Health Care REIT, Inc. (ticker: HCN, exchange: New York Stock Exchange (.N))
News Release -
7-May-2007
Health Care REIT, Inc. Reports First Quarter Results TOLEDO, Ohio--(BUSINESS WIRE)--May 7, 2007--Health Care REIT, Inc.
(NYSE:HCN) announced today operating results for its first quarter
ended March 31, 2007.
Recent Highlights.
- Completed 1Q07 net new investments totaling $219.0 million
- Reported 1Q07 FFO and normalized FAD growth of 7% and 3%,
respectively
- Reported 1Q07 FFO and normalized FAD payout ratios of 84% and
91%, respectively
- Issued 6.3 million shares of common stock for $265.3 million
in net proceeds in April
- Received debt upgrade to Baa2 from Moody's Investors Service
Key Performance Indicators.
1Q07 1Q06 Change
----------------------------------------------------------------------
Net income available to common
stockholders (NICS) per diluted
share $0.32 $0.34 -6%
----------------------------------------------------------------------
FFO per diluted
share $0.76 $0.71 7%
----------------------------------------------------------------------
Normalized FAD per diluted
share $0.70 $0.68 3%
----------------------------------------------------------------------
Dividends per common share (1) $0.64 $0.62 3%
----------------------------------------------------------------------
FFO payout ratio 84% 87%
----------------------------------------------------------------------
Normalized FAD payout ratio 91% 91%
----------------------------------------------------------------------
(1) Includes $0.3409 prorated dividend paid on December 28, 2006
in connection with the Windrose merger.
1Q07 Earnings. The following table summarizes certain items
impacting NICS, FFO and FAD:
NICS FFO
-------------------------------------
1Q07 1Q06 Change 1Q07 1Q06 Change
----------------------------------------------------------------------
Per diluted share $0.32 $0.34 -6% $0.76 $0.71 7%
----------------------------------------------------------------------
Includes impact of:
----------------------------------------------------------------------
Gain (loss) on sales of real
property (1) $0.01 $0.03 -67%
----------------------------------------------------------------------
Cash receipts -
prepaid/straight-line rent
(2)
----------------------------------------------------------------------
Per diluted share - normalized
----------------------------------------------------------------------
FAD
-----------------------------------
1Q07 1Q06 Change
----------------------------------------------------------------------
Per diluted share $0.73 $0.85 -14%
----------------------------------------------------------------------
Includes impact of:
----------------------------------------------------------------------
Gain (loss) on sales of real
property (1)
----------------------------------------------------------------------
Cash receipts -
prepaid/straight-line rent (2) $0.03 $0.18 -83%
----------------------------------------------------------------------
Per diluted share - normalized $0.70 $0.68 3%
----------------------------------------------------------------------
(1) $977,000 and $1,553,000 of gains for 1Q07 and 1Q06, respectively.
(2) $2,078,000 and $10,310,000 of receipts for 1Q07 and 1Q06,
respectively.
Dividends for First Quarter 2007. As previously announced, the
Board of Directors declared a dividend for the quarter ended March 31,
2007 of $0.66 per share, as compared to $0.64 per share for the same
period in 2006. The dividend represents the company's 144th
consecutive dividend payment. The dividend will be payable May 21,
2007 to stockholders of record on May 4, 2007.
Raymond W. Braun Elected to Board of Directors. The company
announced today the election of Raymond Braun to the Board of
Directors, effective May 3, 2007. Mr. Braun is President of the
company, a position he has held since May 2002, and served as Chief
Financial Officer from July 2000 to March 2006. Since 1993, Mr. Braun
has served in various capacities with the company, including Chief
Operating Officer, Executive Vice President, Assistant Vice President
and Assistant General Counsel. Mr. Braun also will serve as a member
of the Board's Investment and Planning Committees.
Outlook for 2007. The company affirms its investment guidance of
$1.0 to $1.2 billion for 2007, which is comprised of $700 to $800
million of acquisitions and $300 to $400 million of funded new
development. In addition, the company expects $100 to $200 million of
dispositions, resulting in net investments of $800 million to $1.1
billion. The company is increasing its 2007 guidance for net income
available to common stockholders to a range of $1.18 to $1.26 per
diluted share, from $1.17 to $1.25 per diluted share primarily due to
gains on sales of real property in the first quarter of $977,000. The
company affirms its 2007 FFO guidance in the range of $3.06 to $3.14
per diluted share. The company is increasing its 2007 FAD guidance to
a range of $2.82 to $2.90 per diluted share, from $2.80 to $2.88 per
diluted share primarily due to cash receipts during the quarter of
$2.1 million.
The company's guidance excludes any impairments, unanticipated
additions to the loan loss reserve, or other additional one-time
items, including any additional cash payments other than normal
monthly rental payments. Please see Exhibit 15 for a reconciliation of
the outlook for net income available to common stockholders to FFO and
FAD.
Conference Call Information. The company has scheduled a
conference call on Tuesday, May 8, 2007 at 9:00 a.m. Eastern Time to
discuss its first quarter results, industry trends, portfolio
performance and outlook for 2007. Telephone access will be available
by dialing 888-694-4702 or 973-582-2741 (international). For those
unable to listen to the call live, a taped rebroadcast will be
available beginning two hours after completion of the call through May
22, 2007. To access the rebroadcast, dial 877-519-4471 or 973-341-3080
(international). The conference ID number is 8675011. To participate
in the webcast, log on to www.hcreit.com or www.earnings.com 15
minutes before the call to download the necessary software. Replays
will be available for 90 days through the same Web sites. This
earnings release is posted on the company's Web site under the heading
News & Events.
Supplemental Reporting Measures. The company believes that net
income available to common stockholders (NICS), as defined by U.S.
generally accepted accounting principles (U.S. GAAP), is the most
appropriate earnings measurement. However, the company considers funds
from operations (FFO) and funds available for distribution (FAD) to be
useful supplemental measures of its operating performance. Historical
cost accounting for real estate assets in accordance with U.S. GAAP
implicitly assumes that the value of real estate assets diminishes
predictably over time as evidenced by the provision for depreciation.
However, since real estate values have historically risen or fallen
with market conditions, many industry investors and analysts have
considered presentations of operating results for real estate
companies that use historical cost accounting to be insufficient. In
response, the National Association of Real Estate Investment Trusts
(NAREIT) created FFO as a supplemental measure of operating
performance for REITs that excludes historical cost depreciation from
net income. FFO, as defined by NAREIT, means net income, computed in
accordance with U.S. GAAP, excluding gains (or losses) from sales of
real estate, plus real estate depreciation and amortization, and after
adjustments for unconsolidated partnerships and joint ventures. FAD
represents FFO excluding the net straight-line rental adjustments,
rental income related to above/below market leases and amortization of
deferred loan expenses and less cash used to fund capital
expenditures, tenant improvements and lease commissions.
EBITDA stands for earnings before interest, taxes, depreciation
and amortization. The company believes that EBITDA, along with net
income and cash flow provided from operating activities, is an
important supplemental measure because it provides additional
information to assess and evaluate the performance of its operations.
Additionally, restrictive covenants in the company's long-term debt
arrangements contain financial ratios based on EBITDA. The company
primarily utilizes EBITDA to measure its interest coverage ratio,
which represents EBITDA divided by total interest, and its fixed
charge coverage ratio, which represents EBITDA divided by fixed
charges. Fixed charges include total interest, secured debt principal
amortization and preferred stock dividends.
FFO, FAD and EBITDA are financial measures that are widely used by
investors, equity and debt analysts and rating agencies in the
valuation, comparison, rating and investment recommendations of
companies. The company's management uses these financial measures to
facilitate internal and external comparisons to historical operating
results and in making operating decisions. Additionally, FFO and FAD
are utilized by the Board of Directors to evaluate management. FFO,
FAD and EBITDA do not represent net income or cash flow provided from
operating activities as determined in accordance with U.S. GAAP and
should not be considered as alternative measures of profitability or
liquidity. Finally, FFO, FAD and EBITDA, as defined by the company,
may not be comparable to similarly entitled items reported by other
real estate investment trusts or other companies. Please see Exhibits
12, 13 and 14 for reconciliations of EBITDA, FAD and FFO.
Net operating income (NOI) is used to evaluate the operating
performance of certain real estate properties such as medical office
buildings. The company defines NOI as total revenues, including tenant
reimbursements and discontinued operations, less property operating
expenses, which exclude depreciation and amortization, general and
administrative expenses, impairments and interest expense. The company
believes NOI provides investors relevant and useful information
because it measures the operating performance of our medical office
buildings at the property level on an unleveraged basis. The company
uses NOI to make decisions about resource allocations and to assess
the property level performance of our medical office buildings.
Health Care REIT, Inc., with headquarters in Toledo, Ohio, is a
self-administered, equity real estate investment trust that invests
across the full spectrum of senior housing and health care real
estate, including independent living/continuing care retirement
communities, assisted living facilities, skilled nursing facilities,
hospitals, long-term acute care hospitals and medical office
buildings. Founded in 1970, the company was the first real estate
investment trust to invest exclusively in health care facilities. As
of March 31, 2007, the company's broadly diversified portfolio
consisted of 597 properties in 37 states. The company also offers a
full array of property management and development services. More
information is available on the Internet at www.hcreit.com.
This document may contain "forward-looking" statements as defined
in the Private Securities Litigation Reform Act of 1995. These
forward-looking statements concern and are based upon, among other
things, the possible expansion of the company's portfolio; the sale of
properties; the performance of its operators and properties; its
occupancy rates; its ability to acquire or develop properties; its
ability to manage properties; its ability to enter into agreements
with new viable tenants for vacant space or for properties that the
company takes back from financially troubled tenants, if any; its
ability to make distributions; its policies and plans regarding
investments, financings and other matters; its tax status as a real
estate investment trust; its ability to appropriately balance the use
of debt and equity; its ability to access capital markets or other
sources of funds; its critical accounting policies; and its ability to
meet its earnings guidance. When the company uses words such as "may,"
"will," "intend," "should," "believe," "expect," "anticipate,"
"project," "estimate" or similar expressions, it is making
forward-looking statements. Forward-looking statements are not
guarantees of future performance and involve risks and uncertainties.
The company's expected results may not be achieved, and actual results
may differ materially from expectations. This may be a result of
various factors, including, but not limited to: the status of the
economy; the status of capital markets, including prevailing interest
rates; issues facing the health care industry, including compliance
with, and changes to, regulations and payment policies; operators' and
tenants' difficulty in cost-effectively obtaining and maintaining
adequate liability and other insurance; changes in financing terms;
competition within the health care and senior housing industries;
negative developments in the operating results or financial condition
of operators or tenants, including, but not limited to, their ability
to pay rent and repay loans; the company's ability to transition or
sell facilities with a profitable result; the failure of closings to
occur as and when anticipated; acts of God affecting the company's
properties; the company's ability to timely reinvest sale proceeds at
similar rates to assets sold; the company's ability to re-lease space
at similar rates as vacancies occur; operator or tenant bankruptcies
or insolvencies; government regulations affecting Medicare and
Medicaid reimbursement rates; liability or contract claims by or
against operators and tenants; unanticipated difficulties and/or
expenditures relating to future acquisitions and the integration of
multi-property acquisitions; environmental laws affecting the
company's properties; changes in rules or practices governing the
company's financial reporting; and legal and operational matters,
including real estate investment trust qualification and key
management personnel recruitment and retention. Finally, the company
assumes no obligation to update or revise any forward-looking
statements or to update the reasons why actual results could differ
from those projected in any forward-looking statements.
FINANCIAL SCHEDULES FOLLOW
HEALTH CARE REIT, INC.
Financial Supplement
CONSOLIDATED BALANCE SHEETS (unaudited)
(In thousands)
March 31,
-------------------------
2007 2006
-------------------------
Assets
Real estate investments:
Real property owned
Land and land improvements $ 394,002 $ 267,824
Buildings & building improvements 3,783,163 2,712,511
Acquired lease intangibles 85,110 0
Real property held for sale, net of
accumulated depreciation 4,236 15,898
Construction in progress 169,782 36,115
------------ ------------
4,436,293 3,032,348
Less accumulated depreciation and
intangible amortization (381,448) (293,738)
------------ ------------
Total real property owned 4,054,845 2,738,610
Loans receivable 256,945 177,704
Less allowance for losses on loans
receivable (7,406) (6,711)
------------ ------------
249,539 170,993
------------ ------------
Net real estate investments 4,304,384 2,909,603
Other assets:
Equity investments 4,700 2,970
Deferred loan expenses 19,767 12,042
Cash and cash equivalents 31,293 25,758
Receivables and other assets 98,510 62,267
------------ ------------
154,270 103,037
------------ ------------
Total assets $ 4,458,654 $ 3,012,640
============ ============
Liabilities and stockholders' equity
Liabilities:
Borrowings under unsecured lines of
credit arrangements $ 381,000 $ 201,000
Senior unsecured notes 1,542,103 1,195,378
Secured debt 377,013 131,946
Liability to subsidiary trust issuing
preferred securities 52,205 0
Accrued expenses and other liabilities 95,595 49,399
------------ ------------
Total liabilities 2,447,916 1,577,723
Minority interests 2,354 0
Stockholders' equity:
Preferred stock 338,993 276,875
Common stock 73,931 58,685
Capital in excess of par value 1,902,186 1,326,341
Treasury stock (3,941) (2,714)
Cumulative net income 962,526 855,081
Cumulative dividends (1,267,462) (1,080,688)
Accumulated other
comprehensive income (135) 0
Other equity 2,286 1,337
------------ ------------
Total stockholders' equity 2,008,384 1,434,917
------------ ------------
Total liabilities and stockholders' equity $ 4,458,654 $ 3,012,640
============ ============
CONSOLIDATED STATEMENTS OF INCOME (unaudited)
(In thousands, except per share data)
Three Months Ended
March 31,
------------------
2007 2006
------------------
Revenues:
Rental income $105,904 $71,380
Interest income 5,149 4,262
Other income 1,592 366
--------- --------
Gross revenues 112,645 76,008
Expenses:
Interest expense 31,922 23,523
Property operating expenses 7,168 0
Depreciation and amortization 33,860 21,825
General and administrative expenses 9,793 5,976
Loan expense 1,267 711
Provision for loan losses 0 250
--------- --------
Total expenses 84,010 52,285
--------- --------
Income before minority interests 28,635 23,723
Minority interests (126) 0
--------- --------
Income from continuing operations 28,509 23,723
Discontinued operations:
Gain (loss) on sales of properties 977 1,553
Income (loss) from discontinued
operations, net 187 (298)
--------- --------
1,164 1,255
--------- --------
Net income 29,673 24,978
Preferred dividends 6,317 5,333
--------- --------
Net income available to
common stockholders $ 23,356 $19,645
========= ========
Average number of common shares
outstanding:
Basic 73,224 58,178
Diluted 73,791 58,535
Net income available to common
stockholders per share:
Basic $ 0.32 $ 0.34
Diluted 0.32 0.34
Common dividends per share $ 0.2991 $0.6200
HEALTH CARE REIT, INC.
Financial Supplement - March 31, 2007
Portfolio Composition Exhibit 1
----------------------
($000's except Investment per Bed/Unit/Sq. Ft.)
Balance #
Sheet Data Properties Balance % Balance
----------------------------------------------------------
Real
Property 564 $ 4,054,845 94%
Loans
Receivable
(1) 33 256,945 6%
----------------------------------------------------------
Totals 597 $ 4,311,790 100%
Investment #
Balances Properties Investment (2) % Investment
----------------------------------------------------------
Independent/
CCRCs 48 $ 550,462 13%
Assisted
Living
Facilities 208 1,045,546 24%
Skilled
Nursing
Facilities 233 1,547,904 36%
Medical
Office
Buildings 90 899,599 21%
Specialty
Care
Facilities 18 270,729 6%
----------------------------------------------------------
Totals 597 $ 4,314,240 100%
#
Committed # Beds/Units Committed Investment
InvestmentsProperties or Sq. Ft. Balance (3) per metric
----------------------------------------------------------
Independent/
CCRCs 48 5,685 units $ 738,921 $129,977 unit
Assisted
Living
Facilities 208 12,590 units 1,153,214 91,598 unit
Skilled
Nursing
Facilities 233 31,668 beds 1,559,100 49,233 bed
Medical
Office
Buildings 90 3,317,476 sq. ft. 899,599 271 sq. ft.
Specialty
Care
Facilities 18 1,391 beds 303,299 218,044 bed
----------------------------------------------------------
Totals 597 -na- $ 4,654,133 -na-
Notes:(1)Includes $799,000 of loans on non-accrual.
(2)Real Estate Investments include gross real estate investments
and credit enhancements which amounted to $4,311,790,000 and
$2,450,000, respectively.
(3)Committed Balance includes gross real estate investments,
credit enhancements and unfunded construction commitments
for which initial funding had commenced.
Selected Facility Data Exhibit 2
-----------------------------
Coverage Data
----------------------
% Payor Mix
------------------------- Before After
Census Private Medicare Medicaid Mgt. Fees Mgt. Fees
------ ------- -------- -------- ----------------------
Independent/
CCRCs 92% 98% 1% 1% 1.39x 1.19x
Assisted Living
Facilities 89% 81% 0% 19% 1.56x 1.35x
Skilled Nursing
Facilities 86% 18% 15% 67% 2.19x 1.57x
Medical Office
Buildings 92% 100% 0% 0% -na- -na-
Specialty Care
Facilities 58% 22% 57% 21% 2.77x 2.21x
----------------------
Weighted Averages 1.94x 1.51x
Notes: (1) Data as of December 31, 2006.
Investment Concentrations ($000's) Exhibit 3
----------------------------------------
Concentration by Customer # Properties Investment % Investment
------------ ------------- ------------
Emeritus Corporation 50 $ 352,344 8%
Brookdale Senior Living Inc. 87 281,930 7%
Life Care Centers of America,
Inc. 26 245,476 6%
Home Quality Management, Inc. 37 241,911 6%
Merrill Gardens L.L.C. 13 182,112 4%
Remaining portfolio 384 3,010,467 69%
------------ ------------- ------------
Totals 597 $4,314,240 100%
Concentration by Region # Properties Investment % Investment
------------ ------------- ------------
South 370 $2,339,300 54%
West 79 764,272 18%
Midwest 78 647,322 15%
Northeast 70 563,346 13%
------------ ------------- ------------
Totals 597 $4,314,240 100%
Concentration by State # Properties Investment % Investment
------------ ------------- ------------
Florida 86 $ 686,378 16%
Texas 75 544,023 13%
Massachusetts 36 327,153 8%
California 22 302,577 7%
Ohio 31 265,264 6%
Remaining portfolio 347 2,188,845 50%
------------ ------------ ------------
Totals 597 $4,314,240 100%
Revenue Concentrations ($000's) Exhibit 4
----------------------------------------------------
Three Months Ended
March 31, 2007
------------------
Revenue by Facility Type (1)
Independent/CCRCs $ 10,223 9%
Assisted Living Facilities 26,528 23%
Skilled Nursing Facilities 43,494 39%
Medical Office Buildings (2) 23,788 21%
Specialty Care Facilities 7,284 7%
Other income 1,592 1%
------------------
Totals $ 112,909 100%
Notes:
(1) Revenues include gross revenues and revenues from
discontinued operations.
(2) NOI for this period was $16.6 million, which represents
$23.8 million of rental income less $7.2 million of property
operating expenses.
Revenue Maturities ($000's) Exhibit 5
------------------------------------
Investment Operating
Properties Properties Interest
Rental Rental Income Total % of
Year Income (1) Income (1) (1) Revenues Total
---------------------------------------------------------------------
2007 $ 495 $ 7,431 $ 3,108 $ 11,034 3%
2008 0 11,228 2,689 13,917 3%
2009 930 5,927 1,871 8,728 2%
2010 578 7,442 3,387 11,407 3%
2011 6,921 5,877 263 13,061 3%
Thereafter 294,271 39,287 12,716 346,274 86%
--------------------------------------------------------
Totals $ 303,195 $ 77,192 $ 24,034 $404,421 100%
Notes: (1) Revenue impact by year, annualized.
Debt Maturities and Principal Payments Exhibit 6
($000's)
--------------------------------------------
Trust
Lines of Senior Secured Preferred
Year Credit (1) Notes (2) Debt (2) Liability (2) Total
----------------------------------------------------------------------
2007 $ 40,000 $ 52,500 $ 17,449 $ 0 $ 109,949
2008 0 42,330 26,363 0 68,693
2009 700,000 0 59,167 0 759,167
2010 0 0 12,651 0 12,651
2011 0 0 49,638 0 49,638
2012 0 250,000 20,927 0 270,927
2013 0 300,000 52,295 0 352,295
Thereafter 0 895,000 138,016 51,000 1,084,016
-----------------------------------------------------------
Totals $740,000 $1,539,830 $376,506 $ 51,000 $2,707,336
Notes: (1) Reflected at 100% capacity.
(2) Amounts above represent principal amounts due and do not
reflect unamortized premiums/discounts or the fair value
of interest-rate swap agreements as reflected on the
balance sheet.
Investment Activity ($000's) Exhibit 7
----------------------------------
Three Months Ended
March 31, 2007
--------------------
Funding by Investment Type
Real Property $ 163,230 67%
Loans Receivable 80,427 33%
--------------------
Totals $ 243,657 100%
Funding by Facility Type
Independent/CCRCs $ 32,805 13%
Assisted Living Facilities 42,351 17%
Skilled Nursing Facilities 146,169 60%
Medical Office Buildings 7,999 3%
Specialty Care Facilities 14,333 7%
--------------------
Totals $ 243,657 100%
Development Activity ($000's) Exhibit 8
-----------------------------------
Balance
at Balance at
December 2007 YTD 2007 YTD March 31, Committed
Facility Type 31, 2006 Fundings Conversions 2007 Balances
------------- --------- ----------- ----------- ---------- -----------
Independent/
CCRCs $ 61,709 $ 16,724 $ (398) $ 78,035 $ 266,494
Assisted
Living
Facilities 55,197 13,888 (6,523) 62,562 170,229
Skilled
Nursing
Facilities 14,852 3,354 0 18,206 29,402
Specialty
Care
Facilities 6,464 4,515 0 10,979 43,550
--------- ----------- ----------- ---------- -----------
Totals $138,222 $ 38,481 $ (6,921) $ 169,782 $ 509,675
Development Funding Projections ($000's)
-----------------------------------------------
Projected Future
Fundings
----------------------
# 2007 Fundings Unfunded
Facility Type Projects Beds/Units Fundings Thereafter Commitments
------------- --------- ----------- ----------- ---------- -----------
Independent/
CCRCs 9 1,093 $ 53,712 $ 134,747 $ 188,459
Assisted
Living
Facilities 15 1,173 32,790 74,877 107,667
Skilled
Nursing
Facilities 3 247 8,450 2,746 11,196
Specialty
Care
Facilities 3 150 21,912 10,659 32,571
--------- ----------- ----------- ---------- -----------
Totals 30 2,663 $ 116,864 $ 223,029 $ 339,893
Project Conversion Projections ($000's)
-----------------------------------------------
2007 Quarterly Conversions Annual Projections
--------------------------------- ----------------------------------
Projected Projected
Average Average
Initial Initial
Quarter Amount Yields (1) Year Amount Yields (1)
----------- --------- ----------- ----------- ---------- -----------
2007
1Q07 actual $ 6,921 9.06% projected $ 138,892 9.13%
2Q07 2008
projected 55,048 9.14% projected 206,144 9.46%
3Q07 2009
projected 29,030 9.43% projected 111,787 10.00%
4Q07 2010
projected 47,893 8.94% projected 59,774 8.54%
--------- ----------- ---------- -----------
Totals $138,892 9.13% Totals $ 516,597 9.38%
Notes: All amounts include both cash advances and non-cash additions
such as capitalized interest.
(1) Actual initial yields may be higher if the underlying
market rates increase.
Disposition Activity ($000's) Exhibit 9
----------------------------------------------------
Three Months Ended
March 31, 2007
------------------
Dispositions by Investment Type
Real Property $ 10,560 43%
Loans Receivable 14,182 57%
------------------
Totals $ 24,742 100%
Dispositions by Facility Type
Assisted Living Facilities $ 22,335 90%
Independent/CCRCs 2,407 10%
----------------
Totals $ 24,742 100%
Discontinued Operations ($000's) Exhibit 10
------------------------------------
Three Months Ended
March 31,
------------------
2007 2006
-------- ---------
Revenues
Rental income $ 264 $ 2,079
Expenses
Interest expense 77 715
Depreciation and amortization 0 1,437
General and administrative 0 225
-------- ---------
Income (loss) from discontinued
operations, net $ 187 $ (298)
Exhibit 11
Current Capitalization ($000's except Leverage & Performance
share price) Ratios
------------------------------------------ ---------------------------
%
Balance Balance
-------------------
Borrowings Under Bank Debt/Total Book
Lines $ 381,000 9% Cap 54%
Long-Term Debt
Obligations 1,919,116 44%
Trust Preferred Debt/Undepreciated
Liability 52,205 1% Book Cap 50%
Stockholders' Equity 2,008,384 46%
-------------------
Total Book Debt/Total Market
Capitalization $4,360,705 100% Cap 40%
Common Shares Interest
Outstanding (000's) 74,091 Coverage 2.82x 1st Qtr.
Period-End Share Price $ 43.90
-----------
Common Stock Market Interest
Value $3,252,595 55% Coverage 2.91x 1st Qtr.
Preferred Stock 338,993 5% - adjusted
Borrowings Under Bank Fixed Charge
Lines 381,000 7% Coverage 2.28x 1st Qtr.
Trust Preferred
Liability 52,205 1%
Long-Term Debt Fixed Charge
Obligations 1,919,116 32% Coverage 2.35x 1st Qtr.
-------------------
Total Market
Capitalization $5,943,909 100% - adjusted
EBITDA Reconciliation ($000's) Exhibit 12
--------------------------------------------------
Three Months Ended
March 31,
-------------------
2007 2006
--------- ---------
Net income $ 29,673 $ 24,978
Interest expense (1) 31,999 24,238
Tax expense (benefit) 11 0
Depreciation and amortization (1) 33,860 23,262
Amortization of deferred loan expenses 1,267 711
--------- ---------
EBITDA 96,810 73,189
Stock-based compensation expense 3,177 2,514
Provision for loan losses 0 250
--------- ---------
EBITDA - adjusted $ 99,987 $ 75,953
Interest Coverage Ratio
Interest expense (1) $ 31,999 $ 24,238
Capitalized interest 2,327 202
--------- ---------
Total interest 34,326 24,440
EBITDA $ 96,810 $ 73,189
--------- ---------
Interest coverage ratio 2.82x 2.99x
EBITDA - adjusted $ 99,987 $ 75,953
--------- ---------
Interest coverage ratio - adjusted 2.91x 3.11x
Fixed Charge Coverage Ratio
Total interest (1) $ 34,326 $ 24,440
Secured debt principal amortization 1,894 643
Preferred dividends 6,317 5,333
--------- ---------
Total fixed charges 42,537 30,416
EBITDA $ 96,810 $ 73,189
--------- ---------
Fixed charge coverage ratio 2.28x 2.41x
EBITDA - adjusted $ 99,987 $ 75,953
--------- ---------
Fixed charge coverage ratio - adjusted 2.35x 2.50x
Notes: (1) Depreciation and amortization and interest expense
include depreciation and amortization and interest
expense from discontinued operations.
Funds Available For Distribution Reconciliation Exhibit 13
---------------------------------------------------
(Amounts in 000's except per share data)
Three Months Ended
March 31,
------------------
2007 2006
-------- ---------
Net income available to common
stockholders $23,356 $ 19,645
Depreciation and amortization (1) 33,860 23,262
Loss (gain) on sales of properties (977) (1,553)
Minority interests (5) 0
Gross straight-line rental income (4,231) (2,400)
Prepaid/straight-line rent receipts 2,078 10,310
Rental income related to above/(below) market
leases, net (460) 0
Amortization of deferred loan expenses 1,267 711
Cap Ex, tenant improvements, lease commissions (1,063) 0
-------- ---------
Funds available for distribution 53,825 49,975
Prepaid/straight-line rent receipts (2,078) (10,310)
-------- ---------
Funds available for distribution - normalized $51,747 $ 39,665
Average common shares outstanding:
Basic 73,224 58,178
Diluted 73,791 58,535
Per share data:
Net income available to common stockholders
Basic $ 0.32 $ 0.34
Diluted 0.32 0.34
Funds available for distribution
Basic $ 0.74 $ 0.86
Diluted 0.73 0.85
Funds available for distribution - normalized
Basic $ 0.71 $ 0.68
Diluted 0.70 0.68
FAD Payout Ratio
Dividends per common share (2) $ 0.64 $ 0.62
FAD per diluted share $ 0.73 $ 0.85
-------- ---------
FAD payout ratio 88% 73%
FAD Payout Ratio - Normalized
Dividends per common share (2) $ 0.64 $ 0.62
FAD per diluted share - normalized $ 0.70 $ 0.68
-------- ---------
FAD payout ratio - normalized 91% 91%
Notes: (1) Depreciation and amortization includes depreciation and
amortization from discontinued operations.
(2) Includes $0.3409 prorated dividend paid on December 28,
2006 in connection with the Windrose merger.
Funds From Operations Reconciliation Exhibit 14
--------------------------------------------------
(Amounts in 000's except per share data)
Three Months Ended
March 31,
-------------------
2007 2006
--------- ---------
Net income available to common
stockholders $ 23,356 $ 19,645
Depreciation and amortization (1) 33,860 23,262
Loss (gain) on sales of properties (977) (1,553)
Minority interests (32) 0
--------- ---------
Funds from operations $ 56,207 $ 41,354
Average common shares outstanding:
Basic 73,224 58,178
Diluted 73,791 58,535
Per share data:
Net income available to common stockholders
Basic $ 0.32 $ 0.34
Diluted 0.32 0.34
Funds from operations
Basic $ 0.77 $ 0.71
Diluted 0.76 0.71
FFO Payout Ratio
Dividends per common share (2) $ 0.64 $ 0.62
FFO per diluted share $ 0.76 $ 0.71
--------- ---------
FFO payout ratio 84% 87%
Notes: (1) Depreciation and amortization includes depreciation and
amortization from discontinued operations.
(2) Includes $0.3409 prorated dividend paid on
December 28, 2006 in connection with the Windrose
merger.
Outlook Reconciliation Exhibit 15
--------------------------------------------------
(Amounts in 000's except per share data)
Current Outlook
Year Ended
December 31, 2007
-------------------
Low High
--------- ---------
Net income available to
common stockholders $ 94,777 $101,177
Loss (gain) on sales
of properties (977) (977)
Depreciation and amortization (1) 151,000 151,000
--------- ---------
Funds from operations 244,800 251,200
Gross straight-line rental income (16,000) (16,000)
Prepaid/straight-line rent receipts 2,078 2,078
Rental income related to above/below market
leases (2,000) (2,000)
Amortization of deferred loan expenses 4,000 4,000
Cap Ex, tenant improvements, lease commissions (7,000) (7,000)
--------- ---------
Funds available for
distribution $225,878 $232,278
Average common shares
outstanding (diluted) 80,000 80,000
Per share data (diluted):
Net income available to
common stockholders $ 1.18 $ 1.26
Funds from operations 3.06 3.14
Funds available for
distribution 2.82 2.90
Notes: (1) Depreciation and amortization includes depreciation and
amortization from discontinued operations.
CONTACT: Health Care REIT, Inc.
Scott Estes, 419-247-2800
Mike Crabtree, 419-247-2800
SOURCE: Health Care REIT, Inc.
|
Health Care REIT, Inc.
