[8-K] Sun Communities, Inc Reports Material Event

Rhea-AI Filing Summary

Merit Medical Systems (MMSI) – Q2 2025 10-Q highlights

• Revenue: $382.5 m, up 13.1 % YoY; six-month revenue $737.8 m, up 11.5 %.
• Mix: Cardiovascular +11 % to $364.0 m; Endoscopy devices +81 % to $18.4 m.
• Margins: Gross margin 48.3 % (+60 bp); SG&A +19 %, R&D +20 % drove operating margin down 130 bp to 12.3 %.
• Earnings: Net income $32.6 m (-8.8 %); diluted EPS $0.54 vs $0.61. 1H EPS $1.03 (-5.5 %).
• Cash flow: 1H operating cash flow $123.9 m (+18 %); capex $34.8 m; acquisitions $122.6 m.
• Balance sheet: Cash $341.8 m (-9 % YTD); long-term convertible notes $731.8 m; equity $1.49 bn (+7.9 %). Leverage covenants remain compliant.
• Acquisitions: Closed $126 m Biolife deal in May (hemostatic devices); prior Cook ($210 m) and EGS ($105 m) integrations ongoing. Goodwill now $504.6 m.
• Tax: Effective rate 24.9 % vs 22.1 %, pressuring earnings.

Overall, strong top-line growth and cash generation were offset by higher operating costs, acquisition spending and a rising tax rate, leading to lower YoY earnings.

Positive

• Revenue growth of 13 % YoY and broad-based segment gains signal strong demand.
• Gross margin expansion of 60 bp despite inflation indicates pricing/efficiency traction.
• Operating cash flow up 18 % to $124 m enhances internal funding capacity.
• Balance-sheet strength: $342 m cash and $697 m unused revolver provide liquidity for further R&D and M&A.

Negative

• Diluted EPS fell 11 % YoY due to higher SG&A, R&D and tax rate.
• Net margin compression: operating margin down 130 bp to 12.3 %.
• Cash balance down 46 % vs prior-year quarter following heavy acquisition spend.
• Interest expense remains elevated ($6.8 m in Q2) reflecting convertible-debt issuance.

Insights

Sell-side Financial Analyst

TL;DR – Solid revenue beat, but cost inflation and taxes eroded EPS; outlook hinges on acquisition synergies.

Double-digit sales growth, particularly in peripheral and endoscopy lines, confirms healthy procedure volumes and early contribution from recent tuck-ins. Gross margin expanded slightly, yet SG&A and R&D rose faster (partly Biolife/Cook integration), trimming operating leverage. Interest and tax headwinds compounded, driving an 11 % EPS decline. Cash generation remains robust and liquidity ample, though cash pile fell following $123 m Biolife payment. Net leverage is manageable (<2× EBITDA est.) under covenant limits. Investors will focus on realizing cost synergies to restore earnings momentum and on potential dilution from 2029 converts if the stock trades above the ~$86.83 strike.

Medical-device M&A Specialist

TL;DR – Biolife buy widens wound-closure portfolio and adds IP; integration risk appears contained.

Management paid ~4.2× projected 2025 sales for Biolife, securing patented StatSeal/WoundSeal technology with 12-year amortization life. Goodwill of $38 m signals expectation of cross-selling through Merit’s cardiovascular channel. Prior Cook and EGS assets are bedding in without material P&L disruption. Cumulative intangible amortization will step up (> $80 m in 2026), but cash tax impact is limited. No covenant stress post-deal: $697 m of revolver headroom and senior secured leverage at ~0×. Successful commercialization could lift organic growth above the current low-double-digit rate.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d)

of The Securities Exchange Act of 1934

Date of Report: July 30, 2025

(Date of earliest event reported)

SUN COMMUNITIES, INC

(Exact name of registrant as specified in its charter)

Maryland

1-12616

38-2730780

(State or other jurisdiction of incorporation)

Commission File Number

(IRS Employer Identification No.)

27777 Franklin Rd.

Suite 300,

Southfield,

Michigan

48034

(Address of Principal Executive Offices)

(Zip Code)

(248) 208-2500

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.01 par value

SUI

New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter):

☐ Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02 Results of Operations and Financial Condition

On July 30, 2025, Sun Communities, Inc. (the "Company") issued a press release, furnished as Exhibit 99.1 and incorporated herein by reference, announcing its financial results for the period ended June 30, 2025, and certain other information.

The Company will hold an investor conference call and webcast at 2:00 p.m. ET on July 31, 2025 to discuss the financial results for the period ended June 30, 2025.

The information contained in this Item 2.02, including Exhibit 99.1, is being furnished and shall not be deemed to be "filed" for purposes of the Securities Exchange Act of 1934, as amended (the "Exchange Act").

Item 9.01 Financial Statements and Exhibits

(d)        Exhibits.

Exhibit No.			Description
99.1			Press release dated July 30, 2025
104			Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.

						SUN COMMUNITIES, INC.
Dated: July 30, 2025						By:			/s/ Fernando Castro-Caratini
									Fernando Castro-Caratini, Executive Vice President, Chief Financial Officer, Secretary and Treasurer

FAQ

How much did MMSI earn per share in Q2 2025?

Diluted EPS was $0.54, down from $0.61 a year earlier.

What drove Merit Medical Systems’ revenue growth in Q2 2025?

Cardiovascular products added $364 m (+11 %) and endoscopy devices rose 81 % to $18 m, boosted by portfolio realignment and acquisitions.

How large is MMSI’s cash position after the Biolife acquisition?

Cash and cash equivalents were $341.8 million at 30 Jun 2025.

What is the status of Merit’s convertible notes?

The $747.5 m 3.0 % notes mature Feb 1 2029 with an initial conversion price of about $86.83 per share.

Did Merit meet its credit-facility covenants in Q2 2025?

Yes. The company reported compliance with leverage and interest-coverage ratios and has about $697 m borrowing capacity remaining.

What was the effective tax rate for Q2 2025?

The rate increased to 24.9 % from 22.1 % in the prior year.