NEXPOINT RESIDENTIAL TRUST, INC. REPORTS FOURTH QUARTER AND FULL YEAR 2023 RESULTS

DALLAS, Feb. 20, 2024

DALLAS, Feb. 20, 2024 /PRNewswire/ -- NexPoint Residential Trust, Inc. (NYSE:NXRT) reported financial results for the fourth quarter and year ended December 31, 2023.

Highlights

• NXRT¹ reported net income, FFO², Core FFO² and AFFO² of $44.3M, $71.4M, $73.5M and $84.4M, respectively, attributable to common stockholders for the year ended December 31, 2023, compared to net loss, FFO, Core FFO, and AFFO of $(9.3)M, $73.4M, $81.8M and $91.4M, respectively, attributable to common stockholders for the year ended December 31, 2022.
• For the year ended December 31, 2023, 2022-2023 Same Store properties³ average effective rent, total revenue and NOI² increased 0.1%, 7.1% and 8.2%, respectively, and occupancy increased 60 bps over the prior year period.
• During the year ended December 31, 2023, the Company completed the sales of Silverbrook and Timber Creek for a combined sales price of $119.0 million.
• The weighted average effective monthly rent per unit across all 38 properties held as of December 31, 2023 (the "Portfolio"), consisting of 14,133 units⁴, was $1,502, while physical occupancy was 94.7%.
• NXRT paid a fourth quarter dividend of $0.46242 per share of common stock on December 29, 2023; this cash dividend represented a $0.04242 per share, or 10.1% increase, over the prior quarter's dividend. Since inception, NXRT has increased the dividend per share by 124.5%.
• During 2023, for the properties in the Portfolio, NXRT completed 2,073 full/partial upgrades and washer/dryer installation, achieving an average monthly rent premium of $190 and a 21.4% ROI⁵.
• Since inception, NXRT has completed installation of 8,534 full and partial upgrades, 4,761 kitchen and laundry appliances and 12,348 technology packages, resulting in $169, $49 and $43 average monthly rental increase per unit and 20.9%, 64.7% and 37.8% ROI, respectively.
• During the year ended December 31, 2023, the Company paid down $50.5 million of principal on its corporate credit facility.

(1)	In this release, "we," "us," "our," the "Company," "NexPoint Residential Trust," and "NXRT" each refer to NexPoint Residential Trust, Inc., a Maryland corporation. ARIVA.DE Börsen-Geflüster Kurse NexPoint Residential Trust 36,51 $ +0,41%
(2)	FFO, Core FFO, AFFO and NOI are non-GAAP measures. For a discussion of why we consider these non-GAAP measures useful and reconciliations of FFO, Core FFO, AFFO and NOI to net income (loss), see the "Definitions and Reconciliations of Non-GAAP Measures" and "FFO, Core FFO and AFFO" sections of this release.
(3)	We define "Same Store" properties as properties that were in our Portfolio for the entirety of the periods being compared. There are 33 properties encompassing 12,378 units of apartment space in our Same Store pool for the year ended December 31, 2023  (our "2022-2023" Same Store" properties). There are 35 properties encompassing 12,940 units of apartment space in our Q4 Same Store pool for the three months ended December 31, 2023 (our "Q4 Same Store" properties). The same store unit count excludes 44 units that are currently down due to fires (Rockledge: 20 units, Bella Solara: 8 units, Six Forks Station: 8 units, Versailles II: 7 units and Bloom: 1 unit).
(4)	Total number of units owned as of December 31, 2023 is 14,133, however 45 units are currently down due to fires and water damage (Rockledge: 20 units, Bella Solara: 8 units, Six Forks Station: 8 units, Versailles II: 7 units, Bloom: 1 unit and Old Farm: 1 unit).
(5)	We define Return on Investment ("ROI") as the sum of the actual rent premium divided by the sum of the total cost.

Full Year 2023 Financial Results

• Total revenues were $277.5 million for the full year 2023, compared to $264.0 million for the full year 2022.
• Net income for the full year 2023 totaled $44.3 million, or income of $1.69 per diluted share, which included a gain on sales of real estate of $67.9 million and $95.2 million of depreciation and amortization expense. This compared to net loss of $(9.3) million, or loss of $(0.36) per diluted share, which included a gain on sales of real estate of $14.7 million and $97.6 million of depreciation and amortization expense for the full year 2022.
• The change in our net income of $44.4 million for the year ended December 31, 2023 as compared to our net loss of $(9.3) million for the year ended December 31, 2022 primarily relates to increases in gains on sales of real estate and total revenues, partially offset by an increase in interest expense.
• For the full year 2023, NOI was $167.4 million on 38 properties, compared to $157.4 million for the full year 2022 on 40 properties.
• For the full year 2023, Same Store NOI increased 8.2% to $145.0 million, compared to $134.0 million for the full year 2022.
• For the full year 2023, FFO totaled $71.4 million, or $2.72 per diluted share, compared to $73.4 million, or $2.81 per diluted share, for the full year 2022. For the full year 2023, Core FFO totaled $73.5 million, or $2.80 per diluted share, compared to $81.8 million, or $3.13 per diluted share, for the full year 2022. For the full year 2023, AFFO totaled $84.4 million, or $3.22 per diluted share, compared to $91.4 million, or $3.49 per diluted share, for the full year 2022.

Fourth Quarter 2023 Financial Results

• Total revenues were $68.9 million for the fourth quarter of 2023, compared to $69.3 million for the fourth quarter of 2022.
• Net income for the fourth quarter of 2023 totaled $18.4 million, or income of $0.70 per diluted share, which included $24.3 million of depreciation and amortization expense and $18.3 million of interest expense. This compared to net income of $3.8 million, or income of $0.15 per diluted share, for the fourth quarter of 2022, which included $23.2 million of depreciation and amortization expense and $15.8 million of interest expense.
• The change in our net income of $18.4 million for the fourth quarter of 2023 as compared to our net income of $3.8 primarily relates to increases in gains on sales of real estate, partially offset by an increase in interest expense.
• For the fourth quarter of 2023, NOI was $42.2 million on 38 properties, compared to $41.8 million for the fourth quarter of 2022 on 40 properties.
• For the fourth quarter of 2023, Q4 Same Store NOI increased 4.5% to $39.1 million, compared to $37.4 million for the fourth quarter of 2022.
• For the fourth quarter of 2023, FFO totaled $17.8 million, or $0.68 per diluted share, compared to $12.2 million, or $0.47 per diluted share, for the fourth quarter of 2022. For the fourth quarter of 2023, Core FFO totaled $17.4 million, or $0.66 per diluted share, compared to $19.5 million, or $0.75 per diluted share, for the fourth quarter of 2022. For the fourth quarter of 2023, AFFO totaled $20.1 million, or $0.77 per diluted share, compared to $22.0 million, or $0.84 per diluted share, for the fourth quarter of 2022.

Fourth Quarter Earnings Conference Call

NXRT will host a call on Tuesday, February 20, 2024, at 11:00 a.m. ET (10:00 a.m. CT), to discuss its full year and fourth quarter 2023 financial results. The conference call can be accessed live over the phone by dialing 888-660-4430 or, for international callers, +1 646-960-0537 and using passcode Conference ID: 5001576.  A live audio webcast of the call will be available online at the Company's website,  nxrt.nexpoint.com (under "Resources").  An online replay will be available shortly after the call on the Company's website and continue to be available for 60 days.

A replay of the conference call will also be available through Tuesday, March 5, 2024, by dialing 800- 770- 2030 or, for international callers, +1 647-362-9199 and entering passcode 5001576. 

About NXRT

NexPoint Residential Trust is a publicly traded REIT, with its shares listed on the New York Stock Exchange under the symbol "NXRT," primarily focused on acquiring, owning and operating well-located middle-income multifamily properties with "value-add" potential in large cities and suburban submarkets of large cities, primarily in the Southeastern and Southwestern United States. NXRT is externally advised by NexPoint Real Estate Advisors, L.P., an affiliate of NexPoint Advisors, L.P., an SEC-registered investment advisor, which has extensive real estate experience. Our filings with the Securities and Exchange Commission (the "SEC") are available on our website, nxrt.nexpoint.com, under the "Financials" tab.

Cautionary Statement Regarding Forward-Looking Statements

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on management's current expectations, assumptions and beliefs. Forward-looking statements can often be identified by words such as "expect," "anticipate," "estimate," "may," "plan," "believe" and similar expressions, and variations or negatives of these words. These forward-looking statements include, but are not limited to, statements regarding NXRT's business and industry in general, pro-forma debt allocation and capital structure and related assumptions, including paydowns of property level debt in connection with dispositions and the paydown of the Company's Corporate Credit Facility (as defined below) in Q1 2024 with the net proceeds from the sale of Old Farm, forecasted submarket deliveries, 2024 full year guidance and the related components and assumptions, including acquisitions and dispositions, shares outstanding, interest expense and the related components and same store growth projections, NXRT's net asset value and the related components and assumptions, estimated value-add expenditures, estimated proceeds from dispositions, debt payments, dispositions, outstanding debt and shares outstanding, guidance for the first quarter 2024 and the related assumptions, planned value-add programs, including projected average rehab costs, rent change and return on investment, expected settlement of interest rate swaps and the effect on the debt maturity schedule, rehab budgets, and expected acquisitions and dispositions, related timing, expected sales prices, estimated investment returns and net cash proceeds. They are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statement, including those described in greater detail in our filings with the Securities and Exchange Commission, particularly those described in our Annual Report on Form 10-K. Readers should not place undue reliance on any forward-looking statements and are encouraged to review the Company's most recent Annual Report on Form 10-K and other filings with the SEC for a more complete discussion of the risks and other factors that could affect any forward-looking statements. The statements made herein speak only as of the date of this release and except as required by law, NXRT does not undertake any obligation to publicly update or revise any forward-looking statements.

FFO, Core FFO and AFFO

The following table reconciles our calculations of FFO, Core FFO and AFFO to net income (loss), the most directly comparable GAAP financial measure, for the years ended December 31, 2023, 2022 and 2021 and for the three months ended December 31, 2023 and 2022 (in thousands, except per share amounts):

		For the Year Ended December 31,												For the Three Months Ended  December 31,
		2023				2022				2021				2023				2022
Net income (loss)		$	44,433			$	(9,291)			$	23,106			$	18,421			$	3,802
Depreciation and amortization			95,186				97,648				86,878				24,251				23,158
Gain on sales of real estate			(67,926)				(14,684)				(46,214)				(24,836)				(14,684)
Adjustment for noncontrolling interests			(273)				(276)				(191)				(68)				(48)
FFO attributable to common stockholders			71,420				73,397				63,579				17,768				12,228
FFO per share - basic		$	2.78			$	2.87			$	2.53			$	0.69			$	0.48
FFO per share - diluted		$	2.72			$	2.81			$	2.47			$	0.68			$	0.47
Loss on extinguishment of debt and modification costs			2,409				8,734				912				316				8,734
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