Conference Call Scheduled for Thursday, February 13, 2025 at
1:00 pm ET
CareTrust REIT, Inc. (NYSE:CTRE) today reported operating
results for the quarter and year ended December 31, 2024, as well
as other recent events.
For the quarter, CareTrust REIT reported:
- Investments of $696.5 million at an estimated stabilized yield
of 9.9%;
- 15.9 million shares sold in a public offering of its common
stock for gross proceeds of $507.8 million;
- Upsized its existing revolving credit line to $1.2 billion and
extended maturity date to February 2029;
- 98.8% of contractual rent and interest collected;
- Net income of $52.1 million and net income per share of
$0.29;
- Net Debt to Annualized Normalized Run Rate EBITDA of 0.5x;
- Normalized FFO of $72.9 million and normalized FFO per share of
$0.40;
- Normalized FAD of $74.3 million and normalized FAD per share of
$0.41;
- A quarterly dividend of $0.29 per share, representing a payout
ratio of approximately 71% on normalized FAD; and
- Announced agency upgrade of its unsecured notes to investment
grade.
Since quarter end, CareTrust REIT reported:
- Investments totaling approximately $26.8 million at an
estimated stabilized yield of 10.6%;
- Investment pipeline of approximately $325 million;
- Entered into a new $750.0 million ATM Program; and
- Cash on hand of approximately $205 million.
CareTrust’s President and Chief Executive Officer, Dave
Sedgwick, commented on the Company’s 2024 fourth quarter and full
year results. "We finished a record year with a record quarter. Now
all eyes are on 2025 and beyond.” Mr. Sedgwick continued, “We
continue to position the company to build on the momentum of
impactful growth with top-tier operators. Our balance sheet, access
to capital, team, partnerships, and opportunities to grow and
diversify the portfolio are all in a stronger position than they
were twelve months ago.”
Financial Results for Quarter and Year Ended December 31,
2024
Chief Financial Officer, Bill Wagner, reported that, for the
fourth quarter, CareTrust reported net income of $52.1 million, or
$0.29 per diluted weighted-average common share, normalized FFO of
$72.9 million, or $0.40 per diluted weighted-average common share,
and normalized FAD of $74.3 million, or $0.41 per diluted
weighted-average common share. For the year ended December 31,
2024, CareTrust reported net income of $125.1 million, or $0.80 per
diluted weighted-average common share, normalized FFO of $232.9
million, or $1.50 per diluted weighted-average common share, and
normalized FAD of $238.8 million, or $1.54 per diluted
weighted-average common share.
Liquidity
As of quarter end, CareTrust reported net debt-to-annualized
normalized run rate EBITDA of 0.5x, which is below the Company's
target leverage range of 4.0x to 5.0x, and a net debt-to-enterprise
value of approximately 3.5%. Mr. Wagner stated that, as of today,
the Company has no borrowings outstanding on its $1.2 billion
revolving credit line, with no scheduled debt maturities prior to
2028. He also disclosed that CareTrust currently has approximately
$205 million in cash on hand. During the fourth quarter of 2024,
the Company sold 15.9 million shares in a public offering of its
common stock at a price of $32.00 per share for gross proceeds of
$507.8 million. As of February 12, 2025, the Company had $750.0
million available for future issuances under the ATM Program. "We
have plenty of availability under both our ATM Program and
revolving credit line which will allow us to fund a replenishing
pipeline of accretive investment opportunities," said Mr.
Wagner.
Guidance
The Company issued guidance for 2025, with Mr. Wagner projecting
on a per-diluted weighted-average common share basis net income of
approximately $1.35 to $1.39, normalized FFO of approximately $1.68
to $1.72, and normalized FAD of approximately $1.72 to $1.76. He
noted that the 2025 guidance is based on a diluted weighted-average
common share count of 187.5 million shares, and assumes the
following:
- All investments year-to-date;
- No new investments;
- Dispositions made to date;
- Loan repayments made to date or expected to be made;
- No new dispositions;
- No new debt incurrences or new equity issuances; and
- Estimated 2.5% CPI-based rent escalators under CareTrust's
long-term net leases.
Dividend Maintained
During the quarter, CareTrust declared a quarterly dividend of
$0.29 per common share. On an annualized basis, the payout ratio
was approximately 73% based on fourth quarter 2024 normalized FFO,
and 71% based on fourth quarter 2024 normalized FAD.
Conference Call
A conference call will be held on Thursday, February 13, 2025,
at 1:00 p.m. Eastern Time (10:00 a.m. Pacific Time), during which
CareTrust’s management will discuss fourth quarter and full year
2024 results, recent developments and other matters. The toll-free
dial-in number is 1 (800) 715-9871 or toll dial-in number is 1
(646) 307-1963 and the conference ID number is 2243604. To listen
to the call online, or to view any financial or other statistical
information required by SEC Regulation G, please visit the
Investors section of the CareTrust REIT website at
http://investor.caretrustreit.com. This call will be recorded, and
will be available for replay via the website for 30 days following
the call.
About CareTrust™
CareTrust REIT, Inc. is a self-administered, publicly-traded
real estate investment trust engaged in the ownership, acquisition,
development and leasing of skilled nursing, seniors housing and
other healthcare-related properties. With a nationwide portfolio of
long-term net-leased properties, and a growing portfolio of quality
operators leasing them, CareTrust REIT is pursuing both external
and organic growth opportunities across the United States. More
information about CareTrust REIT is available at
www.caretrustreit.com.
Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995:
This press release contains, and the related conference call
will include, forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Forward-looking
statements include all statements that are not historical
statements of fact and statements regarding the Company’s intent,
belief or expectations, including, but not limited to, statements
regarding the following: future financial and financing plans;
strategies related to the Company's business and its portfolio,
including acquisition opportunities and disposition plans; growth
prospects; operating and financial performance; expectations
regarding the making of distributions and payment of dividends; and
the performance of the Company’s tenants and operators and their
respective facilities.
Words such as “anticipate,” “believe,” “could,” “expect,”
“estimate,” “intend,” “may,” “plan,” “seek,” “should,” “will,”
“would,” and similar expressions, or the negative of these terms,
are intended to identify such forward-looking statements, though
not all forward-looking statements contain these identifying words.
The Company’s forward-looking statements are based on management’s
current expectations and beliefs, and are subject to a number of
risks and uncertainties that could lead to actual results differing
materially from those projected, forecasted or expected. Although
the Company believes that the assumptions underlying these
forward-looking statements are reasonable, they are not guarantees
and the Company can give no assurance that its expectations will be
attained. Factors which could have a material adverse effect on the
Company’s operations and future prospects or which could cause
actual results to differ materially from expectations include, but
are not limited to: (i) the ability and willingness of our tenants
and borrowers to meet and/or perform their obligations under the
agreements we have entered into with them, including without
limitation, their respective obligations to indemnify, defend and
hold us harmless from and against various claims, litigation and
liabilities; (ii) the risk that we may have to incur additional
impairment charges related to our assets held for sale if we are
unable to sell such assets at the prices we expect; (iii) the
impact of healthcare reform legislation, including minimum staffing
level requirements, on the operating results and financial
conditions of our tenants and borrowers; (iv) the ability of our
tenants and borrowers to comply with applicable laws, rules and
regulations in the operation of the properties we lease to them or
finance; (v) the ability and willingness of our tenants to renew
their leases with us upon their expiration, and the ability to
reposition our properties on the same or better terms in the event
of nonrenewal or in the event we replace an existing tenant, as
well as any obligations, including indemnification obligations, we
may incur in connection with the replacement of an existing tenant;
(vi) the availability of and the ability to identify (a) tenants
who meet our credit and operating standards, and (b) suitable
acquisition opportunities and the ability to acquire and lease the
respective properties to such tenants on favorable terms; (vii) the
ability to generate sufficient cash flows to service our
outstanding indebtedness; (viii) access to debt and equity capital
markets; (ix) fluctuating interest rates; (x) the impact of public
health crises, including significant COVID-19 outbreaks as well as
other pandemics or epidemics; (xi) the ability to retain our key
management personnel; (xii) the ability to maintain our status as a
real estate investment trust (“REIT”); (xiii) changes in the U.S.
tax law and other state, federal or local laws, whether or not
specific to REITs; (xiv) other risks inherent in the real estate
business, including potential liability relating to environmental
matters and illiquidity of real estate investments; and (xv) any
additional factors included in our Annual Report on Form 10-K for
the year ended December 31, 2024, including in the section entitled
“Risk Factors” in Item 1A of such report, as such risk factors may
be amended, supplemented or superseded from time to time by other
reports we file with the SEC.
This press release and the related conference call provides
information about the Company's financial results as of and for the
quarter and year ended December 31, 2024 and is provided as of the
date hereof, unless specifically stated otherwise. The Company
expressly disclaims any obligation to update or revise any
information in this press release or the related conference call
(and replays thereof), including forward-looking statements,
whether to reflect any change in the Company’s expectations, any
change in events, conditions or circumstances, or otherwise.
As used in this press release or the related conference call,
unless the context requires otherwise, references to “CTRE,”
"CareTrust," “CareTrust REIT” or the “Company” refer to CareTrust
REIT, Inc. and its consolidated subsidiaries. GAAP refers to
generally accepted accounting principles in the United States of
America.
CARETRUST REIT, INC.
CONSOLIDATED INCOME
STATEMENTS
(in thousands, except per
share data)
For the Three Months
Ended
December 31,
For the Twelve Months
Ended
December 31,
2024
2023
2024
2023
(Unaudited)
Revenues:
Rental income
$
62,199
$
53,473
$
228,261
$
198,599
Interest income from financing
receivable
1,009
—
1,009
—
Interest income from other real estate
related investments and other income
23,736
6,261
67,016
19,171
Total revenues
86,944
59,734
296,286
217,770
Expenses:
Depreciation and amortization
15,514
13,211
56,831
51,199
Interest expense
5,122
8,266
30,310
40,883
Property taxes
1,946
1,733
7,838
6,170
Impairment of real estate investments
5,353
4,791
42,225
36,301
Transaction costs
1,326
—
1,326
—
Provision for loan losses, net
4,900
—
4,900
—
Property operating expenses
1,322
563
5,714
3,423
General and administrative
9,286
6,507
28,923
21,805
Total expenses
44,769
35,071
178,067
159,781
Other income (loss):
Loss on extinguishment of debt
—
—
(657
)
—
Gain (loss) on sale of real estate,
net
46
260
(2,208
)
2,218
Unrealized gain (loss) on other real
estate related investments, net
9,734
1,371
9,045
(6,485
)
Total other income (loss)
9,780
1,631
6,180
(4,267
)
Net income
51,955
26,294
124,399
53,722
Net loss attributable to noncontrolling
interests
(180
)
(2
)
(681
)
(13
)
Net income attributable to CareTrust
REIT, Inc.
$
52,135
$
26,296
$
125,080
$
53,735
Earnings per common share attributable
to CareTrust REIT, Inc.:
Basic
$
0.29
$
0.22
$
0.81
$
0.50
Diluted
$
0.29
$
0.22
$
0.80
$
0.50
Weighted-average number of common
shares:
Basic
181,645
121,411
154,795
105,956
Diluted
182,013
121,684
155,167
106,152
Dividends declared per common
share
$
0.29
$
0.28
$
1.16
$
1.12
CARETRUST REIT, INC.
RECONCILIATIONS OF NET INCOME
TO NON-GAAP FINANCIAL MEASURES
(in thousands)
(Unaudited)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2024
2023
2024
2023
Net income attributable to CareTrust
REIT, Inc.
$
52,135
$
26,296
$
125,080
$
53,735
Depreciation and amortization
15,514
13,211
56,831
51,199
Noncontrolling interests' share of real
estate related depreciation and amortization
(837
)
—
(837
)
—
Interest expense[1]
4,768
8,266
29,025
40,883
Amortization of stock-based
compensation
1,461
1,774
6,130
5,153
EBITDA attributable to CareTrust REIT,
Inc.
73,041
49,547
216,229
150,970
Write-off of deferred financing costs
354
—
354
—
Impairment of real estate investments
5,353
4,791
42,225
36,301
Provision for loan losses, net
4,900
—
4,900
—
Property operating expenses
1,665
714
6,891
4,095
(Gain) loss on sale of real estate,
net
(46
)
(260
)
2,208
(2,218
)
Non-routine transaction costs
1,326
—
1,326
—
Loss on extinguishment of debt
—
—
657
—
Extraordinary incentive plan payment
2,313
—
2,313
—
Unrealized (gain) loss on other real
estate related investments, net
(9,734
)
(1,371
)
(9,045
)
6,485
Normalized EBITDA attributable to
CareTrust REIT, Inc.
79,172
53,421
$
268,058
$
195,633
Full impact of quarterly
investments[2]
11,027
48
Normalized Run Rate EBITDA attributable
to CareTrust REIT, Inc.
$
90,199
$
53,469
NET DEBT TO ANNUALIZED
NORMALIZED RUN RATE EBITDA RECONCILIATION
(in thousands)
(Unaudited)
Three Months Ended
December 31,
2024
2023
Total debt
$
400,000
$
600,000
Cash, cash equivalents
(213,822
)
(294,448
)
Net Debt
$
186,178
$
305,552
Annualized Normalized Run Rate EBITDA
attributable to CareTrust REIT, Inc.[3]
$
360,796
$
213,876
Net Debt to Annualized Normalized Run
Rate EBITDA attributable to CareTrust REIT, Inc.
0.5x
1.4x
[1] Interest Expense excludes the effect
of the $75.0 million participation interest outstanding during a
portion of 2024 and the write-off of deferred financing fees.
[2] Quarterly adjustments give effect to
the investments completed and loans receivable pay downs during the
three months ended for the respective period as though such
investments and pay downs were completed as of the beginning of the
period.
[3] Annualized Normalized Run Rate EBITDA
is calculated as Normalized Run Rate EBITDA attributable to
CareTrust REIT, Inc. for the quarter multiplied by four (4).
CARETRUST REIT, INC.
RECONCILIATIONS OF NET INCOME
TO NON-GAAP FINANCIAL MEASURES (continued)
(in thousands)
(Unaudited)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2024
2023
2024
2023
Net income attributable to CareTrust
REIT, Inc.
$
52,135
$
26,296
$
125,080
$
53,735
Real estate related depreciation and
amortization
15,507
13,206
56,804
51,179
Noncontrolling interests' share of real
estate related depreciation and amortization
(837
)
—
(837
)
—
Impairment of real estate investments
5,353
4,791
42,225
36,301
(Gain) loss on sale of real estate,
net
(46
)
(260
)
2,208
(2,218
)
Funds from Operations (FFO)
attributable to CareTrust REIT, Inc.
72,112
44,033
225,480
138,997
Write-off of deferred financing costs
354
—
354
—
Provision for loan losses, net
4,900
—
4,900
—
Property operating expenses
1,665
714
6,891
4,095
Non-routine transaction costs
1,326
—
1,326
—
Loss on extinguishment of debt
—
—
657
—
Extraordinary incentive plan payment
2,313
—
2,313
—
Unrealized (gain) loss on other real
estate related investments, net
(9,734
)
(1,371
)
(9,045
)
6,485
Normalized FFO attributable to
CareTrust REIT, Inc.
$
72,936
$
43,376
$
232,876
$
149,577
CARETRUST REIT, INC.
RECONCILIATIONS OF NET INCOME
TO NON-GAAP FINANCIAL MEASURES (continued)
(in thousands, except per
share data)
(Unaudited)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2024
2023
2024
2023
Net income attributable to CareTrust
REIT, Inc.
$
52,135
$
26,296
$
125,080
$
53,735
Real estate related depreciation and
amortization
15,507
13,206
56,804
51,179
Noncontrolling interests' share of real
estate related depreciation and amortization
(837
)
—
(837
)
—
Amortization of deferred financing
fees
619
610
2,461
2,436
Amortization of stock-based
compensation
1,461
1,774
6,130
5,153
Straight-line rental income
7
8
28
29
Amortization of lease incentives
13
—
22
—
Noncontrolling interests' share of
amortization of lease incentives
(6
)
—
(6
)
—
Amortization of below market leases
(926
)
(384
)
(2,885
)
(384
)
Noncontrolling interests' share of
amortization of below market leases
463
—
463
—
Non-cash revenues and expenses
(281
)
—
(281
)
—
Impairment of real estate investments
5,353
4,791
42,225
36,301
(Gain) loss on sale of real estate,
net
(46
)
(260
)
2,208
(2,218
)
Funds Available for Distribution (FAD)
attributable to CareTrust REIT, Inc.
73,462
46,041
231,412
146,231
Write-off of deferred financing costs
354
—
354
—
Provision for loan losses, net
4,900
—
4,900
—
Property operating expenses
1,665
714
6,891
4,095
Non-routine transaction costs
1,326
—
1,326
—
Loss on extinguishment of debt
—
—
657
—
Extraordinary incentive plan payment
2,313
—
2,313
—
Unrealized (gain) loss on other real
estate related investments, net
(9,734
)
(1,371
)
(9,045
)
6,485
Normalized FAD attributable to
CareTrust REIT, Inc.
$
74,286
$
45,384
$
238,808
$
156,811
FFO per share attributable to CareTrust
REIT, Inc.
$
0.40
$
0.36
$
1.45
$
1.31
Normalized FFO per share attributable
to CareTrust REIT, Inc.
$
0.40
$
0.36
$
1.50
$
1.41
FAD per share attributable to CareTrust
REIT, Inc.
$
0.40
$
0.38
$
1.49
$
1.38
Normalized FAD per share attributable
to CareTrust REIT, Inc.
$
0.41
$
0.37
$
1.54
$
1.48
Diluted weighted average shares
outstanding [1]
182,222
121,854
155,325
106,264
[1] For the periods presented, the diluted
weighted average shares have been calculated using the treasury
stock method.
CARETRUST REIT, INC.
CONSOLIDATED INCOME STATEMENTS
- 5 QUARTER TREND
(in thousands, except per
share data)
(Unaudited)
Quarter
Quarter
Quarter
Quarter
Quarter
Ended
Ended
Ended
Ended
Ended
December 31, 2023
March 31, 2024
June 30, 2024
September 30, 2024
December 31, 2024
Revenues:
Rental income
$ 53,473
$ 53,502
$ 55,407
$ 57,153
$ 62,199
Interest income from financing
receivable
—
—
—
—
1,009
Interest income from other real estate
related investments and other income
6,261
9,568
13,484
20,228
23,736
Total revenues
59,734
63,070
68,891
77,381
86,944
Expenses:
Depreciation and amortization
13,211
13,448
13,860
14,009
15,514
Interest expense
8,266
8,228
8,679
8,281
5,122
Property taxes
1,733
1,801
1,976
2,115
1,946
Impairment of real estate investments
4,791
2,744
25,711
8,417
5,353
Transaction costs
—
—
—
—
1,326
Provision for loan losses, net
—
—
—
—
4,900
Property operating expenses
563
660
255
3,477
1,322
General and administrative
6,507
6,838
6,136
6,663
9,286
Total expenses
35,071
33,719
56,617
42,962
44,769
Other income (loss):
Loss on extinguishment of debt
—
—
—
(657)
—
Gain (loss) on sale of real estate,
net
260
11
21
(2,286)
46
Unrealized gain (loss) on other real
estate related investments, net
1,371
(612)
(1,877)
1,800
9,734
Total other income (loss)
1,631
(601)
(1,856)
(1,143)
9,780
Net income
26,294
28,750
10,418
33,276
51,955
Net (loss) income attributable to
noncontrolling interests
(2)
4
(340)
(165)
(180)
Net income attributable to CareTrust
REIT, Inc.
$ 26,296
$ 28,746
$ 10,758
$ 33,441
$ 52,135
Diluted earnings per share attributable
to CareTrust REIT, Inc.
$ 0.22
$ 0.22
$ 0.07
$ 0.21
$ 0.29
Diluted weighted average shares
outstanding
121,684
133,202
145,258
159,850
182,013
CARETRUST REIT, INC.
RECONCILIATIONS OF NET INCOME
TO NON-GAAP FINANCIAL MEASURES - 5 QUARTER TREND
(in thousands)
(Unaudited)
Quarter
Quarter
Quarter
Quarter
Quarter
Ended
Ended
Ended
Ended
Ended
December 31, 2023
March 31, 2024
June 30, 2024
September 30, 2024
December 31, 2024
Net income attributable to CareTrust
REIT, Inc.
$
26,296
$
28,746
$
10,758
$
33,441
$
52,135
Depreciation and amortization
13,211
13,448
13,860
14,009
15,514
Noncontrolling interests' share of real
estate related depreciation and amortization
—
—
—
—
(837
)
Interest expense
8,266
8,228
8,222
7,807
4,768
Amortization of stock-based
compensation
1,774
2,120
1,406
1,143
1,461
EBITDA attributable to CareTrust REIT,
Inc.
49,547
52,542
34,246
56,400
73,041
Write-off of deferred financing costs
—
—
—
—
354
Impairment of real estate investments
4,791
2,744
25,711
8,417
5,353
Provision for loan losses, net
—
—
—
—
4,900
Property operating expenses
714
972
361
3,893
1,665
(Gain) loss on sale of real estate,
net
(260
)
(11
)
(21
)
2,286
(46
)
Loss on extinguishment of debt
—
—
—
657
—
Non-routine transaction costs
—
—
—
—
1,326
Extraordinary incentive plan payment
—
—
—
—
2,313
Unrealized (gain) loss on other real
estate related investments, net
(1,371
)
612
1,877
(1,800
)
(9,734
)
Normalized EBITDA attributable to
CareTrust REIT, Inc.
$
53,421
$
56,859
$
62,174
$
69,853
$
79,172
Net income attributable to CareTrust
REIT, Inc.
$
26,296
$
28,746
$
10,758
$
33,441
$
52,135
Real estate related depreciation and
amortization
13,206
13,442
13,853
14,002
15,507
Noncontrolling interests' share of real
estate related depreciation and amortization
—
—
—
—
(837
)
Impairment of real estate investments
4,791
2,744
25,711
8,417
5,353
(Gain) loss on sale of real estate,
net
(260
)
(11
)
(21
)
2,286
(46
)
Funds from Operations (FFO)
attributable to CareTrust REIT, Inc.
44,033
44,921
50,301
58,146
72,112
Write-off of deferred financing costs
—
—
—
—
354
Provision for loan losses, net
—
—
—
—
4,900
Property operating expenses
714
972
361
3,893
1,665
Non-routine transaction costs
—
—
—
—
1,326
Loss on extinguishment of debt
—
—
—
657
—
Extraordinary incentive plan payment
—
—
—
—
2,313
Unrealized (gain) loss on other real
estate related investments, net
(1,371
)
612
1,877
(1,800
)
(9,734
)
Normalized FFO attributable to
CareTrust REIT, Inc.
$
43,376
$
46,505
$
52,539
$
60,896
$
72,936
CARETRUST REIT, INC.
RECONCILIATIONS OF NET INCOME
TO NON-GAAP FINANCIAL MEASURES - 5 QUARTER TREND
(continued)
(in thousands, except per
share data)
(Unaudited)
Quarter
Quarter
Quarter
Quarter
Quarter
Ended
Ended
Ended
Ended
Ended
December 31, 2023
March 31, 2024
June 30, 2024
September 30, 2024
December 31, 2024
Net income attributable to CareTrust
REIT, Inc.
$
26,296
$
28,746
$
10,758
$
33,441
$
52,135
Real estate related depreciation and
amortization
13,206
13,442
13,853
14,002
15,507
Noncontrolling interests' share of real
estate related depreciation and amortization
—
—
—
—
(837
)
Amortization of deferred financing
fees
610
614
614
614
619
Amortization of stock-based
compensation
1,774
2,120
1,406
1,143
1,461
Straight-line rental income
8
7
7
7
7
Amortization of lease incentives
—
—
4
5
13
Noncontrolling interests' share of
amortization of lease incentives
—
—
—
—
(6
)
Amortization of below market leases
(384
)
(575
)
(575
)
(809
)
(926
)
Noncontrolling interests' share of
amortization of below market leases
—
—
—
—
463
Non-cash revenues and expenses
—
—
—
—
(281
)
Impairment of real estate investments
4,791
2,744
25,711
8,417
5,353
(Gain) loss on sale of real estate,
net
(260
)
(11
)
(21
)
2,286
(46
)
Funds Available for Distribution (FAD)
attributable to CareTrust REIT, Inc.
46,041
47,087
51,757
59,106
73,462
Write-off of deferred financing costs
—
—
—
—
354
Provision for loan losses, net
—
—
—
—
4,900
Property operating expenses
714
972
361
3,893
1,665
Non-routine transaction costs
—
—
—
—
1,326
Loss on extinguishment of debt
—
—
—
657
—
Extraordinary incentive plan payment
—
—
—
—
2,313
Unrealized (gain) loss on other real
estate related investments, net
(1,371
)
612
1,877
(1,800
)
(9,734
)
Normalized FAD attributable to
CareTrust REIT, Inc.
$
45,384
$
48,671
$
53,995
$
61,856
$
74,286
FFO per share attributable to CareTrust
REIT, Inc.
$
0.36
$
0.34
$
0.35
$
0.36
$
0.40
Normalized FFO per share attributable
to CareTrust REIT, Inc.
$
0.36
$
0.35
$
0.36
$
0.38
$
0.40
FAD per share attributable to CareTrust
REIT, Inc.
$
0.38
$
0.35
$
0.36
$
0.37
$
0.40
Normalized FAD per share attributable
to CareTrust REIT, Inc.
$
0.37
$
0.37
$
0.37
$
0.39
$
0.41
Diluted weighted average shares
outstanding [1]
121,854
133,328
145,380
160,025
182,222
[1] For the periods presented, the diluted
weighted average shares have been calculated using the treasury
stock method.
CARETRUST REIT, INC.
CONSOLIDATED BALANCE
SHEETS
(in thousands)
December 31, 2024
December 31, 2023
Assets:
Real estate investments, net
$
2,226,740
$
1,567,119
Financing receivable, at fair value
(including accrued interest of $281 as of December 31, 2024)
96,004
—
Other real estate related investments
(including accrued interest of $4,725 and $1,727 as of December 31,
2024 and 2023, respectively)
795,203
180,368
Assets held for sale, net
57,261
15,011
Cash and cash equivalents
213,822
294,448
Accounts and other receivables
1,174
395
Prepaid expenses and other assets, net
35,608
23,337
Deferred financing costs, net
11,204
4,160
Total assets
$
3,437,016
$
2,084,838
Liabilities and Equity:
Senior unsecured notes payable, net
$
396,927
$
396,039
Senior unsecured term loan, net
—
199,559
Accounts payable, accrued liabilities and
deferred rent liabilities
56,318
33,992
Dividends payable
54,388
36,531
Total liabilities
507,633
666,121
Redeemable noncontrolling interest
18,243
—
Equity:
Common stock
1,870
1,300
Additional paid-in capital
3,439,117
1,883,147
Cumulative distributions in excess of
earnings
(532,570
)
(467,628
)
Total stockholders' equity
2,908,417
1,416,819
Noncontrolling interests
2,723
1,898
Total equity
2,911,140
1,418,717
Total liabilities and equity
$
3,437,016
$
2,084,838
CARETRUST REIT, INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(in thousands)
For the Twelve Months Ended
December 31,
2024
2023
Cash flows from operating activities:
Net income
$
124,399
$
53,722
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization (including
below-market ground leases)
56,932
51,257
Amortization of deferred financing
costs
2,816
2,436
Loss on extinguishment of debt
282
—
Unrealized (gain) loss on other real
estate related investments, net
(9,045
)
6,485
Amortization of stock-based
compensation
6,130
5,153
Straight-line rental income
28
29
Amortization of lease incentives
22
—
Amortization of below market leases
(2,885
)
(384
)
Noncash interest income
(3,279
)
(407
)
Loss (gain) on sale of real estate,
net
2,208
(2,218
)
Impairment of real estate investments
42,225
36,301
Provision for loan losses, net
4,900
—
Change in operating assets and
liabilities:
Accounts and other receivables
(808
)
(9
)
Prepaid expenses and other assets, net
(3,719
)
(21
)
Accounts payable, accrued liabilities and
deferred rent liabilities
24,045
2,423
Net cash provided by operating
activities
244,251
154,767
Cash flows from investing activities:
Acquisitions of real estate, net of
deposits applied
(812,002
)
(233,776
)
Purchases of equipment, furniture and
fixtures and improvements to real estate
(8,054
)
(10,976
)
Investment in real estate related
investments and other loans receivable
(559,188
)
(60,319
)
Preferred equity investments
(52,000
)
(1,782
)
Investment in financing receivable
(95,723
)
—
Principal payments received on real estate
related investments and other loans receivable
4,512
26,525
Escrow deposits for potential acquisitions
of real estate
(5,167
)
(3,800
)
Net proceeds from sales of real estate
13,939
16,313
Net cash used in investing activities
(1,513,683
)
(267,815
)
Cash flows from financing activities:
Proceeds from the issuance of common
stock, net
1,552,894
634,446
Proceeds from the secured borrowing
75,000
—
Borrowings under unsecured revolving
credit facility
—
185,000
Payments on unsecured revolving credit
facility
—
(310,000
)
Payments on senior unsecured term loan
(200,000
)
—
Payment on secured borrowing
(75,000
)
—
Payments on extinguishment of debt and
deferred financing costs
(9,188
)
(68
)
Net-settle adjustment on restricted
stock
(2,484
)
(1,479
)
Dividends paid on common stock
(172,165
)
(115,492
)
Contributions from noncontrolling
interests
19,818
1,952
Distributions to noncontrolling
interests
(69
)
(41
)
Net cash provided by financing
activities
1,188,806
394,318
Net (decrease) increase in cash and cash
equivalents
(80,626
)
281,270
Cash and cash equivalents as of the
beginning of period
294,448
13,178
Cash and cash equivalents as of the end
of period
$
213,822
$
294,448
CARETRUST REIT, INC.
DEBT SUMMARY
(dollars in thousands)
(Unaudited)
December 31, 2024
Interest
Maturity
% of
Deferred
Net Carrying
Debt
Rate
Date
Principal
Principal
Loan Costs
Value
Fixed Rate Debt
Senior unsecured notes payable
3.875
%
2028
$
400,000
100.0
%
$
(3,073
)
$
396,927
Floating Rate Debt
Unsecured revolving credit facility
—
%
[1]
2029
[2]
—
—
%
—
[3]
—
Total Debt
3.875
%
$
400,000
100.0
%
$
(3,073
)
$
396,927
[1] Funds can be borrowed at applicable
SOFR plus 1.05% to 1.55% or at the Base Rate (as defined) plus
0.05% to 0.55%.
[2] Maturity date does not assume exercise
of two 6-month extension options.
[3] Deferred financing fees are not shown
net for the unsecured revolving credit facility and are included in
assets on the balance sheet.
CARETRUST REIT, INC.
RECONCILIATIONS OF NET INCOME
TO NON-GAAP FINANCIAL MEASURES
(shares in thousands)
(Unaudited)
2025 Guidance
Full Year 2025
Guidance[1]
Low
High
Net income attributable to CareTrust
REIT, Inc.
$
1.35
$
1.39
Real estate related depreciation and
amortization
0.38
0.38
Noncontrolling interests' share of real
estate related depreciation and amortization
(0.05
)
(0.05
)
(Gain) loss on sale of real estate
(0.02
)
(0.02
)
Funds from Operations (FFO)
attributable to CareTrust REIT, Inc.
1.66
1.70
Amortization of extraordinary stock
grants
0.02
0.02
Normalized FFO attributable to
CareTrust REIT, Inc.
$
1.68
$
1.72
Net income attributable to CareTrust
REIT, Inc.
$
1.35
$
1.39
Real estate related depreciation and
amortization
0.38
0.38
Noncontrolling interests' share of real
estate related depreciation and amortization
(0.05
)
(0.05
)
Amortization of deferred financing
fees
0.02
0.02
Amortization of stock-based
compensation
0.04
0.04
Amortization of extraordinary stock
grants
0.02
0.02
Straight-line rental income
—
—
Amortization of below market leases
(0.02
)
(0.02
)
Noncontrolling interests' share of
amortization of below market leases
0.01
0.01
Noncash revenues related to financing
receivable
(0.01
)
(0.01
)
Amortization of lease incentives
—
—
Noncontrolling interests' share of
amortization of lease incentives
—
—
(Gain) loss on sale of real estate
(0.02
)
(0.02
)
Funds Available for Distribution (FAD)
attributable to CareTrust REIT, Inc.
1.72
1.76
Normalized FAD attributable to
CareTrust REIT, Inc.
$
1.72
$
1.76
Weighted average shares
outstanding:
Diluted
187,518
187,518
[1]This guidance assumes and includes (i)
all investments, dispositions and expected loan repayments made to
date or expected to be made, (ii) no new investments, dispositions,
new loans or loan repayments, (iii) no new debt incurrences or new
equity issuances, and (iv) estimated 2.5% CPI-based rent escalators
under CareTrust's long-term net leases.
Non-GAAP Financial Measures
EBITDA attributable to CareTrust REIT, Inc. represents net
income (loss) attributable to CareTrust REIT, Inc. before interest
expense (including amortization of deferred financing costs),
amortization of stock-based compensation, and depreciation and
amortization. Normalized EBITDA attributable to CareTrust REIT,
Inc. represents EBITDA attributable to CareTrust REIT, Inc. as
further adjusted to eliminate the impact of certain items that the
Company does not consider indicative of core operating performance,
such as recovery of previously reversed rent, lease termination
revenue, property operating expenses, gains or losses from
dispositions of real estate, real estate impairment charges,
provision for loan losses, non-routine transaction costs, loss on
extinguishment of debt, extraordinary incentive plan payment,
write-off of deferred financing costs, unrealized loss on other
real estate related investments and provision for doubtful accounts
and lease restructuring, as applicable. EBITDA attributable to
CareTrust REIT, Inc. and Normalized EBITDA attributable to
CareTrust REIT, Inc. do not represent cash flows from operations or
net income as defined by GAAP and should not be considered an
alternative to those measures in evaluating the Company’s liquidity
or operating performance. EBITDA attributable to CareTrust REIT,
Inc. and Normalized EBITDA attributable to CareTrust REIT, Inc. do
not purport to be indicative of cash available to fund future cash
requirements, including the Company’s ability to fund capital
expenditures or make payments on its indebtedness. Further, the
Company’s computation of EBITDA and Normalized EBITDA may not be
comparable to EBITDA and Normalized EBITDA reported by other
REITs.
Funds from Operations (“FFO”), as defined by the National
Association of Real Estate Investment Trusts (“Nareit”), and Funds
Available for Distribution (“FAD”) are important non-GAAP
supplemental measures of operating performance for a REIT. Because
the historical cost accounting convention used for real estate
assets requires straight-line depreciation except on land, such
accounting presentation implies that the value of real estate
assets diminishes predictably over time. Since real estate values
have historically risen or fallen with market and other conditions,
presentations of operating results for a REIT that uses historical
cost accounting for depreciation could be less informative. Thus,
Nareit created FFO as a supplemental measure of operating
performance for REITs that excludes historical cost depreciation
and amortization, among other items, from net income, as defined by
GAAP.
FFO is defined by Nareit as net income computed in accordance
with GAAP, excluding gains or losses from dispositions of real
estate investments, real estate related depreciation and
amortization and real estate impairment charges, adjustments for
the share of consolidated joint ventures, and adjustments for
unconsolidated partnerships and joint ventures. Noncontrolling
interests' pro rata share information is prepared by applying
noncontrolling interests' actual ownership percentage for the
period and is intended to reflect noncontrolling interests'
proportionate economic interest in the financial position and
operating results of properties in our portfolio. The Company
computes FFO attributable to CareTrust REIT, Inc. in accordance
with Nareit’s definition.
FAD attributable to CareTrust REIT, Inc. is defined as FFO
attributable to CareTrust REIT, Inc. excluding noncash income and
expenses, such as amortization of stock-based compensation,
amortization of deferred financing fees, amortization of above and
below market intangibles, amortization of lease incentives, the
effects of straight-line rent and adjustments for the share of
consolidated joint ventures. The Company considers FAD attributable
to CareTrust REIT, Inc. to be a useful supplemental measure to
evaluate the Company’s operating results excluding these income and
expense items to help investors, analysts and other interested
parties compare the operating performance of the Company between
periods or as compared to other companies on a more consistent
basis.
In addition, the Company reports Normalized FFO attributable to
CareTrust REIT, Inc. and Normalized FAD attributable to CareTrust
REIT, Inc., which adjust FFO and FAD for certain revenue and
expense items that the Company does not believe are indicative of
its ongoing operating results, such as write-off of deferred
financing costs, provision for loan losses, non-routine transaction
costs, provision for doubtful accounts and lease restructuring,
loss on extinguishment of debt, extraordinary incentive plan
payment, unrealized loss on other real estate related investments,
recovery of previously reversed rent, lease termination revenue and
property operating expenses. By excluding these items, investors,
analysts and our management can compare Normalized FFO and
Normalized FAD between periods more consistently.
While FFO, Normalized FFO, FAD and Normalized FAD are relevant
and widely-used measures of operating performance among REITs, they
do not represent cash flows from operations or net income as
defined by GAAP and should not be considered an alternative to
those measures in evaluating the Company’s liquidity or operating
performance. FFO, Normalized FFO, FAD and Normalized FAD do not
purport to be indicative of cash available to fund future cash
requirements.
Further, the Company’s computation of FFO, Normalized FFO, FAD
and Normalized FAD may not be comparable to FFO, Normalized FFO,
FAD and Normalized FAD reported by other REITs that do not define
FFO in accordance with the current Nareit definition or that
interpret the current Nareit definition or define FAD differently
than the Company does.
The Company also discloses Net Debt to Annualized Normalized Run
Rate EBITDA, which compares the Company’s Net Debt as of the last
day of the quarter to the Annualized Run Rate EBITDA attributable
to CareTrust REIT, Inc. for the quarter. Net Debt is defined as the
Company’s Total Debt as of the last day of the specified quarter
adjusted to exclude the Company’s cash, cash equivalents,
restricted cash and escrow deposits on acquisition of real estate
as of such date as well as the net proceeds from the expected
settlement of shares sold under equity forward contracts through
the Company’s ATM Program that are outstanding as of such date.
Normalized Run Rate EBITDA represents Normalized EBITDA, adjusted
to give effect to the investments completed during the three months
ended for the respective period as though such investments were
completed as of the beginning of the period. Annualized Normalized
Run Rate EBITDA is calculated as Normalized Run Rate EBITDA
attributable to CareTrust REIT, Inc. for the specified quarter
multiplied by four.
The Company believes that net income attributable to CareTrust
REIT, Inc., as defined by GAAP, is the most appropriate earnings
measure. The Company also believes that the use of EBITDA,
Normalized EBITDA, FFO, Normalized FFO, FAD and Normalized FAD,
combined with the required GAAP presentations, improves the
understanding of operating results of REITs among investors and
makes comparisons of operating results among such companies more
meaningful. The Company considers EBITDA and Normalized EBITDA, in
each case attributable to CareTrust REIT, Inc., useful in
understanding the Company’s operating results independent of its
capital structure, indebtedness and other charges that are not
indicative of its ongoing results, thereby allowing for a more
meaningful comparison of operating performance between periods and
against other REITs. The Company considers FFO, Normalized FFO, FAD
and Normalized FAD, in each case attributable to CareTrust REIT,
Inc., to be useful measures for reviewing comparative operating and
financial performance because, by excluding gains or losses from
real estate dispositions, impairment charges and real estate
related depreciation and amortization, and, for FAD and Normalized
FAD, by excluding noncash income and expenses such as amortization
of stock-based compensation, amortization of deferred financing
fees, and the effects of straight-line rent, FFO, Normalized FFO,
FAD and Normalized FAD can help investors compare the Company’s
operating performance between periods and to other REITs. The
Company believes that the disclosure of Net Debt to Annualized
Normalized Run Rate EBITDA provides a useful measure to investors
to evaluate the credit strength of the Company and its ability to
service its debt obligations and to compare the Company’s credit
strength to prior reporting periods and to other companies without
the effect of charges that are not indicative of the Company’s
ongoing performance or that could obscure the Company’s actual
credit quality and after considering the effect of investments
occurring during the period.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250211442013/en/
CareTrust REIT, Inc. (949) 542-3130 ir@caretrustreit.com
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