Normalized FFO of $0.48 Per Share for the
Fourth Quarter, up 6.7% over the Same Period in the Prior Year,
Including 11.7% Increase in Cash Basis
NOI from Same Property Managed Senior Living Communities
Portfolio
Senior Housing Properties Trust (NYSE: SNH) today announced its
financial results for the quarter and year ended December 31,
2015.
SNH’s President and Chief Operating Officer, David Hegarty, made
the following statement:
“Our business produced strong operating results in the fourth
quarter, with a 6.7% increase in normalized FFO per share compared
to the same period last year. These results were created in part by
an 11.7% increase in cash basis NOI at our same property managed
senior living communities.”
Results for the quarter ended December 31, 2015:
Normalized funds from operations, or Normalized FFO, for the
quarter ended December 31, 2015 were $113.0 million, or $0.48 per
diluted share. This compares to Normalized FFO for the quarter
ended December 31, 2014 of $91.3 million, or $0.45 per diluted
share. The increase in Normalized FFO is primarily the result of
acquisitions since January 1, 2015, strong performance from SNH’s
managed senior living communities and dividends received from SNH’s
ownership of The RMR Group Inc. (NASDAQ: RMR) common stock related
to the period from June 5, 2015 to December 14, 2015.
Net income was $9.5 million, or $0.04 per diluted share, for the
quarter ended December 31, 2015, compared to net income of $45.3
million, or $0.22 per diluted share, for the quarter ended December
31, 2014. The decline in net income per diluted share for the
quarter ended December 31, 2015 primarily resulted from the
non-cash loss on the distribution of RMR common stock to SNH’s
shareholders totaling $38.4 million, or $0.16 per diluted
share.
The basic and diluted weighted average number of common shares
outstanding were approximately 237.0 million for the quarter ended
December 31, 2015, and approximately 204.0 million for the quarter
ended December 31, 2014.
Reconciliations of net income determined in accordance with U.S.
generally accepted accounting principles, or GAAP, to funds from
operations, or FFO, and Normalized FFO for the quarters ended
December 31, 2015 and 2014 appear later in this press release.
Results for the year ended December 31, 2015:
Normalized FFO for the year ended December 31, 2015 were $429.7
million, or $1.84 per diluted share. This compares to Normalized
FFO for the year ended December 31, 2014 of $347.6 million, or
$1.75 per diluted share. The increase in Normalized FFO is
primarily the result of acquisitions since January 1, 2015, strong
performance from SNH’s managed senior living communities and
dividends received from SNH’s ownership of RMR common stock related
to the period from June 5, 2015 to December 14, 2015.
Net income was $124.0 million, or $0.53 per diluted share, for
the year ended December 31, 2015, compared to net income of $158.6
million, or $0.80 per diluted share, for the year ended December
31, 2014. The decline in net income is primarily the result of the
non-cash loss on the distribution of RMR common stock to SNH’s
shareholders totaling $38.4 million, or $0.17 per diluted
share.
The basic and diluted weighted average number of common shares
outstanding were approximately 233.0 million for the year ended
December 31, 2015, and approximately 199.0 million for the year
ended December 31, 2014.
Reconciliations of net income determined in accordance with GAAP
to FFO and Normalized FFO for the years ended December 31 2015 and
2014 appear later in this press release.
Operating Results for the quarter ended December 31,
2015:
For the three months ended December 31, 2015, consolidated same
property net operating income, or NOI, and cash basis NOI increased
0.3% and 0.9%, respectively, compared to the quarter ended December
31, 2014.
For the three months ended December 31, 2015, 38.4% of SNH’s NOI
came from 121 properties leased to medical providers, medical
related businesses, clinics and biotech laboratory tenants, or
MOBs, with 11.3 million leasable square feet. As of December 31,
2015, 96.4% of SNH’s MOB leasable square feet were leased, compared
to 96.0% as of September 30, 2015 and 95.9% as of December 31,
2014. Same property occupancy for SNH’s MOBs owned continuously
since October 1, 2014 decreased to 95.5% as of December 31, 2015,
compared to 95.9% as of December 31, 2014. SNH’s MOB same property
NOI and cash basis NOI decreased 4.0% and 2.9%, respectively,
during the quarter ended December 31, 2015 compared to the quarter
ended December 31, 2014.
For the three months ended December 31, 2015, 45.2% of SNH’s
consolidated NOI came from 231 triple net leased senior living
communities with 26,114 living units. Occupancy at triple net
leased senior living communities was 84.6% during the most recently
reported period, remaining unchanged from the comparable period
last year.(1) Same property NOI and cash basis NOI for SNH’s triple
net leased senior living communities increased 1.0% and 0.9%,
respectively, during the quarter ended December 31, 2015 compared
to the quarter ended December 31, 2014.
For the three months ended December 31, 2015, 13.7% of SNH’s NOI
came from 65 managed senior living communities with 8,585 living
units. Occupancy at the managed senior living communities was 87.7%
during the quarter ended December 31, 2015, compared to 88.4%
during the comparable period last year. Same property occupancy for
managed senior living communities owned continuously since October
1, 2014 decreased to 87.2% during the quarter ended December 31,
2015 from 88.4% during the comparable period last year. Same
property average monthly rates increased 2.1% to $4,250 during the
quarter ended December 31, 2015 compared to the quarter ended
December 31, 2014. Same property NOI and cash basis NOI for SNH’s
managed senior living communities each increased 11.7% during the
quarter ended December 31, 2015 compared to the quarter ended
December 31, 2014.
Reconciliations of NOI and cash basis NOI to net income
determined in accordance with GAAP for the quarters ended December
31, 2015 and 2014 appear later in this press release. In addition,
calculations and reconciliations of NOI, Cash Basis NOI, Same
Property NOI and Same Property Cash Basis NOI by SNH’s operating
segments for the quarters ended December 31, 2015 and 2014 appear
later in this press release.
Recent Investment Activities:
In February 2016, SNH acquired one MOB (three buildings) located
in Minnesota with approximately 128,000 square feet for a purchase
price of approximately $22.7 million, excluding closing costs. In
January 2016, SNH entered into an agreement to acquire one senior
living community with 38 private pay assisted living units located
in Georgia for a purchase price of approximately $8.4 million,
excluding closing costs. SNH expects to acquire this community in
the first half of 2016 using a taxable REIT subsidiary structure
and to have Five Star Quality Care, Inc. manage this community. In
addition, during the quarter ended December 31, 2015, SNH spent
approximately $5.0 million on capital investments that will
generate additional rent under existing leases.
Recent Financing Activities:
In February 2016, SNH sold $250.0 million in aggregate principal
amount of 6.25% senior unsecured notes due 2046, raising net
proceeds of approximately $241.5 million after underwriting
discounts and estimated expenses. SNH has also granted the
underwriters an option to purchase up to an additional $37.5
million in aggregate principal amount of the notes. SNH used the
net proceeds of this offering to repay amounts outstanding under
its revolving credit facility and for general business
purposes.
In October 2015, SNH prepaid two mortgages with maturity dates
in January 2016 encumbering one property with an aggregate
principal balance of $52.0 million and a weighted average annual
interest rate of 5.6%. In November 2015, SNH prepaid its $250.0
million 4.30% senior unsecured notes due in January 2016. In
January 2016, SNH prepaid one mortgage with a maturity date in
April 2016 encumbering one property with a principal balance of
$6.1 million and an annual interest rate of 5.97%. SNH funded these
prepayments with cash on hand and borrowings under its revolving
credit facility.
Distribution of RMR Common Stock:
On December 14, 2015, SNH distributed to its common shareholders
0.0111 of a share of RMR common stock for each SNH common share
owned as of the close of business on November 27, 2015. In
connection with this distribution, SNH recognized a non-cash loss
of $38.4 million because the closing price of RMR’s common stock
was lower than SNH’s carrying amount per share on the day RMR’s
common stock was distributed to SNH’s shareholders. Since the
distribution date, the trading price of RMR’s common stock has
increased. If the trading price of RMR’s common stock on the
distribution date had been at the current increased price per
share, SNH would have recognized a lesser non-cash loss on the
distribution.
Conference Call:
On Tuesday, February 23, 2016, at 1:00 p.m. Eastern Time, David
J. Hegarty, President and Chief Operating Officer, and Richard W.
Siedel, Jr., Chief Financial Officer, will host a conference call
to discuss the fourth quarter and full year 2015 financial results.
The conference call telephone number is (877) 329-4297.
Participants calling from outside the United States and Canada
should dial (412) 317-5435. No pass code is necessary to access the
call at either number. Participants should dial in about 15 minutes
prior to the scheduled start of the call. A replay of the
conference call will be available through 11:59 p.m. Eastern Time
on Tuesday, March 1, 2016. To hear the replay, dial (412) 317-0088.
The replay pass code is 10079046.
A live audio webcast of the conference call will also be
available in a listen only mode on the company's website, which is
located at www.snhreit.com. Participants wanting to access the
webcast should visit the company's website about five minutes
before the call. The archived webcast will be available for replay
on the company's website after the call. The transcription,
recording and retransmission in any way of SNH’s fourth quarter
2015 conference call are strictly prohibited without the prior
written consent of SNH.
Supplemental Data:
A copy of SNH’s Fourth Quarter 2015 Supplemental Operating and
Financial Data is available for download from the SNH website,
www.snhreit.com. SNH’s website and the information on it are not
incorporated as part of this press release.
SNH is a real estate investment trust, or REIT, which owns
senior living communities, medical office buildings and wellness
centers throughout the United States. SNH is managed by the
operating subsidiary of The RMR Group Inc. (NASDAQ: RMR), an
alternative asset management company that is headquartered in
Newton, MA.
Please see the pages attached hereto for a more detailed
statement of SNH’s operating results and financial condition, and
for an explanation of SNH’s calculation of FFO, Normalized FFO, NOI
and Cash Basis NOI.
(1) Occupancy ratios for triple net leased senior living
communities are based on operating results provided by SNH’s
tenants, and this information is usually provided to SNH three
months after the end of a fiscal quarter end. As a result,
occupancy ratios presented for triple net leased senior living
communities are for the 12 months ended September 30, 2015 and
2014.
WARNING CONCERNING
FORWARD LOOKING STATEMENTS
THIS PRESS RELEASE CONTAINS STATEMENTS THAT CONSTITUTE FORWARD
LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995 AND OTHER SECURITIES LAWS. ALSO,
WHENEVER SNH USES WORDS SUCH AS “BELIEVE”, “EXPECT”, “ANTICIPATE”,
“INTEND”, “PLAN”, “ESTIMATE” OR SIMILAR EXPRESSIONS, SNH IS MAKING
FORWARD LOOKING STATEMENTS. THESE FORWARD LOOKING STATEMENTS ARE
BASED UPON SNH’S PRESENT INTENT, BELIEFS OR EXPECTATIONS, BUT
FORWARD LOOKING STATEMENTS ARE NOT GUARANTEED TO OCCUR AND MAY NOT
OCCUR. ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE CONTAINED IN
OR IMPLIED BY SNH’S FORWARD LOOKING STATEMENTS AS A RESULT OF
VARIOUS FACTORS. FOR EXAMPLE:
- THIS PRESS RELEASE STATES THAT THE
TRADING PRICE OF RMR COMMON STOCK HAS INCREASED SINCE THE
DISTRIBUTION OF RMR COMMON STOCK TO SNH’S SHAREHOLDERS. AN
IMPLICATION OF THIS STATEMENT MAY BE THAT THE TRADING PRICE OF RMR
COMMON STOCK WILL CONTINUE TO INCREASE OR WILL NOT DECLINE. THE
MARKET VALUE OF RMR COMMON STOCK DEPENDS UPON VARIOUS FACTORS,
INCLUDING SOME THAT ARE BEYOND SNH’S CONTROL, SUCH AS MARKET
CONDITIONS. THERE CAN BE NO ASSURANCE REGARDING THE PRICE AT WHICH
RMR COMMON STOCK WILL,
- THIS PRESS RELEASE STATES THAT SNH HAS
AGREED TO ACQUIRE ONE SENIOR LIVING COMMUNITY FOR APPROXIMATELY
$8.4 MILLION. THIS ACQUISITION IS SUBJECT TO CLOSING CONDITIONS.
THESE CONDITIONS MAY NOT BE SATISFIED AND THE ACQUISITION MAY NOT
OCCUR, MAY BE DELAYED OR THE TERMS MAY CHANGE, AND
- THIS PRESS RELEASE STATES THAT SNH HAS
GRANTED UNDERWRITERS AN OPTION TO PURCHASE UP TO AN ADDITIONAL
$37.5 MILLION AGGREGATE PRINCIPAL AMOUNT OF ITS 6.25% UNSECURED
SENIOR NOTES DUE 2046. AN IMPLICATION OF THIS STATEMENT MAY BE THAT
THIS OPTION MAY BE EXERCISED IN WHOLE OR IN PART. IN FACT, SNH DOES
NOT KNOW WHETHER THE UNDERWRITERS WILL EXERCISE THIS OPTION, OR ANY
PART OF IT.
THE INFORMATION CONTAINED IN SNH’S FILINGS WITH THE SECURITIES
AND EXCHANGE COMMISSION, OR SEC, INCLUDING UNDER THE CAPTION “RISK
FACTORS” IN SNH’S PERIODIC REPORTS, OR INCORPORATED THEREIN,
IDENTIFIES OTHER IMPORTANT FACTORS THAT COULD CAUSE SNH’S ACTUAL
RESULTS TO DIFFER MATERIALLY FROM THOSE STATED IN OR IMPLIED BY
SNH’S FORWARD LOOKING STATEMENTS. SNH’S FILINGS WITH THE SEC ARE
AVAILABLE ON THE SEC’S WEBSITE AT WWW.SEC.GOV.
YOU SHOULD NOT PLACE UNDUE RELIANCE UPON FORWARD LOOKING
STATEMENTS.
EXCEPT AS REQUIRED BY LAW, SNH DOES NOT INTEND TO UPDATE OR
CHANGE ANY FORWARD LOOKING STATEMENTS AS A RESULT OF NEW
INFORMATION, FUTURE EVENTS OR OTHERWISE.
SENIOR HOUSING PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF
INCOME
(amounts in thousands, except per share
data)
(unaudited)
Three Months Ended Year
Ended December 31, December 31, 2015
2014 2015 2014
Revenues: Rental income $ 170,706 $ 149,364 $ 630,899 $ 526,703
Residents fees and services 96,813 80,445
367,874 318,184 Total revenues 267,519 229,809 998,773
844,887 Expenses: Property operating expenses 101,266 84,268
377,579 324,564 Depreciation 71,549 50,257 257,783 185,391 General
and administrative 10,266 10,696 42,830 38,946 Acquisition related
costs 337 1,957 6,853 4,607 Impairment of assets 292
(10) 194 (10) Total expenses 183,710
147,168 685,239 553,498 Operating income
83,809 82,641 313,534 291,389 Dividend income 2,773 — 2,773
63 Interest and other income 106 89 379 362 Interest expense
(38,043) (35,901) (150,881) (135,114) Loss on distribution to
common shareholders of RMR common stock (38,437) — (38,437) — Loss
on early extinguishment of debt (425) (12)
(1,894) (12) Income from continuing operations before income
tax expense and equity in (losses) earnings of an investee 9,783
46,817 125,474 156,688 Income tax expense (189) (74) (574)
(576) Equity in (losses) earnings of an investee (50)
28 20 87 Income from continuing operations 9,544
46,771 124,920 156,199 Discontinued operations: (Loss) income from
discontinued operations — (123) (350) 1,362 Impairment of assets
from discontinued operations — (4,260) (602)
(4,377) Income before gain on sale of properties 9,544
42,388 123,968 153,184 Gain on sale of properties —
2,900 — 5,453 Net income $ 9,544 $ 45,288 $ 123,968 $
158,637 Weighted average shares outstanding (basic)
237,313 203,742 232,931 198,868 Weighted
average shares outstanding (diluted) 237,320 203,754
232,963 198,894 Basic and diluted per common
share amounts: Income from continuing operations per share $ 0.04 $
0.24 $ 0.54 $ 0.81 Loss from discontinued operations per share
— (0.02) (0.01) (0.01) Basic and
diluted net income per share $ 0.04 $ 0.22 $ 0.53 $ 0.80
SENIOR HOUSING PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF FUNDS FROM
OPERATIONS AND NORMALIZED FUNDS FROM OPERATIONS
(amounts in thousands, except per share
data)
(unaudited)
Calculation of Funds from Operations
(FFO) and Normalized FFO (1):
Three Months Ended Year Ended
December 31, December 31, 2015
2014 2015 2014 Net income $
9,544 $ 45,288 $ 123,968 $ 158,637 Depreciation expense 71,549
50,257 257,783 185,391 Gain on sale of properties — (2,900) —
(5,453) Impairment of assets from continuing operations 292 (10)
194 (10) Impairment of assets from discontinued operations —
4,260 602 4,377 FFO 81,385 96,895 382,547
342,942 Acquisition related costs 337 1,957 6,853 4,607 Loss
on distribution to common shareholders of RMR common stock(2)
38,437 — 38,437 — Loss on early extinguishment of debt 425 12 1,894
12 Percentage rent adjustment(3) (7,600) (7,600)
— — Normalized FFO $ 112,984 $ 91,264 $ 429,731 $
347,561 Weighted average shares outstanding (basic)
237,313 203,742 232,931 198,868 Weighted
average shares outstanding (diluted) 237,320 203,754
232,963 198,894 FFO per share (basic and
diluted) $ 0.34 $ 0.48 $ 1.64 $ 1.72 Normalized FFO per share
(basic and diluted) $ 0.48 $ 0.45 $ 1.84 $ 1.75 Net income per
share (basic and diluted) $ 0.04 $ 0.22 $ 0.53 $ 0.80 Distributions
declared per share $ 0.39 $ 0.39 $ 1.56 $ 1.56
(1) SNH calculates FFO and Normalized FFO as shown above. FFO is
calculated on the basis defined by the National Association of Real
Estate Investment Trusts, or NAREIT, which is net income,
calculated in accordance with GAAP, excluding any gain or loss on
sale of properties and impairment of real estate assets, plus real
estate depreciation and amortization, as well as certain other
adjustments currently not applicable to SNH. SNH’s calculation of
Normalized FFO differs from NAREIT’s definition of FFO because SNH
includes estimated percentage rent in the period to which SNH
estimates that it relates rather than when it is recognized as
income in accordance with GAAP, SNH includes estimated business
management incentive fees, if any, only in the fourth quarter
versus the quarter when they are recognized as expense in
accordance with GAAP and SNH excludes acquisition related costs,
loss on distribution to common shareholders of RMR common stock,
gains and losses on early extinguishment of debt, gains and losses
on lease terminations and losses on impairment of intangible
assets, if any. SNH considers FFO and Normalized FFO to be
appropriate measures of operating performance for a REIT, along
with net income, operating income and cash flow from operating
activities. SNH believes that FFO and Normalized FFO provide
useful information to investors because by excluding the effects of
certain historical amounts, such as depreciation expense, FFO and
Normalized FFO may facilitate a comparison of its operating
performance between periods and with other REITs. FFO and
Normalized FFO are among the factors considered by SNH’s Board of
Trustees when determining the amount of distributions to its
shareholders. Other factors include, but are not limited to,
requirements to maintain SNH’s qualification for taxation as a
REIT, limitations in SNH’s revolving credit facility and term loan
agreements and SNH’s public debt covenants, the availability to SNH
of debt and equity capital, SNH’s expectation of its future capital
requirements and operating performance, and SNH’s expected needs
and availability of cash to pay its obligations. FFO and Normalized
FFO do not represent cash generated by operating activities in
accordance with GAAP and should not be considered as alternatives
to net income, operating income or cash flow from operating
activities determined in accordance with GAAP, or as indicators of
SNH’s financial performance or liquidity, nor are these measures
necessarily indicative of sufficient cash flow to fund all of SNH’s
activities. These measures should be considered in conjunction with
net income, operating income and cash flow from operating
activities as presented in SNH’s Consolidated Statements of Income
and Consolidated Statements of Cash Flows. Other REITs and
real estate companies may calculate FFO and Normalized FFO
differently than SNH does.
(2) Amounts represent a non-cash loss recorded as a result of
the closing price of RMR common stock being lower than SNH’s
carrying amount per share on the day RMR common stock was
distributed to SNH’s shareholders.
(3) In calculating net income in accordance with GAAP, SNH
recognizes percentage rental income received for the full year in
the fourth quarter, which is when all contingencies are met and the
income is earned. Although SNH defers recognition of this revenue
until the fourth quarter for purposes of calculating net income,
SNH include estimates of these amounts in its calculation of
Normalized FFO for each quarter of the year. The fourth quarter
Normalized FFO calculation includes an adjustment to exclude the
amounts included in Normalized FFO during the first three
quarters.
SENIOR HOUSING PROPERTIES TRUST
CALCULATION AND RECONCILIATION OF NET
OPERATING INCOME (NOI) AND CASH BASIS NOI
(amounts in thousands)
(unaudited)
Three Months Ended December 31,
December 31, 2015 2014
Calculation of
NOI and Cash Basis NOI(1):
Revenues: Rental income $ 170,706 $ 149,364 Residents fees and
services 96,813 80,445 Total revenues
267,519 229,809 Property operating expenses (101,266 )
(84,268 ) Property net operating income (NOI): 166,253
145,541 Non-cash straight line rent adjustments (4,300 ) (2,857 )
Lease value amortization (599 ) (1,211 ) Lease termination fees
(127 ) - Non-cash amortization included in property operating
expenses(2) (199 ) - Cash Basis NOI $ 161,028
$ 141,473
Reconciliation of
Cash Basis NOI to Net Income:
Cash Basis NOI $ 161,028 $ 141,473 Non-cash straight line rent
adjustments 4,300 2,857 Lease value amortization 599 1,211 Lease
termination fees 127 - Non-cash amortization included in property
operating expenses(2) 199 - Property
NOI 166,253 145,541 Depreciation expense (71,549 ) (50,257 )
General and administrative expense (10,266 ) (10,696 ) Acquisition
related costs (337 ) (1,957 ) Impairment of assets (292 )
10 Operating income 83,809 82,641 Dividend
income 2,773 - Interest and other income 106 89 Interest expense
(38,043 ) (35,901 ) Loss on distribution to common shareholders of
RMR common stock (38,437 ) - Loss on early extinguishment of debt
(425 ) (12 ) Income before income tax expense and
equity in (losses) earnings of an investee 9,783 46,817 Income tax
expense (189 ) (74 ) Equity in (losses) earnings of an investee
(50 ) 28 Income from continuing operations
9,544 46,771 Discontinued operations Loss from discontinued
operations - (123 ) Impairment of assets from discontinued
operations - (4,260 ) Income before gain on
sale of properties 9,544 42,388 Gain on sale of properties -
2,900 Net income $ 9,544 $ 45,288
(1) The calculations of NOI and Cash Basis NOI exclude certain
components of net income in order to provide results that are more
closely related to SNH’s property level results of operations. SNH
calculates NOI and Cash Basis NOI as shown above excluding
properties classified as discontinued operations. SNH defines NOI
as income from its real estate less its property operating
expenses. NOI excludes amortization of capitalized tenant
improvement costs and leasing commissions. SNH defines Cash Basis
NOI as NOI excluding non-cash straight line rent adjustments, lease
value amortization, lease termination fees, if any, and non-cash
amortization included in property operating expenses. SNH considers
NOI and Cash Basis NOI to be appropriate supplemental measures to
net income because they may help both investors and management to
understand the operations of SNH’s properties. SNH uses NOI and
Cash Basis NOI internally to evaluate individual and company wide
property level performance, and it believes that NOI and Cash Basis
NOI provide useful information to investors regarding its results
of operations because these measures reflect only those income and
expense items that are generated and incurred at the property level
and may facilitate comparisons of its operating performance between
periods and with other REITs. NOI and Cash Basis NOI do not
represent cash generated by operating activities in accordance with
GAAP and should not be considered as an alternative to net income,
operating income or cash flow from operating activities determined
in accordance with GAAP, or as indicators of SNH’s financial
performance or liquidity, nor are these measures necessarily
indicative of sufficient cash flow to fund all of SNH’s activities.
These measures should be considered in conjunction with net income,
operating income and cash flow from operating activities as
presented in SNH’s Consolidated Statements of Income and
Consolidated Statements of Cash Flows. Other REITs and real estate
companies may calculate NOI and Cash Basis NOI differently than SNH
does.
(2) SNH recorded a liability for the amount by which the
estimated fair value for accounting purposes exceeded the price SNH
paid for its investment in RMR common stock in June 2015. A portion
of this liability is being amortized on a straight line basis
through December 31, 2035, the then 20 year life of the property
management agreement with the operating subsidiary of RMR as a
reduction to property management fees, which are included in
property operating expenses.
SENIOR HOUSING PROPERTIES TRUST
Calculation and Reconciliation of NOI, Cash Basis NOI, Same
Property NOI and Same Property Cash Basis NOI by Segment
(1) (dollars in thousands) (unaudited)
For the Three Months Ended December
31, 2015 For the Three Months Ended December
31, 2014 Calculation of NOI and Cash Basis
NOI: Triple Net Leased Senior Living Communities
(2) Managed Senior Living Communities (3)
MOBs (4)
Non-Segment (5) Total Triple Net Leased
Senior Living Communities (2) Managed Senior Living
Communities (3) MOBs (4)
Non-Segment (5) Total Rental income /
residents fees and services $ 75,215 $ 96,813 $ 90,922 $ 4,569 $
267,519 $ 65,394 $ 80,445 $ 79,452 $ 4,517 $ 229,808 Property
operating expenses - (74,064 ) (27,202
) - (101,266 ) - (62,352 )
(21,915 ) - (84,267 ) Property net operating
income (NOI) $ 75,215 $ 22,749 $ 63,720 $
4,569 $ 166,253 $ 65,394 $ 18,093 $ 57,537
$ 4,517 $ 145,541 NOI change 15.0 % 25.7 % 10.7 % 1.2
% 14.2 % -- -- -- -- -- Property NOI $ 75,215 $ 22,749 $
63,720 $ 4,569 $ 166,253 $ 65,394 $ 18,093 $ 57,537 $ 4,517 $
145,541 Less: Non-cash straight line rent adjustments 1,376 - 2,787
137 4,300 129 - 2,590 138 2,857 Lease value amortization - - 544 55
599 - - 1,156 55 1,211 Lease termination fees - - 127 - 127 - - - -
- Non-cash amortization included in property operating expenses (7)
- - 199 -
199 - - - -
- Cash Basis NOI $ 73,839 $ 22,749 $
60,063 $ 4,377 $ 161,028 $ 65,265 $ 18,093
$ 53,791 $ 4,324 $ 141,473 Cash Basis NOI
change 13.1 % 25.7 % 11.7 % 1.2 % 13.8 % -- -- -- -- --
Reconciliation of NOI to Same Property NOI: Property NOI $
75,215 $ 22,749 $ 63,720 $ 4,569 $ 166,253 $ 65,394 $ 18,093 $
57,537 $ 4,517 $ 145,541 Less: NOI not included in same property
9,550 2,746 8,520 - 20,816 357 186 24 - 567
Same property NOI
(6) $ 65,665 $ 20,003 $ 55,200 $ 4,569
$ 145,437 $ 65,037 $ 17,907 $ 57,513 $ 4,517 $
144,974 Same property NOI change 1.0 % 11.7 % (4.0 %) 1.2 %
0.3 % -- -- -- -- --
Reconciliation of Same Property NOI
to Same Property Cash Basis NOI: Same property NOI (6) $ 65,665
$ 20,003 $ 55,200 $ 4,569 $ 145,437 $ 65,037 $ 17,907 $ 57,513 $
4,517 $ 144,974 Less: Non-cash straight line rent adjustments 155 -
2,098 137 2,390 129 - 2,590 137 2,856 Lease value amortization - -
574 55 629 - - 1,156 55 1,211 Lease termination fees - - 128 - 128
- - - - - Non-cash amortization included in property operating
expenses (7) - - 175
175 - - -
- - Same property cash basis NOI (6) $ 65,510
$ 20,003 $ 52,225 $ 4,377 $ 142,115
$ 64,908 $ 17,907 $ 53,767 $ 4,325 $ 140,907
Same property cash basis NOI change 0.9 % 11.7 % (2.9 %) 1.2
% 0.9 % -- -- -- -- --
(1) See above for the calculation of NOI and a reconciliation of
NOI to net income determined in accordance with GAAP, and for a
definition of NOI and Cash Basis NOI, reasons why management
believes they are appropriate supplemental measures and any
additional purposes for which management uses these measures.
Excludes properties classified in discontinued operations.
(2) Includes triple net leased senior living communities that
provide short term and long term residential care and other
services for residents.
(3) Includes managed senior living communities that provide
short term and long term residential care and other services for
residents.
(4) Includes properties leased to medical providers, medical
related businesses, clinics and biotech laboratory tenants.
(5) Includes the operating results of certain properties that
offer wellness and spa services to members.
(6) Consists of properties owned continuously since October 1,
2014.
(7) SNH recorded a liability for the amount by which the
estimated fair value for accounting purposes exceeded the price SNH
paid for its investment in RMR common stock in June 2015. A portion
of this liability is being amortized on a straight line basis
through December 31, 2035, the then 20 year life of the property
management agreement with the operating subsidiary of RMR as a
reduction to property management fees, which are included in
property operating expenses.
SENIOR HOUSING PROPERTIES TRUST
CONDENSED CONSOLIDATED BALANCE
SHEETS
(amounts in thousands)
(unaudited)
Balance Sheet:
December 31, December 31, 2015
2014
ASSETS
Real estate properties $ 7,456,940 $ 6,222,360 Less accumulated
depreciation (1,147,540) (973,205) 6,309,400
5,249,155 Cash and cash equivalents 37,656 27,594 Restricted cash
6,155 10,544 Deferred financing fees, net 27,695 30,549 Acquired
real estate leases and other intangible assets, net 604,286 472,788
Other assets 198,786 177,639 Total assets $ 7,183,978
$ 5,968,269
LIABILITIES AND
SHAREHOLDERS’ EQUITY
Unsecured revolving credit facility $ 775,000 $ 80,000 Unsecured
term loans 550,000 350,000 Senior unsecured notes, net of discount
1,495,066 1,743,628 Secured debt and capital leases 682,959 627,076
Accrued interest 16,974 20,046 Assumed real estate lease
obligations, net 115,363 122,826 Other liabilities 188,856
72,286 Total liabilities 3,824,218 3,015,862 Total
shareholders’ equity 3,359,760 2,952,407 Total
liabilities and shareholders’ equity $ 7,183,978 $ 5,968,269
A Maryland Real Estate Investment Trust with
transferable shares of beneficial interest listed on the New York
Stock Exchange.
No shareholder, Trustee or officer is
personally liable for any act or obligation of the Trust.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160223005657/en/
Senior Housing Properties TrustOlivia Snyder,
617-796-8234Investor Relations Analystwww.snhreit.com
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