10-KPeriod: FY2021

Extra Space Storage Inc. Annual Report, Year Ended Dec 31, 2021

Filed February 28, 2022For Securities:EXR

Summary

Extra Space Storage Inc. (EXR) reported solid performance in its 2021 10-K filing, driven by strong rental revenue growth and increased occupancy rates across its expansive portfolio of 2,096 stores. The company benefited from favorable market conditions in the self-storage sector, which saw a rebound from the impacts of the COVID-19 pandemic, leading to record occupancy levels in 2021. Management highlighted strategic growth initiatives, including acquisitions, redeployment of capital, and a focus on operational efficiencies, contributing to a significant increase in total revenues and net operating income. Financially, EXR demonstrated robust revenue generation, with property rental revenues increasing by 15.9% and tenant reinsurance revenues up by 16.1% year-over-year. Funds From Operations (FFO) attributable to common stockholders and unit holders saw a substantial rise of 34.8%. The company also managed its debt effectively, with a decrease in interest expense and a stable debt-to-enterprise value ratio, supported by a strong credit rating. The outlook suggests continued focus on strategic expansion and operational excellence, positioning EXR for sustained growth within the self-storage industry.

Financial Highlights

43 data points
Beta

Revenue

$1.58B

76.6% Gross Margin

Net Income

$827.65M

52.5% Net Margin

EPS (Diluted)

$6.19

Total Assets

$10.47B

Cash & Equivalents

$71.13M

Free Cash Flow

$952.44M

Financial Statements
Beta
Revenue$1.58B
Cost of Revenue$368.61M
Gross Profit$1.21B
Operating Expenses$742.17M
Operating Income$975.95M
Interest Expense$166.18M
Net Income$827.65M
EPS (Basic)$6.20
EPS (Diluted)$6.19
Shares Outstanding (Basic)133.37M
Shares Outstanding (Diluted)140.02M

Key Highlights

  • 1Total revenues increased by 16.3% to $1.58 billion in 2021, primarily driven by property rental revenue growth.
  • 2Same-store net operating income (NOI) grew by 19.7% in 2021, reflecting strong pricing power and occupancy.
  • 3Funds From Operations (FFO) attributable to common stockholders and unit holders increased by 34.8% to $974 million in 2021.
  • 4The company acquired 74 new stores in 2021, expanding its portfolio and enhancing its market presence.
  • 5Interest expense decreased by 1.4% to $166.2 million, aided by lower average interest rates and debt management.
  • 6EXR maintained a strong balance sheet with $71.1 million in cash and cash equivalents as of December 31, 2021.
  • 7Occupancy rates for wholly-owned stores reached 94.8% in 2021, a slight increase from the previous year.

Frequently Asked Questions

Revenue growth in 2021 was primarily driven by a significant increase in property rental revenue, up 15.9%, attributed to higher occupancy levels and increased rental rates for both new and existing customers. Tenant reinsurance revenue also saw a notable increase of 16.1%, reflecting the growth in the company's store portfolio and higher average occupancy.

Extra Space Storage continued its growth strategy through acquisitions, adding 74 new stores in 2021. These acquisitions, along with those from prior years, contributed to the increase in property rental revenues and expanded the company's geographic footprint and operational scale.

The company demonstrated effective debt management, with a decrease in interest expense. EXR maintains a diversified capital structure and plans to continue financing future growth through a mix of cash flow, credit facilities, debt, and equity offerings. The company also has access to a $1.4 billion revolving credit facility, with $855 million undrawn as of December 31, 2021, providing significant financial flexibility.

The company's same-store portfolio showed strong performance in 2021, with rental revenues increasing by 13.8% and same-store net operating income (NOI) growing by an impressive 19.7%. This indicates efficient operations and effective pricing strategies within its stabilized properties.