American Campus Communities (ACC) Tops Q1 EPS by 35c, Revenues Beat

American Campus Communities (NYSE: ACC) reported Q1 EPS of $0.58, $0.35 better than the analyst estimate of $0.23. Revenue for the quarter came in at $249.4 million versus the consensus estimate of $232.13 million.

• Implemented a COVID-19 crisis response plan, which included creating task forces to support the company’s residents and employees during the novel coronavirus crisis, adopting and communicating relevant guidelines issued by the CDC, following guidelines for cleaning and disinfecting, and implementing social distancing protocols for residents and staff including limiting employee hours on-site while maintaining compensation and limiting in-person contact while continuing essential activities such as emergency work orders and life-safety maintenance.
• Formed a Resident Hardship Program to provide relief to those experiencing financial hardship as a result of the pandemic as well as waiving late payment and online payment fees.
• Reported net income attributable to ACC of $80.9 million or $0.58 per fully diluted share, versus $29.6 million or $0.21 per fully diluted share in the first quarter 2019.
• Increased FFOM to $97.6 million or $0.70 per fully diluted share versus $95.3 million or $0.69 per fully diluted share in the first quarter prior year.
• Grew same store net operating income (\"NOI\") by 1.2 percent over the first quarter 2019. Revenues increased 0.7 percent and operating expenses were flat with the prior year quarter.
• Grew same store average physical occupancy to 97.0 percent for the first quarter 2020 compared to 96.9 percent for the first quarter 2019.
• Advanced a new development project on the campus of Massachusetts Institute of Technology (MIT) that is anticipated to be structured as an American Campus Equity (ACE®) transaction, although the full scope, transaction structure, feasibility, fees and timing have not yet been finalized.
• Awarded a new second phase on-campus development project with Virginia Commonwealth University in Richmond.
• Completed the disposition of The Varsity, a 901-bed property located in College Park, Maryland for proceeds of $148.0 million, representing an economic cap rate of 4.1 percent.
• Issued $400.0 million of 10-year senior unsecured notes at a yield of 2.872 percent, representing a record low credit spread and yield for a mid-BBB rated REIT and one of the lowest credit spreads and yields of any 10-year REIT benchmark offering in history.

“While the start to 2020 was strong and poised for positive company performance, we quickly shifted our focus in March to respond to the COVID-19 pandemic,” said Bill Bayless, American Campus Communities CEO. “Our teams are working tirelessly to respond to the evolving COVID-19 impacts to our residents, our employees and our university partners. Our Resident Hardship Program has been well received and we pledge that every American Campus Communities resident will continue to have a home during this crisis regardless of their ability to pay rent on a timely basis. We will act in good faith – working with every student and family suffering financial hardship on a case-by-case basis to ensure our residents continue to have a home and the ability to complete their online instruction in an academically-oriented environment. At this difficult time, there will be no late fees, no online payment fees and no financial related evictions. We are now working with our university partners regarding how our modern communities, which facilitate the implementation of social distancing guidelines, may assist them in returning to in-person operations in the fall.”

For earnings history and earnings-related data on American Campus Communities (ACC) click here.

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