Medical Properties Trust, Inc. Reports First Quarter Results
Per Share Net Income of $0.25 and Normalized FFO of $0.36 Up 19% and 9% Respectively Compared to Prior Year Quarter
BIRMINGHAM, Ala.--(BUSINESS WIRE)--May 3, 2018-- Medical Properties Trust, Inc. (the “Company” or “MPT”) (NYSE: MPW) today announced financial and operating results for the first quarter ended March 31, 2018 and recent highlights.
“After a record year in 2017, MPT raised its quarterly dividend by over 4 percent in the first quarter making this the fourth consecutive year that the Company has increased its payout to shareholders,” said Edward K. Aldag, Jr., MPT’s Chairman, President and Chief Executive Officer. “Our consistent dividend growth has contributed to superior total shareholder returns and is the result of strongly accretive acquisitions. The Company has experienced extraordinary growth over the past five years, increasing total assets at a compound rate of over 33 percent annually, and our pipeline is very strong.”
FIRST QUARTER AND RECENT HIGHLIGHTS
Net income of $0.25 and Normalized Funds from Operations (“NFFO”) of $0.36 in the first quarter both on a per diluted share basis;
Completed construction of a 40-bed, 50,985 square foot rehabilitation hospital in Flagstaff, Arizona operated by Ernest Health (“Ernest”) for a total investment of approximately $24 million; commenced rent on March 1st;
Entered into a 15-year lease agreement in March with a joint venture formed by Vibra Healthcare and Ernest for an LTAC hospital in Boise, Idaho; lease has three 5-year renewal options;
Increased quarterly dividend by 4.2% to $0.25 making 2018 the fourth consecutive year that MPT has increased its dividend;
Added Elizabeth Pitman to Company’s Board of Directors in February.
Aldag commented on the election of Elizabeth Pitman to MPT’s Board of Directors and the recent promotions of two senior team members. “MPT will benefit greatly from Elizabeth’s addition to the Board. Her extensive healthcare and legal experience together with her expertise in cyber security is critical and complements the Board’s needs. The sustainability of MPT depends in part on the career growth of our people. In the first quarter, we were very pleased to announce the promotion of Rosa Hooper to Vice President and Managing Director, Asset Management and Underwriting in recognition of the outstanding job she has done managing MPT’s largest department. We were delighted to also announce the promotion of Charles Lambert to Treasurer and Managing Director, Capital Markets as an acknowledgement of his significant contribution to the Company over the past 12 years.”
Included in the financial tables accompanying this press release is information about the Company’s assets and liabilities, net income and reconciliations of net income to NFFO, all on a basis comparable to 2017 results. In addition, a reconciliation of pro forma total gross assets to total assets is included in the financial tables accompanying this press release.
PORTFOLIO UPDATE
The Company has pro forma total gross assets of approximately $9.5 billion, including $6.6 billion in general acute care hospitals, $2.1 billion in inpatient rehabilitation hospitals, and $0.4 billion in long-term acute care hospitals. This pro forma portfolio includes 275 properties representing more than 32,000 licensed beds in 29 states and in Germany, the United Kingdom, Italy and Spain. The properties are leased to or mortgaged by 31 hospital operating companies.
OPERATING RESULTS AND OUTLOOK
Net income for the first quarter of 2018 was $90.6 million (or $0.25 per diluted share), compared to $68.0 million (or $0.21 per diluted share) in the first quarter of 2017.
NFFO for the first quarter of 2018 increased 24% to $131.5 million compared with $105.9 million in the first quarter of 2017. Per share NFFO increased 9% to $0.36 per diluted share in the first quarter of 2018, compared with $0.33 per diluted share in the first quarter of 2017.
On January 1, 2018, the Company adopted new accounting rules, which resulted in an increase in general and administrative expenses for the first quarter. Certain third party transaction costs that were previously accounted for as acquisition expenses are now capitalized. With this accounting change, MPT will no longer charge indirect and internal transaction costs as acquisition expenses.
The Company reaffirms its NFFO estimates for 2018. Net income is expected to range from $1.00 to $1.04 per diluted share, while NFFO is expected to range from $1.42 to $1.46 per diluted share. This estimate assumes no additional acquisitions or investments, no asset sales and no material capital transactions. The Company also reaffirmed its expectations that it will complete negotiations of certain joint venture arrangements during the first half of 2018. However, there is no assurance that any such arrangements will be completed.
A reconciliation of NFFO guidance to net income is included with the financial tables accompanying this press release.
These estimates do not include the effects, if any, of unexpected real estate operating costs, changes in accounting pronouncements, litigation costs, debt refinancing costs, acquisition costs, currency exchange rate movements, interest rate hedging activities, write-offs of straight-line rent or other non-recurring or unplanned transactions, including the previously mentioned joint venture arrangements. These estimates may change if the Company acquires or sells assets, market interest rates change, debt is refinanced, new shares are issued, additional debt is incurred, other operating expenses vary, income from investments in tenant operations vary from expectations, or existing leases do not perform in accordance with their terms.
CONFERENCE CALL AND WEBCAST
The Company has scheduled a conference call and webcast for Thursday, May 3, 2018 at 11:00 a.m. Eastern Time to present the Company’s financial and operating results for the quarter ended March 31, 2018. The dial-in numbers for the conference call are 855-365-5214 (U.S.) and 440-996-5721 (International); both numbers require passcode 2449648. The conference call will also be available via webcast in the Investor Relations’ section of the Company’s website,
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www.medicalpropertiestrust.com.A telephone and webcast replay of the call will be available beginning shortly after the call’s completion through May 17, 2018. Dial-in numbers for the replay are 855-859-2056 and 404-537-3406 for U.S. and International callers, respectively. The replay passcode for both U.S. and International callers is 2449648.
The Company’s supplemental information package for the current period will also be available on the Company’s website under the “Investor Relations” section.
About Medical Properties Trust, Inc.
Medical Properties Trust, Inc. is a self-advised real estate investment trust formed to capitalize on the changing trends in healthcare delivery by acquiring and developing net-leased healthcare facilities. MPT’s financing model helps facilitate acquisitions and recapitalizations and allows operators of hospitals and other healthcare facilities to unlock the value of their real estate assets to fund facility improvements, technology upgrades and other investments in operations. Facilities include acute care hospitals, inpatient rehabilitation hospitals, long-term acute care hospitals, and other medical and surgical facilities. For more information, please visit the Company’s website at
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www.medicalpropertiestrust.com.The statements in this press release that are forward looking are based on current expectations and actual results or future events may differ materially. Words such as "expects," "believes," "anticipates," "intends," "will," "should" and variations of such words and similar expressions are intended to identify such forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results of the Company or future events to differ materially from those expressed in or underlying such forward-looking statements, including without limitation: the satisfaction of all conditions to, and the timely closing (if at all) of pending transactions; net income per share for 2018; NFFO per share for 2018; the amount of acquisitions of healthcare real estate, if any; results from potential sales and joint venture arrangements, if any; capital markets conditions; estimated leverage metrics; the repayment of debt arrangements; statements concerning the additional income to the Company as a result of ownership interests in certain hospital operations and the timing of such income; the payment of future dividends, if any; completion of additional debt arrangements, and additional investments; national and international economic, business, real estate and other market conditions; the competitive environment in which the Company operates; the execution of the Companys business plan; financing risks; the Company's ability to maintain its status as a REIT for income tax purposes; acquisition and development risks; potential environmental and other liabilities; and other factors affecting the real estate industry generally or healthcare real estate in particular. For further discussion of the factors that could affect outcomes, please refer to the "Risk factors" section of the Company's Annual Report on Form 10-K for the year ended December 31, 2017 and as updated by the Company’s subsequently filed Quarterly Reports on Form 10-Q and other SEC filings. Except as otherwise required by the federal securities laws, the Company undertakes no obligation to update the information in this press release.
MEDICAL PROPERTIES TRUST, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(Amounts in thousands, except for per share data) March 31, 2018 December 31, 2017
Assets (Unaudited) (A)
Real estate assets
Land, buildings and improvements, intangible lease assets, and other $ 5,867,286 $ 5,944,220
Mortgage loans 1,927,393 1,778,316
Net investment in direct financing leases 686,024 698,727
Gross investment in real estate assets 8,480,703 8,421,263
Accumulated depreciation and amortization (493,782 ) (455,712 )
Net investment in real estate assets 7,986,921 7,965,551
Cash and cash equivalents 138,314 171,472
Interest and rent receivables 81,965 78,970
Straight-line rent receivables 202,317 185,592
Other assets 622,323 618,703
Total Assets $ 9,031,840 $ 9,020,288
Liabilities and Equity
Liabilities
Debt, net $ 4,898,364 $ 4,898,667
Accounts payable and accrued expenses 206,891 211,188
Deferred revenue 15,549 18,178
Lease deposits and other obligations to tenants 57,847 57,050
Total Liabilities 5,178,651 5,185,083
Equity
Preferred stock, $0.001 par value. Authorized 10,000 shares; no shares outstanding
- -
Common stock, $0.001 par value. Authorized 500,000 shares; issued and outstanding - 364,695 shares at March 31, 2018 and 364,424 shares at December 31, 2017
365 364
Additional paid-in capital 4,333,972 4,333,027
Distributions in excess of net income (484,804 ) (485,932 )
Accumulated other comprehensive loss (9,961 ) (26,049 )
Treasury shares, at cost (777 ) (777 )
Total Medical Properties Trust, Inc. Stockholders' Equity 3,838,795 3,820,633
Non-controlling interests 14,394 14,572
Total Equity 3,853,189 3,835,205
Total Liabilities and Equity $ 9,031,840 $ 9,020,288
(A) Financials have been derived from the prior year audited financial statements.
https://medicalpropertiestrust.gcs-web.com/news-releases/news-release-details/medical-properties-trust-inc-reports-first-quarter-results-0
