SAN CLEMENTE, Calif., Nov. 02, 2016 (GLOBE NEWSWIRE) -- CareTrust REIT, Inc. (NASDAQ:CTRE) today reported
operating results for the third quarter of 2016, as well as other recent events. For the quarter:
- Net income was $0.13, normalized FFO was $0.28 and normalized FAD was $0.30, all per diluted weighted-average common
share;
- CareTrust acquired five facilities and initiated two new net-lease tenant relationships;
- The Company made two additional preferred equity investments to develop two skilled nursing facilities, both of which are
currently under construction; and
- CareTrust invested approximately $45.9 million (inclusive of transaction costs) at a blended initial cash yield of 9.4%.
Approximately $45.9 Million in New Investments
Discussing the Company’s progress during the quarter, Chairman and Chief Executive Officer Greg Stapley
remarked, “We are excited to report the addition of two great operator relationships in key markets, along with the five,
well-situated skilled nursing and seniors housing assets they are now operating.” He further reported that CareTrust expanded its
existing relationship with tenant Cascadia Healthcare through two preferred equity investments, and that the two new,
state-of-the-art skilled nursing facilities being developed thereunder had already begun construction.
Mr. Stapley also reiterated CareTrust’s disciplined growth strategy, saying, “We remain committed to making
investments only when we can partner with an experienced, sophisticated and fully-engaged operator who we believe can thrive in all
kinds of operating environments.”
Financial Results for the Quarter Ended September 30, 2016
Chief Financial Officer Bill Wagner reported that CareTrust generated normalized FFO of $16.3 million or $0.28
per diluted weighted-average common share, and normalized FAD of $17.1 million or $0.30 per diluted weighted-average common share.
He added that net income for the quarter was $7.8 million, or $0.13 per diluted weighted-average common share.
Capital Events and Liquidity
Mr. Wagner also discussed the Company’s liquidity, reporting that the Company briefly activated its
at-the-market equity issuance program during the quarter, issuing approximately 183,000 shares at an average price per share of
$15.61, resulting in gross proceeds of $2.9 million.
He further reported an outstanding balance of $103.0 million under CareTrust’s $400 million unsecured revolving
credit facility. He added that CareTrust’s debt-to-run-rate EBITDA ratio was approximately 5.1x, and its debt-to-enterprise value
was approximately 35%, each at quarter-end. He also noted that CareTrust continues to have no property-level debt and, taking into
account existing extension rights, no debt maturing before 2020.
2016 FFO and FAD Guidance Revised Upward
Mr. Wagner updated CareTrust’s previously-issued 2016 earnings guidance, increasing the low estimate of the
previous ranges. CareTrust now projects normalized FFO per diluted weighted-average common share of approximately $1.09 to $1.10,
and normalized FAD per diluted weighted-average common share of approximately $1.16 to $1.17. The revised guidance assumes no new
acquisitions beyond those made to date, no new debt incurrences or new equity issuances, and no future rent escalations on
CareTrust’s long-term leases.
Dividend Declared
During the quarter, CareTrust declared a quarterly dividend of $0.17 per common share. “On an annualized basis,
our quarterly dividend represents a FFO payout ratio of approximately 62% based on the midpoint of our 2016 normalized FFO
guidance,” said Mr. Wagner. “At this level, our dividend remains among the best-protected of all our industry peers, while giving
us ample additional growth capital to reinvest and providing a solid overall return to our shareholders,” he added.
Conference Call
A conference call will be held on Thursday, November 3, at 12:00 p.m. Eastern Time (9:00 a.m. Pacific Time),
during which CareTrust’s management will discuss the Company’s third quarter 2016 results, recent developments and other matters
affecting the Company’s business and prospects. The dial-in number for this call is (844) 220-4972 (U.S.) or (317) 973-4053
(International). The conference ID number is 9812123. To listen to the call online, or to view any financial or other statistical
information required by SEC Regulation G, please visit the Investors section of the CareTrust website at http://investor.caretrustreit.com. The call will be recorded, and will be available for replay
via the website for 30 days following the call
About CareTrustTM
CareTrust REIT, Inc. is a self-administered, publicly-traded real estate investment trust engaged in the
ownership, acquisition and leasing of seniors housing and healthcare-related properties. With 149 net-leased healthcare properties
and three operated seniors housing properties in 20 states, CareTrust pursues opportunities across the nation to acquire properties
that will be leased to a diverse group of local, regional and national seniors housing operators, healthcare services providers,
and other healthcare-related businesses. More information about CareTrust is available at www.caretrustreit.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:
This press release contains, and the related conference call will include, forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all
statements that are not historical statements of fact and statements regarding our intent, belief or expectations, including, but
not limited to, statements regarding future financial positions, business and acquisition strategies, growth prospects, operating
and financial performance, and the performance of our operators and their respective facilities.
Words such as “anticipate,” “believe,” “could,” expect,” “estimate,” “intend,” “may,” “plan,” “seek,”
“should,” “will,” “would,” and similar expressions, or the negative of these terms, are intended to identify such forward-looking
statements, though not all forward-looking statements contain these identifying words. Our forward-looking statements are based on
our current expectations and beliefs, and are subject to a number of risks and uncertainties that could lead to actual results
differing materially from those projected, forecasted or expected. Although we believe that the assumptions underlying these
forward-looking statements are reasonable, they are not guarantees and we can give no assurance that our expectations will be
attained. Factors which could have a material adverse effect on our operations and future prospects or which could cause actual
results to differ materially from expectations include, but are not limited to: (i) the ability to achieve some or all
of the expected benefits from the completed spin-off from The Ensign Group, Inc. (“Ensign”); (ii) the ability and
willingness of Ensign to meet and/or perform its obligations under the contractual arrangements that it entered into with us in
connection with such spin-off, including its triple-net long-term leases with us, and any of its obligations to indemnify, defend
and hold us harmless from and against various claims, litigation and liabilities; (iii) the ability and willingness of our
tenants to (a) comply with laws, rules and regulations in the operation of the properties we lease to them, and (b) renew
their leases with us upon expiration, or in the alternative, (c) our ability to reposition and re-let our properties on the same or
better terms in the event of nonrenewal or replacement of an existing tenant and any obligations, including indemnification
obligations, that we may incur in replacing an existing tenant; (iv) the availability of, and the ability to identify and
acquire, suitable acquisition opportunities and lease the same to reliable tenants on accretive terms; (v) the ability to
generate sufficient cash flows to service our outstanding indebtedness; (vi) access to debt and equity capital markets;
(vii) fluctuating interest rates; (viii) the ability to retain and properly incentivize key management personnel;
(ix) the ability maintain our status as a real estate investment trust (“REIT”); (x) changes in the U.S. tax laws and
other state, federal or local laws, whether or not specific to REITs; (xi) other risks inherent in the real estate business,
including potential liability relating to environmental matters and illiquidity of real estate investments; and (xii) any
additional factors identified in our filings with the Securities Exchange Commission (“SEC”), including those in our Annual Report
on Form 10-K for the year ended December 31, 2015 under the heading entitled “Risk Factors.”
Information in this press release or the related conference call is provided as of September 30, 2016,
unless specifically stated otherwise. We expressly disclaim any obligation to update or revise any information in this press
release or the related conference call (and replays thereof), including forward-looking statements, whether to reflect any change
in our expectations, any change in events, conditions or circumstances, or otherwise.
As used in this press release or the related conference call, unless the context requires otherwise,
references to “CTRE,” “CareTrust” or the “Company” refer to CareTrust REIT, Inc. and its consolidated subsidiaries. GAAP refers to
generally accepted accounting principles in the United States of America.
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CARETRUST REIT, INC. |
|
CONSOLIDATED INCOME STATEMENTS |
|
(in thousands, except per share
amounts) |
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
|
|
|
|
|
2016 |
|
|
|
2015 |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
Rental income |
$ |
24,179 |
|
|
$ |
15,778 |
|
|
$ |
67,857 |
|
|
$ |
45,869 |
|
|
|
|
Tenant reimbursements |
|
2,089 |
|
|
|
1,320 |
|
|
|
5,815 |
|
|
|
3,866 |
|
|
|
|
Independent living facilities |
|
766 |
|
|
|
626 |
|
|
|
2,177 |
|
|
|
1,868 |
|
|
|
|
Interest and other income |
|
72 |
|
|
|
261 |
|
|
|
587 |
|
|
|
716 |
|
|
|
|
Total revenues |
|
27,106 |
|
|
|
17,985 |
|
|
|
76,436 |
|
|
|
52,319 |
|
|
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
8,248 |
|
|
|
5,815 |
|
|
|
23,433 |
|
|
|
17,093 |
|
|
|
|
Interest expense |
|
5,743 |
|
|
|
7,221 |
|
|
|
17,370 |
|
|
|
19,111 |
|
|
|
|
Property taxes |
|
2,089 |
|
|
|
1,320 |
|
|
|
5,815 |
|
|
|
3,866 |
|
|
|
|
Independent living facilities |
|
708 |
|
|
|
610 |
|
|
|
1,926 |
|
|
|
1,778 |
|
|
|
|
Acquisition costs |
|
203 |
|
|
|
- |
|
|
|
203 |
|
|
|
- |
|
|
|
|
General and administrative |
|
2,283 |
|
|
|
2,292 |
|
|
|
6,724 |
|
|
|
5,440 |
|
|
|
|
Total expenses |
|
19,274 |
|
|
|
17,258 |
|
|
|
55,471 |
|
|
|
47,288 |
|
|
|
Net income |
$ |
7,832 |
|
|
$ |
727 |
|
|
$ |
20,965 |
|
|
$ |
5,031 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common share: |
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.13 |
|
|
$ |
0.02 |
|
|
$ |
0.38 |
|
|
$ |
0.14 |
|
|
|
|
Diluted |
$ |
0.13 |
|
|
$ |
0.02 |
|
|
$ |
0.38 |
|
|
$ |
0.14 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding: |
|
|
|
|
|
|
|
|
|
|
Basic |
|
57,595 |
|
|
|
39,125 |
|
|
|
54,403 |
|
|
|
33,916 |
|
|
|
|
Diluted |
|
57,595 |
|
|
|
39,125 |
|
|
|
54,403 |
|
|
|
33,916 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends declared per common
share |
$ |
0.17 |
|
|
$ |
0.16 |
|
|
$ |
0.51 |
|
|
$ |
0.48 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CARETRUST REIT, INC. |
RECONCILIATIONS OF NET INCOME TO NON-GAAP
FINANCIAL MEASURES |
(in thousands, except
per share amounts) |
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
Quarter |
|
Quarter |
|
|
|
|
Ended |
|
Ended |
|
|
|
|
September 30,
2016 |
|
September 30,
2015 |
|
|
|
|
|
|
|
Net income |
|
$ |
7,832 |
|
|
$ |
727 |
|
|
Depreciation and amortization |
|
|
8,248 |
|
|
|
5,815 |
|
|
Interest expense |
|
|
5,743 |
|
|
|
7,221 |
|
|
Amortization of stock-based compensation |
|
|
339 |
|
|
|
435 |
|
EBITDA |
|
|
22,162 |
|
|
|
14,198 |
|
|
Acquisition costs |
|
|
203 |
|
|
|
- |
|
Normalized EBITDA |
|
$ |
22,365 |
|
|
$ |
14,198 |
|
|
|
|
|
|
|
|
Net income |
|
$ |
7,832 |
|
|
$ |
727 |
|
|
Real estate related depreciation and amortization |
|
|
8,223 |
|
|
|
5,796 |
|
Funds from Operations (FFO) |
|
|
16,055 |
|
|
|
6,523 |
|
|
Write-off of deferred financing fees |
|
|
- |
|
|
|
1,208 |
|
|
Acquisition costs |
|
|
203 |
|
|
|
- |
|
Normalized FFO |
|
$ |
16,258 |
|
|
$ |
7,731 |
|
|
|
|
|
|
|
|
Net income |
|
$ |
7,832 |
|
|
$ |
727 |
|
|
Real estate related depreciation and amortization |
|
|
8,223 |
|
|
|
5,796 |
|
|
Amortization of deferred financing fees |
|
|
561 |
|
|
|
547 |
|
|
Amortization of stock-based compensation |
|
|
339 |
|
|
|
435 |
|
|
Straight-line rental income |
|
|
(78 |
) |
|
|
- |
|
Funds Available for Distribution (FAD) |
|
|
16,877 |
|
|
|
7,505 |
|
|
Write-off of deferred financing fees |
|
|
- |
|
|
|
1,208 |
|
|
Acquisition costs |
|
|
203 |
|
|
|
- |
|
Normalized FAD |
|
$ |
17,080 |
|
|
$ |
8,713 |
|
|
|
|
|
|
|
|
FFO per share |
|
$ |
0.28 |
|
|
$ |
0.17 |
|
Normalized FFO per share |
|
$ |
0.28 |
|
|
$ |
0.20 |
|
|
|
|
|
|
|
|
FAD per share |
|
$ |
0.29 |
|
|
$ |
0.19 |
|
Normalized FAD per share |
|
$ |
0.30 |
|
|
$ |
0.22 |
|
|
|
|
|
|
|
|
Diluted weighted average shares outstanding [1] |
|
|
57,739 |
|
|
|
39,271 |
|
|
|
|
|
|
|
|
|
[1] For the periods presented, the diluted
weighted average shares have been calculated using the treasury stock method. |
|
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CARETRUST REIT, INC. |
CONSOLIDATED INCOME STATEMENTS - 5 QUARTER
TREND |
(in thousands, except per share
amounts) |
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter |
Quarter |
Quarter |
Quarter |
Quarter |
|
|
Ended |
Ended |
Ended |
Ended |
Ended |
|
|
September 30,
2015 |
December 31,
2015 |
March 31,
2016 |
June 30,
2016 |
September 30,
2016 |
Revenues: |
|
|
|
|
|
|
Rental income |
$ |
15,778 |
|
$ |
20,110 |
|
$ |
20,897 |
|
$ |
22,781 |
|
$ |
24,179 |
|
|
Tenant reimbursements |
|
1,320 |
|
|
1,631 |
|
|
1,797 |
|
|
1,929 |
|
|
2,089 |
|
|
Independent living facilities |
|
626 |
|
|
642 |
|
|
681 |
|
|
730 |
|
|
766 |
|
|
Interest and other income |
|
261 |
|
|
249 |
|
|
254 |
|
|
261 |
|
|
72 |
|
|
Total revenues |
|
17,985 |
|
|
22,632 |
|
|
23,629 |
|
|
25,701 |
|
|
27,106 |
|
Expenses: |
|
|
|
|
|
|
Depreciation and amortization |
|
5,815 |
|
|
7,040 |
|
|
7,293 |
|
|
7,892 |
|
|
8,248 |
|
|
Interest expense |
|
7,221 |
|
|
6,145 |
|
|
6,187 |
|
|
5,440 |
|
|
5,743 |
|
|
Property taxes |
|
1,320 |
|
|
1,631 |
|
|
1,797 |
|
|
1,929 |
|
|
2,089 |
|
|
Independent living facilities |
|
610 |
|
|
598 |
|
|
620 |
|
|
598 |
|
|
708 |
|
|
Acquisition costs |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
203 |
|
|
General and administrative |
|
2,292 |
|
|
2,215 |
|
|
2,230 |
|
|
2,211 |
|
|
2,283 |
|
|
Total expenses |
|
17,258 |
|
|
17,629 |
|
|
18,127 |
|
|
18,070 |
|
|
19,274 |
|
Net income |
$ |
727 |
|
$ |
5,003 |
|
$ |
5,502 |
|
$ |
7,631 |
|
$ |
7,832 |
|
|
|
|
|
|
|
|
Diluted earnings per share |
$ |
0.02 |
|
$ |
0.10 |
|
$ |
0.11 |
|
$ |
0.13 |
|
$ |
0.13 |
|
|
|
|
|
|
|
|
Diluted weighted average shares
outstanding |
|
39,125 |
|
|
47,660 |
|
|
48,101 |
|
|
57,478 |
|
|
57,595 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CARETRUST REIT, INC. |
RECONCILIATIONS OF NET INCOME TO NON-GAAP
FINANCIAL MEASURES - 5 QUARTER TREND |
(in thousands, except
per share amounts) |
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter |
Quarter |
Quarter |
Quarter |
Quarter |
|
|
|
|
Ended |
Ended |
Ended |
Ended |
Ended |
|
|
|
|
September 30,
2015 |
December 31,
2015 |
March 31,
2016 |
June 30,
2016 |
September 30,
2016 |
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
727 |
|
$ |
5,003 |
|
$ |
5,502 |
|
$ |
7,631 |
|
$ |
7,832 |
|
|
Depreciation and amortization |
|
|
5,815 |
|
|
7,040 |
|
|
7,293 |
|
|
7,892 |
|
|
8,248 |
|
|
Interest expense |
|
|
7,221 |
|
|
6,145 |
|
|
6,187 |
|
|
5,440 |
|
|
5,743 |
|
|
Amortization of stock-based compensation |
|
|
435 |
|
|
427 |
|
|
431 |
|
|
437 |
|
|
339 |
|
EBITDA |
|
|
14,198 |
|
|
18,615 |
|
|
19,413 |
|
|
21,400 |
|
|
22,162 |
|
|
Acquisition costs |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
203 |
|
Normalized EBITDA |
|
$ |
14,198 |
|
$ |
18,615 |
|
$ |
19,413 |
|
$ |
21,400 |
|
$ |
22,365 |
|
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
727 |
|
$ |
5,003 |
|
$ |
5,502 |
|
$ |
7,631 |
|
$ |
7,832 |
|
|
Real estate related depreciation and amortization |
|
|
5,796 |
|
|
7,018 |
|
|
7,270 |
|
|
7,867 |
|
|
8,223 |
|
Funds from Operations (FFO) |
|
|
6,523 |
|
|
12,021 |
|
|
12,772 |
|
|
15,498 |
|
|
16,055 |
|
|
Write-off of deferred financing fees |
|
|
1,208 |
|
|
- |
|
|
326 |
|
|
- |
|
|
- |
|
|
Acquisition costs |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
203 |
|
Normalized FFO |
|
$ |
7,731 |
|
$ |
12,021 |
|
$ |
13,098 |
|
$ |
15,498 |
|
$ |
16,258 |
|
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
727 |
|
$ |
5,003 |
|
$ |
5,502 |
|
$ |
7,631 |
|
$ |
7,832 |
|
|
Real estate related depreciation and amortization |
|
|
5,796 |
|
|
7,018 |
|
|
7,270 |
|
|
7,867 |
|
|
8,223 |
|
|
Amortization of deferred financing fees |
|
|
547 |
|
|
551 |
|
|
556 |
|
|
561 |
|
|
561 |
|
|
Amortization of stock-based compensation |
|
|
435 |
|
|
427 |
|
|
431 |
|
|
437 |
|
|
339 |
|
|
Straight-line rental income |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(78 |
) |
Funds Available for Distribution (FAD) |
|
|
7,505 |
|
|
12,999 |
|
|
13,759 |
|
|
16,496 |
|
|
16,877 |
|
|
Write-off of deferred financing fees |
|
|
1,208 |
|
|
- |
|
|
326 |
|
|
- |
|
|
- |
|
|
Acquisition costs |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
203 |
|
Normalized FAD |
|
$ |
8,713 |
|
$ |
12,999 |
|
$ |
14,085 |
|
$ |
16,496 |
|
$ |
17,080 |
|
|
|
|
|
|
|
|
|
|
FFO per share |
|
$ |
0.17 |
|
$ |
0.25 |
|
$ |
0.26 |
|
$ |
0.27 |
|
$ |
0.28 |
|
Normalized FFO per share |
|
$ |
0.20 |
|
$ |
0.25 |
|
$ |
0.27 |
|
$ |
0.27 |
|
$ |
0.28 |
|
|
|
|
|
|
|
|
|
|
FAD per share |
|
$ |
0.19 |
|
$ |
0.27 |
|
$ |
0.29 |
|
$ |
0.29 |
|
$ |
0.29 |
|
Normalized FAD per share |
|
$ |
0.22 |
|
$ |
0.27 |
|
$ |
0.29 |
|
$ |
0.29 |
|
$ |
0.30 |
|
|
|
|
|
|
|
|
|
|
Diluted weighted average shares outstanding [1] |
|
|
39,271 |
|
|
47,802 |
|
|
48,258 |
|
|
57,667 |
|
|
57,739 |
|
|
|
|
|
|
|
|
|
|
|
[1] For the periods presented, the diluted
weighted average shares have been calculated using the treasury stock method. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CARETRUST REIT, INC. |
|
CONSOLIDATED BALANCE
SHEETS |
|
(in thousands) |
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, |
|
December 31, |
|
|
|
|
|
|
|
2016 |
|
|
|
2015 |
|
|
Assets |
|
|
|
|
|
|
Real estate investments, net |
|
$ |
809,121 |
|
|
$ |
645,614 |
|
|
Other real estate investments |
|
|
13,595 |
|
|
|
8,477 |
|
|
Cash and cash equivalents |
|
|
11,878 |
|
|
|
11,467 |
|
|
Accounts receivable |
|
|
5,666 |
|
|
|
2,342 |
|
|
Prepaid expenses and other assets |
|
|
1,755 |
|
|
|
2,083 |
|
|
Deferred financing costs, net |
|
|
3,074 |
|
|
|
3,183 |
|
|
|
|
|
Total assets |
|
$ |
845,089 |
|
|
$ |
673,166 |
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Equity |
|
|
|
|
|
Senior unsecured notes payable, net |
|
$ |
255,028 |
|
|
$ |
254,229 |
|
|
Senior unsecured term loan, net |
|
|
99,398 |
|
|
|
- |
|
|
Unsecured revolving credit facility |
|
|
103,000 |
|
|
|
45,000 |
|
|
Mortgage notes payable, net |
|
|
- |
|
|
|
94,676 |
|
|
Accounts payable and accrued liabilities |
|
|
15,015 |
|
|
|
9,269 |
|
|
Dividends payable |
|
|
9,873 |
|
|
|
7,704 |
|
|
|
|
|
Total liabilities |
|
|
482,314 |
|
|
|
410,878 |
|
|
|
|
|
|
|
|
|
|
|
Equity: |
|
|
|
|
|
|
Common stock |
|
|
577 |
|
|
|
477 |
|
|
Additional paid-in capital |
|
|
519,204 |
|
|
|
410,217 |
|
|
Cumulative distributions in excess of earnings |
|
|
(157,006 |
) |
|
|
(148,406 |
) |
|
|
|
|
Total equity |
|
|
362,775 |
|
|
|
262,288 |
|
|
|
|
|
Total liabilities and equity |
|
$ |
845,089 |
|
|
$ |
673,166 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CARETRUST REIT, INC. |
CONSOLIDATED STATEMENTS OF CASH
FLOWS |
(in thousands) |
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended
September 30, |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
|
|
|
Cash flows from operating activities: |
|
|
|
|
Net income |
$ |
20,965 |
|
|
$ |
5,031 |
|
|
Adjustments to reconcile net income to net cash provided by |
|
|
|
|
operating activities: |
|
|
|
|
Depreciation and amortization (including a below-market ground lease) |
|
23,444 |
|
|
|
17,093 |
|
|
Amortization of deferred financing costs |
|
1,678 |
|
|
|
1,649 |
|
|
Write-off of deferred financing costs |
|
326 |
|
|
|
1,208 |
|
|
Amortization of stock-based compensation |
|
1,207 |
|
|
|
1,095 |
|
|
Straight-line rental income |
|
( 78 |
) |
|
|
- |
|
|
Non cash interest income |
|
( 587 |
) |
|
|
( 697 |
) |
|
Change in operating assets and liabilities: |
|
|
|
|
Accounts receivable |
|
( 3,246 |
) |
|
|
( 2,945 |
) |
|
Accounts receivable due from related party |
|
- |
|
|
|
2,275 |
|
|
Prepaid expenses and other assets |
|
3 |
|
|
|
( 90 |
) |
|
Accounts payable and accrued liabilities |
|
5,801 |
|
|
|
4,416 |
|
Net cash provided by operating activities |
|
49,513 |
|
|
|
29,035 |
|
Cash flows from investing activities: |
|
|
|
|
Acquisitions of real estate |
|
( 185,284 |
) |
|
|
( 231,501 |
) |
|
Improvements to real estate |
|
( 258 |
) |
|
|
( 143 |
) |
|
Purchases of equipment, furniture and fixtures |
|
( 139 |
) |
|
|
( 256 |
) |
|
Preferred equity investments |
|
( 4,531 |
) |
|
|
- |
|
|
Escrow deposit for acquisition of real estate |
|
( 1,000 |
) |
|
|
- |
|
|
Net proceeds from sale of vacant land |
|
- |
|
|
|
30 |
|
Net cash used in investing activities |
|
( 191,212 |
) |
|
|
( 231,870 |
) |
Cash flows from financing activities: |
|
|
|
|
Proceeds from the issuance of common stock, net |
|
108,395 |
|
|
|
163,466 |
|
|
Proceeds from the issuance of senior unsecured term loan |
|
100,000 |
|
|
|
- |
|
|
Borrowings under unsecured revolving credit facility |
|
150,000 |
|
|
|
45,000 |
|
|
Payments on unsecured revolving credit facility |
|
( 92,000 |
) |
|
|
- |
|
|
Borrowings under senior secured revolving credit facility |
|
- |
|
|
|
35,000 |
|
|
Repayments of borrowings under senior secured revolving credit facility |
|
- |
|
|
|
( 35,000 |
) |
|
Payments on the mortgage notes payable |
|
( 95,022 |
) |
|
|
( 2,509 |
) |
|
Payments of deferred financing costs |
|
( 1,352 |
) |
|
|
( 2,113 |
) |
|
Net-settle adjustment on restricted stock |
|
( 515 |
) |
|
|
( 145 |
) |
|
Dividends paid on common stock |
|
( 27,396 |
) |
|
|
( 14,086 |
) |
Net cash provided by financing activities |
|
142,110 |
|
|
|
189,613 |
|
Net increase (decrease) in cash and cash equivalents |
|
411 |
|
|
|
( 13,222 |
) |
Cash and cash equivalents beginning of period |
|
11,467 |
|
|
|
25,320 |
|
Cash and cash equivalents end of period |
$ |
11,878 |
|
|
$ |
12,098 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CARETRUST REIT, INC. |
DEBT SUMMARY |
(dollars in thousands) |
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30,
2016 |
|
|
|
Interest |
|
Maturity |
|
|
|
% of |
|
Deferred |
|
Net Carrying |
Debt |
|
|
Rate |
|
Date |
|
Principal |
|
Principal |
|
Loan
Costs |
|
Value |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed Rate Debt |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior unsecured notes payable |
|
|
|
5.875 |
% |
|
2021 |
|
$ |
260,000 |
|
|
|
56.2 |
% |
|
$ |
(4,972 |
) |
|
$ |
255,028 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Floating Rate Debt |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior unsecured term loan [1] |
|
|
|
2.574 |
% |
|
2023 |
|
|
100,000 |
|
|
|
21.6 |
% |
|
|
(602 |
) |
|
|
99,398 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unsecured revolving credit facility [2] |
|
|
2.374 |
% |
|
2019 |
|
|
103,000 |
|
|
|
22.2 |
% |
|
|
- |
|
[3] |
|
103,000 |
|
|
|
|
|
2.473 |
% |
|
|
|
|
203,000 |
|
|
|
43.8 |
% |
|
|
(602 |
) |
|
|
202,398 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Debt |
|
|
|
4.383 |
% |
|
|
|
$ |
463,000 |
|
|
|
100.0 |
% |
|
$ |
(5,574 |
) |
|
$ |
457,426 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
[1] Funds can be borrowed at applicable LIBOR plus 1.95% to 2.60% or
at the Base Rate (as defined) plus 0.95% to 1.6%. |
|
|
[2] Funds can be borrowed at applicable LIBOR plus 1.75% to 2.40% or
the Base Rate (as defined) plus 0.75% to 1.4%. |
|
|
[3] Deferred financing fees are not shown net for the unsecured
revolving credit facility and are included in assets on the balance sheet. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CARETRUST REIT, INC. |
RECONCILIATIONS OF NET INCOME TO NON-GAAP
FINANCIAL MEASURES |
(shares in
thousands) |
(unaudited) |
|
|
|
|
|
|
|
|
2016
Guidance |
|
|
|
|
|
|
|
|
|
|
Low |
High |
Net income |
$ |
0.51 |
|
$ |
0.52 |
|
|
Real estate related depreciation and amortization |
|
0.57 |
|
|
0.57 |
|
Funds from Operations (FFO) |
|
1.08 |
|
|
1.09 |
|
|
Acquisition costs |
|
0.00 |
|
|
0.00 |
|
|
Write-off of deferred financing fees |
|
0.01 |
|
|
0.01 |
|
Normalized FFO |
$ |
1.09 |
|
$ |
1.10 |
|
|
|
|
|
Net income |
$ |
0.51 |
|
$ |
0.52 |
|
|
Real estate related depreciation and amortization |
|
0.57 |
|
|
0.57 |
|
|
Amortization of deferred financing fees |
|
0.04 |
|
|
0.04 |
|
|
Amortization of stock-based compensation |
|
0.03 |
|
|
0.03 |
|
|
Straight-line rental income |
|
0.00 |
|
|
0.00 |
|
Funds Available for Distribution (FAD) |
|
1.15 |
|
|
1.16 |
|
|
Acquisition costs |
|
0.00 |
|
|
0.00 |
|
|
Write-off of deferred financing fees |
|
0.01 |
|
|
0.01 |
|
Normalized FAD |
$ |
1.16 |
|
$ |
1.17 |
|
Weighted average shares
outstanding: |
|
|
|
Diluted |
|
55,443 |
|
|
55,443 |
|
|
Non-GAAP Financial Measures
EBITDA represents net income before interest expense, amortization of deferred financing costs and stock-based
compensation, and depreciation and amortization. Normalized EBITDA represents EBITDA as further adjusted to eliminate the impact of
certain items that the Company does not consider indicative of core operating performance, such as costs associated with the
spin-off, impairments, and gains or losses on the sale of real estate. EBITDA and Normalized EBITDA do not represent cash
flows from operations or net income as defined by GAAP and should not be considered an alternative to those measures in evaluating
the Company’s liquidity or operating performance. EBITDA and Normalized EBITDA do not purport to be indicative of cash available to
fund future cash requirements, including the Company’s ability to fund capital expenditures or make payments on its indebtedness.
Further, the Company’s computation of EBITDA and Normalized EBITDA may not be comparable to EBITDA and Normalized EBITDA
reported by other REITs.
Funds from Operations (“FFO”), as defined by the National Association of Real Estate Investment Trusts
(“NAREIT”), and Funds Available for Distribution (“FAD”) are important non-GAAP supplemental measures of operating performance for
a REIT. Because the historical cost accounting convention used for real estate assets requires straight-line depreciation except on
land, such accounting presentation implies that the value of real estate assets diminishes predictably over time. However, since
real estate values have historically risen or fallen with market and other conditions, presentations of operating results for a
REIT that uses historical cost accounting for depreciation could be less informative. Thus, NAREIT created FFO as a supplemental
measure of operating performance for REITs that excludes historical cost depreciation and amortization, among other items, from net
income, as defined by GAAP.
FFO is defined by NAREIT as net income computed in accordance with GAAP, excluding gains or losses from real
estate dispositions, real estate depreciation and amortization and impairment charges, and adjustments for unconsolidated
partnerships and joint ventures. The Company computes FFO in accordance with NAREIT’s definition.
FAD is defined as FFO excluding non-cash expenses, such as stock-based compensation expense, amortization of
deferred financing costs and the effects of straight-line rent. The Company considers FAD to be a useful supplemental measure to
evaluate the Company’s operating results excluding these expense items to help investors, analysts and other interested parties
compare the operating performance of the Company between periods or as compared to other companies on a more consistent basis.
In addition, the Company reports normalized FFO and normalized FAD, which adjust FFO and FAD for certain revenue
and expense items that the Company does not believe are indicative of its ongoing operating results, such as costs associated with
the spin-off and other unanticipated charges. By excluding these items, investors, analysts and our management can compare
normalized FFO and normalized FAD between periods more consistently.
While FFO, normalized FFO, FAD and normalized FAD are relevant and widely-used measures of operating performance
among REITs, they do not represent cash flows from operations or net income as defined by GAAP and should not be considered an
alternative to those measures in evaluating the Company’s liquidity or operating performance. FFO, normalized FFO, FAD and
normalized FAD do not purport to be indicative of cash available to fund future cash requirements.
Further, the Company’s computation of FFO, normalized FFO, FAD and normalized FAD may not be comparable to FFO, normalized FFO,
FAD and normalized FAD reported by other REITs that do not define FFO in accordance with the current NAREIT definition or that
interpret the current NAREIT definition or define FAD differently than the Company does.
The Company believes that the use of EBITDA, Normalized EBITDA, FFO, normalized FFO, FAD and normalized FAD, combined with the
required GAAP presentations, improves the understanding of operating results of REITs among investors and makes comparisons of
operating results among such companies more meaningful. The Company considers EBITDA and Normalized EBITDA useful in understanding
the Company’s operating results independent of its capital structure and indebtedness, thereby allowing for a more meaningful
comparison of operating performance between periods and against other REITs. The Company considers FFO, normalized FFO, FAD and
normalized FAD to be useful measures for reviewing comparative operating and financial performance because, by excluding gains or
losses from real estate dispositions, impairment charges and real estate depreciation and amortization, and, for FAD and normalized
FAD, by excluding non-cash expenses such as stock-based compensation expense and amortization of deferred financing costs, FFO,
normalized FFO, FAD and normalized FAD can help investors compare the Company’s operating performance between periods and to other
REITs.
Contact Information CareTrust REIT, Inc. (949) 542-3130 ir@caretrustreit.com