SOURCE: CubeSmart

CubeSmart

October 27, 2016 16:17 ET

CubeSmart Reports Third Quarter 2016 Results: FFO Per Share Grows 11.8%; Same-Store NOI Increases 9.3%

MALVERN, PA--(Marketwired - October 27, 2016) - CubeSmart (NYSE: CUBE) today announced its operating results for the three and nine months ended September 30, 2016.

"Third quarter results reflect the quality of our portfolio, the strength of our operating platform, and our focus on providing industry-leading customer service. We are pleased to be raising the mid-point of our FFO and same-store NOI guidance for 2016," commented President and Chief Executive Officer Christopher P. Marr. "We remain active on the external growth front, maintaining our disciplined underwriting approach as we continue to pursue investment opportunities that create long-term value for our shareholders."

Key Highlights for the Quarter

  • Reported funds from operations ("FFO") per share, as adjusted, of $0.38, representing a year-over-year increase of 11.8%.
  • Increased same-store (407 facilities) net operating income ("NOI") 9.3% year over year, driven by 6.2% revenue growth and a 0.9% decrease in property operating expenses.
  • Same-store occupancy averaged 93.8% during the quarter, an increase of 40 basis points year over year, ending the quarter with same-store occupancy of 93.1%.
  • Closed on seven facility acquisitions totaling $79.9 million.
  • Issued $300 million of unsecured senior notes in fourth public bond offering.

Funds from Operations

FFO, as adjusted, was $68.7 million for the third quarter of 2016, compared with $58.5 million for the third quarter of 2015. FFO per share, as adjusted, increased 11.8% to $0.38 for the third quarter of 2016, compared with $0.34 for the same period last year.

Investment Activity

Acquisition Activity

The Company acquired seven properties for $79.9 million during the three months ended September 30, 2016. These acquisitions are located in Arizona (1), Colorado (1), Minnesota (1), Nevada (2), and Texas (2). Subsequent to September 30, 2016, the Company acquired one facility located in Nevada for $13.3 million. In total for the year to date through this press release, the Company has acquired 22 properties for $294.7 million, excluding three assets acquired upon completion of construction and issuance of certificate of occupancy ("C/O"). The Company has three additional properties under contract for $39.5 million.

Development Activity

The Company has agreements with developers for the construction of Class A self-storage facilities in high-barrier-to-entry locations. These agreements are structured either as purchases at C/O or as joint venture developments. In total for the year to date through this press release, the Company has acquired three properties at C/O and opened for operation two joint venture development properties for a total investment of $133.4 million. These properties are located in New York (3) and Texas (2).

As of September 30, 2016, the Company had three facilities under contract to purchase at C/O for a total acquisition price of $43.3 million. The properties are located in Florida (1) and Illinois (2). The purchase of these facilities is expected to occur by the fourth quarter of 2017. These acquisitions are subject to due diligence and other customary closing conditions, and no assurance can be provided that these acquisitions will be completed on the terms described, or at all.

As of September 30, 2016, the Company had five joint venture development properties and two wholly owned projects under development. The Company anticipates investing a total of $303.2 million related to these projects and had invested $140.5 million of that total as of September 30, 2016. These facilities are located in Florida (1), New York (5), and Washington, D.C. (1). The seven projects are expected to open at various times between the fourth quarter of 2016 and the fourth quarter of 2018.

Third-Party Management

As of September 30, 2016, the Company's third-party management program included 291 facilities totaling 18.1 million square feet. During the quarter ended September 30, 2016, the Company added 17 properties to its third-party management program. For the nine months ended September 30, 2016, the Company added 82 properties to its third-party management program.

Same-Store Results

The Company's same-store portfolio at September 30, 2016 included 407 facilities containing approximately 27.8 million rentable square feet, or approximately 85.6% of the aggregate rentable square feet of the Company's 471 owned facilities. These same-store facilities represented approximately 91.0% of property net operating income for the quarter ended September 30, 2016.

Same-store physical occupancy at period end for the third quarter of 2016 was 93.1%, compared with 92.7% for the same quarter of last year. Same-store revenues for the third quarter of 2016 increased 6.2%, and same-store operating expenses decreased 0.9% from the same quarter in 2015 primarily due to lower property insurance and utility costs in 2016. Same-store net operating income increased 9.3%, as compared with the same period in 2015.

Operating Results

As of September 30, 2016, the Company's total owned portfolio included 471 properties containing 32.5 million rentable square feet and had a physical occupancy of 90.9%.

Revenues increased $16.1 million and property operating expenses increased $2.5 million in the third quarter of 2016, as compared with the same period in 2015. Increases in revenues were primarily attributable to increased net effective rents and occupancy levels in the same-store portfolio and revenues generated from property acquisitions. Increases in property operating expenses were primarily attributable to a $2.9 million increase in expenses associated with newly acquired or recently opened facilities offset by lower year-over-year property insurance and utility costs in the same-store portfolio.

Interest expense increased from $10.4 million during the three months ended September 30, 2015 to $12.8 million during the three months ended September 30, 2016, an increase of $2.4 million. The increase is attributable to a higher amount of outstanding debt during the 2016 period. To fund a portion of the Company's growth, the average debt balance during the three months ended September 30, 2016 increased approximately $281.4 million from the same period in 2015 from $1.2 billion to $1.5 billion.

The Company reported net income attributable to the Company's common shareholders of $23.4 million, or $0.13 per common share, in the third quarter of 2016, compared with net income attributable to the Company's common shareholders of $16.9 million, or $0.10 per common share, in the third quarter of 2015.

Financing Activity

On August 8, 2016, the Company issued $300 million of 3.125% unsecured senior notes due September 1, 2026. The net proceeds from the offering were used to repay outstanding indebtedness under the Company's unsecured revolving credit facility and for working capital and other general corporate purposes, including funding a portion of the Company's investment activity.

On September 2, 2016, the Company announced that it will redeem all of the 3.1 million outstanding shares of its 7.75% Series A Cumulative Redeemable Preferred Shares ("Preferred Shares") with a par value of $77.5 million on November 2, 2016. The Preferred Shares will be redeemed at a redemption price of $25.00 per share, plus accumulated and unpaid dividends up to and including the redemption date of $0.17374 per share. In connection with the redemption of the Preferred Shares, in accordance with EITF D-42, the Company expects to recognize a charge of approximately $2.8 million in the fourth quarter related to excess redemption costs over the original net issuance proceeds.

During the quarter, the Company sold 1.6 million common shares of beneficial interest through its at-the-market equity program at an average sales price of $30.26 per share, resulting in net proceeds of $47.5 million, after deducting offering costs. As of September 30, 2016, the Company had 5.8 million shares available for issuance under the existing equity distribution agreements.

Quarterly Dividend

On August 2, 2016, the Company declared a dividend of $0.21 per common share. The dividend was paid on October 17, 2016 to common shareholders of record on October 3, 2016.

Also on August 2, 2016, the Company declared a dividend of $0.484375 for the 7.75% Series A Cumulative Redeemable Preferred Shares. The dividend was paid on October 17, 2016 to holders of record on October 3, 2016.

2016 Financial Outlook

"We are increasing our full-year 2016 guidance for same-store NOI and FFO per share to reflect the Company's strong operating performance to date," commented Chief Financial Officer Tim Martin. "In addition to the improved outlook for same-store results, our updated guidance also reflects the impact of additional investment activity, the completion of our fourth unsecured senior notes offering, the upcoming redemption of our outstanding Preferred Shares, and our equity capital raising activity year-to-date."

The Company is adjusting its previously issued estimates as well as underlying assumptions, and now expects that its fully diluted FFO per share, as adjusted, for 2016 will be between $1.43 and $1.44 (previously between $1.40 and $1.44). The Company's estimates are based on the following key operating assumptions:

  • For 2016, a same-store pool consisting of 407 assets totaling 27.8 million square feet
  • Same-store net operating income ("NOI") growth of 9.75% to 10.25% over 2015 (previously 9.5% to 10.25%), driven by revenue growth of 6.75% to 7.25% (unchanged) and expense growth of 0.0% to 0.75% (previously 0.5% to 1.5%)
  • General and administrative expenses of approximately $31.5 million to $32.5 million (previously $31.0 million to $32.0 million)

Key investment and financing assumptions include:

  • Impact of development activity:
    • Four new facilities opened in 2015 for a total investment of $65.1 million.
    • Two new joint venture development facilities and two new wholly owned development facilities are expected to open in 2016 for a total investment of $98.8 million, of which two properties have opened year to date for $64.0 million.
    • Three new facilities acquired at C/O in 2016 for a total investment of $69.4 million.
    • Approximately $0.03 per share of dilution in 2016 related to development activity.
  • Impact of acquisition activity:
    • Acquired 21 facilities for $281.4 million during the nine months ended September 30, 2016 and one additional property was acquired subsequent to quarter-end for $13.3 million.
  • Impact of financing activity:
    • Funding 2016 debt maturities and our acquisition and development commitments with long-term capital, with specific impact to 2016 earnings dependent upon the amount, timing, cost and form of capital we raise.

Due to uncertainty related to the timing and terms of transactions, the impact of any potential future speculative investment activity not contemplated above, is excluded from guidance. For 2016, the Company is targeting $325 million to $350 million of acquisitions (previously between $300 million and $350 million), excluding contracts related to joint venture development or purchase at completion of construction and issuance of C/O investments discussed above.

          
2016 Full Year Guidance  Range or Value
Earnings per diluted share allocated to common shareholders  $0.44  to  $0.45
Plus: real estate depreciation and amortization   0.93      0.93
Plus: acquisition related costs   0.04      0.04
Plus: preferred share redemption charge   0.02      0.02
FFO per diluted share, as adjusted  $1.43  to  $1.44
         

The Company estimates that its fully diluted FFO, as adjusted, per share for the quarter ending September 30, 2016 will be between $0.37 and $0.38, and that its fully diluted earnings per share for the period will be between $0.12 and $0.13.

          
4th Quarter 2016 Guidance  Range or Value
Earnings per diluted share allocated to common shareholders  $0.12  to  $0.13
Plus: real estate depreciation and amortization   0.22      0.22
Plus: acquisition related costs   0.01      0.01
Plus: preferred share redemption charge   0.02      0.02
FFO per diluted share, as adjusted  $0.37  to  $0.38
            

Conference Call

Management will host a conference call at 11:00 a.m. ET on Friday, October 28, 2016 to discuss financial results for the three months ended September 30, 2016.

A live webcast of the conference call will be available online from the investor relations page of the Company's corporate website at www.CubeSmart.com. Telephone participants may avoid any delays in joining the conference call by pre-registering for the call using the following link to receive a special dial-in number and PIN: http://dpregister.com/10093462.

Telephone participants who are unable to pre-register for the conference call may join on the day of the call using 1-877-506-3281 for domestic callers, +1-412-902-6677 for international callers, or 1-855-669-9657 for callers in Canada. After the live webcast, the call will remain available on CubeSmart's website for 30 days. In addition, a telephonic replay of the call will be available through November 28, 2016. The replay numbers are 1-877-344-7529 for domestic callers, +1-412-317-0088 for international callers, and 1-855-669-9658 for callers in Canada. For callers accessing a telephonic replay, the conference number is 10093462.

Supplemental operating and financial data as of September 30, 2016 is available on the Company's corporate website under Investor Relations - Financial Information - Financial Reports.

About CubeSmart

CubeSmart is a self-administered and self-managed real estate investment trust. The Company's self-storage facilities are designed to offer affordable, easily accessible and secure storage space for residential and commercial customers. According to the 2016 Self-Storage Almanac, CubeSmart is one of the top four owners and operators of self-storage facilities in the United States.

Non-GAAP Financial Measures

Funds from operations ("FFO") is a widely used performance measure for real estate companies and is provided here as a supplemental measure of operating performance. The April 2002 National Policy Bulletin of the National Association of Real Estate Investment Trusts (the "White Paper"), as amended, defines FFO as net income (computed in accordance with GAAP), excluding gains (or losses) from sales of real estate and related impairment charges, plus real estate depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures.

Management uses FFO as a key performance indicator in evaluating the operations of the Company's facilities. Given the nature of its business as a real estate owner and operator, the Company considers FFO a key measure of its operating performance that is not specifically defined by accounting principles generally accepted in the United States. The Company believes that FFO is useful to management and investors as a starting point in measuring its operational performance because FFO excludes various items included in net income that do not relate to or are not indicative of its operating performance such as gains (or losses) from sales of real estate, gains from remeasurement of investments in real estate ventures, impairments of depreciable assets, and depreciation, which can make periodic and peer analyses of operating performance more difficult. The Company's computation of FFO may not be comparable to FFO reported by other REITs or real estate companies.

FFO should not be considered as an alternative to net income (determined in accordance with GAAP) as an indication of the Company's performance. FFO does not represent cash generated from operating activities determined in accordance with GAAP and is not a measure of liquidity or an indicator of the Company's ability to make cash distributions. The Company believes that to further understand its performance, FFO should be compared with its reported net income and considered in addition to cash flows computed in accordance with GAAP, as presented in its Consolidated Financial Statements.

FFO, as adjusted represents FFO as defined above, excluding the effects of acquisition related costs, gains or losses from early extinguishment of debt, and other non-recurring items, which the Company believes are not indicative of the Company's operating results.

The Company defines net operating income, which it refers to as "NOI," as total continuing revenues less continuing property operating expenses. NOI also can be calculated by adding back to net income (loss): interest expense on loans, loan procurement amortization expense, loan procurement amortization expense -- early repayment of debt, acquisition related costs, equity in losses of real estate ventures, other expense, depreciation and amortization expense, general and administrative expense, and deducting from net income (loss): gains from sale of real estate, net, other income, gains from remeasurement of investments in real estate ventures and interest income. NOI is not a measure of performance calculated in accordance with GAAP.

Management uses NOI as a measure of operating performance at each of its facilities, and for all of its facilities in the aggregate. NOI should not be considered as a substitute for operating income, net income, cash flows provided by operating, investing and financing activities, or other income statement or cash flow statement data prepared in accordance with GAAP.

Forward-Looking Statements

This presentation, together with other statements and information publicly disseminated by CubeSmart ("we," "us," "our" or the "Company"), 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, or the "Exchange Act." Forward-looking statements include statements concerning the Company's plans, objectives, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs, plans or intentions relating to acquisitions and other information that is not historical information. In some cases, forward-looking statements can be identified by terminology such as "believes," "expects," "estimates," "may," "will," "should," "anticipates," or "intends" or the negative of such terms or other comparable terminology, or by discussions of strategy. Such statements are based on assumptions and expectations that may not be realized and are inherently subject to risks, uncertainties and other factors, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Although we believe the expectations reflected in these forward-looking statements are based on reasonable assumptions, future events and actual results, performance, transactions or achievements, financial and otherwise, may differ materially from the results, performance, transactions or achievements expressed or implied by the forward-looking statements. As a result, you should not rely on or construe any forward-looking statements in this presentation, or which management may make orally or in writing from time to time, as predictions of future events or as guarantees of future performance. We caution you not to place undue reliance on forward-looking statements, which speak only as of the date of this presentation or as of the dates otherwise indicated in the statements. All of our forward-looking statements, including those in this presentation, are qualified in their entirety by this statement.

There are a number of risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements contained in or contemplated by this presentation. Any forward-looking statements should be considered in light of the risks and uncertainties referred to in Item 1A. "Risk Factors" in our Annual Report on Form 10-K and in our other filings with the Securities and Exchange Commission ("SEC"). These risks include, but are not limited to, the following:

  • national and local economic, business, real estate and other market conditions;
  • the competitive environment in which we operate, including our ability to maintain or raise occupancy and rental rates;
  • the execution of our business plan;
  • the availability of external sources of capital;
  • financing risks, including the risk of over-leverage and the corresponding risk of default on our mortgage and other debt and potential inability to refinance existing indebtedness;
  • increases in interest rates and operating costs;
  • counterparty non-performance related to the use of derivative financial instruments;
  • our ability to maintain our status as a real estate investment trust ("REIT") for federal income tax purposes;
  • acquisition and development risks;
  • increases in taxes, fees, and assessments from state and local jurisdictions;
  • risks of investing through joint ventures;
  • changes in real estate and zoning laws or regulations;
  • risks related to natural disasters;
  • potential environmental and other liabilities;
  • other factors affecting the real estate industry generally or the self-storage industry in particular; and
  • other risks identified in Item 1A of our Annual Report on Form 10-K and, from time to time, in other reports that we file with the SEC or in other documents that we publicly disseminate.

Given these uncertainties, we caution readers not to place undue reliance on forward-looking statements. We undertake no obligation to publicly update or revise these forward-looking statements, whether as a result of new information, future events or otherwise except as may be required in securities laws.

 
CUBESMART AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
          
   September 30,   December 31,  
   2016   2015  
   (unaudited)      
ASSETS           
Storage facilities  $3,968,754   $3,467,032  
Less: Accumulated depreciation   (685,771 )  (594,049 )
Storage facilities, net (including VIE assets of $194,167 and $136,274, respectively)   3,282,983    2,872,983  
Cash and cash equivalents   87,379    62,869  
Restricted cash   8,052    24,600  
Loan procurement costs, net of amortization   2,313    2,800  
Investment in real estate ventures, at equity   97,405    97,281  
Other assets, net   41,067    43,631  
 Total assets  $3,519,199   $3,104,164  
            
LIABILITIES AND EQUITY           
Unsecured senior notes, net  $1,038,728   $741,904  
Revolving credit facility   -    -  
Unsecured term loans, net   398,608    398,183  
Mortgage loans and notes payable, net   115,393    111,455  
Accounts payable, accrued expenses and other liabilities   93,854    85,034  
Distributions payable   39,781    38,685  
Deferred revenue   20,141    17,519  
Security deposits   420    403  
 Total liabilities   1,706,925    1,393,183  
            
Noncontrolling interests in the Operating Partnership   60,541    66,128  
            
Commitments and contingencies           
            
Equity           
 7.75% Series A Preferred shares $.01 par value, 3,220,000 shares authorized, 3,100,000 shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively   31    31  
 Common shares $.01 par value, 400,000,000 shares authorized, 179,858,650 and 174,667,870 shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively   1,799    1,747  
 Additional paid-in capital   2,381,836    2,231,181  
 Accumulated other comprehensive loss   (3,247 )  (4,978 )
 Accumulated deficit   (634,248 )  (584,654 )
  Total CubeSmart shareholders' equity   1,746,171    1,643,327  
 Noncontrolling interests in subsidiaries   5,562    1,526  
  Total equity   1,751,733    1,644,853  
  Total liabilities and equity  $3,519,199   $3,104,164  
           
           
 
CUBESMART AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share data)
(unaudited)
                  
   Three Months Ended September 30,   Nine Months Ended September 30,  
   2016   2015   2016   2015  
                      
REVENUES                     
 Rental income  $116,416   $102,385   $332,951   $290,744  
 Other property related income   13,007    11,827    37,413    33,755  
 Property management fee income   2,673    1,758    7,129    5,030  
  Total revenues   132,096    115,970    377,493    329,529  
OPERATING EXPENSES                     
 Property operating expenses   41,805    39,297    123,631    114,938  
 Depreciation and amortization   41,827    38,744    122,631    114,725  
 General and administrative   8,065    7,002    24,184    21,289  
 Acquisition related costs   888    1,222    5,793    2,485  
  Total operating expenses   92,585    86,265    276,239    253,437  
OPERATING INCOME   39,511    29,705    101,254    76,092  
OTHER (EXPENSE) INCOME                     
 Interest:                     
  Interest expense on loans   (12,787 )  (10,399 )  (37,071 )  (32,324 )
  Loan procurement amortization expense   (655 )  (537 )  (1,871 )  (1,742 )
 Equity in (losses) earnings of real estate ventures   (581 )  139    (1,817 )  (199 )
 Other   (397 )  (288 )  834    (812 )
  Total other expense   (14,420 )  (11,085 )  (39,925 )  (35,077 )
NET INCOME   25,091    18,620    61,329    41,015  
 NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS                     
 Noncontrolling interests in the Operating Partnership   (283 )  (223 )  (682 )  (475 )
 Noncontrolling interest in subsidiaries   76    41    411    56  
NET INCOME ATTRIBUTABLE TO THE COMPANY   24,884    18,438    61,058    40,596  
 Distribution to preferred shareholders   (1,502 )  (1,502 )  (4,506 )  (4,506 )
NET INCOME ATTRIBUTABLE TO THE COMPANY'S COMMON SHAREHOLDERS  $23,382   $16,936   $56,552   $36,090  
                      
Basic earnings per share attributable to common shareholders  $0.13   $0.10   $0.32   $0.22  
Diluted earnings per share attributable to common shareholders  $0.13   $0.10   $0.32   $0.21  
                      
Weighted-average basic shares outstanding   179,223    169,304    177,639    167,177  
Weighted-average diluted shares outstanding   180,478    170,901    178,937    168,705  
                 
                 
 
Same-Store Facility Results (407 facilities)
(in thousands, except percentage and per square foot data)
(unaudited)
                          
   Three Months Ended       Nine Months Ended      
   September 30,   Percent   September 30,   Percent  
   2016   2015   Change   2016   2015   Change  
                              
REVENUES                             
 Rental income  $103,231   $96,934   6.5 % $300,290   $278,818   7.7 %
 Other property related income   10,836    10,451   3.7 %  31,556    30,110   4.8 %
  Total revenues   114,067    107,385   6.2 %  331,846    308,928   7.4 %
                              
OPERATING EXPENSES                             
 Property taxes   10,871    10,682   1.8 %  33,138    31,987   3.6 %
 Personnel expense   9,096    9,103   (0.1) %  27,287    27,393   (0.4) %
 Advertising   1,880    1,800   4.4 %  5,611    5,311   5.6 %
 Repair and maintenance   1,308    1,354   (3.4) %  3,787    3,670   3.2 %
 Utilities   3,621    3,834   (5.6) %  10,122    10,909   (7.2) %
 Property insurance   674    932   (27.7) %  2,350    2,804   (16.2) %
 Other expenses   4,421    4,444   (0.5) %  13,490    14,148   (4.7) %
                              
  Total operating expenses   31,871    32,149   (0.9) %  95,785    96,222   (0.5) %
                              
Net operating income (1)  $82,196   $75,236   9.3 % $236,061   $212,706   11.0 %
                              
 Gross margin   72.1 %  70.1 %      71.1 %  68.9 %    
                               
 Period end occupancy (2)   93.1 %  92.7 %      93.1 %  92.7 %    
                               
 Period average occupancy (3)   93.8 %  93.4 %      93.1 %  92.2 %    
                               
 Total rentable square feet   27,810             27,810           
                               
 Realized annual rent per occupied square foot (4)  $15.83   $14.93   6.0 % $15.46   $14.50   6.6 %
                               
 Scheduled annual rent per square foot (5)  $16.88   $16.50   2.3 % $16.65   $16.03   3.9 %
                              
Reconciliation of Same-Store Net Operating Income to Operating Income                             
                              
Same-store net operating income (1)  $82,196   $75,236       $236,061   $212,706      
Non same-store net operating income (1)   8,972    3,376        22,079    7,468      
Indirect property overhead (6)   (877 )  (1,939 )      (4,278 )  (5,583 )    
Depreciation and amortization   (41,827 )  (38,744 )      (122,631 )  (114,725 )    
General and administrative expense   (8,065 )  (7,002 )      (24,184 )  (21,289 )    
Acquisition related costs   (888 )  (1,222 )      (5,793 )  (2,485 )    
                              
Operating Income  $39,511   $29,705       $101,254   $76,092      
                              
(1) Net operating income (NOI) is a non-GAAP (generally accepted accounting principles) financial measure that excludes from operating income the impact of depreciation and general & administrative expense.
(2) Represents occupancy at September 30 of the respective year.
(3) Represents the weighted average occupancy for the period.
(4) Realized annual rent per occupied square foot is computed by dividing rental income by the weighted average occupied square feet for the period.
(5) Scheduled annual rent per square foot represents annualized asking rents per available square foot for the period.
(6) Includes property management income earned in conjunction with managed properties.
   
   
 
Non-GAAP Measure - Computation of Funds From Operations
(in thousands, except per share data)
(unaudited)
                 
   Three Months Ended   Nine Months Ended  
   September 30,   September 30,  
   2016  2015   2016   2015  
                     
Net income attributable to the Company's common shareholders  $23,382  $16,936   $56,552   $36,090  
                     
Add:                    
 Real estate depreciation and amortization:                    
  Real property   41,195   38,328    120,925    113,422  
  Company's share of unconsolidated real estate ventures   2,905   1,784    8,148    5,340  
 Noncontrolling interests in the Operating Partnership   283   223    682    475  
                     
FFO attributable to common shareholders and OP unitholders  $67,765  $57,271   $186,307   $155,327  
                     
Add:                    
 Acquisition related costs (1)   888   1,222    5,970    2,485  
                     
FFO attributable to common shareholders and OP unitholders, as adjusted  $68,653  $58,493   $192,277   $157,812  
                     
Earnings per share attributable to common shareholders - basic  $0.13  $0.10   $0.32   $0.22  
Earnings per share attributable to common shareholders - diluted  $0.13  $0.10   $0.32   $0.21  
FFO per share and unit - fully diluted  $0.37  $0.33   $1.03   $0.91  
FFO, as adjusted per share and unit - fully diluted  $0.38  $0.34   $1.06   $0.92  
                     
Weighted-average basic shares outstanding   179,223   169,304    177,639    167,177  
Weighted-average diluted shares outstanding   180,478   170,901    178,937    168,705  
Weighted-average diluted shares and units outstanding   182,699   173,138    181,134    170,956  
                     
Dividend per common share and unit  $0.21  $0.16   $0.63   $0.48  
Payout ratio of FFO, as adjusted   55.3   % 47.1 %  59.4 %  52.2 %
                
(1) Nine months ended September 30, 2016 includes $0.2 million of acquisition related costs that are included in the Company's share of equity in (losses) earnings of real estate ventures.
   
   

Contact Information

  • Contact:
    CubeSmart
    Charles Place
    Director, Investor Relations
    (610) 535-5700