Community Healthcare Trust Announces Results for the Three Months Ended June 30, 2022

Published: Aug. 2, 2022 at 5:00 PM CDT

FRANKLIN, Tenn., Aug. 2, 2022 /PRNewswire/ -- Community Healthcare Trust Incorporated (NYSE: CHCT) (the "Company") today announced results for the three months ended June 30, 2022. The Company reported net income for the three months ended June 30, 2022 of approximately $5.6 million, or $0.21 per diluted common share. Funds from operations ("FFO") and adjusted funds from operations ("AFFO") for the three months ended June 30, 2022 totaled $0.57 and $0.62, respectively, per diluted common share.

Highlights include:

  • During the three months ended June 30, 2022, the Company acquired a 37,720 square foot inpatient rehabilitation facility for a purchase price of approximately $23.5 million. Upon acquisition, the property was 100% leased with a lease expiration in 2037.
  • The Company has three properties under definitive purchase agreements for an aggregate expected purchase price of approximately $23.4 million. The Company's expected returns on these investments range from 9.0% to 9.72%. The Company expects to close on these properties in the second half of 2022; however, the Company cannot provide assurance as to the timing of when, or whether, these transactions 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 $117.5 million. The Company's expected return on these investments will approximate 10.25%. The Company anticipates closing on these properties from the fourth quarter of 2022 through the fourth quarter of 2023; however, the Company cannot provide assurance as to the timing of when, or whether, these transactions will actually close.
  • On July 28, 2022, the Company's Board of Directors declared a quarterly common stock dividend in the amount of $0.4425 per share. The dividend is payable on August 26, 2022 to stockholders of record on August 12, 2022.

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 our target sub-markets throughout the United States. As of June 30, 2022, the Company had investments of approximately $869.5 million in 159 real estate properties (including a portion of one property accounted for as a financing lease). The properties are located in 34 states, totaling approximately 3.4 million square feet in the aggregate.

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, effects on global and national markets as well as businesses resulting from the COVID-19 pandemic, 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, 2021 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

(Dollars and shares in thousands, except per share amounts)



(Unaudited)




June 30, 2022


December 31, 2021





ASSETS




Real estate properties:




Land and land improvements

$                     101,909


$                   97,397

Buildings, improvements, and lease intangibles

764,338


736,465

Personal property

234


223

Total real estate properties

866,481


834,085

Less accumulated depreciation

(149,049)


(133,056)

Total real estate properties, net

717,432


701,029

Cash and cash equivalents

1,699


2,351

Restricted cash

659


516

Other assets, net

66,244


50,337

Total assets

$                     786,034


$                 754,233





LIABILITIES AND STOCKHOLDERS' EQUITY




Liabilities




Debt, net

$                     291,726


$                 265,625

Accounts payable and accrued liabilities

7,219


7,845

Other liabilities, net

14,127


18,651

Total liabilities

313,072


292,121





Commitments and contingencies








Stockholders' Equity




Preferred stock, $0.01 par value; 50,000 shares authorized; none issued and outstanding


Common stock, $0.01 par value; 450,000 shares authorized; 25,099 and 24,983 shares
issued and outstanding at June 30, 2022 and December 31, 2021, respectively

251


250

Additional paid-in capital

599,631


595,624

Cumulative net income

70,231


59,123

Accumulated other comprehensive gain (loss)

12,761


(4,980)

Cumulative dividends

(209,912)


(187,905)

Total stockholders' equity

472,962


462,112

Total liabilities and stockholders' equity

$                     786,034


$                 754,233


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, 2022 AND 2021

(Unaudited; Dollars and shares in thousands, except per share amounts)



Three Months Ended

June 30,


Six Months Ended

June 30,


2022


2021


2022


2021

REVENUES








Rental income

$       23,197


$       22,006


$       45,801


$       42,786

Other operating interest

852


682


1,729


1,297


24,049


22,688


47,530


44,083









EXPENSES








Property operating

4,062


3,843


8,153


7,572

General and administrative

3,610


2,893


6,926


5,752

Depreciation and amortization

8,077


7,539


16,019


14,763


15,749


14,275


31,098


28,087









INCOME BEFORE INCOME TAXES AND OTHER ITEMS

8,300


8,413


16,432


15,996

Interest expense

(2,755)


(2,736)


(5,381)


(4,966)

        Deferred income tax (expense) benefit          

(16)


(20)


1


(59)

Interest and other income

55


53


56


54

NET INCOME

$         5,584


$         5,710


$       11,108


$       11,025









NET INCOME PER COMMON SHARE:








Net income per common share – Basic

$           0.21


$           0.22


$           0.41


$           0.43

Net income per common share – Diluted

$           0.21


$           0.22


$           0.41


$           0.43

WEIGHTED AVERAGE COMMON SHARE OUTSTANDING-BASIC

23,578


23,195


23,574


23,003

WEIGHTED AVERAGE COMMON SHARE OUTSTANDING-DILUTED

23,578


23,195


23,574


23,003


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 and AFFO (1)
(Unaudited; Dollars and shares in thousands, except per share amounts)


Three Months Ended June 30,


2022


2021

Net income

$                    5,584


$                    5,710

   Real estate depreciation and amortization

8,141


7,593

FFO

$                  13,725


$                  13,303

   Straight-line rent

(917)


(981)

   Stock-based compensation

2,184


1,606

AFFO

$                  14,992


$                  13,928

   FFO per Common Share-Diluted

$                      0.57


$                      0.56

   AFFO per Common Share-Diluted

$                      0.62


$                      0.58

Weighted Average Common Shares Outstanding-Diluted (2)

24,247


23,908

(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") 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 AFFO is useful because it allows 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 (calculated in accordance with GAAP), excluding gains or losses from the sale of certain real estate assets, gains and losses from change in control, impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity, plus depreciation and amortization related to real estate properties, and after adjustments for unconsolidated partnerships and joint ventures. NAREIT also provides REITs with an option to exclude gains, losses and impairments of assets that are incidental to the main business of the REIT from the calculation of FFO.

 

In addition to FFO, the Company presents AFFO and AFFO per share. The Company defines AFFO as FFO, excluding certain expenses related to closing costs of properties acquired accounted for as business combinations and mortgages funded, excluding straight-line rent and the amortization of stock-based compensation, and including or excluding other non-cash items from time to time. 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 definition. 

 

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 and AFFO should be examined in conjunction with net income as presented elsewhere herein.

(2)

Diluted weighted average common shares outstanding for FFO and AFFO are calculated based on the treasury method, rather than the 2-class method used to calculate earnings per share.

CONTACT:  David H. Dupuy, 615-771-3052

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SOURCE Community Healthcare Trust, Inc.

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