1. The Company is required by GAAP to defer recognition of the non-refundable upfront payments from the entry of right-to-use contracts over the estimated customer life. The customer life is currently estimated to range from one to 31 years and is based upon historical attrition rates provided to the Company by Privileged Access. The amount shown represents the deferral of a substantial portion of current period contracts sales, offset by amortization of prior period sales.

2. The Company is required by GAAP to defer recognition of the commission paid related to the entry of right-to-use contracts. The deferred commissions will be amortized on the same method as the related non-refundable upfront payments from the entry of right-to-use contracts. The amount shown represents the deferral of a substantial portion of current period contract commissions, offset by the amortization of prior period commissions.

3. For the three months and year ended December 31, 2011, the Company previously reported FFO and FAD including a deduction for rental home depreciation expense. To conform with the 2012 presentation of FFO and FAD, rental home depreciation expense was added back to previously reported FFO and FAD for the three months and year ended December 31, 2011.

4. See definition of FFO and FAD page 21.

5. FFO adjusted to include a deduction for depreciation expense on rental homes would have been $48.6 million, or $1.07 per fully diluted share, and $43.5 million, or $0.96 per fully diluted share, for the three months ending December 31, 2012 and 2011, respectively, and $203.9 million, or $4.49 per fully diluted share, and $143.2 million, or $3.55 per fully diluted share, for the year ended December 31, 2012 and 2011, respectively.
Consolidated Income from Property Operations (1)

(In $US millions, except home site and occupancy figures, unaudited)
Three Months Ended   Year Ended
December 31, December 31,
2012   2011 2012   2011
Community base rental income (2) $ 104.4 $ 99.1 $ 414.2 $ 318.9
Rental home income 4.0 2.7 14.1 8.0
Resort base rental income (3) 29.8 28.6 134.3 130.5
Right-to-use annual payments 11.6 12.1 47.7 49.1
Right-to-use contracts current period, gross 3.8 4.8 13.4 17.9
Utility and other income 14.3   13.8   64.4   53.8  
Property operating revenues 167.9 161.1 688.1 578.2
 
Property operating, maintenance, and real estate taxes 65.2 63.3 274.6 238.2
Rental home operating and maintenance 2.2 1.8 7.4 4.9
Sales and marketing, gross 3.0   2.9   10.8   11.2  
Property operating expenses 70.4   68.0   292.8   254.3  
Income from property operations $ 97.5   $ 93.1   $ 395.3   $ 323.9  
 
Manufactured home site figures and occupancy averages:
Total sites 74,116 71,828 74,107 55,709
Occupied sites 66,368 63,886 66,180 49,847
Occupancy % 89.5 % 88.9 % 89.3 % 89.5 %
Monthly base rent per site $ 524 $ 517 $ 522 $ 533
 
Core total sites 44,101 44,104 44,102 44,104
Core occupied sites 40,462 40,215 40,333 40,094
Core occupancy % 91.7 % 91.2 % 91.5 % 90.9 %
Core monthly base rent per site $ 570 $ 557 $ 567 $ 554
 
Resort base rental income:
Annual $ 22.4 $ 21.3 $ 87.2 $ 83.3
Seasonal 4.1 4.0 21.1 20.7
Transient 3.3   3.3   26.0   26.5  
Total resort base rental income $ 29.8   $ 28.6   $ 134.3   $ 130.5  

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