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Omega Announces Second Quarter 2019 Financial Results

HUNT VALLEY, Md.--(BUSINESS WIRE)--

Completed $678 Million of New Investments in Q2

Agrees to Acquire $735 Million of New Investments

Omega Healthcare Investors, Inc. (OHI) (the “Company” or “Omega”) today announced its results of operations for the quarter ended June 30, 2019. The Company reported net income of $75.7 million or $0.34 per common share. The Company also reported Funds From Operations (“FFO”) for the quarter of $157.2 million or $0.71 per common share, Adjusted Funds From Operations (“AFFO” or “Adjusted FFO”) of $169.2 million or $0.77 per common share, and Funds Available For Distribution (“FAD”) of $150.6 million.

Adjusted FFO excludes a few one-time non-cash revenue and expense items from FFO. FFO, AFFO and FAD are non-GAAP financial measures. For more information regarding these non-GAAP measures, see the “Funds From Operations” schedule below and the Company’s website at www.omegahealthcare.com.

GAAP NET INCOME

For the quarter ended June 30, 2019, the Company reported net income of $75.7 million, or $0.34 per common share, on operating revenues of $225.3 million. This compares to net income of $82.0 million, or $0.39 per common share, on operating revenues of $219.9 million, for the same period in 2018.

For the six-month period ended June 30, 2019, the Company reported net income of $147.9 million, or $0.68 per common share, on operating revenues of $449.0 million. This compares to net income of $169.9 million, or $0.82 per common share, on operating revenues of $440.1 million, for the same period in 2018.

The year-to-date decrease in net income compared to the prior year was primarily due to (i) a $14.9 million reduction in gains on the sale of assets, (ii) an increase of $9.6 million of impairments on direct financing leases and real estate properties and (iii) $4.2 million of costs related to the acquisition of MedEquities Realty Trust, Inc. (“MedEquities”). The decrease in net income was partially offset by incremental revenue from new investments made since the second quarter of 2018.

CEO COMMENTS

Taylor Pickett, Omega’s Chief Executive Officer, stated, “We are excited about our recent capital allocation activity. We seamlessly closed and integrated the MedEquities acquisition in May and on July 26th we signed a $735 million purchase agreement to acquire 60 facilities as described in more detail below. In addition, we continue to source smaller, attractively priced acquisitions and new development projects with our existing tenants, while opportunistically divesting of certain non-core holdings.”

Mr. Pickett continued, “During the quarter, the Texas State Legislature failed to pass any form of skilled nursing Medicaid rate relief, meaning that operators in the State will have to deal with the same Medicaid reimbursement rates which are one of the lowest in the country. As a result, we do not envision Daybreak reverting to their contractual rent for the foreseeable future and are actively working with Daybreak’s management team and third party consultants to maximize future Daybreak cash flows.”

Mr. Pickett concluded, “We remain excited about the new Medicare reimbursement model, the Patient Driven Payment Model or PDPM, which begins on October 1st. We believe this new revenue-neutral payment model more accurately aligns quality of care and patient outcomes with operator reimbursement and our operators are well prepared for the change. We believe the combination of PDPM and the recently confirmed 2.4% increase in Medicare reimbursement will augment the improving census, driven by the multi-decade demographic tailwind.”

2019 RECENT DEVELOPMENTS AND SECOND QUARTER HIGHLIGHTS

In Q3 2019, the Company

  • signed a Purchase and Sale Agreement to acquire $735 million of skilled nursing and assisted living facilities.
  • completed a $25 million acquisition in July.
  • declared a $0.66 per share quarterly common stock dividend.

In Q2 2019, the Company

  • completed the $623 million acquisition by merger of MedEquities.
  • invested $55 million in capital renovation and construction-in-progress projects.
  • paid a $0.66 per share quarterly common stock dividend.

In Q1 2019, the Company

  • entered into a definitive merger agreement to acquire MedEquities.
  • finalized the Orianna portfolio restructuring.
  • invested $42 million in capital renovation and construction-in-progress projects.
  • paid a $0.66 per share quarterly common stock dividend.

SECOND QUARTER 2019 RESULTS

Operating Revenues and Expenses – Operating revenues for the quarter ended June 30, 2019 totaled $225.3 million, which included $17.0 million of non-cash revenue, $3.0 million of real estate tax and ground rents, and a write-off of $6.7 million in uncollectible accounts primarily related to straight-line revenue.

Operating expenses for the quarter ended June 30, 2019 totaled $98.5 million, consisting of $73.6 million of depreciation and amortization expense, $9.5 million of general and administrative (“G&A”) expense, $5.7 million of impairment on real estate properties, $4.3 million of real estate tax and ground lease expense, $4.0 million of stock-based compensation expense and $1.2 million of acquisition (merger) related costs. For more information on impairment charges, see the “2019 Second Quarter and Recent Portfolio Activity – Asset Impairments and Dispositions” section below.

Other Income and Expense – Other income and expense for the quarter ended June 30, 2019 was a net expense of $51.0 million, primarily consisting of $48.4 million of interest expense and $2.2 million of amortized deferred financing costs.

Funds From Operations – For the quarter ended June 30, 2019, FFO was $157.2 million, or $0.71 per common share, on 220 million weighted-average common shares outstanding, compared to $154.5 million, or $0.74 per common share on 208 million weighted-average common shares outstanding, for the same period in 2018.

The $157.2 million of FFO for the quarter ended June 30, 2019 includes a $6.7 million write-off of non-cash revenue (primarily straight-line revenue), $4.0 million of non-cash stock-based compensation expense and $1.2 million of acquisition costs.

The $154.5 million of FFO for the quarter ended June 30, 2018 includes the impact of $4.1 million of non-cash stock-based compensation expense and $0.6 million in provisions for uncollectible accounts.

Adjusted FFO was $169.2 million, or $0.77 per common share, for the quarter ended June 30, 2019, compared to $159.1 million, or $0.76 per common share, for the same quarter in 2018. For further information see the “Funds From Operations” schedule below and the Company’s website.

FINANCING ACTIVITIES

Equity Shelf Program and Dividend Reinvestment and Common Stock Purchase Plan – During the quarter ended June 30, 2019, the Company sold 1.3 million shares of its common stock, generating $48.8 million of gross proceeds. The following table outlines shares of the Company’s common stock issued under its Equity Shelf Program and its Dividend Reinvestment and Common Stock Purchase Plan:

 

 

Equity Shelf (At-the-Market) Program for 2019

 

(in thousands, except price per share)

 

 

 

 

 

Q1

Q2

Year To Date

Number of shares

 

2,221

 

733

 

2,954

Average price per share

$

35.26

$

36.81

$

35.65

Gross proceeds

$

78,325

$

26,993

$

105,318

 

 

 

 

 

 

Dividend Reinvestment and Common Stock Purchase Plan for 2019

 

(in thousands, except price per share)

 

 

 

 

 

Q1

Q2

Year To Date

Number of shares

 

892

 

589

 

1,481

Average price per share

$

36.19

$

37.02

$

36.52

Gross proceeds

$

32,286

$

21,817

$

54,103

 

2019 SECOND QUARTER AND RECENT PORTFOLIO ACTIVITY

Q2 Portfolio Activity:

$678 Million of New Investments in Q2 2019 – In Q2 2019, the Company completed approximately $623 million of new investments and $55 million in capital renovations and new construction consisting of the following:

$623 Million Acquisition – On May 17, 2019, the Company completed its acquisition by merger of MedEquities and acquired $622.6 million of investments. The Company repaid $285.1 million of MedEquities secured borrowings at closing with borrowings under its unsecured credit facility. The investments include 35 properties located in eight states and operated by 12 third-party operators.

Under the terms of the merger agreement, each outstanding share of MedEquities common stock automatically was converted into 0.235 of a share of Omega common stock plus $2.00 in cash, which represents a value of $10.85 per MedEquities share based on the $37.67 closing price for Omega common stock on May 16, 2019. The Company issued approximately 7.5 million shares of its common stock in this transaction.

$55 Million of New Investments – In the second quarter of 2019, the Company invested $55.5 million under its capital renovation and construction-in-progress programs.

Post Q2 Portfolio Activity:

$735 Million Purchase and Sale Agreement – On July 26, 2019, the Company entered into an agreement to purchase 60 facilities for $735 million consisting of approximately $345 million of cash and the assumption of approximately $390 million (as of August 1, 2019) in mortgage loans guaranteed by the U.S. Department of Housing and Urban Development (“HUD”). These loans have a blended “all-in” rate (including Mortgage Insurance Premiums) of 3.66% per annum with maturities between September 2046 and December 2051.

The 60 facilities consist of 58 skilled nursing facilities (“SNFs”) and two assisted living facilities (“ALFs”) representing 6,590 operating beds, located in eight states and are leased to two operators in three triple net leases generating approximately $64 million in 2020 annual contractual cash rent.

Completion of the transaction is subject to consent by HUD as well as the satisfaction of customary closing conditions. No assurance can be given as to when or if (i) HUD’s consent will be obtained, (ii) the closing conditions will be satisfied, and (iii) the acquisition will be completed.

$25 Million of New Investments – On July 1, 2019, the Company acquired three SNFs for approximately $24.9 million from an unrelated third party. The Virginia and North Carolina facilities with approximately 320 beds were added to an existing operator’s master lease with an initial cash yield of 9.5% and 2% annual escalators.

Asset Impairments and Dispositions:

During the second quarter of 2019, four properties were sold for $8.7 million in cash, recognizing a loss of approximately $0.3 million. The Company also received $11.4 million for final payment on a mortgage loan. The Company recorded impairment charges of $5.7 million primarily related to reducing the net book values on two properties to their estimated fair values or expected selling prices.

Also during the second quarter, the Company reached an agreement with Diversicare Healthcare Services, Inc. (DVCR) to amend its master lease to terminate operations of ten nursing facilities located in Kentucky. Omega will concurrently sell the facilities to an unrelated third party for approximately $84.5 million. The transaction is subject to closing conditions, including but not limited to, state licensure and regulatory approval. The transaction is expected to become effective in the third quarter of 2019; however, no assurance can be given as to when or if the closing conditions are satisfied and the sale completed.

As of June 30, 2019, the Company had four properties classified as assets held for sale totaling approximately $4.6 million. The Company expects to sell these properties over the next few quarters.

DIVIDENDS

On July 15, 2019, the Board of Directors declared a common stock dividend of $0.66 per share, to be paid August 15, 2019 to common stockholders of record as of the close of business on July 31, 2019.

2019 GUIDANCE TIGHTENED

The Company tightened its 2019 annual guidance range to be between $1.44 and $1.48 of Net Income per diluted share and between $3.03 and $3.07 of Adjusted FFO per diluted share. The Company also adjusted its 2019 Q4 guidance range to be between $0.39 and $0.42 of Net Income per diluted share and between $0.76 and $0.79 of Adjusted FFO per diluted share.

Bob Stephenson, Omega’s CFO commented, “We have tightened our 2019 year-end guidance and adjusted our fourth quarter guidance primarily as a result of the pending sale of ten Diversicare assets, continuing Daybreak on a cash basis at approximately $3 to $5 million per quarter and to a lesser extent, shares issued under our equity programs.” Mr. Stephenson continued, “As I stated in February and again in May, we may continue to issue equity under our ATM to further de-lever, which may significantly impact our guidance.”

The following table presents a reconciliation of Omega’s guidance regarding Adjusted FFO to projected GAAP earnings.

 

 

 

 

 

 

 

2019 Q4
Guidance Range
(per diluted common share)

 

2019 Annual
Guidance Range
(per diluted common share)

Net Income

 

$0.39 - $0.42

 

$1.44 - $1.48

Depreciation

 

0.35

 

1.36

Depreciation – unconsolidated joint venture

 

 

0.03

Provision for real estate impairment

 

 

0.03

Unrealized gain on warrants

 

 

Gain on assets sold – net

 

 

FFO

 

$0.74 - $0.77

 

$2.86 - $2.90

Adjustments:

 

 

 

 

One-time revenue items

 

 

(0.00)

One-time termination payment

 

 

0.00

Acquisition deal costs

 

 

0.02

Restructuring expenses

 

 

0.01

Provision or write-off of uncollectible accounts

 

 

0.04

Impairment on direct financing leases

 

 

0.03

Stock-based compensation expense

 

0.02

 

0.07

Adjusted FFO

 

$0.76 - $0.79

 

$3.03 - $3.07

 

Note: All per share numbers rounded to 2 decimals.

 

The Company's Adjusted FFO guidance for 2019 assumes over $75 million of planned capital renovation projects with 2019 estimated in-service dates or spending that generates cash in 2019 and the sale of the ten Diversicare assets. It excludes additional acquisitions and asset sales, the impact of gains and losses from the sale of assets, certain revenue and expense items, interest refinancing expense, capital transactions, acquisition costs, and additional provisions for uncollectible accounts, if any.

The Company's guidance is based on a number of assumptions, 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, capital and financing transactions, and variations in stock-based compensation expense 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.

CONFERENCE CALL

The Company will be conducting a conference call on Wednesday, August 7, 2019 at 11 a.m. Eastern to review the Company’s 2019 second quarter results and current developments. Analysts and investors within the United States interested in participating are invited to call (877) 511-2891. The Canadian toll-free dial-in number is (855) 669-9657. All other international participants can use the dial-in number (412) 902-4140. Ask the operator to be connected to the “Omega Healthcare’s Second Quarter 2019 Earnings Call.”

To listen to the conference call via webcast, log on to www.omegahealthcare.com and click the “earnings call” icon on the Company’s home page. Webcast replays of the call will be available on the Company’s website for two weeks following the call.

Omega is a real estate investment trust 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 US, as well as in the UK.

Forward-Looking Statements

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. 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 impact of healthcare reform and regulation, including cost containment measures and changes in reimbursement policies, procedures and rates; (iii) the ability of operators and borrowers to maintain the financial strength and liquidity necessary to satisfy their respective rent and debt obligations; (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) the availability and cost of capital; (vi) changes in Omega’s credit ratings and the ratings of its debt securities; (vii) competition in the financing of healthcare facilities; (viii) Omega’s ability to maintain its status as a REIT and the impact of changes in tax laws and regulations affecting REITs; (ix) Omega’s ability to sell assets held for sale or complete potential asset sales on a timely basis and on terms that allow Omega to realize the carrying value of these assets; (x) Omega’s ability to re-lease, otherwise transition or sell underperforming assets on a timely basis and on terms that allow Omega to realize the carrying value of these assets; (xi) the effect of economic and market conditions generally, and particularly in the healthcare industry; (xii) the potential impact of changes in the SNF and ALF market or local real estate conditions on the Company’s ability to dispose of assets held for sale for the anticipated proceeds or on a timely basis, or to redeploy the proceeds therefrom on favorable terms; (xiii) changes in interest rates; and (xiv) other factors identified in Omega’s filings with the SEC. 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 of 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)

 

 

 

 

June 30,

 

December 31,

 

2019

 

2018

 

(Unaudited)

 

 

 

 

ASSETS

 

 

Real estate properties

 

 

Real estate investments

$

8,373,540

 

$

7,746,410

 

Less accumulated depreciation

 

(1,689,438

)

 

(1,562,619

)

Real estate investments – net

 

6,684,102

 

 

6,183,791

 

Investments in direct financing leases – net

 

11,709

 

 

132,262

 

Mortgage notes receivable – net

 

774,327

 

 

710,858

 

 

 

7,470,138

 

 

7,026,911

 

Other investments – net

 

367,233

 

 

504,626

 

Investments in unconsolidated joint ventures

 

102,838

 

 

31,045

 

Assets held for sale – net

 

4,606

 

 

989

 

Total investments

 

7,944,815

 

 

7,563,571

 

 

 

 

Cash and cash equivalents

 

32,766

 

 

10,300

 

Restricted cash

 

1,372

 

 

1,371

 

Contractual receivables – net

 

25,903

 

 

33,826

 

Other receivables and lease inducements

 

342,030

 

 

313,551

 

Goodwill

 

643,875

 

 

643,950

 

Other assets

 

107,659

 

 

24,308

 

Total assets

$

9,098,420

 

$

8,590,877

 

 

 

 

LIABILITIES AND EQUITY

 

 

Revolving line of credit

$

500,000

 

$

313,000

 

Term loans – net

 

898,604

 

 

898,726

 

Secured borrowing

 

2,275

 

Senior notes and other unsecured borrowings – net

 

3,331,905

 

 

3,328,896

 

Accrued expenses and other liabilities

 

300,303

 

 

272,172

 

Deferred income taxes

 

12,827

 

 

13,599

 

Total liabilities

 

5,045,914

 

 

4,826,393

 

 

 

 

Equity:

 

 

Common stock $.10 par value authorized – 350,000 shares, issued and outstanding – 216,089 shares as of June 30, 2019 and 202,346 as of December 31, 2018

 

21,608

 

 

20,235

 

Common stock – additional paid-in capital

 

5,580,042

 

 

5,074,544

 

Cumulative net earnings

 

2,265,156

 

 

2,130,511

 

Cumulative dividends paid

 

(4,013,116

)

 

(3,739,197

)

Accumulated other comprehensive loss

 

(50,719

)

 

(41,652

)

Total stockholders’ equity

 

3,802,971

 

 

3,444,441

 

Noncontrolling interest

 

249,535

 

 

320,043

 

Total equity

 

4,052,506

 

 

3,764,484

 

Total liabilities and equity

$

9,098,420

 

$

8,590,877

 

 

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,

 

 

2019

 

2018

 

2019

 

2018

Revenue

 

 

 

 

 

 

 

 

Rental income

 

$

191,812

 

 

$

192,850

 

 

$

380,016

 

 

$

386,799

 

Real estate tax and ground lease income

 

 

3,005

 

 

 

 

 

6,978

 

 

Income from direct financing leases

 

 

259

 

 

 

497

 

 

 

519

 

 

 

1,110

 

Mortgage interest income

 

 

18,832

 

 

 

16,834

 

 

 

36,966

 

 

 

33,413

 

Other investment income

 

 

11,133

 

 

 

9,097

 

 

 

23,047

 

 

 

17,624

 

Miscellaneous income

 

 

238

 

 

 

603

 

 

 

1,441

 

 

 

1,134

 

Total operating revenues

 

 

225,279

 

 

 

219,881

 

 

 

448,967

 

 

 

440,080

 

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

73,637

 

 

 

69,609

 

 

 

144,489

 

 

 

139,970

 

General and administrative

 

 

9,548

 

 

 

11,148

 

 

 

21,374

 

 

 

23,567

 

Real estate tax and ground lease expense

 

 

4,317

 

 

 

 

8,436

 

 

Stock-based compensation

 

 

4,040

 

 

 

4,089

 

 

 

8,110

 

 

 

8,145

 

Acquisition costs

 

 

1,236

 

 

 

 

4,185

 

 

Impairment (recovery) on real estate properties

 

 

5,709

 

 

 

(1,097

)

 

 

5,709

 

 

 

3,817

 

Impairment on direct financing leases

 

 

 

 

7,700

 

 

Provision for uncollectible accounts

 

 

 

564

 

 

 

 

8,378

 

Total operating expenses

 

 

98,487

 

 

 

84,313

 

 

 

200,003

 

 

 

183,877

 

 

 

 

 

 

 

 

 

 

Other operating (loss) income

 

 

 

 

 

 

 

 

(Loss) gain on assets sold – net

 

 

(267

)

 

 

(2,891

)

 

 

(264

)

 

 

14,609

 

Operating income

 

 

126,525

 

 

 

132,677

 

 

 

248,700

 

 

 

270,812

 

 

 

 

 

 

 

 

 

 

Other income (expense)

 

 

 

 

 

 

 

 

Interest income and other – net

 

 

(191

)

 

 

1,125

 

 

 

146

 

 

 

1,710

 

Interest expense

 

 

(48,380

)

 

 

(48,082

)

 

 

(96,480

)

 

 

(96,093

)

Interest – amortization of deferred financing costs

 

 

(2,238

)

 

 

(2,242

)

 

 

(4,476

)

 

 

(4,485

)

Realized loss on foreign exchange

 

 

(195

)

 

 

(66

)

 

 

(169

)

 

 

(7

)

Total other expense

 

 

(51,004

)

 

 

(49,265

)

 

 

(100,979

)

 

 

(98,875

)

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

 

75,521

 

 

 

83,412

 

 

 

147,721

 

 

 

171,937

 

Income tax expense

 

 

(793

)

 

 

(838

)

 

 

(1,468

)

 

 

(1,381

)

Income (loss) from unconsolidated joint ventures

 

 

943

 

 

 

(588

)

 

 

1,600

 

 

 

(637

)

Net income

 

 

75,671

 

 

 

81,986

 

 

 

147,853

 

 

 

169,919

 

Net income attributable to noncontrolling interest

 

 

(2,530

)

 

 

(3,450

)

 

 

(5,010

)

 

 

(7,163

)

Net income available to common stockholders

 

$

73,141

 

 

$

78,536

 

 

$

142,843

 

 

$

162,756

 

 

 

 

 

 

 

 

 

 

Earnings per common share available to common stockholders:

 

 

 

 

 

 

 

 

Basic:

 

 

 

 

 

 

 

 

Net income available to common stockholders

 

$

0.35

 

 

$

0.39

 

 

$

0.69

 

 

$

0.82

 

Diluted:

 

 

 

 

 

 

 

 

Net income

 

$

0.34

 

 

$

0.39

 

 

$

0.68

 

 

$

0.82

 

Dividends declared per common share

 

$

0.66

 

 

$

0.66

 

 

$

1.32

 

 

$

1.32

 

Weighted-average shares outstanding, basic

 

 

211,569

 

 

 

199,497

 

 

 

208,064

 

 

 

199,204

 

Weighted-average shares outstanding, diluted

 

 

220,479

 

 

 

208,460

 

 

 

217,002

 

 

 

208,139

 

 

OMEGA HEALTHCARE INVESTORS, INC.

FUNDS FROM OPERATIONS

Unaudited

(in thousands, except per share amounts)

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

 

June 30,

 

June 30,

 

 

2019

 

2018

 

2019

 

2018

 

 

 

 

 

 

 

 

 

Net income

 

$

75,671

 

 

$

81,986

 

 

$

147,853

 

 

$

169,919

 

Add back loss (deduct gain) from real estate dispositions

 

 

267

 

 

 

2,891

 

 

 

264

 

 

 

(14,609

)

Add back loss from real estate dispositions of unconsolidated joint ventures

 

 

 

640

 

 

 

 

640

 

Sub-total

 

 

75,938

 

 

 

85,517

 

 

 

148,117

 

 

 

155,950

 

Elimination of non-cash items included in net income:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

73,637

 

 

 

69,609

 

 

 

144,489

 

 

 

139,970

 

Depreciation - unconsolidated joint ventures

 

 

1,675

 

 

 

1,466

 

 

 

3,047

 

 

 

3,123

 

Add back (deduct) non-cash provision (recovery) for impairments on real estate properties

 

 

5,709

 

 

null