Community Healthcare Trust Announces Results for the Three Months Ended September 30, 2022

Rhea-AI Summary

Community Healthcare Trust Incorporated (NYSE: CHCT) reported a net income of approximately $5.7 million or $0.21 per diluted share for the three months ended September 30, 2022. Funds from operations (FFO) and adjusted funds from operations (AFFO) were $0.57 and $0.63 per diluted share, respectively. The Company acquired a 96,886 square foot behavioral facility for $13.2 million and a 17,318 square foot clinic for $4.3 million, both fully leased. Additionally, it has 20 properties under purchase agreements valued at $71.6 million.

Positive

• Net income of $5.7 million, or $0.21 per diluted share.
• Funds from operations (FFO) of $0.57 per diluted share.
• Adjusted funds from operations (AFFO) of $0.63 per diluted share.
• Acquisition of a 96,886 square foot facility for $13.2 million, fully leased.
• Acquisition of a 17,318 square foot clinic for $4.3 million, fully leased.
• 20 properties under purchase agreements totaling $71.6 million with expected returns of 9.0% to 10.17%.
• Planned acquisition of additional properties worth $117.5 million with expected return of 10.25%.
• Quarterly dividend declared at $0.4450 per share.

Negative

• Uncertainty regarding the timing or closure of upcoming property acquisitions.

FRANKLIN, Tenn., Nov. 1, 2022 /PRNewswire/ -- Community Healthcare Trust Incorporated (NYSE: CHCT) (the "Company") today announced results for the three months ended September 30, 2022. The Company reported net income for the three months ended September 30, 2022 of approximately $5.7 million, or $0.21 per diluted common share. Funds from operations ("FFO") and adjusted funds from operations ("AFFO") for the three months ended September 30, 2022 totaled $0.57 and $0.63, respectively, per diluted common share. 

Highlights include:

•  During the three months ended September 30, 2022, the Company acquired a 96,886 square foot behavioral specialty facility for a purchase price of approximately $13.2 million and a 17,318 square foot physician clinic for a purchase price of approximately $4.3 million. Upon acquisition, the properties were 100% leased with lease expirations through 2037.
  
  
•  The Company has 20 properties under definitive purchase agreements for an aggregate expected purchase price of approximately $71.6 million. The Company's expected returns on these investments range from 9.0% to 10.17%. The Company expects to close on these properties in the fourth quarter of 2022; however, the Company cannot provide assurance as to the timing of when, or whether, these transactions will actually close.
  
  
• The Company also has five properties under definitive purchase agreements, to be acquired after completion and occupancy, for an aggregate expected purchase price of approximately $117.5 million. The Company's expected return on these investments will approximate 10.25%. The Company anticipates closing on these properties throughout 2023; however, the Company cannot provide assurance as to the timing of when, or whether, these transactions will actually close.
  
  
• On October 27, 2022, the Company's Board of Directors declared a quarterly common stock dividend in the amount of $0.4450 per share. The dividend is payable on November 25, 2022 to stockholders of record on November 10, 2022.

About Community Healthcare Trust Incorporated

Community Healthcare Trust Incorporated is a real estate investment trust that focuses on owning income-producing real estate properties associated primarily with the delivery of outpatient healthcare services in our target sub-markets throughout the United States. As of September 30, 2022, the Company had investments of approximately $890.0 million in 161 real estate properties (including a portion of one property accounted for as a financing lease). The properties are located in 34 states, totaling approximately 3.5 million square feet in the aggregate.

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

This press release contains statements that are "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", "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 Company's control. Thus, the Company's actual results and financial condition may differ materially from those indicated in such forward-looking statements. Some factors that might cause such a difference include the following: general volatility of the capital markets and the market price of the Company's common stock, changes in the Company's business strategy, availability, terms and deployment of capital, the Company's ability to refinance existing indebtedness at or prior to maturity on favorable terms, or at all, changes in the real estate industry in general, interest rates or the general economy, adverse developments related to the healthcare industry, the degree and nature of the Company's competition, the ability to consummate acquisitions under contract, effects on global and national markets as well as businesses resulting from the COVID-19 pandemic, and the other factors described in the section entitled "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2021 and the Company's other filings with the Securities and Exchange Commission from time to time. Readers are therefore cautioned not to place undue reliance on the forward-looking statements contained herein which speak only as of the date hereof.  The Company intends these forward-looking statements to speak only as of the time of this release and the Company undertakes no obligation to update forward-looking statements, whether as a result of new information, future developments, or otherwise, except as may be required by law.

 

COMMUNITY HEALTHCARE TRUST INCORPORATED CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars and shares in thousands, except per share amounts)
	(Unaudited)
	September 30, 2022		December 31, 2021
ASSETS
Real estate properties:
Land and land improvements	$                     103,413		$                   97,397
Buildings, improvements, and lease intangibles	783,308		736,465
Personal property	237		223
Total real estate properties	886,958		834,085
Less accumulated depreciation	(157,040)		(133,056)
Total real estate properties, net	729,918		701,029
Cash and cash equivalents	2,656		2,351
Restricted cash	682		516
Other assets, net	78,673		50,337
Total assets	$                     811,929		$                 754,233
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Debt, net	$                     310,781		$                 265,625
Accounts payable and accrued liabilities	8,143		7,845
Other liabilities, net	14,519		18,651
Total liabilities	333,443		292,121
Commitments and contingencies
Stockholders' Equity
Preferred stock, $0.01 par value; 50,000 shares authorized; none issued and outstanding	—		—
Common stock, $0.01 par value; 450,000 shares authorized; 25,299 and 24,983 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively	253		250
Additional paid-in capital	601,968		595,624
Cumulative net income	75,904		59,123
Accumulated other comprehensive gain (loss)	21,468		(4,980)
Cumulative dividends	(221,107)		(187,905)
Total stockholders' equity	478,486		462,112
Total liabilities and stockholders' equity	$                     811,929		$                 754,233

The Condensed Consolidated Balance Sheets do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.

 

COMMUNITY HEALTHCARE TRUST INCORPORATED CONDENSED CONSOLIDATED STATEMENTS OF INCOME FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2022 AND 2021 (Unaudited; Dollars and shares in thousands, except per share amounts)
	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
REVENUES
Rental income	$       23,919		$       22,447		$       69,720		$       65,233
Other operating interest	888		807		2,617		2,104
	24,807		23,254		72,337		67,337
EXPENSES
Property operating	4,327		4,051		12,480		11,623
General and administrative	3,762		3,206		10,688		8,958
Depreciation and amortization	8,003		7,812		24,022		22,576
	16,092		15,069		47,190		43,157
INCOME BEFORE INCOME TAXES AND OTHER ITEMS	8,715		8,185		25,147		24,180
Interest expense	(3,028)		(2,788)		(8,409)		(7,753)
Deferred income tax expense	(21)		(45)		(20)		(104)
Interest and other income	7		2		63		56
NET INCOME	$         5,673		$         5,354		$       16,781		$       16,379
NET INCOME PER COMMON SHARE:
Net income per common share – Basic	$          0.21		$          0.20		$          0.62		$          0.63
Net income per common share – Diluted	$           0.21		$           0.20		$           0.62		$           0.63
WEIGHTED AVERAGE COMMON SHARE OUTSTANDING-BASIC	23,587		23,472		23,578		23,161
WEIGHTED AVERAGE COMMON SHARE OUTSTANDING-DILUTED	23,587		23,472		23,578		23,161

The Condensed Consolidated Statements of Income do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.

 

COMMUNITY HEALTHCARE TRUST INCORPORATED RECONCILIATION OF FFO and AFFO (1) (Unaudited; Dollars and shares in thousands, except per share amounts)
	Three Months Ended September 30,
	2022		2021
Net income	$                    5,673		$                    5,354
Real estate depreciation and amortization	8,078		7,871
FFO	$                  13,751		$                  13,225
Straight-line rent	(853)		(895)
Stock-based compensation	2,464		2,004
AFFO	$                  15,362		$                  14,334
FFO per Common Share-Diluted	$                      0.57		$                      0.55
AFFO per Common Share-Diluted	$                      0.63		$                      0.59
Weighted Average Common Shares Outstanding-Diluted (2)	24,312		24,220

(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 National Association of Real Estate Investment Trusts, Inc. ("NAREIT") definition of FFO. FFO and FFO per share are operating performance measures adopted by NAREIT. NAREIT defines FFO as the most commonly accepted and reported measure of a REIT's operating performance equal to net income (calculated in accordance with GAAP), excluding gains or losses from the sale of certain real estate assets, gains and losses from change in control, impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity, plus depreciation and amortization related to real estate properties, and after adjustments for unconsolidated partnerships and joint ventures. NAREIT also provides REITs with an option to exclude gains, losses and impairments of assets that are incidental to the main business of the REIT from the calculation of FFO.   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.

 

View original content:https://www.prnewswire.com/news-releases/community-healthcare-trust-announces-results-for-the-three-months-ended-september-30-2022-301665485.html

SOURCE Community Healthcare Trust, Inc.

FAQ

What were the net income results for CHCT in Q3 2022?

Community Healthcare Trust reported a net income of approximately $5.7 million, or $0.21 per diluted share.

What is the FFO and AFFO for CHCT for the three months ended September 30, 2022?

The FFO was $0.57 and the AFFO was $0.63 per diluted share.

What properties did CHCT acquire during Q3 2022?

CHCT acquired a 96,886 square foot behavioral facility for $13.2 million and a 17,318 square foot clinic for $4.3 million, both fully leased.

How many properties does CHCT have under purchase agreements as of November 2022?

CHCT has 20 properties under definitive purchase agreements for an aggregate expected purchase price of approximately $71.6 million.

What is the expected return on investment for CHCT's current property acquisitions?

The expected returns range from 9.0% to 10.17%.

When is CHCT's next scheduled dividend payment?

The next dividend is payable on November 25, 2022, to stockholders of record on November 10, 2022.