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Essex Announces Second Quarter 2019 Results

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Essex Property Trust, Inc. (NYSE:ESS) (the "Company") announced today its second quarter 2019 earnings results and related business activities.

Net Income, Funds from Operations ("FFO"), and Core FFO per diluted share for the quarter ended June 30, 2019 are detailed below.

 

Three Months Ended

 

Six Months Ended

 

 

June 30,

%

June 30,

%

 

2019

2018

Change

2019

2018

Change

Per Diluted Share

 

 

 

 

 

 

Net Income

$1.40

$1.52

-7.9%

$3.21

$2.90

10.7%

Total FFO

$3.36

$3.17

6.0%

$6.69

$6.52

2.6%

Core FFO

$3.33

$3.14

6.1%

$6.57

$6.23

5.5%

 

 

 

 

 

 

 

Second Quarter 2019 Highlights:

  • Reported Net Income per diluted share for the second quarter of 2019 of $1.40, compared to $1.52 in the second quarter of 2018. The decrease is attributable to gains on sale of real estate in the second quarter of 2018.
  • Grew Core FFO per diluted share by 6.1% compared to the second quarter of 2018, exceeding the midpoint of the guidance range by $0.11.
  • Achieved same-property gross revenue and net operating income ("NOI") growth of 3.5% and 4.1%, respectively, compared to the second quarter of 2018.
  • Raised the midpoint of full-year guidance for same-property gross revenues and NOI by 0.25% and 0.65%, respectively. Full-year same-property expense guidance was lowered by 0.80% at the midpoint, primarily attributable to favorable tax assessments in Washington.
  • Increased full-year Net Income per diluted share guidance range to $5.84 to $6.02. Provided Net Income guidance range for the third quarter of $1.27 to $1.37 per diluted share.
  • Increased full-year Total FFO per diluted share guidance range to $13.31 to $13.49. Provided Total FFO guidance range for the third quarter of $3.26 to $3.36 per diluted share.
  • Raised full-year Core FFO per diluted share guidance by $0.20 per share at the midpoint to a range of $13.19 to $13.37. Provided Core FFO guidance range for the third quarter of $3.26 to $3.36 per diluted share.

"We are pleased to report strong second quarter results with Core FFO per share growth exceeding the high-end of our guidance range. Market conditions remain favorable, particularly in technology-driven Northern California and Seattle, where job growth continues to exceed the national average. Personal income growth continues to outpace rents, improving rental affordability in all of our markets. Better market conditions, favorable tax assessments, and an improving cost of capital have resulted in a meaningful increase to the midpoint of our full-year Core FFO per share guidance range," commented Michael Schall, President and CEO of the Company.

SAME-PROPERTY OPERATIONS

Same-property operating results exclude any properties that are not comparable for the periods presented. The table below illustrates the percentage change in same-property gross revenues for the quarter ended June 30, 2019 compared to the quarter ended June 30, 2018, and the sequential percentage change for the quarter ended June 30, 2019 compared to the quarter ended March 31, 2019, by submarket for the Company:

Q2 2019 vs.

Q2 2018

Q2 2019 vs.

Q1 2019

% of Total

Gross

Revenues

Gross

Revenues

Q2 2019

Revenues

Southern California

 

Los Angeles County

3.4%

0.3%

19.0%

Orange County

2.8%

0.7%

10.9%

San Diego County

3.2%

1.2%

8.5%

Ventura County and Other

3.2%

0.6%

4.9%

Total Southern California

3.2%

0.6%

43.3%

Northern California

 

Santa Clara County

3.9%

0.8%

18.8%

Alameda County

3.0%

0.6%

6.9%

San Mateo County

4.4%

0.5%

5.0%

Contra Costa County

2.7%

0.6%

4.8%

San Francisco

5.9%

2.6%

3.3%

Total Northern California

3.8%

0.9%

38.8%

Seattle Metro

3.5%

1.0%

17.9%

Same-Property Portfolio

3.5%

0.8%

100.0%

 

Year-Over-Year Growth

 

Year-Over-Year Growth

 

Q2 2019 compared to Q2 2018

 

YTD 2019 compared to YTD 2018

 

Gross

Revenues

Operating

Expenses

NOI

 

Gross

Revenues

Operating

Expenses

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