Community Healthcare Trust Incorporated (NYSE: CHCT) (the “Company”) today announced results for the three months ended June 30, 2018.
FRANKLIN, Tenn., Aug. 7, 2018 /PRNewswire/ -- Community Healthcare Trust Incorporated (NYSE: CHCT) (the "Company") today announced results for the three months ended June 30, 2018. The Company reported net income for the second quarter of approximately $2.4 million, or $0.12 per diluted common share. Normalized funds from operations and adjusted funds from operations ("AFFO") for the three months ended June 30, 2018 totaled $0.40 and $0.42, respectively, per diluted common share.
Highlights include:
- During the second quarter of 2018, the Company acquired three real estate properties totaling approximately 68,000 square feet for an aggregate purchase price of approximately $11.7 million, including cash consideration of approximately $7.4 million and $4.5 million fair value of real estate received in foreclosure. Upon acquisition, two of the properties were 100% leased in the aggregate with lease expirations ranging from 2020 through 2026, and one property previously secured a mortgage note receivable held by the Company. The property is subject to a signed term sheet to be leased to a single tenant as soon as the lease can be negotiated.
- On April 25, 2018, the Company provided a $23.0 million loan to a newly formed company (Newco), secured by all assets and ownership interests in seven long-term acute care hospitals and one inpatient rehabilitation hospital that, along with a series of investments by the management of Newco, allowed Newco to acquire certain assets of the Borrower.
- Also on April 25, 2018, $10.95 million of promissory notes purchased in late 2017 and first quarter of 2018 and approximately $0.261 million of interest on those promissory notes and approximately $0.25 million in fees and reimbursement of expenses and approximately $6.7 million principal and accrued interest related to its mortgage note receivable were satisfied with proceeds from the loan. In addition, the Company received title to the property previously financed by the mortgage note receivable at an approximate $4.5 million valuation.
- On July 30, 2018, the Company acquired a real estate property totaling approximately 17,000 square feet for a purchase price and cash consideration of approximately $3.5 million. The building was 100% leased at acquisition with lease expirations in 2023.
- The Company has one property under a definitive purchase agreement for an expected purchase price of approximately $3.2 million. The Company anticipates the property will close during the third quarter of 2018. However, the Company is currently performing due diligence procedures customary for these types of transactions and cannot provide assurance as to the timing of when, or whether, the transaction will actually close.
- The Company also has five properties under definitive purchase agreements, to be acquired after completion and occupancy, for an aggregate expected purchase price of approximately $103.0 million. The Company's expected aggregate returns on these investments range from approximately 9.4% to 11.0%. The Company expects to close these properties through the end of 2019; however, the Company cannot provide assurance as to the timing of when, or whether, these transactions will actually close.
- On August 1, 2018, the Company's Board of Directors declared a quarterly common stock dividend in the amount of $0.4025 per share. The dividend is payable on August 31, 2018 to stockholders of record on August 17, 2018.
About Community Healthcare Trust Incorporated
Community Healthcare Trust Incorporated is a real estate investment trust that focuses on owning income-producing real estate properties associated primarily with the delivery of outpatient healthcare services in non-urban markets throughout the United States. The Company had investments of approximately $416.8 million in 91 real estate properties as of June 30, 2018, located in 27 states, totaling approximately 2.1 million square feet.
Additional information regarding the Company, including this quarter's operations, can be found at www.chct.reit. Please contact the Company at 615-771-3052 to request a printed copy of this information.
Cautionary Note Regarding Forward-Looking Statements
This press release contains statements that are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are generally identifiable by use of forward-looking terminology such as "believes", "expects", "may", "should", "seeks", "approximately", "intends", "plans", "estimates", "anticipates" or other similar words or expressions, including the negative thereof. Forward-looking statements are based on certain assumptions and can include future expectations, future plans and strategies, financial and operating projections or other forward-looking information. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management. Because forward-looking statements relate to future events, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of the Company's control. Thus, the Company's actual results and financial condition may differ materially from those indicated in such forward-looking statements. Some factors that might cause such a difference include the following: general volatility of the capital markets and the market price of the Company's common stock, changes in the Company's business strategy, availability, terms and deployment of capital, the Company's ability to refinance existing indebtedness at or prior to maturity on favorable terms, or at all, changes in the real estate industry in general, interest rates or the general economy, adverse developments related to the healthcare industry, the degree and nature of the Company's competition, the ability to consummate acquisitions under contract and the other factors described in the section entitled "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2017 and the Company's other filings with the Securities and Exchange Commission from time to time. Readers are therefore cautioned not to place undue reliance on the forward-looking statements contained herein which speak only as of the date hereof. The Company intends these forward-looking statements to speak only as of the time of this release and the Company undertakes no obligation to update forward-looking statements, whether as a result of new information, future developments, or otherwise, except as may be required by law.
COMMUNITY HEALTHCARE TRUST INCORPORATED
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in thousands, except per share amounts)
June 30, 2018 December 31, 2017
------------- -----------------
ASSETS
Real estate properties:
Land and land improvements $47,080 $44,419
Buildings, improvements, and lease
intangibles 369,563 343,955
Personal property 129 112
--- ---
Total real estate properties 416,772 388,486
Less accumulated depreciation (45,682) (36,136)
------- -------
Total real estate properties, net 371,090 352,350
Cash and cash equivalents 1,784 2,130
Mortgage note receivable, net - 10,633
Other assets, net 37,910 20,653
------ ------
Total assets $410,784 $385,766
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Debt, net $125,417 $93,353
Accounts payable and accrued
liabilities 4,439 4,056
Other liabilities 4,570 4,983
----- -----
Total liabilities 134,426 102,392
Commitments and contingencies
Stockholders' Equity
Preferred stock, $0.01 par value;
50,000,000 shares authorized; none
issued and outstanding - -
Common stock, $0.01 par value;
450,000,000 shares authorized;
18,199,975 and 18,085,798 shares
issued and outstanding at June 30,
2018 and December 31, 2017,
respectively 182 181
Additional paid-in capital 325,719 324,303
Cumulative net income 9,064 4,775
Accumulated other comprehensive
loss 2,039 258
Cumulative dividends (60,646) (46,143)
------- -------
Total stockholders' equity 276,358 283,374
------- -------
Total liabilities and stockholders'
equity $410,784 $385,766
======== ========
The Condensed Consolidated
Balance Sheets do not include
all of the information and
footnotes required by accounting
principles generally accepted in
the United States of America for
complete financial statements.
COMMUNITY HEALTHCARE TRUST INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017
(Unaudited)
(Amounts in thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
2018 2017 2018 2017
---- ---- ---- ----
REVENUES
Rental income $10,220 $7,338 $19,855 $13,956
Tenant reimbursements 1,590 1,334 3,030 2,462
Mortgage interest - 258 - 519
Other operating interest 592 - 946 -
--- --- --- ---
12,402 8,930 23,831 16,937
EXPENSES
Property operating 2,506 2,140 4,870 3,878
General and administrative 1,504 835 2,697 1,605
Depreciation and amortization 4,630 4,281 9,546 8,205
Bad debts - - - 67
--- --- --- ---
8,640 7,256 17,113 13,755
OTHER INCOME (EXPENSE)
Interest expense (1,571) (1,209) (2,839) (1,806)
Other income (expense) 226 1 410 3
--- --- --- ---
(1,345) (1,208) (2,429) (1,803)
NET INCOME $2,417 $466 $4,289 $1,379
====== ==== ====== ======
NET INCOME PER COMMON SHARE:
Net income per common share -
Basic $0.12 $0.04 $0.22 $0.11
===== ===== ===== =====
Net income per common share -
Diluted $0.12 $0.04 $0.22 $0.11
===== ===== ===== =====
WEIGHTED AVERAGE COMMON SHARE
OUTSTANDING-BASIC 17,574 12,686 17,574 12,686
====== ====== ====== ======
WEIGHTED AVERAGE COMMON SHARE
OUTSTANDING-DILUTED 17,574 12,816 17,574 12,841
====== ====== ====== ======
The Condensed Consolidated
Statements of Income do not
include all of the information
and footnotes required by
accounting principles generally
accepted in the United States of
America for complete financial
statements.
COMMUNITY HEALTHCARE TRUST INCORPORATED
RECONCILIATION OF FFO, NORMALIZED FFO, and AFFO (1)
(Amounts in thousands, except per share amounts)
(Unaudited)
Three Months Ended June 30,
2018 2017
---- ----
Net income $2,417 $466
Real estate
depreciation
and
amortization 4,624 4,276
----- -----
Total
adjustments 4,624 4,276
----- -----
Funds From
Operations $7,041 $4,742
Transaction
costs (2) 57 -
Normalized
Funds From
Operations $7,098 $4,742
====== ======
Straight line
rent (391) (270)
Deferred
compensation 801 338
AFFO $7,508 $4,810
====== ======
Funds from
Operations
per Common
Share-
Diluted $0.40 $0.37
===== =====
Normalized
Funds From
Operations
Per Common
Share-
Diluted $0.40 $0.37
===== =====
AFFO Per
Common Share-
Diluted $0.42 $0.38
===== =====
Weighted
Average
Common Shares
Outstanding-
Diluted (3) 17,800 12,816
====== ======
(1) Historical cost accounting for real
estate assets implicitly assumes
that the value of real estate assets
diminishes predictably over time.
However, since real estate values
have historically risen or fallen
with market conditions, many
industry investors deem
presentations of operating results
for real estate companies that use
historical cost accounting to be
insufficient by themselves. For that
reason, the Company considers funds
from operations ("FFO"), normalized
FFO and adjusted funds from
operations ("AFFO") to be
appropriate measures of operating
performance of an equity real estate
investment trust ("REIT"). In
particular, the Company believes
that normalized FFO and AFFO are
useful because they allow investors,
analysts and Company management to
compare the Company's operating
performance to the operating
performance of other real estate
companies and between periods on a
consistent basis without having to
account for differences caused by
unanticipated items and other
events.
The Company uses the National
Association of Real Estate
Investment Trusts, Inc. ("NAREIT")
definition of FFO. FFO and FFO per
share are operating performance
measures adopted by NAREIT. NAREIT
defines FFO as the most commonly
accepted and reported measure of a
REIT's operating performance equal
to "net income (computed in
accordance with GAAP), excluding
gains (or losses) from sales of
property, plus depreciation and
amortization, and after adjustments
for unconsolidated partnerships and
joint ventures." The Company has
included normalized FFO which it has
defined as FFO excluding certain
expenses related to closing costs of
properties acquired accounted for as
business combinations and mortgages
funded and has included AFFO which
it has defined as normalized FFO
excluding straight-line rent and
deferred compensation and may
include other non-cash items from
time to time. Normalized FFO and
AFFO presented herein may not be
comparable to similar measures
presented by other real estate
companies due to the fact that not
all real estate companies use the
same definitions.
FFO, normalized FFO and AFFO should
not be considered as alternatives to
net income (determined in accordance
with GAAP) as indicators of the
Company's financial performance or
as alternatives to cash flow from
operating activities (determined in
accordance with GAAP) as measures of
the Company's liquidity, nor are
they necessarily indicative of
sufficient cash flow to fund all of
the Company's needs. The Company
believes that in order to facilitate
a clear understanding of the
consolidated historical operating
results of the Company, FFO,
normalized FFO and AFFO should be
examined in conjunction with net
income as presented elsewhere
herein.
(2) The transaction costs of $57 above
for the three months ended June 30,
2018 relate to costs associated with
the acquisition of the $23.0 million
promissory note.
(3) Diluted weighted average common
shares outstanding for FFO are
calculated based on the treasury
method, rather than the 2-class
method used to calculate earnings
per share.
CONTACT: W. Page Barnes, 615-771-3052
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SOURCE Community Healthcare Trust Incorporated
Company Codes: NYSE:CHCT
