Medical Properties Trust, Inc. Reports First Quarter Results
Medical Properties Trust, Inc. reported a net loss of ($1.23) and Normalized Funds from Operations of $0.24 per share for the first quarter of 2024. The company executed total liquidity transactions of $1.6 billion year-to-date, reducing debt by approximately $1.6 billion since Q1 2023. MPT sold hospitals in California and New Jersey for $350 million, and a 75% interest in five Utah hospitals for $1.1 billion. The company paid a regular quarterly dividend of $0.15 per share and was selected as a Green Lease Leader by the Department of Energy's Better Building Alliance. MPT's total assets amount to approximately $17.4 billion, with a diversified portfolio across various facility types and geographies.
Executed total liquidity transactions of $1.6 billion year-to-date.
Sold hospitals in California and New Jersey for $350 million.
Sold a 75% interest in five Utah hospitals for approximately $1.1 billion.
Paid a regular quarterly dividend of $0.15 per share.
Selected as a Green Lease Leader by the Department of Energy's Better Building Alliance.
Portfolio includes total assets of approximately $17.4 billion.
Highly diversified portfolio across various facility types and geographies.
Net loss of ($1.23) per share reported for the first quarter of 2024.
Normalized Funds from Operations decreased to $0.24 per share compared to the previous year.
Impairments of approximately $693 million included in net loss for the quarter.
Significant decrease in revenue related to Steward impacting NFFO year-over-year.
Estimated fair market value of MPT's investment in PHP Holdings declined by approximately $60 million.
Insights
Executed Total Liquidity Transactions of
Debt, Net of Cash, Reduced by Approximately
-
Net loss of (
) and Normalized Funds from Operations (“NFFO”) of$1.23 for the 2024 first quarter on a per share basis;$0.24 -
First quarter net loss included approximately
($693 million per share) in impairments, primarily non-real estate adjustments related to Steward Health Care System (“Steward”) and the International Joint Venture;$1.16 -
Commenced rents in the first quarter at development properties leased to Lifepoint Behavioral in
Texas and to IMED inValencia, Spain ; -
Completed in April the sale of five hospitals in
California andNew Jersey to Prime Healthcare for ;$350 million -
Sold in April a
75% interest in fiveUtah hospitals operated by an affiliate of CommonSpirit Health to an institutional asset manager, resulting in approximately of total proceeds;$1.1 billion -
Paid a regular quarterly dividend of
per share; and$0.15 - Selected as Green Lease Leader by the Department of Energy’s Better Building Alliance and the Institute for Market Transformation.
Edward K. Aldag, Jr., Chairman, President and Chief Executive Officer, said, “We continue to execute a capital allocation strategy that we now expect will exceed our initial target of
Mr. Aldag continued, “Regarding Steward’s recent filing for Chapter 11 bankruptcy, we expect this process may facilitate an orderly transition of Steward’s operations to new operators. As Steward continues these efforts, MPT has agreed to provide
Looking ahead, we remain confident in the valuable role MPT serves in the healthcare ecosystem – providing operators with necessary financing solutions to optimize their capital stack and redirect resources towards caring for patients. We have constructed a highly diversified portfolio across geographies, operators, and facility types with significant long-term cash flow potential.”
Included in the financial tables accompanying this press release is information about the Company’s assets and liabilities, operating results, and reconciliations of net income (loss) to NFFO, including per share amounts, all on a basis comparable to 2023 results.
PORTFOLIO UPDATE
Medical Properties Trust has total assets of approximately
MPT’s operations in the
Across the Company’s
In April, MPT achieved GOLD recognition as a 2024 Green Lease Leader by the Institute for Market Transformation and the
During the first quarter of 2024, Steward paid cash rent of
As announced earlier this week, MPT has approved
During the first quarter of 2024, Prospect paid cash rent and interest of
OPERATING RESULTS AND OUTLOOK
Net loss for the first quarter ended March 31, 2024 was (
NFFO for the first quarter ended March 31, 2024 was
A reconciliation of net (loss) income to FFO and NFFO, including per share amounts, can be found in the financial tables accompanying this press release.
CONFERENCE CALL AND WEBCAST
The Company has scheduled a conference call and webcast for May 9, 2024 at 11:00 a.m. Eastern Time to present the Company’s financial and operating results for the quarter ended March 31, 2024. The dial-in numbers for the conference call are 877-883-0383 (
A telephone and webcast replay of the call will be available beginning shortly after the call’s completion. The telephone replay will be available through May 23, 2024, using dial-in numbers 877-344-7529 (
The Company’s supplemental information package for the current period will also be available on the Company’s website in the Investor Relations section.
The Company uses, and intends to continue to use, the Investor Relations page of its website, which can be found at www.medicalpropertiestrust.com, as a means of disclosing material nonpublic information and of complying with its disclosure obligations under Regulation FD, including, without limitation, through the posting of investor presentations that may include material nonpublic information. Accordingly, investors should monitor the Investor Relations page, in addition to following our press releases, SEC filings, public conference calls, presentations and webcasts. The information contained on, or that may be accessed through, our website is not incorporated by reference into, and is not a part of, this document.
About Medical Properties Trust, Inc.
Medical Properties Trust, Inc. is a self-advised real estate investment trust formed in 2003 to acquire and develop net-leased hospital facilities. From its inception in
Forward-Looking Statements
This press release includes 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. Forward-looking statements can generally be identified by the use of forward-looking words such as “may”, “will”, “would”, “could”, “expect”, “intend”, “plan”, “estimate”, “target”, “anticipate”, “believe”, “objectives”, “outlook”, “guidance” or other similar words, and include statements regarding our strategies, objectives, future expansion and development activities, asset sales and other liquidity transactions, expected returns on investments and expected financial performance. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results or future events to differ materially from those expressed in or underlying such forward-looking statements, including, but not limited to: (i) the risk that Steward’s bankruptcy restructuring does not result in MPT recovering deferred rent or its other investments in Steward at full value, within a reasonable time period or at all; (ii) macroeconomic conditions, including due to geopolitical conditions and instability, which may lead to a disruption of or lack of access to the capital markets, disruptions and instability in the banking and financial services industries, rising inflation and movements in currency exchange rates; (iii) the risk that previously announced or contemplated property sales, loan repayments, and other capital recycling transactions do not occur as anticipated or at all; (iv) the risk that MPT is not able to attain its leverage, liquidity and cost of capital objectives within a reasonable time period or at all; (v) MPT’s ability to obtain debt financing on attractive terms or at all, as a result of changes in interest rates and other factors, which may adversely impact its ability to pay down, refinance, restructure or extend its indebtedness as it becomes due, or pursue acquisition and development opportunities; (vi) the ability of our tenants, operators and borrowers to satisfy their obligations under their respective contractual arrangements with us; (vii) the economic, political and social impact of, and uncertainty relating to, the potential impact from health crises (like COVID-19), which may adversely affect MPT’s and its tenants’ business, financial condition, results of operations and liquidity; (viii) our success in implementing our business strategy and our ability to identify, underwrite, finance, consummate and integrate acquisitions and investments; (ix) the nature and extent of our current and future competition; (x) international, national and local economic, real estate and other market conditions, which may negatively impact, among other things, the financial condition of our tenants, lenders and institutions that hold our cash balances, and may expose us to increased risks of default by these parties; (xi) factors affecting the real estate industry generally or the healthcare real estate industry in particular; (xii) our ability to maintain our status as a REIT for income tax purposes in the
The risks described above are not exhaustive and additional factors could adversely affect our business and financial performance, including the risk factors discussed under the section captioned “Risk Factors” in our most recent Annual Report on Form 10-K, as may be updated in our other filings with the SEC. Forward-looking statements are inherently uncertain and actual performance or outcomes may vary materially from any forward-looking statements and the assumptions on which those statements are based. Readers are cautioned to not place undue reliance on forward-looking statements as predictions of future events. We disclaim any responsibility to update such forward-looking statements, which speak only as of the date on which they were made.
MEDICAL PROPERTIES TRUST, INC. AND SUBSIDIARIES | |||||||
Consolidated Balance Sheets | |||||||
(Amounts in thousands, except for per share data) | |||||||
March 31, 2024 | December 31, 2023 | ||||||
Assets | (Unaudited) | (A) | |||||
Real estate assets | |||||||
Land, buildings and improvements, intangible lease assets, and other | $ |
12,823,748 |
|
$ |
13,237,187 |
|
|
Investment in financing leases |
|
1,233,178 |
|
|
1,231,630 |
|
|
Real estate held for sale |
|
295,130 |
|
|
- |
|
|
Mortgage loans |
|
309,926 |
|
|
309,315 |
|
|
Gross investment in real estate assets |
|
14,661,982 |
|
|
14,778,132 |
|
|
Accumulated depreciation and amortization |
|
(1,422,728 |
) |
|
(1,407,971 |
) |
|
Net investment in real estate assets |
|
13,239,254 |
|
|
13,370,161 |
|
|
Cash and cash equivalents |
|
224,340 |
|
|
250,016 |
|
|
Interest and rent receivables |
|
34,492 |
|
|
45,059 |
|
|
Straight-line rent receivables |
|
677,570 |
|
|
635,987 |
|
|
Investments in unconsolidated real estate joint ventures |
|
1,450,482 |
|
|
1,474,455 |
|
|
Investments in unconsolidated operating entities |
|
934,138 |
|
|
1,778,640 |
|
|
Other loans |
|
426,971 |
|
|
292,615 |
|
|
Other assets |
|
453,709 |
|
|
457,911 |
|
|
Total Assets | $ |
17,440,956 |
|
$ |
18,304,844 |
|
|
Liabilities and Equity | |||||||
Liabilities | |||||||
Debt, net | $ |
10,098,723 |
|
$ |
10,064,236 |
|
|
Accounts payable and accrued expenses |
|
302,526 |
|
|
412,178 |
|
|
Deferred revenue |
|
32,076 |
|
|
37,962 |
|
|
Obligations to tenants and other lease liabilities |
|
163,264 |
|
|
156,603 |
|
|
Total Liabilities |
|
10,596,589 |
|
|
10,670,979 |
|
|
Equity | |||||||
Preferred stock, |
|||||||
outstanding |
|
- |
|
|
- |
|
|
Common stock, |
|||||||
outstanding - 600,304 shares at March 31, 2024 and 598,991 |
|
600 |
|
|
599 |
|
|
shares at December 31, 2023 | |||||||
Additional paid-in capital |
|
8,567,199 |
|
|
8,560,309 |
|
|
Retained deficit |
|
(1,706,862 |
) |
|
(971,809 |
) |
|
Accumulated other comprehensive (loss) income |
|
(18,838 |
) |
|
42,501 |
|
|
Total Medical Properties Trust, Inc. Stockholders' Equity |
|
6,842,099 |
|
|
7,631,600 |
|
|
Non-controlling interests |
|
2,268 |
|
|
2,265 |
|
|
Total Equity |
|
6,844,367 |
|
|
7,633,865 |
|
|
Total Liabilities and Equity | $ |
17,440,956 |
|
$ |
18,304,844 |
|
|
(A) Financials have been derived from the prior year audited financial statements. |
MEDICAL PROPERTIES TRUST, INC. AND SUBSIDIARIES |
|||||||
|
|
|
|||||
Consolidated Statements of Income |
|||||||
(Unaudited) |
|||||||
|
|||||||
(Amounts in thousands, except for per share data) | For the Three Months Ended | ||||||
March 31, 2024 | March 31, 2023 | ||||||
Revenues | |||||||
Rent billed | $ |
199,299 |
|
$ |
248,157 |
|
|
Straight-line rent |
|
44,736 |
|
|
56,693 |
|
|
Income from financing leases |
|
16,393 |
|
|
13,195 |
|
|
Interest and other income |
|
10,888 |
|
|
32,166 |
|
|
Total revenues |
|
271,316 |
|
|
350,211 |
|
|
Expenses | |||||||
Interest |
|
108,685 |
|
|
97,654 |
|
|
Real estate depreciation and amortization |
|
75,586 |
|
|
83,860 |
|
|
Property-related (A) |
|
4,818 |
|
|
7,110 |
|
|
General and administrative |
|
33,348 |
|
|
41,724 |
|
|
Total expenses |
|
222,437 |
|
|
230,348 |
|
|
Other expense | |||||||
(Loss) gain on sale of real estate |
|
(1,423 |
) |
|
62 |
|
|
Real estate and other impairment charges, net |
|
(693,088 |
) |
|
(89,538 |
) |
|
Earnings from equity interests |
|
10,549 |
|
|
11,352 |
|
|
Other (including fair value adjustments on securities) |
|
(89,345 |
) |
|
(5,166 |
) |
|
Total other expense |
|
(773,307 |
) |
|
(83,290 |
) |
|
(Loss) income before income tax |
|
(724,428 |
) |
|
36,573 |
|
|
Income tax expense |
|
(10,949 |
) |
|
(3,543 |
) |
|
Net (loss) income |
|
(735,377 |
) |
|
33,030 |
|
|
Net income attributable to non-controlling interests |
|
(248 |
) |
|
(236 |
) |
|
Net (loss) income attributable to MPT common stockholders | $ |
(735,625 |
) |
$ |
32,794 |
|
|
Earnings per common share - basic and diluted: | |||||||
Net (loss) income attributable to MPT common stockholders | $ |
(1.23 |
) |
$ |
0.05 |
|
|
Weighted average shares outstanding - basic |
|
600,304 |
|
|
598,302 |
|
|
Weighted average shares outstanding - diluted |
|
600,304 |
|
|
598,310 |
|
|
Dividends declared per common share (B) | $ |
- |
|
$ |
0.29 |
|
|
(A) Includes |
|||||||
(B) Regular quarterly dividend was declared subsequent to March 31, 2024. |
MEDICAL PROPERTIES TRUST, INC. AND SUBSIDIARIES |
|||||||
|
|||||||
Reconciliation of Net (Loss) Income to Funds From Operations | |||||||
(Unaudited) | |||||||
|
|||||||
(Amounts in thousands, except for per share data) |
|||||||
For the Three Months Ended | |||||||
March 31, 2024 | March 31, 2023 |
||||||
FFO information: | |||||||
Net (loss) income attributable to MPT common stockholders | $ |
(735,625 |
) |
$ |
32,794 |
|
|
Participating securities' share in earnings |
|
- |
|
|
(515 |
) |
|
Net (loss) income, less participating securities' share in earnings | $ |
(735,625 |
) |
$ |
32,279 |
|
|
Depreciation and amortization |
|
94,243 |
|
|
101,960 |
|
|
Loss (gain) on sale of real estate |
|
1,423 |
|
|
(62 |
) |
|
Real estate impairment charges |
|
- |
|
|
52,104 |
|
|
Funds from operations | $ |
(639,959 |
) |
$ |
186,281 |
|
|
Write-off of billed and unbilled rent and other |
|
1,817 |
|
|
2,192 |
|
|
Other impairment charges, net |
|
693,088 |
|
|
37,434 |
|
|
Litigation and other |
|
5,870 |
|
|
7,726 |
|
|
Non-cash fair value adjustments |
|
81,276 |
|
|
(4,121 |
) |
|
Tax rate changes and other |
|
(307 |
) |
|
(7,305 |
) |
|
Normalized funds from operations | $ |
141,785 |
|
$ |
222,207 |
|
|
Certain non-cash and related recovery information: | |||||||
Share-based compensation | $ |
7,633 |
|
$ |
11,829 |
|
|
Debt costs amortization | $ |
4,839 |
|
$ |
5,121 |
|
|
Non-cash rent and interest revenue (A) | $ |
- |
|
$ |
(20,863 |
) |
|
Cash recoveries of non-cash rent and interest revenue (B) | $ |
5,748 |
|
$ |
31,356 |
|
|
Straight-line rent revenue from operating and finance leases | $ |
(47,246 |
) |
$ |
(62,589 |
) |
|
Per diluted share data: | |||||||
Net (loss) income, less participating securities' share in earnings | $ |
(1.23 |
) |
$ |
0.05 |
|
|
Depreciation and amortization |
|
0.16 |
|
|
0.17 |
|
|
Loss (gain) on sale of real estate |
|
- |
|
|
- |
|
|
Real estate impairment charges |
|
- |
|
|
0.09 |
|
|
Funds from operations | $ |
(1.07 |
) |
$ |
0.31 |
|
|
Write-off of billed and unbilled rent and other |
|
- |
|
|
0.01 |
|
|
Other impairment charges, net |
|
1.16 |
|
|
0.06 |
|
|
Litigation and other |
|
0.01 |
|
|
0.01 |
|
|
Non-cash fair value adjustments |
|
0.14 |
|
|
(0.01 |
) |
|
Tax rate changes and other |
|
- |
|
|
(0.01 |
) |
|
Normalized funds from operations | $ |
0.24 |
|
$ |
0.37 |
|
|
Certain non-cash and related recovery information: | |||||||
Share-based compensation | $ |
0.01 |
|
$ |
0.02 |
|
|
Debt costs amortization | $ |
0.01 |
|
$ |
0.01 |
|
|
Non-cash rent and interest revenue (A) | $ |
- |
|
$ |
(0.03 |
) |
|
Cash recoveries of non-cash rent and interest revenue (B) | $ |
0.01 |
|
$ |
0.05 |
|
|
Straight-line rent revenue from operating and finance leases | $ |
(0.08 |
) |
$ |
(0.10 |
) |
|
Notes: |
|
Investors and analysts following the real estate industry utilize funds from operations ("FFO") as a supplemental performance measure. FFO, reflecting the assumption that real estate asset values rise or fall with market conditions, principally adjusts for the effects of GAAP depreciation and amortization of real estate assets, which assumes that the value of real estate diminishes predictably over time. We compute FFO in accordance with the definition provided by the National Association of Real Estate Investment Trusts, or Nareit, which represents net income (loss) (computed in accordance with GAAP), excluding gains (losses) on sales of real estate and impairment charges on real estate assets, plus real estate depreciation and amortization, including amortization related to in-place lease intangibles, and after adjustments for unconsolidated partnerships and joint ventures. |
|
In addition to presenting FFO in accordance with the Nareit definition, we disclose normalized FFO, which adjusts FFO for items that relate to unanticipated or non-core events or activities or accounting changes that, if not noted, would make comparison to prior period results and market expectations less meaningful to investors and analysts. We believe that the use of FFO, combined with the required GAAP presentations, improves the understanding of our operating results among investors and the use of normalized FFO makes comparisons of our operating results with prior periods and other companies more meaningful. While FFO and normalized FFO are relevant and widely used supplemental measures of operating and financial performance of REITs, they should not be viewed as a substitute measure of our operating performance since the measures do not reflect either depreciation and amortization costs or the level of capital expenditures and leasing costs (if any not paid by our tenants) to maintain the operating performance of our properties, which can be significant economic costs that could materially impact our results of operations. FFO and normalized FFO should not be considered an alternative to net income (loss) (computed in accordance with GAAP) as indicators of our results of operations or to cash flow from operating activities (computed in accordance with GAAP) as an indicator of our liquidity. |
|
Certain line items above (such as depreciation and amortization) include our share of such income/expense from unconsolidated joint ventures. These amounts are included with all activity of our equity interests in the "Earnings from equity interests" line on the consolidated statements of income. |
|
(A) Includes revenue accrued during the period but not received in cash, such as deferred rent, payment-in-kind ("PIK") interest or other accruals. |
|
(B) Includes cash received to satisfy previously accrued non-cash revenue, such as the cash receipt of previously deferred rent or PIK interest. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240508183707/en/
Drew Babin, CFA, CMA
Senior Managing Director of Corporate Communications
Medical Properties Trust, Inc.
(646) 884-9809
dbabin@medicalpropertiestrust.com
Source: Medical Properties Trust, Inc.
FAQ
What was Medical Properties Trust's net loss per share for the first quarter of 2024?
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What did MPT sell in April 2024?
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