Omega Reports Second Quarter 2024 Results and Recent Developments
Omega Healthcare Investors (NYSE: OHI) reported Q2 2024 results with net income of $117 million ($0.45 per share), up from $62 million in Q2 2023. Nareit FFO increased to $189 million ($0.72 per share) from $155 million. The company completed $221 million in new investments during Q2, including $115 million in real estate acquisitions and $106 million in real estate loans. Year-to-date, Omega has invested $648 million in new investments. Due to strong performance, Omega increased its 2024 AFFO guidance to $2.78-$2.84 per share from the previous $2.70-$2.80. The company also reported improvements in tenant operating metrics and portfolio coverage.
Omega Healthcare Investors (NYSE: OHI) ha riportato i risultati del secondo trimestre 2024 con un utile netto di 117 milioni di dollari (0,45 dollari per azione), in aumento rispetto ai 62 milioni del secondo trimestre 2023. I Nareit FFO sono aumentati a 189 milioni di dollari (0,72 dollari per azione) rispetto ai 155 milioni precedenti. L'azienda ha completato investimenti per 221 milioni di dollari durante il secondo trimestre, inclusi 115 milioni in acquisizioni immobiliari e 106 milioni in prestiti immobiliari. Da inizio anno, Omega ha investito 648 milioni di dollari in nuovi investimenti. Grazie a un'ottima performance, Omega ha aumentato le previsioni di AFFO per il 2024 a 2,78-2,84 dollari per azione, rispetto ai precedenti 2,70-2,80. L'azienda ha anche segnalato miglioramenti nei parametri operativi degli inquilini e nella copertura del portafoglio.
Omega Healthcare Investors (NYSE: OHI) informó los resultados del segundo trimestre de 2024 con un ingreso neto de 117 millones de dólares (0,45 dólares por acción), un aumento respecto a los 62 millones del segundo trimestre de 2023. El Nareit FFO aumentó a 189 millones de dólares (0,72 dólares por acción) desde 155 millones. La compañía completó 221 millones de dólares en nuevas inversiones durante el segundo trimestre, incluyendo 115 millones en adquisiciones de bienes raíces y 106 millones en préstamos inmobiliarios. Hasta la fecha, Omega ha invertido 648 millones de dólares en nuevas inversiones. Debido al sólido rendimiento, Omega aumentó su guía de AFFO para 2024 a 2,78-2,84 dólares por acción desde la anterior de 2,70-2,80. La empresa también informó mejoras en los métricas operativas de los inquilinos y la cobertura de la cartera.
오메가 헬스케어 인베스터스 (NYSE: OHI)는 2024년 2분기 실적을 발표하며 1억 1천7백만 달러 (주당 0.45 달러)의 순이익을 기록했으며, 이는 2023년 2분기 6천2백만 달러에서 증가한 수치입니다. Nareit FFO는 1억 8천9백만 달러 (주당 0.72 달러)로 증가했으며, 이는 1억 5천5백만 달러에서 증가한 것입니다. 회사는 2분기 동안 2억 2천1백만 달러의 신규 투자를 완료했으며, 여기에는 1억 1천5백만 달러의 부동산 인수와 1억 6천만 달러의 부동산 대출이 포함됩니다. 올해 현재까지 오메가는 6억 4천8백만 달러를 신규 투자에 사용하였습니다. 강력한 실적 덕분에 오메가는 2024 AFFO 가이던스를 종전의 2.70-2.80 달러에서 2.78-2.84 달러로 상향 조정했습니다. 또한 회사는 임차인의 운영 지표와 포트폴리오 커버리지 개선을 보고했습니다.
Omega Healthcare Investors (NYSE: OHI) a annoncé les résultats du deuxième trimestre 2024 avec un bénéfice net de 117 millions de dollars (0,45 dollar par action), en hausse par rapport à 62 millions de dollars au deuxième trimestre 2023. Le Nareit FFO a augmenté à 189 millions de dollars (0,72 dollar par action) contre 155 millions précédemment. L'entreprise a réalisé 221 millions de dollars en nouveaux investissements au cours du deuxième trimestre, comprenant 115 millions de dollars en acquisitions immobilières et 106 millions de dollars en prêts immobiliers. Depuis le début de l'année, Omega a investi 648 millions de dollars dans de nouveaux investissements. En raison de sa solide performance, Omega a révisé sa prévision d'AFFO pour 2024 à 2,78-2,84 dollars par action, contre 2,70-2,80 dollars précédemment. L'entreprise a également signalé des améliorations dans les indicateurs de fonctionnement des locataires et dans la couverture du portefeuille.
Omega Healthcare Investors (NYSE: OHI) hat die Ergebnisse für das zweite Quartal 2024 bekannt gegeben, mit einem Nettogewinn von 117 Millionen Dollar (0,45 Dollar pro Aktie), ein Anstieg von 62 Millionen Dollar im zweiten Quartal 2023. Der Nareit FFO stieg auf 189 Millionen Dollar (0,72 Dollar pro Aktie) von 155 Millionen. Das Unternehmen hat 221 Millionen Dollar in neue Investitionen im zweiten Quartal abgeschlossen, darunter 115 Millionen Dollar für Immobilienakquisitionen und 106 Millionen Dollar für Immobilienkredite. Seit Jahresbeginn hat Omega 648 Millionen Dollar in neue Investitionen investiert. Aufgrund der starken Leistung hat Omega die Prognose für AFFO 2024 auf 2,78-2,84 Dollar pro Aktie von zuvor 2,70-2,80 Dollar angehoben. Das Unternehmen berichtete auch von Verbesserungen in den Betriebskennzahlen der Mieter und der Portfoliogedeckung.
- Net income increased to $117 million in Q2 2024 from $62 million in Q2 2023
- Nareit FFO rose to $189 million ($0.72 per share) from $155 million year-over-year
- Completed $221 million in new investments during Q2 2024
- Year-to-date new investments totaled $648 million
- Increased 2024 AFFO guidance to $2.78-$2.84 per share
- Improvement in tenant operating metrics and portfolio coverage
- AFFO per share decreased to $0.71 in Q2 2024 from $0.74 in Q2 2023
- FAD per share declined to $0.68 in Q2 2024 from $0.70 in Q2 2023
- LaVie Care Centers filed for Chapter 11 bankruptcy protection in June 2024
Insights
Omega Healthcare Investors' Q2 2024 results show a significant improvement in financial performance, with net income increasing to
The company's Nareit FFO and AFFO metrics also showed positive trends. Nareit FFO increased to
Omega's investment activity has been robust, with
However, investors should note the ongoing challenges in the healthcare REIT sector, particularly with operators like LaVie entering bankruptcy. While Omega has taken steps to mitigate risks, such as providing DIP financing, these situations require careful monitoring. The company's ability to successfully navigate operator transitions and restructurings will be important for maintaining its financial health and dividend stability.
Omega's Q2 results demonstrate the resilience of its business model in the face of industry headwinds. The company's strategic focus on skilled nursing and assisted living facilities continues to pay off, with improved operator metrics and successful restructurings contributing to financial growth.
The 10.4% initial cash yield on
Omega's balance sheet management deserves attention. The company issued
The increase in quarterly dividend to
Overall, Omega's Q2 performance and increased guidance suggest a positive outlook for the company, but ongoing vigilance regarding operator health and industry trends remains important for long-term success.
Omega's Q2 results reflect the ongoing recovery in the skilled nursing and assisted living sectors post-pandemic. The improvement in operator revenue mix, with Medicare/Medicaid accounting for
The uptick in occupancy to
The bankruptcy filing of LaVie Care Centers highlights the ongoing risks in the sector. Omega's provision of
Looking ahead, the industry faces both opportunities and challenges. The aging demographic trend continues to support long-term demand for skilled nursing and assisted living facilities. However, labor shortages, wage pressures and potential changes in government reimbursement policies remain key risks to monitor. Omega's diversified portfolio and proactive management approach position it well to navigate these industry dynamics, but investors should remain vigilant about operator performance and industry trends.
Completed
Increased Full Year Adjusted FFO Guidance
SECOND QUARTER 2024 AND RECENT HIGHLIGHTS
-
Net income for the quarter of
$117 million $0.45 $62 million $0.25 -
Nareit Funds From Operations (“Nareit FFO”) for the quarter of
$189 million $0.72 $155 million $0.63 -
Adjusted Funds From Operations (“Adjusted FFO” or “AFFO”) for the quarter of
$185 million $0.71 $183 million $0.74 -
Funds Available for Distribution (“FAD”) for the quarter of
$177 million $0.68 $173 million $0.70 -
Completed
$221 million $115 million $106 million -
Issued 8 million common shares for gross proceeds of
$245 million -
Repaid
$400 million -
Completed
$373 million $243 million
Nareit FFO, AFFO and FAD are supplemental non-GAAP financial measures that the Company believes are useful in evaluating the performance of real estate investment trusts (“REITs”). Reconciliations and further information regarding these non-GAAP measures are provided at the end of this press release.
CEO COMMENTS
Taylor Pickett, Omega’s Chief Executive Officer, stated, “Our second quarter financial performance showed strong sequential improvement, driven primarily by accretive investments and the resolution of portfolio restructurings.”
Mr. Pickett continued, “We have accretively invested approximately
Mr. Pickett concluded, “This industry has faced some of its most challenging times in the past four years. During this period, our operators and their brave staff have worked diligently to care for a particularly vulnerable segment of our society. As operations improve and financial challenges recede, we hope that both federal and state governments will continue to support this vital part of the healthcare continuum and enable operators to remain focused on providing exceptional clinical care.”
SECOND QUARTER 2024 RESULTS
Revenues – Revenues for the quarter ended June 30, 2024 totaled
Expenses – Expenses for the quarter ended June 30, 2024 totaled
Other Income and Expense – Other income for the quarter ended June 30, 2024 totaled
Net Income – Net income for the quarter ended June 30, 2024 totaled
2024 SECOND QUARTER PORTFOLIO AND RECENT ACTIVITY
Operator Updates:
LaVie – As previously disclosed, LaVie Care Centers, LLC (“LaVie”) filed for Chapter 11 bankruptcy protection in June 2024. The Company committed
Maplewood – In July 2024, Omega reached an agreement with the estate of the deceased principal and CEO of Maplewood Senior Living (“Maplewood”) to transition control of Maplewood, including assumption of Omega’s lease and loan agreements, to key members of the existing Maplewood management team. The agreement is subject to court approval. In the second quarter of 2024, Maplewood paid
Guardian – In April 2024, the Company transitioned its remaining six Guardian facilities to a new operator for minimum initial annual contractual rent of
New Investments:
The following table presents investment activity for the three and six months ended June 30, 2024:
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Three Months Ended |
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Six Months Ended |
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Investment Activity ( |
|
June 30, 2024 |
|
June 30, 2024 |
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|
|
$ Amount |
|
% |
|
$ Amount |
|
% |
||||
Real property |
|
$ |
114,727 |
|
45.2 |
% |
|
$ |
127,996 |
|
38.9 |
% |
Real estate loans receivable |
|
|
105,895 |
|
41.7 |
% |
|
|
147,137 |
|
44.7 |
% |
Total real property and loan investments |
|
|
220,622 |
|
86.9 |
% |
|
|
275,133 |
|
83.6 |
% |
Construction-in-progress |
|
|
25,901 |
|
10.2 |
% |
|
|
40,689 |
|
12.4 |
% |
Capital expenditures |
|
|
7,456 |
|
2.9 |
% |
|
|
13,120 |
|
4.0 |
% |
Total capital investments |
|
|
33,357 |
|
13.1 |
% |
|
|
53,809 |
|
16.4 |
% |
Total |
|
$ |
253,979 |
|
100.0 |
% |
|
$ |
328,942 |
|
100.0 |
% |
Through July 31, 2024, the Company has completed
Asset Sales and Impairments:
Impairments – During the second quarter of 2024, the Company recorded an
Assets Held for Sale – As of June 30, 2024, the Company had 15 facilities classified as assets held for sale, totaling
OPERATOR COVERAGE DATA
The following tables present operator revenue mix, census and coverage data based on information provided by the Company’s operators for the indicated periods. The Company has not independently verified this information, and it is providing this data for informational purposes only.
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Operator Revenue Mix (1) |
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Medicare / |
Private / |
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Medicaid |
Insurance |
Other |
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Three-months ended March 31, 2024 |
|
52.7 |
% |
30.0 |
% |
17.3 |
% |
Three-months ended December 31, 2023 |
|
55.3 |
% |
28.0 |
% |
16.7 |
% |
Three-months ended September 30, 2023 |
|
55.5 |
% |
28.0 |
% |
16.5 |
% |
Three-months ended June 30, 2023 |
|
54.0 |
% |
30.0 |
% |
16.0 |
% |
Three-months ended March 31, 2023 |
|
53.0 |
% |
31.8 |
% |
15.2 |
% |
| (1) | Excludes all facilities considered non-core and does not include federal stimulus revenue. For non-core definition, see Second Quarter 2024 Financial Supplemental posted in the “Quarterly Supplements” section of Omega’s website. |
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Coverage Data |
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Before |
After |
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|
Occupancy (2) |
Management |
Management |
|
Operator Census and Coverage (1) |
|
|
Fees (3) |
Fees (4) |
|
Twelve-months ended March 31, 2024 |
|
80.2 |
% |
1.78x |
1.42x |
Twelve-months ended December 31, 2023 |
|
79.6 |
% |
1.69x |
1.33x |
Twelve-months ended September 30, 2023 |
|
79.1 |
% |
1.63x |
1.28x |
Twelve-months ended June 30, 2023 |
|
78.6 |
% |
1.50x |
1.15x |
Twelve-months ended March 31, 2023 |
|
78.0 |
% |
1.44x |
1.10x |
| (1) | Excludes facilities considered non-core. For information regarding non-core facilities, see the most recent Quarterly Supplement posted on the Company’s website. |
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| (2) | Based on available (operating) beds. |
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| (3) | Represents EBITDARM of our operators, defined as earnings before interest, taxes, depreciation, amortization, Rent costs and management fees for the applicable period, divided by the total Rent payable to the Company by its operators during such period. “Rent” refers to the total monthly contractual rent and mortgage interest due under the Company’s lease and mortgage agreements over the applicable period. |
|
| (4) |
Represents EBITDAR of our operators, defined as earnings before interest, taxes, depreciation, amortization, and Rent (as defined in footnote 3) expense for the applicable period, divided by the total Rent payable to the Company by its operators during such period. Assumes a management fee of |
FINANCING ACTIVITIES
Dividend Reinvestment and Common Stock Purchase Plan and ATM Program – The following is a summary of the 2024 quarterly Common Stock Purchase Plan and ATM Program through June 30:
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Dividend Reinvestment and Common Stock Purchase Plan for 2024 |
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(in thousands, except price per share) |
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Q1 |
|
Q2 |
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Total |
|||
Number of shares |
|
29 |
|
|
413 |
|
|
442 |
Average price per share |
$ |
30.44 |
|
$ |
31.52 |
|
$ |
31.45 |
Gross proceeds |
$ |
882 |
|
$ |
13,015 |
|
$ |
13,897 |
|
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ATM Program for 2024 |
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(in thousands, except price per share) |
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Q1 |
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Q2 |
|
Total |
|||
Number of shares |
|
1,041 |
|
|
7,212 |
|
|
8,253 |
Average price per share |
$ |
31.02 |
|
$ |
32.16 |
|
$ |
32.01 |
Gross proceeds |
$ |
32,295 |
|
$ |
231,920 |
|
$ |
264,215 |
BALANCE SHEET AND LIQUIDITY
As of June 30, 2024, the Company had
DIVIDENDS
On July 24, 2024, the Board of Directors declared a quarterly cash dividend of
2024 AFFO GUIDANCE INCREASED
The Company increased the guidance range of its 2024 Adjusted FFO to a range of
The Company’s revised Adjusted FFO guidance for 2024 includes the annual impact of
The Company's guidance is based on several assumptions including those noted above, which are subject to change and many of which are outside the Company’s control. If actual results vary from these assumptions, the Company's expectations may change. Without limiting the generality of the foregoing, the timing of collection of rental obligations from operators on a cash basis, the timing and completion of acquisitions, divestitures, restructurings and capital and financing transactions may cause actual results to vary materially from our current expectations. There can be no assurance that the Company will achieve its projected results. The Company may, from time to time, update its publicly announced Adjusted FFO guidance, but it is not obligated to do so.
The Company does not provide a reconciliation for its Adjusted FFO guidance to GAAP net income because it is unable to determine meaningful or accurate estimates of reconciling items without unreasonable effort. This is due to the inherent difficulty of forecasting the timing and/or amounts of various items that would impact future net income. This includes, but is not limited to, changes in the provision for credit losses, real estate impairments, acquisition, merger and transition related costs, straight-line write-offs, gain/loss on assets sold, etc. In particular, the Company is unable to predict with reasonable certainty the amount of the change in the provision for credit losses in future periods, which is often a significant reconciling adjustment.
ADDITIONAL INFORMATION
Additional information regarding the Company can be found in its Second Quarter 2024 Financial Supplemental posted under “Financial Info” in the Investors section of Omega’s website. The information contained on, or that may be accessed through, Omega’s website, including the information contained in the aforementioned supplemental, is not incorporated by any reference into, and is not part of, this document.
CONFERENCE CALL
The Company will be conducting a conference call on Friday, August 2, 2024, at 10 a.m. Eastern time to review the Company’s 2024 second quarter results and current developments. Analysts and investors within the
To listen to the conference call via webcast, log on to www.omegahealthcare.com and click the “Omega Healthcare Investors, Inc. 2Q Earnings Call” hyper-link on the “Investors” page of Omega’s website. Webcast replays of the call will be available on Omega’s website for a minimum of two weeks following the call. Additionally, a copy of the earnings release will be available in the “Financial Info” section and “SEC Filings” section on the “Investors” page of Omega’s website.
* * * * * *
Omega is a REIT that invests in the long-term healthcare industry, primarily in skilled nursing and assisted living facilities. Its portfolio of assets is operated by a diverse group of healthcare companies, predominantly in a triple-net lease structure. The assets span all regions within the
Forward-Looking Statements and Cautionary Language
This press release includes forward-looking statements within the meaning of the federal securities laws. All statements regarding Omega’s or its tenants’, operators’, borrowers’ or managers’ expected future financial condition, results of operations, cash flows, funds from operations, dividends and dividend plans, financing opportunities and plans, capital markets transactions, business strategy, budgets, projected costs, operating metrics, capital expenditures, competitive positions, acquisitions, investment opportunities, dispositions, facility transitions, growth opportunities, expected lease income, continued qualification as a REIT, plans and objectives of management for future operations and statements that include words such as “anticipate,” “if,” “believe,” “plan,” “estimate,” “expect,” “intend,” “may,” “could,” “should,” “will” and other similar expressions are forward-looking statements. These forward-looking statements are inherently uncertain, and actual results may differ from Omega's expectations.
Omega’s actual results may differ materially from those reflected in such forward-looking statements as a result of a variety of factors, including, among other things: (i) uncertainties relating to the business operations of the operators of Omega’s properties, including those relating to reimbursement by third-party payors, regulatory matters and occupancy levels; (ii) the long-term impacts of the Novel coronavirus (“COVID-19”) pandemic on our business and the business of our operators, including the levels of staffing shortages, increased costs and decreased occupancy experienced by operators of skilled nursing facilities (“SNFs”) and assisted living facilities (“ALFs”) arising from the pandemic, the ability of our operators to comply with infection control and vaccine protocols and to manage facility infection rates or future infectious diseases, and the sufficiency of government support and reimbursement rates to offset such costs and the conditions related thereto; (iii) additional regulatory and other changes in the healthcare sector, including federal minimum staffing requirements for SNFs that may further exacerbate labor and occupancy challenges for Omega’s operators; (iv) the ability of any of Omega’s operators in bankruptcy to reject unexpired lease obligations, modify the terms of Omega’s mortgages and impede the ability of Omega to collect unpaid rent or interest during the pendency of a bankruptcy proceeding and retain security deposits for the debtor’s obligations, and other costs and uncertainties associated with operator bankruptcies; (v) changes in tax laws and regulations affecting real estate investment trusts (“REITs”), including as the result of any policy changes driven by the current focus on capital providers to the healthcare industry; (vi) Omega’s ability to re-lease, otherwise transition or sell underperforming assets or assets held for sale on a timely basis and on terms that allow Omega to realize the carrying value of these assets or to redeploy the proceeds therefrom on favorable terms, including due to the potential impact of changes in the SNF and ALF markets or local real estate conditions; (vii) the availability and cost of capital to Omega; (viii) changes in Omega’s credit ratings and the ratings of its debt securities; (ix) competition in the financing of healthcare facilities; (x) competition in the long-term healthcare industry and shifts in the perception of various types of long-term care facilities, including SNFs and ALFs; (xi) changes in the financial position of Omega’s operators; (xii) the effect of economic and market conditions generally, and particularly in the healthcare industry; (xiii) changes in interest rates and the impact of inflation; (xiv) the timing, amount and yield of any additional investments; (xv) Omega’s ability to maintain its status as a REIT; (xvi) the effect of other factors affecting our business or the businesses of Omega’s operators that are beyond Omega’s or operators’ control, including natural disasters, other health crises or pandemics and governmental action, particularly in the healthcare industry, and (xvii) other factors identified in Omega’s filings with the Securities and Exchange Commission. Statements regarding future events and developments and Omega’s future performance, as well as management’s expectations, beliefs, plans, estimates or projections relating to the future, are forward looking statements.
We caution you that the foregoing list of important factors may not contain all the material factors that are important to you. Accordingly, readers should not place undue reliance on those statements. All forward-looking statements are based upon information available to us on the date of this release. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.
OMEGA HEALTHCARE INVESTORS, INC. CONSOLIDATED BALANCE SHEETS (in thousands, except per share amounts) |
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June 30, |
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December 31, |
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2024 |
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2023 |
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(Unaudited) |
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ASSETS |
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Real estate assets |
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Buildings and improvements |
|
$ |
6,925,123 |
|
|
$ |
6,879,034 |
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Land |
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|
876,762 |
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|
|
867,486 |
|
Furniture and equipment |
|
|
473,021 |
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|
467,393 |
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Construction in progress |
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|
185,487 |
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|
|
138,410 |
|
Total real estate assets |
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|
8,460,393 |
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|
8,352,323 |
|
Less accumulated depreciation |
|
|
(2,583,159 |
) |
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|
(2,464,227 |
) |
Real estate assets – net |
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|
5,877,234 |
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|
5,888,096 |
|
Investments in direct financing leases – net |
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|
9,437 |
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|
|
8,716 |
|
Real estate loans receivable – net |
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|
1,378,798 |
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|
|
1,212,162 |
|
Investments in unconsolidated joint ventures |
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|
185,270 |
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|
188,409 |
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Assets held for sale |
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|
76,627 |
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|
|
81,546 |
|
Total real estate investments |
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|
7,527,366 |
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|
7,378,929 |
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Non-real estate loans receivable – net |
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|
234,562 |
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|
275,615 |
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Total investments |
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|
7,761,928 |
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|
|
7,654,544 |
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Cash and cash equivalents |
|
|
35,193 |
|
|
|
442,810 |
|
Restricted cash |
|
|
3,938 |
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|
|
1,920 |
|
Contractual receivables – net |
|
|
10,360 |
|
|
|
11,888 |
|
Other receivables and lease inducements |
|
|
230,428 |
|
|
|
214,657 |
|
Goodwill |
|
|
643,786 |
|
|
|
643,897 |
|
Other assets |
|
|
162,913 |
|
|
|
147,686 |
|
Total assets |
|
$ |
8,848,546 |
|
|
$ |
9,117,402 |
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LIABILITIES AND EQUITY |
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|
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Revolving credit facility |
|
$ |
70,226 |
|
|
$ |
20,397 |
|
Secured borrowings |
|
|
— |
|
|
|
61,963 |
|
Senior notes and other unsecured borrowings – net |
|
|
4,590,378 |
|
|
|
4,984,956 |
|
Accrued expenses and other liabilities |
|
|
287,354 |
|
|
|
287,795 |
|
Total liabilities |
|
|
4,947,958 |
|
|
|
5,355,111 |
|
|
|
|
|
|
|
|
||
Preferred stock |
|
|
— |
|
|
|
— |
|
Common stock |
|
|
25,402 |
|
|
|
24,528 |
|
Additional paid-in capital |
|
|
6,951,244 |
|
|
|
6,671,198 |
|
Cumulative net earnings |
|
|
3,861,804 |
|
|
|
3,680,581 |
|
Cumulative dividends paid |
|
|
(7,161,897 |
) |
|
|
(6,831,061 |
) |
Accumulated other comprehensive income |
|
|
34,345 |
|
|
|
29,338 |
|
Total stockholders’ equity |
|
|
3,710,898 |
|
|
|
3,574,584 |
|
Noncontrolling interest |
|
|
189,690 |
|
|
|
187,707 |
|
Total equity |
|
|
3,900,588 |
|
|
|
3,762,291 |
|
Total liabilities and equity |
|
$ |
8,848,546 |
|
|
$ |
9,117,402 |
|
OMEGA HEALTHCARE INVESTORS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS Unaudited (in thousands, except per share amounts) |
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended |
|
|
Six Months Ended |
||||||||||||
|
|
June 30, |
|
|
June 30, |
||||||||||||
|
|
2024 |
|
|
2023 |
|
|
|
2024 |
|
|
2023 |
|
||||
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Rental income |
|
$ |
210,402 |
|
|
$ |
215,267 |
|
|
|
$ |
413,606 |
|
|
$ |
400,622 |
|
Real estate tax and ground lease income |
|
|
3,913 |
|
|
|
4,088 |
|
|
|
|
7,630 |
|
|
|
8,064 |
|
Real estate loans interest income |
|
|
30,958 |
|
|
|
23,979 |
|
|
|
|
59,697 |
|
|
|
47,376 |
|
Non-real estate loans interest income |
|
|
7,084 |
|
|
|
5,253 |
|
|
|
|
14,181 |
|
|
|
10,276 |
|
Miscellaneous income |
|
|
388 |
|
|
|
1,600 |
|
|
|
|
930 |
|
|
|
2,051 |
|
Total revenues |
|
|
252,745 |
|
|
|
250,187 |
|
|
|
|
496,044 |
|
|
|
468,389 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Depreciation and amortization |
|
|
74,234 |
|
|
|
82,018 |
|
|
|
|
148,791 |
|
|
|
163,210 |
|
General and administrative |
|
|
12,453 |
|
|
|
12,854 |
|
|
|
|
24,247 |
|
|
|
24,268 |
|
Real estate tax and ground lease expense |
|
|
4,257 |
|
|
|
4,423 |
|
|
|
|
8,566 |
|
|
|
8,788 |
|
Stock-based compensation expense |
|
|
9,188 |
|
|
|
8,806 |
|
|
|
|
18,415 |
|
|
|
17,550 |
|
Acquisition, merger and transition related costs |
|
|
1,780 |
|
|
|
423 |
|
|
|
|
4,383 |
|
|
|
1,062 |
|
Impairment on real estate properties |
|
|
8,182 |
|
|
|
21,114 |
|
|
|
|
13,474 |
|
|
|
60,102 |
|
(Recovery) provision for credit losses |
|
|
(14,172 |
) |
|
|
12,967 |
|
|
|
|
(5,702 |
) |
|
|
8,910 |
|
Interest expense |
|
|
50,604 |
|
|
|
55,525 |
|
|
|
|
104,748 |
|
|
|
110,818 |
|
Interest – amortization of deferred financing costs |
|
|
3,362 |
|
|
|
3,251 |
|
|
|
|
7,038 |
|
|
|
6,504 |
|
Total expenses |
|
|
149,888 |
|
|
|
201,381 |
|
|
|
|
323,960 |
|
|
|
401,212 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other income (expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other income – net |
|
|
3,363 |
|
|
|
1,029 |
|
|
|
|
8,639 |
|
|
|
3,749 |
|
Loss on debt extinguishment |
|
|
(213 |
) |
|
|
— |
|
|
|
|
(1,496 |
) |
|
|
(6 |
) |
Gain on assets sold – net |
|
|
12,911 |
|
|
|
12,243 |
|
|
|
|
11,520 |
|
|
|
25,880 |
|
Total other income |
|
|
16,061 |
|
|
|
13,272 |
|
|
|
|
18,663 |
|
|
|
29,623 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Income before income tax expense and income from unconsolidated joint ventures |
|
|
118,918 |
|
|
|
62,078 |
|
|
|
|
190,747 |
|
|
|
96,800 |
|
Income tax expense |
|
|
(1,980 |
) |
|
|
(1,626 |
) |
|
|
|
(4,561 |
) |
|
|
(334 |
) |
Income from unconsolidated joint ventures |
|
|
141 |
|
|
|
1,069 |
|
|
|
|
239 |
|
|
|
1,900 |
|
Net income |
|
|
117,079 |
|
|
|
61,521 |
|
|
|
|
186,425 |
|
|
|
98,366 |
|
Net income attributable to noncontrolling interest |
|
|
(3,217 |
) |
|
|
(1,665 |
) |
|
|
|
(5,202 |
) |
|
|
(2,568 |
) |
Net income available to common stockholders |
|
$ |
113,862 |
|
|
$ |
59,856 |
|
|
|
$ |
181,223 |
|
|
$ |
95,798 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Earnings per common share available to common stockholders: |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic: |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income available to common stockholders |
|
$ |
0.46 |
|
|
$ |
0.25 |
|
|
|
$ |
0.73 |
|
|
$ |
0.41 |
|
Diluted: |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income available to common stockholders |
|
$ |
0.45 |
|
|
$ |
0.25 |
|
|
|
$ |
0.72 |
|
|
$ |
0.40 |
|
Dividends declared per common share |
|
$ |
0.67 |
|
|
$ |
0.67 |
|
|
|
$ |
1.34 |
|
|
$ |
1.34 |
|
OMEGA HEALTHCARE INVESTORS, INC. Nareit FFO, Adjusted FFO and FAD Reconciliation Unaudited (in thousands, except per share amounts) |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
|
June 30, |
|
June 30, |
||||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income (1) |
|
$ |
117,079 |
|
|
$ |
61,521 |
|
|
$ |
186,425 |
|
|
$ |
98,366 |
|
Deduct gain from real estate dispositions |
|
|
(12,911 |
) |
|
|
(12,243 |
) |
|
|
(11,520 |
) |
|
|
(25,880 |
) |
Sub-total |
|
|
104,168 |
|
|
|
49,278 |
|
|
|
174,905 |
|
|
|
72,486 |
|
Elimination of non-cash items included in net income: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Depreciation and amortization |
|
|
74,234 |
|
|
|
82,018 |
|
|
|
148,791 |
|
|
|
163,210 |
|
Depreciation - unconsolidated joint ventures |
|
|
2,531 |
|
|
|
2,743 |
|
|
|
5,067 |
|
|
|
5,427 |
|
Add back provision for impairments on real estate properties |
|
|
8,182 |
|
|
|
21,114 |
|
|
|
13,474 |
|
|
|
60,102 |
|
Nareit funds from operations (“Nareit FFO”) |
|
$ |
189,115 |
|
|
$ |
155,153 |
|
|
$ |
342,237 |
|
|
$ |
301,225 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted-average common shares outstanding, basic |
|
|
249,366 |
|
|
|
236,233 |
|
|
|
247,719 |
|
|
|
235,594 |
|
Restricted stock and PRSUs |
|
|
4,583 |
|
|
|
2,893 |
|
|
|
4,170 |
|
|
|
2,139 |
|
Omega OP Units |
|
|
7,585 |
|
|
|
6,974 |
|
|
|
7,511 |
|
|
|
6,912 |
|
Weighted-average common shares outstanding, diluted |
|
|
261,534 |
|
|
|
246,100 |
|
|
|
259,400 |
|
|
|
244,645 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Nareit funds from operations available per share |
|
$ |
0.72 |
|
|
$ |
0.63 |
|
|
$ |
1.32 |
|
|
$ |
1.23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adjustments to calculate adjusted funds from operations |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Nareit FFO |
|
$ |
189,115 |
|
|
$ |
155,153 |
|
|
$ |
342,237 |
|
|
$ |
301,225 |
|
Add back: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Stock-based compensation expense |
|
|
9,188 |
|
|
|
8,806 |
|
|
|
18,415 |
|
|
|
17,550 |
|
Acquisition, merger and transition related costs |
|
|
1,780 |
|
|
|
423 |
|
|
|
4,383 |
|
|
|
1,062 |
|
Non-recognized cash interest |
|
|
307 |
|
|
|
2,322 |
|
|
|
607 |
|
|
|
4,418 |
|
Loss on debt extinguishment |
|
|
213 |
|
|
|
— |
|
|
|
1,496 |
|
|
|
6 |
|
Non-recurring expense |
|
|
— |
|
|
|
1,893 |
|
|
|
232 |
|
|
|
1,893 |
|
Uncollectible accounts receivable (2) |
|
|
— |
|
|
|
901 |
|
|
|
— |
|
|
|
13,401 |
|
Deduct: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Non-cash (recovery) provision for credit losses |
|
|
(12,989 |
) |
|
|
15,409 |
|
|
|
(3,349 |
) |
|
|
13,968 |
|
Non-recurring revenue |
|
|
(2,649 |
) |
|
|
(1,500 |
) |
|
|
(2,938 |
) |
|
|
(10,315 |
) |
Unconsolidated JV related non-recurring revenue |
|
|
— |
|
|
|
(178 |
) |
|
|
— |
|
|
|
(178 |
) |
Adjusted funds from operations (“AFFO”) (1)(3) |
|
$ |
184,965 |
|
|
$ |
183,229 |
|
|
$ |
361,083 |
|
|
$ |
343,030 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adjustments to calculate funds available for distribution |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Non-cash expense |
|
$ |
2,750 |
|
|
$ |
2,222 |
|
|
$ |
5,947 |
|
|
$ |
4,446 |
|
Capitalized interest |
|
|
(1,758 |
) |
|
|
(991 |
) |
|
|
(3,276 |
) |
|
|
(1,899 |
) |
Non-cash revenue |
|
|
(9,335 |
) |
|
|
(11,624 |
) |
|
|
(19,215 |
) |
|
|
(25,719 |
) |
Funds available for distribution (“FAD”) (1)(3) |
|
$ |
176,622 |
|
|
$ |
172,836 |
|
|
$ |
344,539 |
|
|
$ |
319,858 |
|
| _______________________ | ||
| (1) |
The three and six months ended June 30, 2024 include the application of |
|
| (2) |
The six months ended June 30, 2023 includes a |
|
| (3) | Adjusted funds from operations per share and funds available for distribution per share can be calculated using weighted-average common shares outstanding, diluted, as shown above. |
|
Nareit Funds From Operations (“Nareit FFO”), Adjusted FFO and Funds Available for Distribution (“FAD”) are non-GAAP financial measures. As used in this press release, GAAP refers to generally accepted accounting principles in
The Company calculates and reports Nareit FFO in accordance with the definition and interpretive guidelines issued by the National Association of Real Estate Investment Trusts (“Nareit”), and consequently, Nareit FFO is defined as net income (computed in accordance with GAAP), adjusted for the effects of asset dispositions and certain non-cash items, primarily depreciation and amortization and impairments on real estate assets, and after adjustments for unconsolidated partnerships and joint ventures and changes in the fair value of warrants. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect funds from operations on the same basis. Revenue recognized based on the application of security deposits and letters of credit or based on the ability to offset against other financial instruments is included within Nareit FFO. The Company believes that Nareit FFO, Adjusted FFO and FAD are important supplemental measures of its operating performance. Because the historical cost accounting convention used for real estate assets requires depreciation (except on land), such accounting presentation implies that the value of real estate assets diminishes predictably over time, while real estate values instead have historically risen or fallen with market conditions. The term funds from operations was designed by the real estate industry to address this issue. Funds from operations described herein is not necessarily comparable to funds from operations of other real estate investment trusts, or REITs, that do not use the same definition or implementation guidelines or interpret the standards differently from the Company.
Adjusted FFO is calculated as Nareit FFO excluding the impact of non-cash stock-based compensation and certain revenue and expense items (e.g., acquisition, merger and transition related costs, write-off of straight-line accounts receivable, recoveries and provisions for credit losses (excluding certain cash recoveries on impaired loans), cash interest received but not included in revenue, non-recognized cash interest, severance, legal reserve expenses, etc.). FAD is calculated as Adjusted FFO less non-cash expense, such as the amortization of deferred financing costs, and non-cash revenue, such as straight-line rent. The Company believes these measures provide an enhanced measure of the operating performance of the Company’s core portfolio as a REIT. The Company’s computation of Adjusted FFO and FAD may not be comparable to the Nareit definition of funds from operations or to similar measures reported by other REITs, but the Company believes that they are appropriate measures for this Company.
The Company uses these non-GAAP measures among the criteria to measure the operating performance of its business. The Company also uses FAD among the performance metrics for performance-based compensation of officers. The Company further believes that by excluding the effect of depreciation, amortization, impairments on real estate assets and gains or losses from sales of real estate, all of which are based on historical costs, and which may be of limited relevance in evaluating current performance, funds from operations can facilitate comparisons of operating performance between periods. The Company offers these measures to assist the users of its financial statements in analyzing its operating performance. These non-GAAP measures are not measures of financial performance under GAAP and should not be considered as measures of liquidity or cash flow, alternatives to net income or indicators of any other performance measure determined in accordance with GAAP. Investors and potential investors in the Company’s securities should not rely on these non-GAAP measures as substitutes for any GAAP measure, including net income.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240801452932/en/
Matthew Gourmand, SVP, Corporate Strategy & Investor Relations
or
Bob Stephenson, CFO at (410) 427-1700
Source: Omega Healthcare Investors, Inc.
FAQ
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