Killam Apartment REIT (KMP-UN) Q1 2025 earnings summary

Executive summary

• Delivered Q1-2025 FFO per unit of CAD 0.28, up 7.7% year-over-year, with same property NOI growth of 7.8% and AFFO per unit up 9.5%.

• Net income reached CAD 102 million, including CAD 70 million in fair value gains, and AFFO payout ratio improved to 78%.

• Maintained high apartment occupancy at 97.5% and achieved a 15% rental increase on unit turns.

• Strategic progress on capital recycling, ESG initiatives, and development pipeline, with $21.1M in asset sales completed or under agreement and $129M in conditional agreements.

• Ongoing investment in energy initiatives and new developments, including all-electric and solar projects.

Financial highlights

• FFO per unit rose to CAD 0.28 from CAD 0.26 in Q1 2024; AFFO per unit up 9.5% to CAD 0.23.

• Net operating income increased to CAD 59 million, up 7.2% year-over-year; property revenue rose to CAD 93 million.

• Same property NOI growth: 8% in apartments, 7.5% in manufactured home communities, 4.2% in commercial properties.

• AFFO payout ratio improved to 78%, a 600-basis point decrease from Q1-2024.

• Expense growth was 4.6%, with property taxes up 4.8% and utilities up 7.9%.

Outlook and guidance

• Expect to end 2025 at the middle to upper end of the 4%-7% same property NOI growth target.

• Revenue growth target reaffirmed at 5%-6% for 2025.

• On track to sell $100M-$150M of non-core assets in 2025.

• Proceeds from asset sales to be redeployed into developments, acquisitions, debt reduction, or NCIB program.

• Targeting 10% of operationally controlled energy from renewables by year-end 2025.