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Omega Announces Second Quarter 2013 Financial Results; Adjusted FFO Of $0.62 Per Share For The Second Quarter

This announcement includes forward-looking statements, including without limitation the information under the heading “2013 Adjusted FFO and Adjusted FAD Guidance Confirmed.” Actual results may differ materially from those reflected in such forward-looking statements as a result of a variety of factors, including, among other things: (i) uncertainties relating to the business operations of the operators of the Company’s properties, including those relating to reimbursement by third-party payors, regulatory matters and occupancy levels; (ii) regulatory and other changes in the healthcare sector; (iii) changes in the financial position of the Company’s operators; (iv) the ability of any of the Company’s operators in bankruptcy to reject unexpired lease obligations, modify the terms of the Company’s mortgages and impede the ability of the Company to collect unpaid rent or interest during the pendency of a bankruptcy proceeding and retain security deposits for the debtor's obligations; (v) the availability and cost of capital; (vi) changes in the Company’s credit ratings and the ratings of its debt securities; (vii) competition in the financing of healthcare facilities; (viii) the Company’s ability to maintain its status as a real estate investment trust; (ix) the Company’s ability to manage, re-lease or sell any owned and operated facilities; (x) the Company’s ability to sell closed or foreclosed assets on a timely basis and on terms that allow the Company to realize the carrying value of these assets; (xi) the effect of economic and market conditions generally, and particularly in the healthcare industry; and (xii) other factors identified in the Company’s filings with the Securities and Exchange Commission. Statements regarding future events and developments and the Company’s future performance, as well as management's expectations, beliefs, plans, estimates or projections relating to the future, are forward-looking statements. The Company undertakes no obligation to update any forward-looking statements contained in this announcement.

 
OMEGA HEALTHCARE INVESTORS, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands)
   
June 30, December 31,
2013   2012
(Unaudited)
ASSETS
Real estate properties
Land and buildings $ 3,051,363 $ 3,038,553
Less accumulated depreciation   (643,514 )     (580,373 )
Real estate properties – net 2,407,849 2,458,180
Mortgage notes receivable – net   241,254       238,621  
2,649,103 2,696,801
Other investments – net   74,646       47,339  
2,723,749 2,744,140
Assets held for sale – net   1,020       1,020  
Total investments 2,724,769 2,745,160
 
Cash and cash equivalents 7,039 1,711
Restricted cash 40,127 36,660
Accounts receivable – net 138,059 125,180
Other assets   69,802       73,294  
Total assets $ 2,979,796     $ 2,982,005  
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Revolving line of credit $ 5,000 $ 158,000
Term loan 200,000 100,000
Secured borrowings 301,526 366,538
Unsecured borrowings – net 1,200,139 1,200,394
Accrued expenses and other liabilities   135,835       145,744  
Total liabilities   1,842,500       1,970,676  
 
Stockholders’ equity:
Common stock $.10 par value authorized – 200,000 shares issued and outstanding 117,152 shares as of June 30, 2013 and 112,393 as of December 31, 2012

 

11,715

 

11,239

Common stock – additional paid-in capital 1,807,201 1,664,855
Cumulative net earnings 841,306 754,128
Cumulative dividends paid   (1,522,926 )     (1,418,893 )
Total stockholders’ equity   1,137,296       1,011,329  
Total liabilities and stockholders’ equity $ 2,979,796     $ 2,982,005  
 
OMEGA HEALTHCARE INVESTORS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
Unaudited
(in thousands, except per share amounts)
   
Three Months Ended Six Months Ended
June 30, June 30,
2013   2012   2013   2012
Revenue    
Rental income $ 93,069 $ 75,228 $ 186,178 $ 151,203
Mortgage interest income 7,435 7,404 14,781 14,740
Other investment income – net 1,860 1,165 3,166 2,295
Miscellaneous   151     28     151     102  
Total operating revenues 102,515 83,825 204,276 168,340
 
Expenses
Depreciation and amortization 32,225 27,199 64,184 54,346
General and administrative 4,011 3,468 7,756 7,509
Stock-based compensation expense 1,472 1,486 2,924 2,971
Acquisition costs 9 98 143 203
Impairment loss on real estate properties - - - 272
Provisions for uncollectible mortgages, notes and accounts receivable   65     -    

65

   

-

 
Total operating expenses 37,782 32,251 75,072 65,301
 
Income before other income and expense 64,733 51,574 129,204 103,039
Other income (expense)
Interest income 14 9 17 16
Interest expense (24,952 ) (24,009 ) (50,624 ) (46,976 )
Interest – amortization of deferred financing costs (698 ) (668 ) (1,380 ) (1,297 )
Interest – refinancing gain (costs)   11,112     1,698     11,112     (5,410 )
Total other expense (14,524 ) (22,970 ) (40,875 ) (53,667 )
 
Income before (loss) gain on assets sold 50,209 28,604 88,329 49,372
(Loss) gain on assets sold – net   (1,151 )   1,968     (1,151 )   7,284  
Net income available to common stockholders $ 49,058   $ 30,572   $ 87,178   $ 56,656  
 
Income per common share available to common shareholders:
Basic:
Net income $ 0.42   $ 0.29   $ 0.76   $ 0.54  
Diluted:
Net income $ 0.42   $ 0.29   $ 0.76   $ 0.54  
 
Dividends declared and paid per common share $ 0.46   $ 0.42   $ 0.91   $ 0.83  
 
Weighted-average shares outstanding, basic   116,199     105,717     114,491     104,736  
Weighted-average shares outstanding, diluted   117,022     106,033     115,273     105,023  
 
OMEGA HEALTHCARE INVESTORS, INC.
FUNDS FROM OPERATIONS
Unaudited
(in thousands, except per share amounts)
   
Three Months Ended Six Months Ended
June 30, June 30,
2013   2012 2013   2012
   
Net income available to common stockholders $ 49,058 $ 30,572 $ 87,178 $ 56,656
Add back loss (deduct gain) from real estate dispositions   1,151     (1,968 )   1,151     (7,284 )
Sub – total 50,209 28,604 88,329 49,372
Elimination of non-cash items included in net income:
Depreciation and amortization 32,225 27,199 64,184 54,346
Add back non-cash provision for impairments on real estate properties          

   

272

 
Funds from operations available to common stockholders $ 82,434   $ 55,803   $ 152,513   $ 103,990  
 
Weighted-average common shares outstanding, basic 116,199 105,717 114,491 104,736
Restricted stock and PRSUs 786 299 750 270
Deferred stock   37     17     32     17  
Weighted-average common shares outstanding, diluted   117,022     106,033     115,273     105,023  
 
Funds from operations per share available to common stockholders $ 0.70   $ 0.53  

$

1.32

 

$

0.99

 
 
Adjusted funds from operations:
Funds from operations available to common stockholders $ 82,434 $ 55,803 $ 152,513 $ 103,990
Add back non-cash provision for uncollectible accounts receivable 65

65

(Deduct)/add back interest refinancing expense (11,112 ) (1,698 ) (11,112 ) 5,410
Add back acquisition costs 9 98 143 203
Add back non-cash stock-based compensation expense   1,472     1,486     2,924     2,971  
Adjusted funds from operations available to common stockholders $ 72,868   $ 55,689  

$

144,533

 

$

112,574

 

This press release includes Funds From Operations, or FFO, which is a non-GAAP financial measure. For purposes of the Securities and Exchange Commission’s Regulation G, a non-GAAP financial measure is a numerical measure of a company’s historical or future financial performance, financial position or cash flows that excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable financial measure calculated and presented in accordance with GAAP in the statement of operations, balance sheet or statement of cash flows (or equivalent statements) of the company, or includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable financial measure so calculated and presented. As used in this press release, GAAP refers to generally accepted accounting principles in the United States of America. Pursuant to the requirements of Regulation G, the Company has provided reconciliations of the non-GAAP financial measures to the most directly comparable GAAP financial measures.

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