Equity LifeStyle Properties Inc. (ELS) Q1 2023 Earnings Call Transcript

For the period ending March 31, 2023

April 18, 2023 11:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

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Marguerite Nader

Good morning, and thank you for joining us today. I am pleased to report the results for the first quarter of 2023. The quality of our cash flow and the strength of our balance sheet continues to allow us to report impressive results. Our core NOI exceeded our expectations in the quarter with 5.7% growth year-over-year.

Our MH portfolio is 95% occupied. The MH business is unique in that once a high level of occupancy is achieved at a property, the occupancy is generally sustainable for a long time. The key to that stickiness is having an elevated level of homeowners in the portfolio. Our portfolio is 96% occupied by homeowners. Our new home sales over the last five years have contributed to building up this important benchmark.

Our homeowners are focused on improving their home sites, and we have seen a great effort by those impacted by storms to repair their homes and remain in the community.

Over the last thirty years, we have built our organization focused on high-quality team members, property, cash flow and capital allocation. The result of this shared focus is sustained value for our residents, customers and shareholders.

Our properties are well located in areas where the demographic trends create tailwinds for ELS. Our properties have shown strong demand even when considering weather-related disruptions. ELS will be the beneficiary of Florida's outsized population growth and heavy demand for seasonal accommodations.

We sold 176 new homes in the quarter at an average price of $104,000. While this is a decline from sales volume last year the volume remains at elevated numbers relative to our historical sales volume. We saw an increase in used home sales and are currently experiencing historically low levels of used home inventory.

With respect to our RV business, our annual and seasonal segments, which represents the largest portion of our RV stream performed ahead of expectations in the quarter and we anticipate growth rates of 8.4% and 8.2% for the full year 2023.

The full year guidance for our transient business is impacted by California storms and a reduced number of transient sites. Our customer surveys indicate that demand for RV camping remains strong with nine out of ten respondents from our database saying that they plan to camp the same or more than last year, driven by their desire to spend more time outdoors and because they recently invested in an RV and want to use it.