LTC Experiences 2022 First Quarter Outcomes and Discusses Latest Actions

Rivai H Tukimen

WESTLAKE VILLAGE, Calif.–(BUSINESS WIRE)–LTC Properties, Inc. (NYSE: LTC) (“LTC” or the “Firm”), an actual property funding belief that primarily invests in seniors housing and well being care properties, at the moment introduced working outcomes for the primary quarter ended March 31, 2022.

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2022

 

2021

 

 

 

(unaudited)

 

 

 

 

 

 

 

 

 

Web earnings accessible to frequent stockholders

 

$

14,275

 

$

13,642

 

Diluted earnings per frequent share

 

$

0.36

 

$

0.35

 

NAREIT funds from operations (“FFO”) attributable to frequent stockholders

 

$

23,611

 

$

24,292

 

NAREIT diluted FFO per frequent share

 

$

0.60

 

$

0.62

 

FFO attributable to frequent stockholders, excluding non-recurring objects

 

$

24,034

 

$

25,342

 

Funds accessible for distribution (“FAD”)

 

$

25,118

 

$

24,579

 

FAD, excluding non-recurring objects

 

$

25,118

 

$

25,783

 

 

 

 

 

 

 

 

 

First quarter 2022 outcomes have been impacted by the next:

  • Decrease rental earnings as a result of following:

    • the Senior Care Facilities, LLC (“Senior Care”) and Senior Care’s father or mother firm, Abri Well being Providers, LLC portfolio transition;
    • abated and deferred hire;
    • the sale of a talented nursing middle in Washington; and
    • a lease incentive steadiness write-off associated to a terminated lease;
  • The lower in rental earnings was partially offset by the next:

    • will increase from properties transitioned from Senior Way of life Company (“Senior Way of life”);
    • will increase in property tax income from properties previously leased to Senior Way of life;
    • rental earnings from accomplished growth tasks and annual hire escalations; and
    • the next prior 12 months non-recurring objects:

      • a straight-line hire receivable write-off; and
      • the one-time 50% discount of 2021 hire escalations offered to the vast majority of LTC’s working companions;
  • Increased curiosity earnings from mortgage loans on account of mortgage mortgage originations in 2021;
  • Increased curiosity and different earnings on account of a mezzanine mortgage origination and extra funding beneath working capital loans partially offset by mortgage payoffs;
  • Increased provision for credit score losses on account of a mezzanine mortgage origination and extra funding beneath working capital loans; and
  • Increased normal and administrative bills on account of greater incentive compensation in addition to greater non-cash compensation costs and will increase in general prices on account of inflationary pressures.

Throughout the first quarter of 2022, LTC accomplished the next:

  • Originated a $25 million mezzanine mortgage for the recapitalization of a five-property seniors housing portfolio. The mezzanine mortgage has a time period of roughly 5 years, with two one-year extension choices. It bears curiosity at 8%, with an IRR of 11%. The 5 communities are situated in Oregon and Montana, have a complete of 621 items, and embrace unbiased dwelling, assisted‑dwelling and reminiscence care. The communities are being managed by The Springs Dwelling, LLC, an operator new to LTC;
  • Transitioned two reminiscence care communities totaling 88 items in Texas to an present LTC operator. The brand new grasp lease has a two-year time period. Money hire will begin in month 5, based mostly on mutually agreed truthful market hire. LTC acknowledged $282,000 of hire from these transitioned communities in the course of the first quarter of 2022 and anticipates recognizing roughly $370,000 of hire from these transitioned communities in the course of the second half of 2022;
  • Funded $9.5 million beneath a working capital mortgage for HMG Healthcare, LLC (“HMG Healthcare”) and HMG Healthcare repaid $799,000. The present excellent steadiness beneath the working capital mortgage is $18.6 million, with a remaining availability of as much as $6.4 million;
  • An operator of two assisted dwelling communities in California with a complete of 232 items exercised the acquisition possibility beneath their lease for $43.7 million. The communities have a gross guide worth of $31.8 million and a internet guide worth of $16.8 million. LTC anticipates recognizing a acquire on sale of roughly $26.0 million within the second quarter of 2022;
  • Entered into an settlement with a 3rd celebration to promote a 121-bed expert nursing middle in California for $13.3 million. The property has a gross guide worth of $4.6 million and a internet guide worth of $1.8 million. LTC anticipates recognizing a acquire on sale of roughly $10.5 million within the second quarter of 2022;
  • Borrowed $47.0 million beneath the Firm’s revolving line of credit score;
  • Paid $7.0 million in scheduled principal paydowns beneath LTC’s senior unsecured notes; and
  • Supplied $1.3 million of deferred hire and $720,000 of abated hire.

Subsequent to March 31, 2022, LTC accomplished the next:

  • Acquired 4 newer transitional care facilities for $51.5 million, situated in Texas and have a mixed whole of 339 beds primarily in personal rooms. These facilities will likely be operated by Ignite Medical Resorts (“Ignite”), a present LTC working accomplice. The lease time period is 10 years, with two 5‑12 months renewal choices, and incorporates a purchase order possibility starting within the sixth lease 12 months by way of the tip of the seventh lease 12 months. The Firm expects to obtain hire of roughly $1.0 million in every of the third and fourth quarters of 2022 and roughly $4.3 million throughout 2023. Hire will improve yearly starting on the third anniversary of the lease by 2.0% to 4.0% based mostly on the change within the Medicare Market Basket Fee. Moreover, LTC offered Ignite a 10-year working capital mortgage for as much as $2.0 million, of which $1.9 million has been funded, at 8% for first 12 months, rising to eight.25% for the second 12 months, then rising yearly with the lease price. The Firm initially funded this acquisition utilizing its unsecured revolving line of credit score and intends to make use of proceeds from beforehand introduced asset gross sales, anticipated to shut within the second quarter of 2022, to pay down its unsecured revolving line of credit score;
  • Bought a 74-unit assisted dwelling neighborhood in Virginia for $16.9 million. The neighborhood has a gross guide worth of $16.9 million and a internet guide worth of $15.5 million. LTC anticipates recognizing a acquire on sale of roughly $1.3 million within the second quarter of 2022. In reference to the sale, the present operator paid LTC a $1.2 million lease termination price. The proceeds from this sale have been used to paydown LTC’s unsecured revolving line of credit score;
  • Borrowed a internet of $34.0 million beneath its unsecured revolving line of credit score;
  • Supplied $376,000 of deferred hire and $240,000 of abated hire in April 2022. LTC has agreed to supply hire abatements as much as $240,000 for every of Might and June of 2022; and
  • Diminished the estimated second quarter 2022 hire of $2.7 million from Anthem Reminiscence Care (“Anthem”) to $2.1 million as Anthem is addressing some new challenges which will make it troublesome for them to pay the total 2022 second quarter hire. Nonetheless, LTC anticipates receiving whole money hire from Anthem in 2022 of roughly $10.8 million as LTC believes occupancy on the properties beneath Anthem’s grasp lease will get well and Anthem is anticipating receipt of extra stimulus funds. Anthem has paid their agreed upon hire by way of April 2022.

Convention Name Data

LTC will conduct a convention name on Friday, April 29, 2022, at 8:00 a.m. Pacific Time (11:00 a.m. Jap Time), to supply commentary on its efficiency and working outcomes for the quarter ended March 31, 2022. The convention name is accessible by phone and the web. events could entry the dwell convention name by way of the next:

Webcast

www.LTCreit.com

USA Toll-Free Quantity

1-844-200-6205

Canada Toll-Free Quantity

1-833-950-0062

Convention Entry Code

398152

Moreover, an audio replay of the decision will likely be accessible one hour after the dwell name and thru Might 13, 2022 by way of the next:

USA Toll-Free Quantity

1-866-813-9403

Canada Native Quantity

1-226-828-7578

Worldwide Toll-Free Quantity

+44 204 525 0658

Convention Quantity

809164

About LTC

LTC is an actual property funding belief (REIT) investing in seniors housing and well being care properties primarily by way of sale-leasebacks, mortgage financing, joint-ventures and structured finance options together with most well-liked fairness and mezzanine lending. LTC’s funding portfolio consists of 202 properties in 29 states with 35 working companions. Primarily based on its gross actual property investments, LTC’s funding portfolio is comprised of roughly 50% seniors housing and 50% expert nursing properties. Study extra at www.LTCreit.com.

Ahead-Trying Statements

This press launch consists of statements that aren’t purely historic and are “forward-looking statements” throughout the that means of Part 27A of the Securities Act of 1933, as amended, and Part 21E of the Securities Change Act of 1934, as amended, together with statements relating to the Firm’s expectations, beliefs, intentions or methods relating to the long run. All statements aside from historic information contained on this press launch are forward-looking statements. These forward-looking statements contain a variety of dangers and uncertainties. Please see LTC’s most up-to-date Annual Report on Type 10-Okay, its subsequent Quarterly Experiences on Type 10-Q, and its different publicly accessible filings with the Securities and Change Fee for a dialogue of those and different dangers and uncertainties. All forward-looking statements included on this press launch are based mostly on data accessible to the Firm on the date hereof, and LTC assumes no obligation to replace such forward-looking statements. Though the Firm’s administration believes that the assumptions and expectations mirrored in such forward-looking statements are affordable, no assurance will be on condition that such expectations will show to have been right. The precise outcomes achieved by the Firm could differ materially from any forward-looking statements as a result of dangers and uncertainties of such statements.

LTC PROPERTIES, INC.

CONSOLIDATED STATEMENTS OF INCOME

(unaudited, quantities in hundreds, besides per share quantities)

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

March 31,

 

 

2022

 

2021

Revenues:

 

 

 

 

 

 

Rental earnings

 

$

30,324

 

 

$

31,973

 

Curiosity earnings from mortgage loans

 

 

9,636

 

 

 

7,922

 

Curiosity and different earnings

 

 

827

 

 

 

385

 

Whole revenues

 

 

40,787

 

 

 

40,280

 

 

 

 

 

 

 

 

Bills:

 

 

 

 

 

 

Curiosity expense

 

 

7,143

 

 

 

6,972

 

Depreciation and amortization

 

 

9,438

 

 

 

9,877

 

Provision (restoration) for credit score losses

 

 

354

 

 

 

(9

)

Transaction prices

 

 

32

 

 

 

92

 

Property tax expense

 

 

3,982

 

 

 

3,981

 

Basic and administrative bills

 

 

5,808

 

 

 

5,033

 

Whole bills

 

 

26,757

 

 

 

25,946

 

 

 

 

 

 

 

 

Different working earnings:

 

 

 

 

 

 

Achieve (loss) on sale of actual property, internet

 

 

102

 

 

 

(773

)

Working earnings

 

 

14,132

 

 

 

13,561

 

Earnings from unconsolidated joint ventures

 

 

375

 

 

 

289

 

Web earnings

 

 

14,507

 

 

 

13,850

 

Earnings allotted to non-controlling pursuits

 

 

(95

)

 

 

(88

)

Web earnings attributable to LTC Properties, Inc.

 

 

14,412

 

 

 

13,762

 

Earnings allotted to taking part securities

 

 

(137

)

 

 

(120

)

Web earnings accessible to frequent stockholders

 

$

14,275

 

 

$

13,642

 

 

 

 

 

 

 

 

Earnings per frequent share:

 

 

 

 

 

 

Fundamental

 

$

0.36

 

 

$

0.35

 

Diluted

 

$

0.36

 

 

$

0.35

 

 

 

 

 

 

 

 

Weighted common shares used to calculate earnings per

 

 

 

 

 

 

frequent share:

 

 

 

 

 

 

Fundamental

 

 

39,199

 

 

 

39,100

 

Diluted

 

 

39,349

 

 

 

39,179

 

 

 

 

 

 

 

 

Dividends declared and paid per frequent share

 

$

0.57

 

 

$

0.57

 

 

 

 

 

 

 

 

Supplemental Reporting Measures

FFO and FAD are supplemental measures of an actual property funding belief’s (“REIT”) monetary efficiency that aren’t outlined by U.S. typically accepted accounting rules (“GAAP”). Traders, analysts and the Firm use FFO and FAD as supplemental measures of working efficiency. The Firm believes FFO and FAD are useful in evaluating the working efficiency of a REIT. Actual property values traditionally rise and fall with market circumstances, however value accounting for actual property property in accordance with GAAP assumes that the worth of actual property property diminishes predictably over time. We imagine that by excluding the impact of historic value depreciation, which can be of restricted relevance in evaluating present efficiency, FFO and FAD facilitate like comparisons of working efficiency between intervals. Sometimes, the Firm could exclude non-recurring objects from FFO and FAD so as to enable buyers, analysts and our administration to match the Firm’s working efficiency on a constant foundation with out having to account for variations attributable to unanticipated objects.

FFO, as outlined by the Nationwide Affiliation of Actual Property Funding Trusts (“NAREIT”), means internet earnings accessible to frequent stockholders (computed in accordance with GAAP) excluding positive factors or losses on the sale of actual property and impairment write-downs of depreciable actual property, plus actual property depreciation and amortization, and after changes for unconsolidated partnerships and joint ventures. The Firm’s computation of FFO is probably not similar to FFO reported by different REITs that don’t outline the time period in accordance with the present NAREIT definition or have a distinct interpretation of the present NAREIT definition from that of the Firm; subsequently, warning ought to be exercised when evaluating our Firm’s FFO to that of different REITs.

We outline FAD as FFO excluding the consequences of straight-line hire, amortization of lease inducement, efficient curiosity earnings, deferred earnings from unconsolidated joint ventures, non-cash compensation costs, capitalized curiosity and non-cash curiosity costs. GAAP requires rental revenues associated to non-contingent leases that include specified rental will increase over the lifetime of the lease to be acknowledged evenly over the lifetime of the lease. This methodology ends in rental earnings within the early years of a lease that’s greater than precise money acquired, making a straight-line hire receivable asset included in our consolidated steadiness sheet. Sooner or later in the course of the lease, relying on its phrases, money hire funds exceed the straight-line hire which ends up in the straight-line hire receivable asset reducing to zero over the rest of the lease time period. Efficient curiosity methodology, as required by GAAP, is a method for calculating the precise rate of interest for the time period of a mortgage mortgage based mostly on the preliminary origination worth. Much like the accounting methodology of straight-line hire, the precise rate of interest is greater than the acknowledged rate of interest within the early years of the mortgage mortgage thus creating an efficient curiosity receivable asset included within the curiosity receivable line merchandise in our consolidated steadiness sheet and reduces right down to zero when, in some unspecified time in the future in the course of the mortgage mortgage, the acknowledged rate of interest is greater than the precise rate of interest. FAD is beneficial in analyzing the portion of money stream that’s accessible for distribution to stockholders. Traders, analysts and the Firm make the most of FAD as an indicator of frequent dividend potential. The FAD payout ratio, which represents annual distributions to frequent shareholders expressed as a proportion of FAD, facilitates the comparability of dividend protection between REITs.

Whereas the Firm makes use of FFO and FAD as supplemental efficiency measures of our money stream generated by operations and money accessible for distribution to stockholders, such measures will not be consultant of money generated from working actions in accordance with GAAP, and will not be essentially indicative of money accessible to fund money wants and shouldn’t be thought of a substitute for internet earnings accessible to frequent stockholders.

Reconciliation of FFO and FAD

The next desk reconciles GAAP internet earnings accessible to frequent stockholders to every of NAREIT FFO attributable to frequent stockholders and FAD (unaudited, quantities in hundreds, besides per share quantities):

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

2022

 

2021

 

 

 

 

 

 

 

 

GAAP internet earnings accessible to frequent stockholders

$

14,275

 

 

$

13,642

 

 

Add: Depreciation and amortization

 

9,438

 

 

 

9,877

 

 

(Much less)/Add: (Achieve) loss on sale of actual property, internet

 

(102

)

 

 

773

 

 

NAREIT FFO attributable to frequent stockholders

 

23,611

 

 

 

24,292

 

 

 

 

 

 

 

 

 

Add: Non-recurring objects

 

423

 

(1)

 

1,050

 

(6)

FFO attributable to frequent stockholders, excluding non-recurring objects

$

24,034

 

 

$

25,342

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NAREIT FFO attributable to frequent stockholders

$

23,611

 

 

$

24,292

 

 

Non-cash earnings:

 

 

 

 

 

 

Much less: straight-line rental adjustment (earnings)

 

234

 

 

 

(682

)

(3)

Add: amortization of lease prices

 

396

 

(2)

 

112

 

 

Add: Different non-cash expense

 

 

 

 

758

 

(4)

Much less: Efficient curiosity earnings from mortgage loans

 

(1,402

)

 

 

(1,744

)

(3)

Web non-cash earnings

 

(772

)

 

 

(1,556

)

 

 

 

 

 

 

 

 

Non-cash expense:

 

 

 

 

 

 

Add: Non-cash compensation costs

 

1,925

 

 

 

1,852

 

 

Add: Provision (restoration) for credit score losses

 

354

 

 

 

(9

)

 

Web non-cash expense

 

2,279

 

 

 

1,843

 

 

 

 

 

 

 

 

 

Funds accessible for distribution (FAD)

$

25,118

 

 

$

24,579

 

 

 

 

 

 

 

 

 

Much less: Non-recurring earnings

 

 

 

 

1,204

 

(5)

Funds accessible for distribution (FAD), excluding non-recurring objects

$

25,118

 

 

$

25,783

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Represents provision for credit score losses associated to the origination of a $25,000 mezzanine mortgage throughout 2022 first quarter and (2) beneath.

(2) Features a lease incentive steadiness write-off of $173 associated to a closed property and subsequent lease termination.

(3) Contains the affect of the 50% discount of 2021 hire and curiosity escalation on straight-line hire and efficient curiosity.

(4) Represents a straight-line hire receivable write-off on account of transitioning rental income recognition to money foundation.

(5) Contains the money affect of the 50% discount of 2021 hire and curiosity escalation.

(6) Contains the GAAP affect of the 50% discount of 2021 hire and curiosity escalation ($292) and (4) from above.

 

 

Reconciliation of FFO and FAD (continued)

The next desk continues the reconciliation between GAAP internet earnings accessible to frequent stockholders and every of NAREIT FFO attributable to frequent stockholders and FAD (unaudited, quantities in hundreds, besides per share quantities):

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2022

 

 

2021

 

 

 

 

 

 

 

 

NAREIT Fundamental FFO attributable to frequent stockholders per share

$

0.60

 

$

0.62

 

NAREIT Diluted FFO attributable to frequent stockholders per share

$

0.60

 

$

0.62

 

 

 

 

 

 

 

 

NAREIT Diluted FFO attributable to frequent stockholders

$

23,611

 

$

24,412

 

Weighted common shares used to calculate NAREIT diluted FFO per share attributable to frequent stockholders

 

39,349

 

 

39,374

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted FFO attributable to frequent stockholders, excluding non-recurring objects

$

24,171

 

$

25,462

 

Weighted common shares used to calculate diluted FFO, excluding non-recurring objects, per share attributable to frequent stockholders

 

39,575

 

 

39,374

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted FAD

$

25,255

 

$

24,699

 

 

 

 

 

 

 

 

Weighted common shares used to calculate diluted FAD per share

 

39,575

 

 

39,374

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted FAD, excluding non-recurring objects

$

25,255

 

$

25,903

 

Weighted common shares used to calculate diluted FAD, excluding non-recurring objects, per share

 

39,575

 

 

39,374

 

 

 

 

 

 

LTC PROPERTIES, INC.

CONSOLIDATED BALANCE SHEETS

(quantities in hundreds, besides per share)

 

 

 

 

 

 

 

 

 

 

March 31, 2022

 

December 31, 2021

 

ASSETS

 

(unaudited)

 

(audited)

 

Investments:

 

 

 

 

 

 

 

Land

 

$

120,203

 

 

$

123,239

 

 

Buildings and enhancements

 

 

1,240,713

 

 

 

1,285,318

 

 

Amassed depreciation and amortization

 

 

(367,623

)

 

 

(374,606

)

 

Working actual property property, internet

 

 

993,293

 

 

 

1,033,951

 

 

Properties held-for-sale, internet of amassed depreciation: 2022—$16,396; 2021—$0

 

 

32,313

 

 

 

 

 

Actual property investments, internet

 

 

1,025,606

 

 

 

1,033,951

 

 

Mortgage loans receivable, internet of mortgage loss reserve: 2022—$3,494; 2021—$3,473

 

 

346,543

 

 

 

344,442

 

 

Actual property investments, internet

 

 

1,372,149

 

 

 

1,378,393

 

 

Notes receivable, internet of mortgage loss reserve: 2022—$619; 2021—$286

 

 

61,508

 

 

 

28,337

 

 

Investments in unconsolidated joint ventures

 

 

19,340

 

 

 

19,340

 

 

Investments, internet

 

 

1,452,997

 

 

 

1,426,070

 

 

 

 

 

 

 

 

 

 

Different property:

 

 

 

 

 

 

 

Money and money equivalents

 

 

4,393

 

 

 

5,161

 

 

Debt problem prices associated to revolving line of credit score

 

 

2,883

 

 

 

3,057

 

 

Curiosity receivable

 

 

41,165

 

 

 

39,522

 

 

Straight-line hire receivable

 

 

23,912

 

 

 

24,146

 

 

Lease incentives

 

 

2,277

 

 

 

2,678

 

 

Pay as you go bills and different property

 

 

8,470

 

 

 

4,191

 

 

Whole property

 

$

1,536,097

 

 

$

1,504,825

 

 

 

 

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

 

 

Revolving line of credit score

 

$

157,900

 

 

$

110,900

 

 

Time period loans, internet of debt problem prices: 2022—$600; 2021—$637

 

 

99,400

 

 

 

99,363

 

 

Senior unsecured notes, internet of debt problem prices: 2022—$498; 2021—$524

 

 

505,482

 

 

 

512,456

 

 

Accrued curiosity

 

 

3,090

 

 

 

3,745

 

 

Accrued bills and different liabilities

 

 

27,626

 

 

 

33,234

 

 

Whole liabilities

 

 

793,498

 

 

 

759,698

 

 

 

 

 

 

 

 

 

 

EQUITY

 

 

 

 

 

 

 

Stockholders’ fairness:

 

 

 

 

 

 

 

Widespread inventory: $0.01 par worth; 60,000 shares licensed; shares issued and excellent: 2022—39,460; 2021—39,374

 

 

395

 

 

 

394

 

 

Capital in extra of par worth

 

 

857,558

 

 

 

856,895

 

 

Cumulative internet earnings

 

 

1,459,048

 

 

 

1,444,636

 

 

Amassed different complete earnings (loss)

 

 

4,704

 

 

 

(172

)

 

Cumulative distributions

 

 

(1,587,519

)

 

 

(1,565,039

)

 

Whole LTC Properties, Inc. stockholders’ fairness

 

 

734,186

 

 

 

736,714

 

 

Non-controlling pursuits

 

 

8,413

 

 

 

8,413

 

 

Whole fairness

 

 

742,599

 

 

 

745,127

 

 

Whole liabilities and fairness

 

$

1,536,097

 

 

$

1,504,825

 

 

 

https://www.businesswire.com/information/residence/20220428005396/en/LTC-Experiences-2022-First-Quarter-Outcomes-and-Discusses-Latest-Actions

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