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National Storage Affiliates Trust (NSA)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 results were in line with internal expectations but soft versus Street on revenue and EBITDA; S&P Global consensus showed an EPS beat, a revenue miss, and an EBITDA miss. Reported diluted EPS was $0.10, Core FFO/share $0.54, total revenue $188.4M; S&P “Primary EPS” actual was $0.1687 vs consensus $0.155; S&P revenue actual $182.6M vs consensus $186.9M; S&P EBITDA actual $107.4M vs consensus $118.0M *.
  • Management reaffirmed 2025 guidance, including Core FFO/share $2.30–$2.38, same‑store revenue growth −1.25% to +1.25%, OpEx +3–4%, NOI −2.8% to 0.0%; diluted EPS range eased to $0.63–$0.69 from $0.64–$0.70 previously .
  • Operationally, sequential momentum improved: street and contract rates rose each month through April; April moving contract rates were ~5% above Q1 levels and period‑end occupancy in April increased 20 bps to 83.8% .
  • Portfolio catalysts: continued PRO internalization benefits (G&A savings, stronger pricing/marketing tools), active capital recycling ($100–$300M dispositions and acquisitions), and improving supply backdrop; near‑term headwinds include muted occupancy and higher interest expense from swap maturities (~$0.01 drag in Q1) .

What Went Well and What Went Wrong

What Went Well

  • Sequential improvement: “the pace of year‑over‑year same store revenue and NOI growth” improved from Q4, with management believing same‑store growth troughs are behind them .
  • Pricing progress: “street rates and in‑place contract rents have grown sequentially every month…through April,” and April moving contract rates increased ~5% vs Q1; April occupancy rose 20 bps to 83.8% .
  • Specific markets turned positive: Portland and Houston inflected to positive revenue growth; management cited better marketing/revenue management and easing supply in Portland .

What Went Wrong

  • Same‑store softness: same‑store revenue −3.0% and NOI −5.7%; average occupancy −190 bps YoY; period‑end occupancy 83.6% (−240 bps YoY) .
  • OpEx pressure: same‑store property OpEx +3.7% YoY (marketing, R&M, utilities); winter storms inflated snow removal and utilities, otherwise OpEx growth <3% .
  • Interest expense headwind: $225M revolver swaps matured in February, resetting ~275 bps higher; management quantified a ~$0.01 EPS drag in Q1 and expects near‑term leverage above the comfort range before easing in H2’25 .

Financial Results

Consolidated P&L – Sequential Trend (oldest → newest)

MetricQ3 2024Q4 2024Q1 2025
Total Revenue ($M)$193.6 $190.1 $188.4
Diluted EPS ($)$0.18 $0.15 $0.10
Core FFO per share and unit ($)$0.62 $0.60 $0.54
Interest Expense ($M)$39.6 $39.3 $40.5

Year-over-Year – Q1

MetricQ1 2024Q1 2025
Total Revenue ($M)$196.1 $188.4
Diluted EPS ($)$0.65 $0.10
Core FFO per share and unit ($)$0.60 $0.54

Revenue Composition – Q1

Category ($M)Q1 2024Q1 2025
Rental Revenue$180.4 $169.5
Other Property-related Revenue$6.7 $6.7
Management Fees & Other$9.1 $12.1
Total Revenue$196.1 $188.4

Same-Store KPIs (771 stores where applicable)

KPIQ3 2024Q4 2024Q1 2025
Total Revenue ($M)$174.8 $170.7 $168.7
Property OpEx ($M)$50.2 $49.8 $52.2
NOI ($M)$124.6 $120.9 $116.4
NOI Margin (%)71.3% 70.8% 69.0%
Average Occupancy (%)86.3% 85.2% 83.9%
Period-End Occupancy (%)85.6% 84.7% 83.6%
Avg Annualized Rent $/Occupied SF$15.67 $15.56 $15.70

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Core FFO per shareFY 2025$2.30–$2.38 $2.30–$2.38 Maintained
Same-store Total Revenue GrowthFY 2025−1.25% to +1.25% −1.25% to +1.25% Maintained
Same-store OpEx GrowthFY 2025+3.0% to +4.0% +3.0% to +4.0% Maintained
Same-store NOI GrowthFY 2025−2.8% to 0.0% −2.8% to 0.0% Maintained
Diluted EPSFY 2025$0.64–$0.70 $0.63–$0.69 Lowered ($0.01 at both ends)
G&A excl. equity comp ($M)FY 2025$45.5–$47.5 $45.5–$47.5 Maintained
Equity-based comp ($M)FY 2025$8.0–$8.5 $8.0–$8.5 Maintained
Mgmt fees & other revenue ($M)FY 2025$49.5–$51.5 $49.5–$51.5 Maintained
Core FFO from JVs ($M)FY 2025$21.5–$23.5 $21.5–$23.5 Maintained
Acquisitions (NSA share, $M)FY 2025$100–$300 $100–$300 Maintained
Dispositions (NSA share, $M)FY 2025$100–$300 $100–$300 Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024, Q4 2024)Current Period (Q1 2025)Trend
Pricing & Street RatesStreet rates down YoY, widened into Oct; trough in Oct; recovery in Nov–Dec (down ~13%) .Street & contract rates rose sequentially Jan–Apr; moving contract rates +~5% in April .Improving sequential price momentum from trough.
OccupancyOct occupancy improved despite seasonality; average occupancy −190–290 bps YoY through late 2024 .Average occupancy 83.9%; period‑end occupancy in April +20 bps to 83.8%; still muted YoY .Stabilizing; modest spring lift expected.
PRO Internalization BenefitsExecution progress, G&A savings beginning; tenant insurance economics in place .Centralized platforms, upgraded marketing/pricing; AI to optimize call flows/staffing; stronger G&A and fee lines .Accretion ramping across 2025.
Marketing SpendElevated vs peers; necessary to drive funnel; 20% YoY growth expected through year .Continued elevated marketing with efficient paid search via single domain nsastorage.com .Sustained investment; targeting ROI.
Housing/MacroExpect modest improvement and pent‑up mobility; supply deliveries to decline; easy comps in H2’25 .Still cautious; midpoint assumes modest demand improvement; watch housing and tariffs (no impact yet) .Gradual tailwinds vs uncertain timing.
Regional TrendsWest Coast FL uplift post storms; Sunbelt challenged; Portland stabilizing .Portland, Houston positive; Sarasota/Atlanta below average .Mixed; selected MSAs outperform.

Management Commentary

  • “Our first quarter results were in‑line with our expectations…implying that the troughs in same store growth are now behind us. Although occupancy levels remain muted, street rates and in‑place contract rents have grown sequentially every month…through April” — David Cramer, CEO .
  • “Moving contract rates in April increased approximately 5% from the first quarter levels…occupancy increased 20 basis points in April to finish the month at 83.8%” — David Cramer .
  • “Core FFO per share of $0.54…decline due primarily to a decrease in same‑store NOI and an increase in interest expense…swap maturity…resulted in a $0.01 drag” — Brandon Togashi, CFO .
  • “We remain disciplined…$13.5 million acquisitions and two property sales in Q1; expect to announce more transactions…over the next few months” — David Cramer .
  • “No maturities in 2025…approximately $500–$522.5 million of revolver availability” — Brandon Togashi .

Q&A Highlights

  • Rate vs occupancy trade‑off: NSA pushed street rates and used temporary discounts to optimize revenue over occupancy; tools indicate lower rates wouldn’t sufficiently stimulate demand .
  • PRO portfolio uplift: 250–300 bps occupancy gap vs corporate stores targeted to narrow through summer; stronger ECRI cadence and centralized pricing expected to move the needle .
  • Marketing intensity: Elevated spend (≈+20% YoY) is intentional given improved funnel visibility and nsastorage.com consolidation; run‑rate likely similar through 2025 if ROI persists .
  • Capital recycling: ~$10M under contract to sell; full‑year dispositions guided at $100–$300M with proceeds earmarked to pay down revolver and fund selective acquisitions/JV investments .
  • Tariffs & consumer: No tangible impact yet from tariffs; consumer health metrics (bad debt, payment activity) remain within expected ranges .

Estimates Context

MetricQ1 2025 S&P ConsensusQ1 2025 S&P ActualQ1 2025 Reported (8‑K)
Primary EPS ($)0.155*0.1687*0.10
Revenue ($M)186.9*182.6*188.4
EBITDA ($M)118.0*107.4*114.6 (EBITDA)

Values marked with an asterisk (*) were retrieved from S&P Global.

  • Significant estimate variances: EPS beat on S&P “Primary EPS” (0.1687 vs 0.155); revenue miss (182.6M vs 186.9M); EBITDA miss (107.4M vs 118.0M). Note: S&P’s standardized “Primary EPS” and revenue mapping can differ from GAAP diluted EPS and NSA’s total revenue disclosure (which includes management fees and other revenue) *.
  • Estimate revisions may drift modestly higher on pricing momentum and management’s reaffirmed guidance, but near‑term EBITDA/NOI revisions could reflect ongoing OpEx and occupancy pressures as well as higher interest expense from swap maturities .

Key Takeaways for Investors

  • NSA reaffirmed 2025 Core FFO/share $2.30–$2.38 and same‑store ranges, signaling confidence in sequential improvement despite muted occupancy; diluted EPS guide trimmed slightly (−$0.01 at both ends) .
  • Pricing power is building: monthly sequential increases in street and contract rates through April and early signs of stabilization in select MSAs (Portland, Houston) .
  • Watch near‑term leverage and interest expense: swap roll‑offs add cost (~$0.01 EPS drag in Q1); expect leverage above the 5.5–6.5x comfort band near‑term before easing in H2’25 .
  • Capital recycling should be supportive: guided $100–$300M dispositions and acquisitions (NSA share), with dispos proceeds reducing revolver and redeploying into higher‑quality density opportunities/JVs .
  • Marketing remains a tactical lever: elevated spend is boosting funnel visibility and conversion via a unified domain; cost discipline and ROI tracking are critical in a competitive demand environment .
  • Dividend stable: Q1 common dividend $0.57 paid Mar 31; Q2 declared $0.57 payable Jun 30, reinforcing cash distribution consistency amid operational transition .
  • Trading stance: near‑term volatility likely around occupancy and OpEx; improving rate trajectory and reaffirmed guide provide a floor, with PRO internalization benefits and declining supply as medium‑term upside drivers .

Additional Notes

  • Balance sheet: No maturities in next 12 months; ~$522.5M revolver capacity; net debt to annualized current‑quarter Adjusted EBITDA 6.9x as of Mar 31, 2025 .
  • Same-store details: FY guidance reflects 771‑store same‑store pool; FY 2024 actuals reflect a 776‑store pool .
  • Upcoming events: NSA to participate in Nareit REITweek (Jun 2–5, NYC) .
Bolded highlights:
- EPS beat vs S&P; revenue and EBITDA misses (Estimates Context)
- Diluted EPS guidance lowered; Core FFO/share reaffirmed (Guidance Changes)