GuruFocus Premium Membership

Serving Intelligent Investors since 2004. Only 96 cents a day.

Free Trial

Free 7-day Trial
All Articles and Columns »

Home Properties Inc. Reports Operating Results (10-Q)

November 02, 2012 | About:
10qk

10qk

18 followers
Home Properties Inc. (HME) filed Quarterly Report for the period ended 2012-09-30.

Home Properties, Inc. has a market cap of $2.98 billion; its shares were traded at around $62.54 with a P/E ratio of 16 and P/S ratio of 5.1. The dividend yield of Home Properties, Inc. stocks is 4.4%.

Highlight of Business Operations:

The effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges are recorded in accumulated other comprehensive income and are subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. During 2012, such derivatives were used to hedge the variable cash flows associated with certain variable-rate debt. The ineffective portion of the change in fair value of the derivatives are recognized directly in earnings. During the three and nine months ended September 30, 2012 the Company did not record any hedge ineffectiveness.

The Companys net cash flow from operating activities was $198 million in the first nine months of 2012 compared to $146 million in the first nine months of 2011. The $52 million increase was primarily due to more profitable operations and the full period impact of properties acquired during 2011, as more fully described under the heading Results of Operations below.

The table below summarizes the actual total capital improvements incurred by major categories for the three and nine months ended September 30, 2012 and 2011 and an estimate of the breakdown of total capital improvements by major categories between recurring, and non-recurring revenue generating, capital improvements for the three and nine months ended September 30, 2012 as follows:

General and administrative expenses increased in 2012 by $215, or 2.8%. General and administrative expenses as a percentage of total revenues were 4.7% for 2012 as compared to 5.4% for 2011. The 2012 costs include $1,580 in connection with the departure of an executive and represent acceleration of previously granted stock-based compensation as well as future payments for salary continuation. Current stock-based compensation costs were $949 lower than 2011 due primarily due to the restricted stock grants and stock option grants to executives at or near official retirement age resulting in these grants being expensed immediately, or one year less based on age. In addition, the corporate bonus costs were $176 less and other general & administrative spending was $263 lower than the 2011 period.

General and administrative expenses increased in 2012 by $4,502, or 19.7%. General and administrative expenses as a percentage of total revenues were 5.6% for 2012 as compared to 5.4% for 2011. The 2012 costs include $1,580 in connection with the departure of an executive and represent acceleration of previously granted stock-based compensation as well as future payments for salary continuation. Current stock-based compensation costs recognized during 2012 were up $3,333, or 42.7%, of which $2,692 is due to the new three year performance restricted stock unit grants issued in the first quarter of 2012. The remaining $641 stock-based compensation increase is primarily due to the impact of executives at, or near retirement age, resulting in the current year restricted stock awards and stock option grants being expensed over a one-year shorter time period in 2012 as compared to 2011. The above increases were partially offset by $637 lower 2012 spending in other general and administrative areas.

Read the The complete Report

About the author:

10qk
GuruFocus - Stock Picks and Market Insight of Gurus

Rating: 2.0/5 (2 votes)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK
Email Hide