Community Healthcare Trust Announces Results for the Three Months Ended September 30, 2024
Items Impacting Our Results include:
- During the three months ended
September 30, 2024 , the Company acquired one physician clinic for a purchase price of approximately$6.2 million . Upon acquisition, the 20,400 square foot property was 100.0% leased to a tenant with a lease expiration in 2027. This acquisition was funded with proceeds from the Company's Revolving Credit Facility. - During the third quarter of 2024, the Company disposed of an 11,200 square foot surgical center in
Texas , received net proceeds of approximately$1.0 million , and recognized an immaterial gain on sale. - The Company has four properties under definitive purchase agreements for an aggregate expected purchase price of approximately
$8.8 million . The Company's expected returns on these investments range from 9.29% to 9.50%. The Company expects to close on these properties in the fourth quarter of 2024; however, the Company cannot provide assurance as to the timing of when, or whether, these transactions will actually close. - The Company also has seven properties under definitive purchase agreements, to be acquired after completion and occupancy, for an aggregate expected purchase price of approximately
$169.5 million . The Company's expected returns on these investments are approximately 9.1% to 9.75%. The Company anticipates closing on these properties throughout 2025, 2026 and 2027; however, the Company cannot provide assurance as to the timing of when, or whether, these transactions will actually close. - On
October 16, 2024 , the Company entered into a second Amendment to the third amended and restated credit agreement (the "Amended Credit Facility") with a syndicate of lenders, under whichTruist Bank serves as administrative agent. The Amended Credit Facility, among other things, (i) increased the Company's Revolving Credit Facility from$150.0 million to$400.0 million , (ii) extended the maturity date of the Revolving Credit Facility fromMarch 19, 2026 toOctober 16, 2029 , and (iii) lowered pricing on the Revolving Credit Facility by 10 to 30 basis points, depending on the Company's leverage ratio. Proceeds from the increased Revolving Credit Facility were used to repay the existing A-3 Term Loan which was scheduled to mature onMarch 29, 2026 . In addition, amounts outstanding under the Revolving Credit Facility prior to the second Amendment will remain outstanding. Interest rate swaps previously entered into to fix the interest rates on the A-3 Term Loan will remain in place on the Revolving Credit Facility through their maturity onMarch 29, 2026 . - During the third quarter of 2024, the Company did not issue any shares under its at-the-market offering program.
- On
October 24, 2024 , the Company's Board of Directors declared a quarterly common stock dividend in the amount of$0.465 per share. The dividend is payable onNovember 22, 2024 to stockholders of record onNovember 8, 2024 .
About
Additional information regarding the Company, including this quarter's operations, can be found at www.chct.reit. Please contact the Company at 615-771-3052 to request a printed copy of this information.
Cautionary Note Regarding Forward-Looking Statements
In addition to the historical information contained within, the matters discussed in this press release may contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are generally identifiable by use of forward-looking terminology such as "believes", "expects", "may", "will," "should", "seeks", "approximately", "intends", "plans", "estimates", "anticipates" or other similar words or expressions, including the negative thereof. Forward-looking statements are based on certain assumptions and can include future expectations, future plans and strategies, financial and operating projections or other forward-looking information. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management. Because forward-looking statements relate to future events, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of the control of
CONSOLIDATED BALANCE SHEETS (Dollars and shares in thousands, except per share amounts)
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(Unaudited) |
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ASSETS |
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Real estate properties: |
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Land and land improvements |
$ 146,118 |
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$ 136,532 |
Buildings, improvements, and lease intangibles |
989,019 |
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913,416 |
Personal property |
326 |
|
299 |
Total real estate properties |
1,135,463 |
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1,050,247 |
Less accumulated depreciation |
(232,747) |
|
(200,810) |
Total real estate properties, net |
902,716 |
|
849,437 |
Cash and cash equivalents |
2,836 |
|
3,491 |
Restricted cash |
— |
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1,142 |
Real estate properties held for sale |
6,351 |
|
7,466 |
Other assets, net |
69,876 |
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83,876 |
Total assets |
$ 981,779 |
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$ 945,412 |
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LIABILITIES AND STOCKHOLDERS' EQUITY |
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Liabilities |
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Debt, net |
$ 473,716 |
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$ 403,256 |
Accounts payable and accrued liabilities |
14,422 |
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12,032 |
Other liabilities, net |
16,489 |
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16,868 |
Total liabilities |
504,627 |
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432,156 |
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Commitments and contingencies |
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Stockholders' Equity |
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Preferred stock, |
— |
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— |
Common stock, |
282 |
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276 |
Additional paid-in capital |
702,014 |
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688,156 |
Cumulative net income |
83,843 |
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88,856 |
Accumulated other comprehensive gain |
10,016 |
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16,417 |
Cumulative dividends |
(319,003) |
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(280,449) |
Total stockholders' equity |
477,152 |
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513,256 |
Total liabilities and stockholders' equity |
$ 981,779 |
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$ 945,412 |
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The Consolidated Balance Sheets do not include all of the information and footnotes required by accounting principles generally accepted in |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED (Unaudited; Dollars and shares in thousands, except per share amounts)
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Three Months Ended
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Nine Months Ended
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2024 |
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2023 |
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2024 |
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2023 |
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REVENUES |
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Rental income |
$ 29,335 |
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$ 27,690 |
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$ 85,582 |
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$ 80,582 |
Other operating interest, net |
304 |
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1,045 |
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906 |
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3,139 |
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29,639 |
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28,735 |
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86,488 |
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83,721 |
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EXPENSES |
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Property operating |
5,986 |
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5,456 |
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17,349 |
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15,115 |
General and administrative (1) |
4,935 |
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3,618 |
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14,249 |
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23,610 |
Depreciation and amortization |
10,927 |
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11,208 |
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31,981 |
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29,445 |
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21,848 |
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20,282 |
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63,579 |
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68,170 |
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OTHER (EXPENSE) INCOME |
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Gain on sale (impairment) of depreciable real estate asset |
5 |
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(102) |
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(135) |
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(102) |
Interest expense |
(6,253) |
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(4,641) |
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(17,301) |
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(12,773) |
Credit loss reserve |
— |
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— |
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(11,000) |
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— |
Deferred income tax expense |
— |
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(221) |
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— |
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(306) |
Interest and other income, net |
206 |
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3 |
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514 |
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777 |
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(6,042) |
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(4,961) |
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(27,922) |
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(12,404) |
NET INCOME (LOSS) |
$ 1,749 |
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$ 3,492 |
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$ (5,013) |
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$ 3,147 |
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NET INCOME (LOSS) PER COMMON SHARE (1) |
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Net income (loss) per common share - Basic |
$ 0.04 |
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$ 0.11 |
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$ (0.27) |
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$ 0.05 |
Net income (loss) per common share - Diluted |
$ 0.04 |
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$ 0.11 |
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$ (0.27) |
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$ 0.05 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING-BASIC |
26,660 |
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25,514 |
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26,479 |
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24,940 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING-DILUTED |
26,660 |
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25,514 |
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26,479 |
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24,940 |
___________ |
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(1) General and administrative expenses for the nine months ended |
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The Consolidated Statements of Income do not include all of the information and footnotes required by accounting principles generally accepted in |
RECONCILIATION OF FFO and AFFO (1) (Unaudited; Dollars and shares in thousands, except per share amounts)
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Three Months Ended |
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2024 |
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2023 |
Net income |
$ 1,749 |
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$ 3,492 |
Real estate depreciation and amortization |
11,077 |
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11,375 |
(Gain on sale) impairment of depreciable real estate asset |
(5) |
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102 |
Total adjustments |
11,072 |
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11,477 |
FFO (1) |
$ 12,821 |
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$ 14,969 |
Straight-line rent |
(679) |
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(444) |
Stock-based compensation |
2,497 |
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1,898 |
AFFO (1) |
$ 14,639 |
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$ 16,423 |
FFO per Common Share-Diluted (1) |
$ 0.48 |
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$ 0.58 |
AFFO per Common Share-Diluted (1) |
$ 0.55 |
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$ 0.63 |
Weighted Average Common Shares Outstanding-Diluted (2) |
26,853 |
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26,025 |
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(1) |
Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. However, since real estate values have historically risen or fallen with market conditions, many industry investors deem presentations of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. For that reason, the Company considers funds from operations ("FFO") and adjusted funds from operations ("AFFO") to be appropriate measures of operating performance of an equity real estate investment trust ("REIT"). In particular, the Company believes that AFFO is useful because it allows investors, analysts and Company management to compare the Company's operating performance to the operating performance of other real estate companies and between periods on a consistent basis without having to account for differences caused by unanticipated items and other events.
The Company uses the
In addition to FFO, the Company presents AFFO and AFFO per share. The Company defines AFFO as FFO, excluding certain expenses related to closing costs of properties acquired accounted for as business combinations and mortgages funded, excluding straight-line rent and the amortization of stock-based compensation, and including or excluding other non-cash items from time to time. AFFO presented herein may not be comparable to similar measures presented by other real estate companies due to the fact that not all real estate companies use the same definition.
FFO and AFFO should not be considered as alternatives to net income (determined in accordance with GAAP) as indicators of the Company's financial performance or as alternatives to cash flow from operating activities (determined in accordance with GAAP) as measures of the Company's liquidity, nor are they necessarily indicative of sufficient cash flow to fund all of the Company's needs. The Company believes that in order to facilitate a clear understanding of the consolidated historical operating results of the Company, FFO and AFFO should be examined in conjunction with net income as presented elsewhere herein. |
(2) |
Diluted weighted average common shares outstanding for FFO and AFFO are calculated based on the treasury method, rather than the 2-class method used to calculate earnings per share. |
CONTACT:
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