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Press Release: Omega Reports Fourth Quarter 2020 Results and Recent Developments

· 02/04/2021 16:30
-- suspended its dividend reinvestment and stock purchase plan. -- sold six facilities for $18 million in cash proceeds generating $2 million in gains. -- completed $19 million of new investments. -- invested $39 million in capital renovation and construction-in-progress projects. -- borrowed $300 million on credit facility for potential liquidity needs. -- paid a $0.67 per share quarterly common stock dividend.-- collected over 99% of second quarter contractual rent and mortgage payments (when excluding Daybreak). -- sold 7 facilities for $38 million in cash, generating $13 million in gains. -- completed $50 million of new investments. -- invested $31 million in capital renovation and construction-in-progress projects. -- repaid $300 million in credit facility borrowings. -- paid a $0.67 per share quarterly common stock dividend.-- collected over 99% of third quarter contractual rent and mortgage payments (when excluding Daybreak). -- sold 6 facilities and a land parcel for $61 million in cash, recognizing a loss of $0.7 million. -- invested $22 million in capital renovation and construction-in-progress projects. -- revised its revenue recognition accounting treatment related to operators with going concern disclosures. -- paid a $0.67 per share quarterly common stock dividend.-- collected over 99% of fourth quarter contractual rent and mortgage payments (when excluding Daybreak). -- issued $700 million aggregate principal amount of 3.375% Senior Notes due 2031. -- issued $153 million in equity through its equity shelf program. -- sold 16 facilities for $64 million in cash proceeds, generating $5 million in gains. -- completed $78 million of new investments. -- invested $19 million in capital renovation and construction-in-progress projects. -- announced the reinstatement of its dividend reinvestment and stock purchase plan. -- paid a $0.67 per share quarterly common stock dividend.-- declared a $0.67 per share quarterly common stock dividend. -- sold 5 held for sale assets for $76 million in cash proceeds, generating a $71 million gain. -- completed a $510 million acquisition. -- collected over 99% of contractual rent and mortgage payments for the month of January (when excluding Daybreak, which is transitioning its portfolio pursuant to a forbearance agreement). -- was included in the 2021 Bloomberg Gender-Equality Index.HUNT VALLEY, Md.--(BUSINESS WIRE)--February 04, 2021--

Omega Reports Fourth Quarter 2020 Results and Recent Developments

Completed a $510 Million Acquisition in January 2021

Completed $98 Million in New Investments in Q4

Issued $153 Million of Equity in Q4

Issued $700 Million 3.375% Notes due 2031 in Q4

Omega Healthcare Investors, Inc. (NYSE: OHI) (the "Company" or "Omega") today announced its results for the quarter and the year ended December 31, 2020. The Company reported net income for the quarter of $63.1 million or $0.27 per common share. The Company also reported NAREIT Funds From Operations ("NAREIT FFO") for the quarter of $173.3 million or $0.73 per common share, Adjusted Funds From Operations ("AFFO" or "Adjusted FFO") of $192.5 million or $0.81 per common share, and Funds Available for Distribution ("FAD") of $182.9 million.

NAREIT FFO, AFFO and FAD are supplemental non-GAAP financial measures that the Company believes are useful in evaluating the performance of real estate investment trusts. For more information regarding these non-GAAP measures, see the "Funds From Operations" on the Company's website at www.omegahealthcare.com.

CEO COMMENTS

Taylor Pickett, Omega's Chief Executive Officer, stated, "We are pleased to finish an unprecedented year with strong quarterly AFFO and FAD, as well as continued excellent rent collections. Furthermore, we are excited to announce a new relationship with Brookdale, a leading operator of senior living communities, through our acquisition of 24 facilities for $510 million from Healthpeak Properties in January. We also took advantage of strong capital markets in the quarter to issue both debt and equity to enhance our balance sheet and fund acquisitions."

Mr. Pickett continued, "Our operators continue to perform admirably in protecting residents. Despite a meaningful spike in COVID cases within communities nationwide during the holidays, through their enhanced infection control protocols and the continued diligence of their staff, many of our operators were able to significantly limit the increase in cases within our facilities. The efforts of both federal and state governments, including to grant priority access to vaccines for residents and staff, have highlighted their understanding of the vital role skilled nursing and assisted living facilities play within the healthcare continuum. With both occupancy and facility costs meaningfully impacted by the pandemic, we are hopeful that this support will remain forthcoming as the industry continues to focus on protecting their frail and vulnerable residents."

Mr. Pickett concluded, "We would once again like to highlight the remarkable efforts of our operators and their heroic employees, who risk their own health and that of their families to bravely protect and care for their residents, and we thank them wholeheartedly for their endeavors."

2021 RECENT DEVELOPMENTS AND 2020 FOURTH QUARTER HIGHLIGHTS

In Q1 2021, the Company...

In Q4 2020, the Company...

In Q3 2020, the Company...

In Q2 2020, the Company...

In Q1 2020, the Company...

NET INCOME

The Company reported net income of $63.1 million, or $0.27 per common share, on revenues of $263.8 million for the quarter ended December 31, 2020. This compares to net income of $61.1 million, or $0.27 per common share, on revenues of $246.7 million, for the same period in 2019.

The Company reported net income of $163.5 million, or $0.70 per common share, on revenues of $892.4 million for the year ended December 31, 2020. This compares to net income of $351.9 million, or $1.58 per common share, on revenues of $928.8 million, for the same period in 2019.

The year-over-year decrease in net income was primarily due to (i) a $135.5 million write-off of non-cash revenue (primarily straight-line revenue), (ii) a $36.6 million reduction in gains on the sale of assets, (iii) $38.0 million in provision for credit losses, (iv) a $28.2 million increase in depreciation and amortization expense from new investments, (v) a net increase of $16.2 million of impairments on direct financing leases and real estate properties, (vi) a $14.2 million increase in interest expense and (vii) a $13.3 million increase in loss on debt extinguishment. The decrease in net income was offset by (i) a $60.3 million increase in rental income from the $735 million Encore portfolio acquisition completed on October 31, 2019, (ii) a $17.8 million increase in rental income from the $655 million MedEquities Realty Trust, Inc. ("MedEquities") merger on May 17, 2019, (iii) a $13.8 million increase of non-recurring revenue, and (iv) a $3.1 million decrease of acquisition, merger and transition related costs.

FOURTH QUARTER 2020 RESULTS

Revenues -- Revenues for the quarter ended December 31, 2020 totaled $263.8 million, which included $11.9 million of non-cash revenue, $3.1 million of real estate tax and ground rents, $4.3 million of non-recurring revenue, and a $2.1 million write-off of non-cash revenue (primarily straight-line revenue).

Expenses -- Expenses for the quarter ended December 31, 2020 totaled $192.5 million, consisting of $82.6 million of depreciation and amortization expense, $56.0 million of interest expense, $28.8 million of impairment on real estate properties, $10.4 million of general and administrative ("G&A") expense, $4.4 million of stock-based compensation expense, $4.4 million in provision for credit losses, $3.2 million of real estate tax and ground lease expense, $2.7 million of amortized deferred financing costs, $2.0 million of acquisition, merger and transition related costs offset by a $2.0 million recovery on direct financing leases.

Other Income and Expense -- Other income and expense for the quarter ended December 31, 2020 was a net expense of $7.4 million, primarily consisting of $12.4 million charge related to debt extinguishment offset by a $5.2 million gain on assets sold.

Funds From Operations -- NAREIT FFO for the quarter ended December 31, 2020 was $173.3 million, or $0.73 per common share, on 237 million weighted-average common shares outstanding, compared to $175.5 million, or $0.77 per common share, on 228 million weighted-average common shares outstanding, for the same period in 2019.

The $173.3 million of NAREIT FFO includes $12.4 million in loss on debt extinguishment, $4.4 million of non-cash stock-based compensation expense, $4.4 million in provision for credit losses, a $2.1 million write-off of non-cash revenue (primarily straight-line revenue), $2.0 million of acquisition, merger and transition related costs offset by $4.3 million of non-recurring revenue and a $2.0 million recovery on direct financing leases.

The $175.5 million of NAREIT FFO for the quarter ended December 31, 2019 includes $3.8 million of non-cash stock-based compensation expense, $0.2 million write-off of non-cash revenue (primarily straight-line revenue) and $0.2 million of impairment on direct financing leases offset by $1.4 million of non-recurring revenue.

Adjusted FFO was $192.5 million, or $0.81 per common share, for the quarter ended December 31, 2020, compared to $178.3 million, or $0.78 per common share, for the same quarter in 2019. For further information, see the "Funds From Operations" schedule below and on the Company's website.

2020 ANNUAL RESULTS

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February 04, 2021 16:30 ET (21:30 GMT)