortgage and Note Interest Rate (see “Other Real Estate Industry Metrics” for more information) was 4.26% and the REIT’s Weighted Average Mortgage and Note Term (see “Other Real Estate Industry Metrics” for more information) to maturity was 9.5 years. Flagship’s Liquidity (see “Other Real Estate Industry Metrics” for more information) as at June 30, 2025 was approximately $13.4 million consisting of cash, cash equivalents, and available capacity on lines of credit. Operations Overview The REIT continues to advance the integration process and home expansion strategy for the seven MHCs Flagship acquired in Tennessee and West Virginia, as well as its lot expansion strategy across the portfolio. Occupancy levels have steadily increased in West Virginia and new home sales have continued to advance in the Nashville, Tennessee market. Flagship also recently added an amenities package and new clubhouse in one of the Nashville communities. For the fourth consecutive year, Flagship was awarded Community of the Year by the KMHI. This year’s award was granted to the REIT’s Derby Hills Pointe community in Alexandria, Kentucky. Flagship acquired the 170-lot Derby Hills Pointe in 2015 and has since transformed it into a model community through thoughtful infrastructure upgrades and community-building amenities. Additions include a new clubhouse, solar street lighting, an institutional-grade playground, basketball courts, and a newly installed dog park. Derby Hills also operates a resident-driven food pantry, partners with local churches to provide back-to-school programs and organizes annual events such as Halloween parties, Thanksgiving meal donations, and Christmas festivities. As at June 30, 2025, the REIT owned a 100% interest in a portfolio of 80 MHCs with 14,670 lots as well as two recreational vehicle (“RV”) resort communities with 470 sites. The table below provides a summary of the REIT’s portfolio as of June 30, 2025, compared to December 31, 2024: ($000s except per unit and Weighted Average Lot Rent amounts) As at June 30, 2025 As at December 31, 2024Total communities(#)82 82Total lots(#)15,140 15,137Weighted Average Lot Rent1(US$)484 448Total portfolio Occupancy1(%)85.1 83.5Same Community1 Occupancy1(%)85.5 84.3NAV1(US$)727,863 670,784NAV per Unit1(US$)28.96 26.71Debt to Gross Book Value1(%)36.5 38.1Weighted Average Mortgage and Note Interest Rate1(%)4.26 4.41Weighted Average Mortgage and Note Term1(Years)9.5 91. See “Other Real Estate Industry Metrics” Outlook Flagship maintains a positive outlook for the MHC industry and believes it offers significant upside potential to investors. This is primarily due to the MHC industry’s consistent track record of historical outperformance relative to other real estate classes. Rising home ownership costs and limited new supply, have led to greater housing unaffordability for many Americans. Additionally, the lack of supply of new manufactured housing communities given the various layers of regulatory restrictions, competing land uses and scarcity of land zoned has created high barriers to entry for new market entrants. Other macro and MHC industry-specific characteristics and trends that support Flagship’s positive outlook include: Increasing household formations;Lower housing and rental affordability;Declining single-family residential homeownership ratesNon-IFRS Financial Measures In this news release, the REIT uses certain financial measures that are not defined under IFRS including certain non-IFRS ratios, to measure, compare and explain the operating results, financial performance and cash flows of the REIT. These measures are commonly used by entities in the real estate industry as useful metrics for measuring performance. However, they do not have any standardized meaning prescribed by IFRS and are not necessarily comparable to similar measures presented by other publicly traded entities. These measures should be considered as supplemental in nature and not as a substitute for related financial information prepared in accordance with IFRS. Funds from Operations and Adjusted Funds from Operations Funds from operations (“FFO”) and adjusted funds from operations (“AFFO”) are calculated in accordance with the definition provided by the Real Property Association of Canada (“REALPAC”). FFO is defined as IFRS consolidated net income (loss) adjusted for items such as distributions on redeemable or exchangeable units (including distributions on the Class B Units), unrealized fair value adjustments to Class B Units, unrealized fair value adjustments to investment properties, unrealized fair value adjustments to unit based compensation, loss on extinguishment of acquired mortgages payable, gain on disposition of investment properties, and depreciation. FFO should not be construed as an alternative to consolidated net income (loss), or consolidated cash flows provided by (used in) operating activities determined in accordance with IFRS. The REIT’s method of calculating FFO is substantially in accordance with REALPAC’s recommendations but may differ from other issuers’ methods and, accordingly, may not be comparable to FFO reported by other issuers. Refer to section “Reconciliation of FFO, FFO per unit, FFO adjusted, FFO adjusted per unit, AFFO, AFFO per unit, AFFO adjusted and AFFO adjusted per unit” for a reconciliation of FFO and FFO adjusted to net income (loss) and comprehensive income (loss). “FFO per unit (diluted)” is defined as FFO for the applicable period divided by the diluted weighted average unit count (including Units, Class B Units, vested Restricted Units (“RUs”) and vested Deferred Trust Units (“DTUs”)) during the period. “FFO adjusted” is defined as FFO adjusted for non-real estate industry specific operating transactions. FFO adjusted presents FFO in a normalized manner that is substantially in accordance with REALPAC’s recommendations. FFO adjusted may, as transactions occur, include adjustments that were not included in the definition of FFO adjusted in a previous period but are included in the current period to present FFO in a normalized manner that is substantially in accordance with REALPAC’s recommendations. Adjustments for the three and six months ended June 30, 2025, included mortgages payable settlement, which is comprised of prepayment penalties, defeasance, amortization of financing costs, and other costs associated with the refinance and payoff of certain mortgages payable prior to maturity. Adjustments also include insurance proceeds related to covered damage of investment property. “FFO adjusted per unit (diluted)” is defined as FFO adjusted for the applicable period divided by the diluted weighted average unit count (including Units, Class B Units, vested RUs and vested DTUs) during the period. AFFO is defined as FFO adjusted for items such as maintenance capital expenditures, and certain non-cash items such as amortization of intangible assets, and premiums and discounts on debt and investments. AFFO should not be construed as an alternative to consolidated net income (loss), or consolidated cash flows provided by (used in) operating activities determined in accordance with IFRS. The REIT’s method of calculating AFFO is substantially in accordance with REALPAC’s recommendations. The REIT uses a capital expenditure reserve of $75 per lot per year and $1,100 per rental home per year, for the years ending, or ended, December 31, 2025 and 2024, respectively, in the AFFO calculation. This reserve is based on management’s best estimate of the cost that the REIT may incur related to maintaining the investment properties. This may differ from other issuers’ methods and, accordingly, may not be comparable to AFFO reported by other issuers. Refer to section “Reconciliation of FFO, FFO per unit, FFO adjusted, FFO adjusted per unit, AFFO, AFFO per unit, AFFO adjusted and AFFO adjusted per unit” for a reconciliation of AFFO and AFFO adjusted to net income (loss) and comprehensive income (loss). “AFFO Payout Ratio” is defined as total cash distributions of the REIT (including distributions on Class B Units) divided by AFFO. “AFFO per unit (diluted)” is defined as AFFO for the applicable period divided by the diluted weighted average unit count (including Units, Class B Units, vested RUs and vested DTUs) during the period. “AFFO adjusted” is defined as AFFO adjusted for transactions that are not considered recurring measures of economic earnings with the goal of presenting AFFO in a normalized manner that is substantially in accordance with REALPAC’s recommendations. AFFO adjusted may, as transactions occur, include adjustments that were not included in the definition of AFFO adjusted in a previous period but are included in the current period to present AFFO in a normalized manner that is substantially in accordance with REALPAC’s recommendations. Adjustments for the three and six months ended June 30, 2025 included mortgages payable settlement expense, which is comprised of prepayment penalties, defeasance, amortization of financing costs, and other costs associated with the refinance and payoff of certain mortgages payable prior to maturity. Adjustments also include insurance proceeds related to covered damage of investment property. “AFFO adjusted Payout Ratio” is defined as total cash distributions of the REIT (including distributions on Class B Units) divided by AFFO adjusted. “AFFO adjusted per unit (diluted)” is defined as AFFO adjusted for the applicable period divided by the diluted weighted average unit count (including Units, Class B Units, vested RUs and vested DTUs) during the period. The REIT believes these non-IFRS financial measures and ratios provide useful supplemental information to both management and investors in measuring the operating performance, financial performance and financial condition of the REIT. The REIT also uses AFFO and AFFO adjusted in assessing its distribution paying capacity. Other Real Estate Industry Metrics Additionally, this news release contains several other real estate industry financial metrics: “Acquisitions” means the REIT’s properties, excluding Same Community (as defined below) (i.e., Acquisitions Revenue, as well as Acquisitions net operating income (“NOI”), and Acquisitions NOI Margin (as defined below)), and such measure is used by management to evaluate period-over-period performance of such investment properties throughout both respective periods. These res
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