UMH Properties, Inc. Q2 FY2025 earnings call

• Normalized FFO was $0.23 per share for Q2 2025, up 16% quarter-over-quarter and 20% year-over-year.
• Dividend increased by 4.7% to $0.225 per share, annualizing to $0.90 per share, with 5 consecutive years of increases.
• Refinanced 10 communities for $101.4 million, with appraised value of these communities at $164 million, creating $97 million in value from a $67 million investment.
• Marcellus and Utica Shale strategy has led to land, community, and home appreciation due to energy-related developments.
• Nashville and Southeastern US strategies saw occupancy increases, strong sales profits, and property value growth.
• Converted 190 new homes to rental homes in Q2 2025, with 305 converted year-to-date, and anticipates 700-800 new rental homes by end of 2025.
• Acquired 2 New Jersey communities and 2 Maryland communities year-to-date, with ongoing evaluation of future acquisitions.
• Joint venture with Nuveen Real Estate has made progress, with Honey Ridge community in Pennsylvania opening in June.

Normalized FFO for the second quarter was $0.23 per share for both 2024 and 2025. Overall, normalized FFO was up 16% ($2.6 million) for the quarter and 20% ($6.4 million) for the year. Total revenue for Q2 2025 was $66.6 million, with rental and related income at $56.1 million (84.2% of total) and sales income at $10.5 million (15.8% of total). Rental and related income increased 9% from Q2 2024, and sales of manufactured homes had a sales record of $10.5 million in Q2 2025 with gains from sales of $1.5 million.

• Management is not updating full-year 2025 guidance, but is confident in the low end of prior guidance.
• Potential for earnings per share growth in Q3 and Q4 due to expected increases in rental income and sales, especially with HUD developments improving retail financing.
• Optimism due to recent HUD changes and policies that could significantly impact manufactured housing sales and community development.

• Interest rate fluctuations could affect borrowing costs and debt servicing.
• Market conditions impacting demand for affordable housing.
• Supply chain issues potentially delaying home deployments.
• Operational challenges with community repositioning, such as short-term occupancy decreases at acquired properties.

Q: Gaurav Mehta asked if they were withdrawing prior guidance or if it still holds.

A: Samuel Landy said the low end of prior guidance should hold, and they're confident in the low end, with potential for earnings per share growth in Q3 and Q4.

Q: Gaurav Mehta asked about drivers of confidence in guidance.

A: Samuel Landy mentioned confidence in low end of guidance, potential for earnings growth from rental income and retail financing improvements.

Q: Gaurav Mehta asked about new home prices.

A: Brett Taft said prices of new homes are about where they've been, with 200 homes on-site and strong demand.

Q: Robert Stevenson asked about Conowingo Court acquisition.

A: Brett Taft said they expect short-term occupancy decreases but believe they'll rapidly turn around the property.

Q: Craig Kucera asked about home deployments and supply chain.

A: Samuel Landy said no major supply chain issues, but setup crews are a minor issue, and they're confident in 700-800 home deployments.

Q: John Massocca asked about sales margins.

A: Samuel Landy and Brett Taft said margins were lower initially due to initial phases of expansions, but expect margins to improve as expansions progress.