Home Properties Inc. (HME, Financial) filed Quarterly Report for the period ended 2010-06-30.
Home Properties Inc. has a market cap of $1.81 billion; its shares were traded at around $49.82 with a P/E ratio of 15 and P/S ratio of 3.6. The dividend yield of Home Properties Inc. stocks is 4.7%. Home Properties Inc. had an annual average earning growth of 3.8% over the past 5 years.HME is in the portfolios of Manning & Napier Advisors, Inc, Jim Simons of Renaissance Technologies LLC.
Net cash provided by financing activities totaled $14 million in 2010. Cash flows from net proceeds of the ATM common stock offering of $108 million, proceeds from stock option exercises of $6 million and net proceeds from mortgage financing of $4 million were more than offset by distributions paid to stockholders and UPREIT Unitholders of $55 million, and a net paydown of $44 million on the line of credit. Net cash used in financing activities totaled $72 million for 2009, primarily as a result of net borrowing under our line of credit of $33 million and proceeds from stock option exercises of $2 million being more than offset by paydown on mortgage notes of $44 million, distributions paid to stockholders and UPREIT Unitholders of $61 million, and common stock repurchases of $2 million.
In October 2006, the Company issued $200 million of exchangeable senior notes with a coupon rate of 4.125% (Senior Notes), which generated net proceeds of $195.8 million. The net proceeds were used to repurchase 933,000 shares of common stock for a total of $58 million, pay down $70 million on the line of credit, with the balance used for redemption of the Series F Preferred Shares and property acquisitions. During the fourth quarter of 2008, the Company repurchased $60 million of the Senior Notes for $45.4 million. The exchange terms and conditions are more fully described under Contractual Obligations and Other Commitments, below.
On December 3, 2009, the Company initiated an At-the-Market (ATM) equity offering program through which it was authorized to sell up to 3.7 million shares of common stock (not to exceed $150 million of gross proceeds), from time to time in ATM offerings or negotiated transactions. During December 2009, the Company issued 871,600 shares of common stock at an average price per share of $45.70, for aggregate gross proceeds of $39.8 million. Aggregate net proceeds from such issuances, after deducting commissions and other transaction costs of $0.9 million were $38.9 million. During the six months ended June 30, 2010, the Company issued 2,307,100 shares of common stock at an average price per share of $47.75, for aggregate gross proceeds of $110.2 million. Aggregate net proceeds from such issuances, after deducting commissions and other transaction costs of $2.1 million were $108.1 million. In summary, the Companys completed ATM equity offering program resulted in the sale of 3,178,700 shares of common stock at an average price per share of $47.19, for aggregate gross proceeds of $150.0 million. Aggregate net proceeds from such issuances, after deducting commissions and other transaction costs of $3.0 million were $147.0 million.
On June 17, 2010, the Company acquired Annapolis Roads, a 282 unit community in Annapolis, Maryland, which it had managed for the prior owner since 2000. The total purchase price of $32.5 million included the assumption of an existing $20.0 million fixed rate mortgage, $7.5 million in cash and $4.8 million in UPREIT Units. Closing costs of $0.4 million were incurred and included in other expenses. The property was built in three phases between 1974 and 1979 and consists of eleven residential buildings. The weighted average first year capitalization rate projected by the Company on this acquisition was 6.6%.
In October 2006, the Company issued $200 million of Senior Notes with a coupon rate of 4.125%. During 2008, the Company repurchased and retired $60 million principal amount of its Senior Notes and $140 million remain outstanding at June 30, 2010. The notes are exchangeable into cash equal to the principal amount of the notes and, at the Companys option, cash or common stock for the exchange value, to the extent that the market price of common stock exceeds the initial exchange price of $73.34 per share, subject to adjustment. The exchange price is adjusted for payments of dividends in excess of the reference dividend set in the indenture of $0.64 per share. The adjusted exchange price at June 30, 2010 was $72.87 per share. Upon an exchange of the notes, the Company will settle any amounts up to the principal amount of the notes in cash and the remaining exchange value, if any, will be settled, at the Companys option, in cash, common stock or a combination of both. The notes are not redeemable at the option of the Company for five years, except to preserve the status of the Company as a REIT. Holders of the notes may require the Company to repurchase the notes upon the occurrence of certain designated events. In addition, prior to November 1, 2026, the holders may require the Company to repurchase the notes on November 1, 2011, 2016 and 2021. The notes will mature on November 1, 2026, unless previously redeemed, repurchased or exchanged in accordance with their terms prior to that date.
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Home Properties Inc. has a market cap of $1.81 billion; its shares were traded at around $49.82 with a P/E ratio of 15 and P/S ratio of 3.6. The dividend yield of Home Properties Inc. stocks is 4.7%. Home Properties Inc. had an annual average earning growth of 3.8% over the past 5 years.HME is in the portfolios of Manning & Napier Advisors, Inc, Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
Cash used in investing activities was $95 million during 2010 compared to $7 million in 2009. The $88 million swing between periods is primarily due to the 2009 period receiving the benefit of $67 million proceeds from the sale of properties, while the 2010 period realized no property sales. There were $31 million cash outflows for the purchase of properties in 2010 compared to none in 2009. Cash outflows for capital improvements were $38 million during 2010 and 2009. The consistent outflow in both periods reflects managements conscious efforts to continually perform selective rehabilitation in markets that are able to support rent increases. Cash outflows for additions to construction in progress were $24 million in 2010 as compared to $35 million in 2009. The lower spending on development in 2010 reflects the completion of one major project during 2010 compared to the construction of two communities in 2009.Net cash provided by financing activities totaled $14 million in 2010. Cash flows from net proceeds of the ATM common stock offering of $108 million, proceeds from stock option exercises of $6 million and net proceeds from mortgage financing of $4 million were more than offset by distributions paid to stockholders and UPREIT Unitholders of $55 million, and a net paydown of $44 million on the line of credit. Net cash used in financing activities totaled $72 million for 2009, primarily as a result of net borrowing under our line of credit of $33 million and proceeds from stock option exercises of $2 million being more than offset by paydown on mortgage notes of $44 million, distributions paid to stockholders and UPREIT Unitholders of $61 million, and common stock repurchases of $2 million.
In October 2006, the Company issued $200 million of exchangeable senior notes with a coupon rate of 4.125% (Senior Notes), which generated net proceeds of $195.8 million. The net proceeds were used to repurchase 933,000 shares of common stock for a total of $58 million, pay down $70 million on the line of credit, with the balance used for redemption of the Series F Preferred Shares and property acquisitions. During the fourth quarter of 2008, the Company repurchased $60 million of the Senior Notes for $45.4 million. The exchange terms and conditions are more fully described under Contractual Obligations and Other Commitments, below.
On December 3, 2009, the Company initiated an At-the-Market (ATM) equity offering program through which it was authorized to sell up to 3.7 million shares of common stock (not to exceed $150 million of gross proceeds), from time to time in ATM offerings or negotiated transactions. During December 2009, the Company issued 871,600 shares of common stock at an average price per share of $45.70, for aggregate gross proceeds of $39.8 million. Aggregate net proceeds from such issuances, after deducting commissions and other transaction costs of $0.9 million were $38.9 million. During the six months ended June 30, 2010, the Company issued 2,307,100 shares of common stock at an average price per share of $47.75, for aggregate gross proceeds of $110.2 million. Aggregate net proceeds from such issuances, after deducting commissions and other transaction costs of $2.1 million were $108.1 million. In summary, the Companys completed ATM equity offering program resulted in the sale of 3,178,700 shares of common stock at an average price per share of $47.19, for aggregate gross proceeds of $150.0 million. Aggregate net proceeds from such issuances, after deducting commissions and other transaction costs of $3.0 million were $147.0 million.
On June 17, 2010, the Company acquired Annapolis Roads, a 282 unit community in Annapolis, Maryland, which it had managed for the prior owner since 2000. The total purchase price of $32.5 million included the assumption of an existing $20.0 million fixed rate mortgage, $7.5 million in cash and $4.8 million in UPREIT Units. Closing costs of $0.4 million were incurred and included in other expenses. The property was built in three phases between 1974 and 1979 and consists of eleven residential buildings. The weighted average first year capitalization rate projected by the Company on this acquisition was 6.6%.
In October 2006, the Company issued $200 million of Senior Notes with a coupon rate of 4.125%. During 2008, the Company repurchased and retired $60 million principal amount of its Senior Notes and $140 million remain outstanding at June 30, 2010. The notes are exchangeable into cash equal to the principal amount of the notes and, at the Companys option, cash or common stock for the exchange value, to the extent that the market price of common stock exceeds the initial exchange price of $73.34 per share, subject to adjustment. The exchange price is adjusted for payments of dividends in excess of the reference dividend set in the indenture of $0.64 per share. The adjusted exchange price at June 30, 2010 was $72.87 per share. Upon an exchange of the notes, the Company will settle any amounts up to the principal amount of the notes in cash and the remaining exchange value, if any, will be settled, at the Companys option, in cash, common stock or a combination of both. The notes are not redeemable at the option of the Company for five years, except to preserve the status of the Company as a REIT. Holders of the notes may require the Company to repurchase the notes upon the occurrence of certain designated events. In addition, prior to November 1, 2026, the holders may require the Company to repurchase the notes on November 1, 2011, 2016 and 2021. The notes will mature on November 1, 2026, unless previously redeemed, repurchased or exchanged in accordance with their terms prior to that date.
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