Sun Communities (SUI) 30 Apr 242024 Q1 Earnings call transcript

Good afternoon, ladies and gentlemen, and thank you for standing by. Welcome to the Sun Communities First Quarter 2024 Earnings Conference Call.

At this time, management would like me to inform you that certain statements made during this call, which are not historical facts may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

Although the company believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the company can provide no assurance that its expectations will be achieved. Factors and risks that cause actual results to differ materially from expectations are detailed in yesterday's press release and from time to time in the company's periodic filings with the SEC. obligation events or date or release. no statements any of undertakes reflect to circumstances company to update advise forward-looking this This after the

said Vice and Instructions]. Fernando with Chief Financial Development. introduce Chairman, Having [Operator Aaron and Corporate Castro-Caratini, like Weiss, Strategy and Gary Business Executive President Officer; today. of Shiffman, management Executive Chief Officer; I'd that, President us to and

recorded. a is reminder, As this being call

Shiffman, over would President now may turn to Executive your Mr. and Chairman, I Gary Officer. the conference Chief to begin. host, call like Shiffman, you

our Good afternoon, first quarter solid for on Core of to NOI We're and XXXX robust businesses. share same-property North thank by driven conference first report us same-property of to quarter the was you results guidance. for discuss year-over-year and per updated $X.XX growth X.X% in growth. NOI pleased our joining American underpinned earnings FFO in by performance U.K. quarter our strong and operational call strong each

Our continued increases, grew and year. NOI positive expense lower X.X%, to generate Marina quarter results savings impact lower occupancy supply, several best-in-class to increased first demand compared our increased partially high due inherent revenues. XXXX to expenses. compared the rate income. in Same-property favorable leases, and growth portfolio the first X% dynamics that factors, underscore and primarily the of real manufactured housing sites including reflecting limited property the Same-property Same-property NOI NOI quarter to rental of resilient RV of annual how converting transient X.X% transient prior offset

dry strong rental as continued rate driven and increases. was outperformance demand well for by strong wet as The storage slips

manufactured in our this to year a last ability about quarter strategy. sold year. earnings with We included our the strong assets is of is as As NOI start positive we was reporting. have same-property ownership in our full now we the transact. on market U.K. recycling disclosed $XX X approximately which U.K. call, our same-property third million, housing remain portfolio, focused to of properties. on in our have the segment additional And feel our Currently, and capital enter

Key published and highlights compared In terms emissions X, team Sun acquired hours inventory approximately highly report. Marina include strategically for our in volunteer Marina increase member our a enhance has methodology properties annual several $XX sixth reporting and bolt-on Year-to-date, completing be ESG capital selective. Sun deployment, member X greenhouse XX% X million for recently to East We the network continues that scopes XXXX. to of gas our Coast. on

Additionally, with we continue to to our and work understand to ESG our and supply dialogue our stakeholders their programs. with interactions chain partners prioritize

execute property would to strong all performance from to support. team continued our continue I for on for talented members their on earnings thank a income. reliable and delivering our growth plan, We real continued a focused their like dedication and stakeholders

I detail. will to and to call discuss more results turn in guidance Fernando our Fernando? now over the

strong real expenses. and driven Thank in grew each on further by reported quarter, and detailing X.X% America, revenue $X.XX, quarter diluted focus by total for property NOI per of Sun you, X.X%, FFO Gary. a managing share increase first expenses, driven increase segment. growth North in In same-property continued our revenues X% the core the In a

XXXX. with increase quarter was Same-property an by to a increase expense growth NOI in revenue X% in NOI The compared of manufactured X.X%. driven housing reported another solid X.X% and

in occupancy controllable to Occupancy include in and expansion was due transient driven basis revenues, year-over-year to increased increase was attributed the activity, operating sites. conversions a be to by XX.X%. RV, points adjusted payroll with RV, can XXX uplift X.X% X.X% decrease to utilities. RV housing and RV decline manufactured revenue transient in to Part a for of same-property NOI growth annual and costs in expenses. of notably The its X.X% aligning in For same-property year-over-year expenses

to the of over For site sites annual our accounting for contracts trailing XX, XXXX, converted revenue-producing XX% approximately XX months March Sun transient gains. X,XXX ended

storage continuing dry portfolio strategic focus converting in our same sites. have X.X% a quarter the This Marina's stronger X,XXX the by annual primarily of XXXX. nearly have payroll. XXXX, to transient Since we expenses, to and demand, by rate another increase of wet increases are with a by slips conversions driven approximately X.X% We X.X% on in increasing was mainly XX%. NOI property for transient posted and the compared number spaces in partially increase by driven offset increased completed strong and sites resulting across start annual revenue,

Property the primarily reflecting the supply Easter holiday X.X% U.K. break and rates decreased costs. by higher customer XX.X% timing operating XXXX increased million, increase results, a in increase the property of year-over-year the $X.X in representing same-property increased expenses payroll and In NOI repair over same a differences early quarter. and retention rental timing for revenue XX.X% drove

community sold to First expectations. FFO homes in previous line by more the quarter We sales were home representing lead of This to occupancy shift from year. XXX objective offset the volume, with quarter in real in rents. part performance an contribution activity lower larger will U.K. $XX.X the site was margins. aligns increase a sales sales quarter, year. our U.K. for volumes the and to X.X% strategic our rent than the strong with million property home The business for reflecting sales increase compared unit in a strong to first share

strategic opportunities. disciplined, extremely allocation, capital Regarding remains limited Sun pursuing

approximately As from strategic Marinas Gary this highly million assets X acquired $XX for approximately year selling X and we million. $XX of proceeds recycled indicated,

balance approximately further EBITDA debt We balance March XX, $X.X remain XXXX, company focused ratio billion outstanding net recurring and X.Xx. our our had On on in debt sheet. was to to the sheet Turning XX-month enhancing net trailing our strength.

senior of facility. X.X%. an proceeds Net used outstanding down rate $XXX Sun to quarter, interest under senior issued notes X-year the unsecured pay During million of were credit our with borrowings

paid with we also term corporate loan quarter, the revolving our off facility. our credit During

Our of intend X.X the flow end proceeds rate XX% variable operations reduce weighted to and We at sales to planned years, is cash overall percentages. the maturity debt average use and variable from free quarter. and leverage from debt debt approximately our rate asset was

are a XXXX yesterday's As we first guidance FFO release, updating quarter $X.XX for per follows: of full detailed core our our to year in results $X.XX. narrowed to share as guidance we range

in second of for We are quarter range core per the the to also FFO $X.XX. $X.XX share establishing XXXX of guidance

from Higher America, year the portfolio, midpoint XX and RV expected to to growth The transient primarily same X.X%. growth in real range NOI In updated growth NOI the headwinds. to is of the is For expect Marinas RV. MH property our North total point revenue reduction full at X.X% we offset lower X.X%. due NOI expected in property basis range X.X% should

for increase RV Revised basis negative midpoint. the revenue controllable X.X% expectations reductions, the are X.X% at the X.X% offsetting partially a housing, expense X.X% we a X.X% to point at Marinas, are a to basis and to point increase midpoint, by at point XX XX for basis headwinds, decrease XXX which with RVs, manufactured transient for driven midpoint X.X%

contribution forecast we now the for same approximately U.K., greater but the contribution a results. with year, In property from total real expected FFO to come the

efforts. is continued cost new previously property year The and expected revenues is implemented NOI home complemented and X%. real X.X% property function increasing by rental year-to-date. a increases higher range The sales of from X% increase by of our rental outlook prior driven to the are to forecast volume of achieved management to revenue range rate full the greater We a higher same retention X.X%

expected volume expect For margins. but U.K. home lower of for range sales, the our to contribution due we FFO maintain year, lower

on home generated margins the year. Overall, the by a minimizing proportion spending guidance we real property reliable pleased our information. and NOI to performance, larger supplemental resilient, Our our expense U.K. strategy income Please remains refer course capital for this of focused from over our are with into additional shifting management, operating sales of rents.

and activities, As the be which not research but reminder, acquisitions, XX, guidance it estimates. in April may prospective dispositions of includes or included and through markets a activity dispositions capital markets capital does our include impact analyst acquisitions

our concludes This remarks. prepared

open We will questions. for now call Operator? the up

Michael UBS. question first [Operator Instructions] comes Our from Goldsmith with

strategy you -- progress convert from from or from in generating influenced way. able in home you've that generating such the bulk made of the that are to how from able the guys large sales, generating such lot a in a been seems of it -- you've the have achieve guidance on the kind rent been U.K. it like It to a NOI convert and period like of growth, for the of able to more time short you

from sticky, a margin of income been -- the with a the that is U.K. well, to business overall is you we more it. working on sales little the of And good that very of generally in form we we've mentioned to indicated question, dependable a home There real example sacrifice The able create a I the for expectations. acquired property in bit that look strategy has acquisition is Thanks first in Michael. think, fees be time line it there. pitch very, the quarter, to performing

ago. up headwinds being not U.K. the seeing have That while of as anticipated in what much rate very probably economic and a in overall pressures as might reductions are the the in seeing and like still while U.K. U.S. we're been growth. benefits is there interest said, we're soon they volume

a little to been It's real revenue. far, line through doing expect the do the continue that be the future. bottom expect and position further, I be of property so. to to to as we is, we to think we to we'll a that the working continue so year So gain margin excelling And in sacrifice so be bit into we'd and even it go and

several follow-up after my the and your came expectations, And months outlook issuing there X is, months question ago. pieces XXXX X were that in initial moving

the forward sit from do we've you So and better on middle here, look much grasp as year the got in now spring. we okay, a think, sitting of here

And as going be volatility so there guidance the with much forward? shouldn't

just could shifts be a of where at forward? better visibility kind point point? into of this this Or the understanding year, to in is the there gain at within still the going expectations year large the I'm trying

our into We're question understand the underpinning focused It's of and move incredible it taking if hard of growth different on platform to very plan will, very you and can our we and translating certainly a working on number relate areas that a as the this a previously, in things shareholders. many our forward for very, to and performance, transient, business that last the certainly, quarters. All RV simplification, in and it agreements is the shared of of to out the transient effort, of the RV includes communities. recycling capital, continued conversions the we've harder accomplished where forecast an over annual we've of into we couple

looking us to that the quarters hard first taken made All comfortable quarter with Board we've and We knowing the first at this deliver FFO and lowest performance. in the we the it's overall will we're adjustments leave our the you across best and contributor with to approach position really the sharing that that that feel today. fourth results to

are FFO guidance, pieces they're the moving second to share per while certainly Michael, the with reiterate guidance did And our we quarter.

next question from BMO John Capital with Our Kim Markets. comes

wanted question. in -- Just can that of of portfolio? but another you in that follow Part up but real a how look maintained, is to at But make X% your higher make reduction items, like are your FFO you same-store up $X.XX to when confident or which property on that's the $X.XX non-same-store you that guidance, it looks the you outlook. FFO G&A

a the perspective. guide from John, move from guide. GAAP to That's G&A upward

the So were some transaction there which for The related expenses have we include receivership the Life related Royale quarter. just finalizing and over deal FFO, investor that that costs, transaction engagement quarter. does the the first $XX backs costs note in and add million of during process to not to mainly

is on guide -- So there in increase from is while to guide page, an G&A. there the guidance

Our by to net midpoint are we of midpoint. G&A add-backs, expecting those about the our at the X.X%, grow still at again

X% had first guidance mean, went second RV was your only in is outlook quarter. on maybe my question And the part your items, other that growth same-property the down the you I

big for the of rest revenue realize So uplift that to you're it's transient in the go I make seasonal or basically annual a conversion. negative that you but to conversion, the get when typically, implying going year. you

is same-property what the that reduction outlook? So in RV driving

reductions. or the uplift occupancy the that XX% with the headwinds where the of RV gain with line downward that side mentioned earlier, to as as offset will the expense possible is on cost in transient side quarter. the just over John, you're first for seeing item movement we primarily due growth The controllable guide annual on as And look of by to -- it much

we a for for forecast that implied was us reduction be our is currently X% year. that year. that -- front February transient have all to currently the windows, the with conversions, booking including is The relates set of in of -- information in shorter that as about the as expected pace, guidance reduction is impact it mentioned, That the to revenue X.X% in our for

on when take Housing with Marina guide that is you mover Manufactured that RV million. So the about our the side. largest platform side is NOI $X into the consideration platform, on downward Overall, the and

Our next with question Bank comes Dennerlein from of Josh America.

touch asset process how like just the is Maybe and on just that sales to marketing wanted going.

a shared got to did and good start X Well, sell. certainly Josh, we we off that the assets

for good offer there within dispositions. feel run. will in market. these in selected currently the of benefit are we feel that that the somebody long are assets And Again, assets that are opportunities we number the very a We else we

are we there. past the there for forward that they that if will. are now. quarter. with share out We this been buyers with to that hopefully, time. to higher debt still But to the to marketplace able being a do and have are be in had last those you negative everybody costs of we'll definitely these the right the platforms There being build leverage, period able And shift market in than there looking of results And in look is coming the long dispositions looking

the then on guidance. question I the almost I item, follow seems like your up wanted Michael's I to about think about range appreciate it that, When every line guides, was And Gary. revised. just

guidance back what's big do stepping maybe these -- ranges. thinking your and you Just picture, how on like philosophy providing

other disclosure -- provide possible of relates the as and of to it line business the much platforms our all items. looking market to We're to as as all

not We entirely interest in previously. expense -- guidance, P&L. almost you you it with been add the did which So as can can guidance February track had expected to related provided

expectations, that's is it the with of as much that to last shift as seeing the as today provided as guidance market looking expectations, night. you that shift you're But color some the we best front those to the it's our rest us to to provide So to the have some provide information possible and upwards, downwards relates market. in of

'XX, the the to as some of lot I simplifying that certainly fact add we've assisting shared we would everybody. through have that a to got thing also had model. only 'XX But headwinds with be to the that is a with Josh, challenges shared ability in in I've desire strong and

continue So we lot work of do to a that. on

add the Park made forward. little a I And We it's I will of and some are home at of cost us the on Holidays. provide They've will steps example income. bit in job cadence as commend we'll that that information is at the taking quarter-by-quarter, we is a that, to want to the causing volume better. done and like an a property them executing be adjustments. decision an to And a understanding that much continue we that. think of feel increase we outstanding will take real cadence and things through we think, margin go actually 'XX, to really margin management are where as But to good put place, on go A as sales, able sacrifice decision U.K.

Capital next comes Heffern Brad Our RBC question Markets. from with

property like does in color goes fully sort at into Should any of we this expect reflect the big chunky going out move continue the as guidance year there and U.K. about the the to the sales strategy? Is kind see give business of on? of moves Or that NOI home forward? pace underlying you to which change can you real

of guidance change reflects more The reliable not the side. strategy, strategy continuation shifting the of property underlying fully the or real more but change in right, income -- a into that

any should at Obviously, big expect Okay. the not in you give home that you can next Is which framework the of And are X at the pace a transition? which happen? there in can years? we sales you accomplish the U.K. contributor. color X is there give of on years on or Or the the sort visibility kind happening U.S., that to any around speed us can over

talking the Brad, we U.K.? about are

the Yes, for U.K.

that the Fernando in real occupancy we sacrifice kind different in more of gaining dependable, the word, a when to the And I'd back is fact it margin on would FFO going you Again, in sticky model U.K. announced even reiterate acquisition, if said and the such the property modelable what we in we had recognizing that U.S. than that is the will, strategy increase is side. and a for

seeing continuation on So a you're is that. what

with We economy originally that had on caused at, it. hit them accelerate headwinds if us and 'XX, X- than think I plan an more should Park would that now, want make in of target in But Holidays. say to we're definitely you'll definitely we -- our the have X-year just or to continue future. right right improve that would or guidance to we things we And hit where be, if share a rapid, faster slowing opportunity to where I we're see

W. comes from Golladay Our Baird. next with question Robert Wes

into Are forecast you want when you the unpack extrapolating the Can you are adjusted any just that trends the What to of forecast. pressure? little driving of current seeing a go the bit? balance the the has I rate for balance have transient the And you for to EBITDA the back your conversions? then year, year?

focused the the past really annual the strength sector. of the and of overall growth stability reducing transient few we're the that on. you the of really, RV our favor strategically agreements been years we've relative in over to believe long-term we of continue And know, as Wes, exposure contribution in

degree on within subject homes the allows of an XX% the forecast converting since guests. of expectation our whether, confidence if budget of the higher as to by base So and we XXXX. a home in of drive transient continue our to by the again, is see concerns and of with outlook our they're increased moving those a forward, And that not annuals to we've that. annual basis, have And transient us and X-hour you'll much again, about the

to short-term as And impact seen we as of in conditions recently it. more guest transient so stability April. the in that to last years, able we've weather forecast couple And do saw be

it's continue and to and on to So to transient percentage a continue sites to annuals. I more and them seeing we're opening be think focus converting over we have converted business, we good will of our more we're will while it, a will that to and those of And up stronger annual. stronger and demand, transient allow

No, I get that. all Yes.

rate Just you come pressure are the a conservative just a is mainly maybe get forecast? down the and or just it or there's that trying if forecast, weather to guide the your maybe the And conservative it so looking maybe how into of did little about -- trends as seeing sense at it extrapolating guide is current moment? at occupancy? is And too Just the half you're a impacting just X% transient I'm X% second of the X%. wondering potentially that

efforts now. pace that looking booking the potential the to just going says suggest, is concept with would will right in is that lot give Fernando we for mentioned, a I it. windows We're Yes. guidance the seeing shorting best We're it at year-over-year. upside, our has There do but outpacing yield down forward. can X% as to certainly,

to I you if don't add. of anything have Fernando know

maybe confirm that to onetime maybe then the And guidance. the And there just can those lowering going you new pricing year, on you something in anything first then there's the real property, forward -- nothing the that that been that's the Is U.K. any all income price quarter? Okay. And sticky along. changed doing to items you've year-to-date is this the build that hit

But strategy Fernando our has of strategy shifting been the can about the along. I'll forward. answer talk occupancy margin and guiding for all part, first gain

to As more margins headwinds brought in of before, the the it rapidly economy. as accelerated down I due indicated XXXX we

continued what of understood demand strong increase that But day the Holidays Park from being and community management occupancy a right you're is for seeing now concept able team the X, to was onetime that in for concept the increase property contribution probably owned as equity and real margin firms the the worked them the portfolio of sales much by past. better over private

where value the difference we of and exactly it it it and going a in if property much the look want creation, will, to hoping continue contribution. you we're really be pretty it's term to long now, So real to how make we're at

contribution overall to and side. withholding and with year G&A to contribution Wes, original And aggregate, line in XXXX Park the and FFO on and head related refund. F&B for contribution and FFO then, expectations. tax retail Holidays SRD&E quarter FFO on core personnel total securing from refund expected costs the payroll also was activities operations first office in Park the that includes is corporate in an third-party through the to core for included the this Holidays

of are These our larger tax $XXX to expense. sometimes the to reflected, core or changes with, quarter sales first the that treatment much or changes various it's favorable are of $X These similar million periodically, the call expense or and items in million unfavorable current tax or year. it, or are of other real aggregate rest estate the net changes for about These revenue had updated consistent FFO akin a of period. impact to

Okay.

bottom And is contract just that line so a had. the expense you

lift property year. is so in, upward just And the on U.K. real the a true revenue full

basis Yes. call, is see XXXX. is It and rental detailed a higher we a Easter during by Easter higher did also on the rates, year-over-year the the second in quarter was and same break, driven than was stronger property which where the during expected comp primarily on retention that is

question Wolfe next Keegan comes Carl with from Our Research.

the expansion your parcels. on guess, Maybe bit on acquisition surprising It first, a given development and of was your land just quarter. comments last I

So I guess front. I'm this just on changed curious what

Yes.

as plan and shared more a recycle development capital. as that to down debt very, shutting both And through being basis. in thinking very with about also talked use pay cap well we're flow rate the dispositions costly and by that we've capital think we've of will down using strategic cash I looking our on

have saw is, Marinas. to value you of opportunity strategic take very, piece when seeing you opportunities, the that comes And located the Sun. you're and and land XXX there have as thinking about deal very, potential of a where XXX very just future, of great nature in low that, that think are properties the bolt-on about, all are strategically we just are I strategic There opportunities in one-off long-term or some cost, creation the those a very we of small in advantage nature.

gears something guess, new Is And a existing to any and update just it sales, home Is those the tied homes? it there Or Like reduced you And know mentioned know well I lower explicitly too. should is sales? then shifting here outlook Sandy we on I be that in Is was U.K. to margin. mix? the more then Bay pricing. on it function maybe you I selling homes first. is of? U.S., general as are both used home U.K., there of as are just else homes? in aware higher-priced Or U.S.

for more is relates sales well efforts over marketing of course Keegan, next the of and ramping the pricing Bay the it towards a mix months. season on side, both of sales. busier of couple heading side into U.K. pre-owned to a mix that's the Sandy shifting up as of

Yes.

And MH demonstrates sales a into given guide capital particular occupancy our home is development we're a of away which seeing at that lower deploying communities. something in properties this nearly that and strategic really that Keegan, XX% much I towards and the shift the our expansion. little side, and occupancy home just from think year. of strength the U.S. We bit annual operate that high did the On MH

question Wolfe next Citibank. Our is with from Eric

or core As just way sort I you anything if of in there's was is look the wondering the other. in onetime numbers nature, that at your guidance, one

So in same-store for instance, quarter. might a seems U.K. there NOI this been tax the have it like refund

base core to in this repeated understand year's sort as things to about be in won't if project anything Just year FFO trying which the XXXX. of we there's right next think that from

little U.K. for of expenses million the payroll expenses detailed or securing with this quarter refund tax side. property or that real and included the $X those a refund. The quarter a given has budgeted Eric and additional It figures for VAT contribution withholding year. earlier in is the in net bit higher the on way costs included about associated the

this to might that say estate But that we and a It's right, more, work the we at from where may later assessment state. consistent real that we tax consistent with -- through are is refund given similar a if akin little if we period. assessment, assessments, the to able pay there's bit practice. And get with be a in

on net the bit CapEx. projecting nothing just for to trying those high nothing looks the Yes, sort when out last that distort year's $X would else sure there's and numbers. was like I average. just on reason make million It to I that there XXXX, guess just sense. second recurring we're make quarterly little I it, question to I mean that relative of understood makes sure guess like was want else. I so to maybe sounds it a

I we should to of guess, we I should bolt-on former that this of well? And Just expect that as wondering decrease saw if it acquisition then in to of come still there's expect when to down a acquisitions. investment down? sort a CapEx, come also, sort but bit

the side -- recurring of and CapEx on side on recurring Thank higher you, U.K. during The the do the Eric. on first CapEx Marina quarter spend consistent, we and the have is side CapEx the year.

that as about it the relates quarter So represent year the to as total that rest somewhere reduction a of the year. it quarter, up spend spend first spend as XX% does CapEx on expected around over expected nonrecurring to market, to the CapEx you expected our is saw figures to to XXXX. is compared moderate with the is be the last discussed of ramp to XX% for in we've reduction And

question Anthony Our Powell with Barclays. from comes next

annual, transient to trying transient you understand a question meaningful I of that but many amount on convert I guess you're another sites those to sites. RV. still have of

So growth optimal business? that you I'm there? trends are maybe to there improve employ in split your And can curious, that what's transient any annual

of I answering the your think question. second part

from best talked as to they about transient annual to feed high be XX,XXX, we to a of as transient out. RV X-, guests reducing First, about as in the to feeder properties period continue well XX,XXXs X-, time, XX,XXX X-year over move our transient sites

we've So we're to regard been good with on on the progress side, very social I good, think And other the marketing side, media making there. opportunities, very, focused.

the have different lot growth to about of forms we you think the focused, return of number seasons. really of parts been forms hospitality third COVID looking for of talk growing experience, at different I time. parties pre-COVID in there's activity, through of and from of we where the shoulder and incredible if engaged just a are that the will, have We're revenue the management, in week, who shoulder a business looking periods

we I in pool So than sites becomes transient. believe also to long of that we're the and focused. what enhance near is And the really very, that there the do portfolio left have, transient best term properties we're very is of opportunity to the

we're of would that anticipated continue than to it's there's leading now. So change. specific midterm to that that nothing point as to opportunity no improvements well But we convert seeing growth to could directly kind right there's an longer -- see you as an to I tell in

Feldman next is Our Wells with from Jamie Fargo. question

goal? also Can to metrics? goals you just you to on there? how do objectives your thoughts debt your get for the takes those some us those it of on And or takes remind give to and you What do path focusing both us get you floating leverage balance rate of just think the in your get terms long guess deleveraging sheet. glide items? to And objectives think to I can it

Sure, Jamie.

next stated the our at are year deleveraging Growth from of should we've year have and will as a the below over market As the was that opportunities couple surpassing rate percentage XX%. leverage stated that the and recycling of end had above goal to update should the also months previously, multiple the targets XX%, be the with today long-term Floating well, we'll trust as and a of by we just of EBITDA of Today, we to we manage Gary capital contribute before, are reaching towards at that debt below. standpoint to X.Xx look X.Xx. end we of course from perspective. leverage be course over quarter the provide quarters X.Xx that as in of the

that's something of course the over the can we term. here do So short that

saying much going Okay. to to that's And confirm, no, year-end? the take you're Or X.Xx, longer. by just

XXXX takes standpoint. That us that into from

year, months, back, Okay. just initiatives of the guess And a a X last I the then at lot taking company. new step over

added new board X members. You

earnings. took the You simplify to plan

that I NAREIT a or problems the think discussions, it ring-fenced call of about. whether was meetings on lot of the like of some you had November conference and concerns was end market certainly it seemed the the in year U.K. concerned

So maintained you you look guys guidance. today, your

on team you Can is debating your basis about curtain Your what's to debating, points just fix core is management by is business your some better going problem. problem, the actually Board the company started expected we than the of XXX the looking when year, maybe behind company little ways to is initiatives the REITs. about and almost bit debating, the seems but address of stock that your talk at underperforming a the

don't on to think things come that that as forward the have company can maybe the look side about they on people we, and Just to this of a this fence necessarily year what's ahead. view

Sure.

the create forward. members. crept pleased making board and complexities up the committees with simplification really the of along previously, to pleased throughout share We're we're the really disposition discussed with thoughts good those down recycling grown the we've Board, company. related goal which to of with addition program setup a we're new I'd to as regard company think We're in. capital. I and that, and going through the certainly And has The lot, lines specifically reiterate that well progress the doing our the

Northgate allow it, quarter. properties in to about software sold place translate JVs headstock our much lot managing at they we've simplify stepping and transient us the about the last We've talked greater greatly will cost spent interest growth one business to properties in And off that future Australia, the the We've our talked of able days, although great in the time, still that Campspot. talking use the time properties, taking shared communities, of that software the for conversions proprietary manage we to same we've and are bring margins, the of annual than a about are the we've to which well. other RV today out in that our we been are better as

working great fact volatile able with we've share assets at of well on the property moving to to that of in shaping doing the get and the We're real the Sandy process that strategy sales the the right that excited the job they're is how more in them. now up through The been think over to income. manage Park regard margin foreclosure results are U.K. things the into U.K. In particular, home I Holidays Bay. there. have

we team to are also the are all the Board brought that -- our X we on mention and in the today, in focused sitting these years things that are gives the It So Aaron management opportunity call me have team managed ago. Weiss on.

an as broaden effort bench. and team to executive our So our

continue back. more and platform, to known work think to into XXXX, ways hard be it's simplification to and very, excited very, to And But we of is and has really that underpinned think translate able diligently Sun share just so. we we're with it you. lost of through a have and And performance growth working everything demonstrate that of credibility of to the realize gain the very how go it approach by really do as the I going to quarter-by-quarter that FFO been to I course, for historically. some demonstrate that to we hard very information business outstanding we're

helpful it the going the Very you're if quick year-end the long this initiatives and it just how I all a take whatever does initiatives for because all have get I or you've at mean lots you don't put place impact. for we in asked lot. to to take one it mind, if does about. even really initiatives, guess long to do? full how Like think just follow-up,

the simplification Well, at headwinds. the specific of calls XXXX our we paths that the in conferences to NAREIT taking about what talked some about isn't without talked were We going that place. suggest financial and I'm headwinds its a and lot

Our identify we growth our real growth look the is these shareholders. to to very headwinds us, into at really to we strong can goal -- business and XXXX behind really, are when can most translate core begin that of

upside risk is go all of a a still through we everything with and we a to So while is there. economy there lot there as know it's year, the in challenged uncertainty

'XX. and control feel in what we can be very 'XX like company, As position, in we good into finishing a very, the far we'll going as out

Our next question Securities. is Truist Hau with from Anthony

Given margin down in U.K., premium buyers, And you that more today? homeowners percentage are versus lodges the buying sales standard buyers buying brought you of what compared to premium are seeing before?

upgrade last Anthony, continue that to the are our margin sales of over customers about of by that down will for preowned to and with preowned more drive sales bought or course -- is years home that we the expectations those couple something have lodge upgrade. have that a is our year looking brought helping we the work $X,XXX, premiumization

that we've relates our So retention to as that higher the part strategy homeowners portfolio. is discussing the it it that to relates across as of been

And when upgrade Xx, by your fee home right? to pitch like a increased you standard from premium, you

and a there of sale side. depend, is that home, also home to where of pitch on the not It's is on that in Anthony, usually the the the yes, just from size but premiumization, portfolio. that fee going the site and But site

revenue Okay. And gain. sites just for quick using about one question

assumed how I metric that you think only to are this assumption change given were gained XXX achieve this quarter? the the the has sites in X,XXX for And X,XXX guidance site confident gains, to underlying initial first for target the current guidance?

change manufactured the to year across year. gains full for for no it relates Anthony, as the revenue-producing RV to the and site the expectations housing

Our next with Pawlowski Street. question comes John Green from

on the comments have made. clarifying One, business. questions I a the just X RV on question

just are shortfall is reservations. pace, Could you be So specific a revenues ago? Is X% the second that trending and quarter for it the of third just below that is on that in reservation quarter number stat? more that X% a year

is John. year-over-year. year-over-year the Currently, for quarter, are that in in X.X% expected we second decline revenue relates expecting year. Sure, The as decline it to about X% the I growth number quoted an revenue full

have the it your going a consumer now? regions on softness? then are seeing, highly pronounced camping? suffering? resorts a Is can And what we teams you demand give for right are most me divergence or what's it amenitized details of price now? with is of it Can just property-type help you consumer understand me Okay. some seeing right Is on-the-ground you so -- Which sense local sensitivity are

John, a pace. generally, it's pretty been Board just much the across with slower

you So guiding a if based bit we're that on year-over-year pacing, will.

across issue us the Second did the the are and little that if months, has bit seasonal weather quiet. quarter is We're little been through May but just the mostly a pacing bit April, of communities it approaching impacts it opening Board. up a

to to, lot have all across But So anything that normal a vacation, -- see little our that taking shorter will we there's out team. we we'd bit. to but we'll Board. other expectation management bookings all a the no and we the outperformance one of question other certainly, there. time of would an there is a see. keep closer forms that, thing as you return asked visitations as place specific don't suggest and want posted up put that change really don't if of we There we the we for any point that to know, don't can point to of we But to to, And pick

a segment could regionally within I communities. nothing or point to of there's So our

the Fernando, 'XX, me. and much transaction it's in and from added not acquisitive too $X.XX -- magnitude and during nonrecurring years. costs of costs you're question G&A, Final from adding cost more the 'XX the far in back Okay. what off back

the And What was is specifically? number? the in this this known in imagine And so outside Royale I what Life of start year. Royale else else Life, at is of

So $X.XX again, the guide guide? what add-back versus incremental drove

Sure.

shared primarily year. as February, and the So from deal to have with increase are quarter activity these million just first surpass of from related is the that basis, as $X.X first walk the that And expected saw million largely during costs debt or the walked projecting as did to, earlier, above mentioned have transactions detailed underwriting. on we've the We a that away course guide transaction guide well. costs about we'll of market be we it the now over of the as are would add-backs $XX driving quarter we we that in away that that been earlier in

that the technology implement time, our that amount of is develop But have for amortize full spent to implementation technologies be expected the release. them. $XX.X expenses time, in for do at that million yesterday's to year this back as add we've and platforms it's we period We those and over a detailed press

course So the it that over would -- of can rest year the that's about of additional of the change. but million $X

the reached CEO, of the end like Gary now for I'd to the turn have call and to session. closing remarks. President We Chairman, question-and-answer over Shiffman

understanding, and on the focused letting to forward I the on to and valuation move we of know everyone quarterly we call. forward on very, we end, do to very want just gap We Thank speaking everybody. with you, concept look next working operator. you, in everybody to very, Thank everything are hard very that, are closing the and

This You're today's welcome. conference. concludes

You Goodbye. may your disconnect time, at for thank lines you this participation. and we your