NASHVILLE, Tenn., Nov. 10 /PRNewswire-FirstCall/ -- Healthcare Realty
Trust Incorporated (NYSE: HR) today announced results for the third quarter
ended September 30, 2008. Funds from operations ("FFO") per diluted common
share totaled $0.36, compared with $0.31 for the same period in 2007. FFO per
diluted common share totaled $1.13 for the nine months ended September 30,
2008, compared with the prior year's $1.13. FFO would have been $0.38 and
$1.14 per diluted common share for the three and nine months ended September
30, 2008, respectively, before a one-time charge of $765,000 related to a
litigation expense settlement. Funds available for distribution ("FAD") for
the third quarter of 2008 totaled $0.44 per diluted common share.
Revenues for the three months ended September 30, 2008 totaled $54.8
million, compared with the prior year's $50.5 million. Revenues for the nine
months ended September 30, 2008 totaled $159.8 million, compared with the
prior year's $149.7 million. Income from continuing operations for the three
months ended September 30, 2008 totaled $3.3 million, compared with $4.0
million for the three months ended September 30, 2007. Income from continuing
operations for the nine months ended September 30, 2008 totaled $12.5 million,
compared with the prior year's $9.3 million.
Net income for the third quarter of 2008 totaled $5.5 million, or $0.11
per diluted common share, versus $5.5 million, or $0.12 per diluted common
share, for the third quarter of 2007. Net income for the nine months ended
September 30, 2008 totaled $26.1 million, or $0.52 per diluted common share,
compared with $55.5 million, or $1.17 per diluted common share for the nine
months ended September 30, 2007. Net income for the nine months ended
September 30, 2008, as compared to 2007, was affected by the disposition of
the senior living assets and resulting gain included in discontinued
operations in 2007.
Healthcare Realty Trust is a real estate investment trust that integrates
owning, managing and developing income-producing real estate properties
associated primarily with the delivery of outpatient healthcare services
throughout the United States. The Company had investments of approximately
$1.8 billion in 179 real estate properties and mortgages as of September 30,
2008, excluding assets classified as held for sale and including investments
in three unconsolidated limited liability companies. The Company's 173 owned
real estate properties, excluding assets classified as held for sale, are
comprised of six facility types, located in 25 states, totaling approximately
10.9 million square feet. The Company provides property management services
to approximately 7.4 million square feet nationwide.
The Company directs interested parties to its Internet site,
http://www.healthcarerealty.com , where information is posted regarding this
quarter's operations. Please contact the Company at (615) 269-8175 to request
a printed copy of this information.
In addition to the historical information contained within, the matters
discussed in this press release may contain forward-looking statements that
involve risks and uncertainties. These risks are discussed in filings with the
Securities and Exchange Commission by Healthcare Realty Trust, including its
Annual Report on Form 10-K for the year ended December 31, 2007 under the
heading "Risk Factors," and as may be updated in its Quarterly Reports on Form
10-Q filed thereafter. Forward-looking statements represent the Company's
judgment as of the date of this release. The Company disclaims any obligation
to update forward-looking material.
HEALTHCARE REALTY TRUST INCORPORATED
Condensed Consolidated Statements of Income (1)
(Dollars in thousands, except per share data)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2008 2007 2008 2007
REVENUES
Master lease rent $14,434 $13,979 $43,669 $42,358
Property operating 35,441 31,208 101,767 92,190
Straight-line rent 113 611 (87) 655
Mortgage interest 579 404 1,647 1,217
Other operating 4,255 4,269 12,846 13,257
54,822 50,471 159,842 149,677
EXPENSES
General and
administrative 6,018 4,335 17,926 15,730
Property operating 22,062 18,849 60,220 54,155
Impairment 1,600 - 1,600 -
Bad debts, net
of recoveries 95 53 355 130
Depreciation 12,353 10,719 35,733 31,322
Amortization 769 997 1,919 3,597
42,897 34,953 117,753 104,934
OTHER INCOME (EXPENSE)
Gain on extinguishment
of debt, net 2,015 - 2,024 -
Interest expense (10,785) (12,096) (32,379) (36,819)
Interest and other
income, net 184 533 807 1,326
(8,586) (11,563) (29,548) (35,493)
INCOME FROM CONTINUING
OPERATIONS 3,339 3,955 12,541 9,250
DISCONTINUED
OPERATIONS (2)
Income from
discontinued
operations 1,442 2,001 4,483 11,614
Impairments - (4,057) (29) (6,849)
Gain on sales of real
estate properties 746 3,587 9,098 41,459
INCOME FROM DISCONTINUED
OPERATIONS 2,188 1,531 13,552 46,224
NET INCOME $5,527 $5,486 $26,093 $55,474
BASIC EARNINGS PER
COMMON SHARE
Income from continuing
operations per
common share $0.07 $0.08 $0.25 $0.20
Discontinued operations
per common share 0.04 0.04 0.28 0.99
Net income per
common share $0.11 $0.12 $0.53 $1.19
DILUTED EARNINGS PER
COMMON SHARE
Income from continuing
operations per
common share $0.07 $0.08 $0.25 $0.19
Discontinued operations
per common share 0.04 0.04 0.27 0.98
Net income per
common share $0.11 $0.12 $0.52 $1.17
WEIGHTED AVERAGE
COMMON SHARES
OUTSTANDING
- BASIC 49,530,813 46,683,619 49,438,796 46,680,455
WEIGHTED AVERAGE
COMMON SHARES
OUTSTANDING
- DILUTED 50,614,173 47,601,330 50,481,469 47,596,154
(1) The Condensed Consolidated Statements of Income do not include all
of the information and footnotes required by generally accepted
accounting principles for complete financial statements.
(2) In accordance with SFAS No. 144, "Accounting for Impairment or
Disposal of Long-Lived Assets," the Company reports real estate
properties and related assets and liabilities to be sold as held
for sale and includes the results of operations of real estate
properties sold or held for sale in discontinued operations on the
Company's Condensed Consolidated Statements of Income.
HEALTHCARE REALTY TRUST INCORPORATED
Condensed Consolidated Statements of Cash Flows (1)
(Dollars in thousands)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2008 2007 2008 2007
Cash flows from operating activities:
Net income $5,527 $5,486 $26,093 $55,474
Non-cash items:
Depreciation and
amortization - real estate 13,025 12,345 38,300 38,611
Depreciation and
amortization - other 663 551 1,868 1,681
Provision for bad debt, net
of recoveries 95 33 426 115
Impairments 1,600 4,057 1,629 6,849
Straight-line rent receivable (124) (640) 75 (735)
Straight-line rent liability 61 535 147 1,269
Equity in (income) losses
from unconsolidated LLCs (55) (193) 93 59
Consolidated losses from
variable interest entities - 282 - 676
Stock-based compensation 1,084 1,015 3,487 3,681
Provision for deferred
post-retirement benefits 828 506 2,482 1,544
Other non-cash items 133 30 572 108
Total non-cash items 17,310 18,521 49,079 53,858
Other items:
Accounts payable and
accrued liabilities 13,325 3,597 9,653 (3,180)
Other liabilities 2,739 (2,506) (71) 1,099
Other assets (837) 478 5,029 (1,732)
Gain on sales of real
estate properties (746) (3,587) (9,098) (41,459)
Gain on repurchase of notes
payable (2,015) - (2,024) -
State income taxes paid,
net of refunds (30) (66) (651) (107)
Total other items 12,436 (2,084) 2,838 (45,379)
Net cash provided by
operating activities 35,273 21,923 78,010 63,953
Cash flows from investing activities:
Acquisition and development
of real estate properties (100,758) (69,206) (138,452) (106,808)
Funding of mortgages and
notes receivable (5,338) 51 (12,519) (4,020)
Distributions received from
unconsolidated LLCs 15 603 882 1,127
Redemption of preferred
equity investment in
unconsolidated LLC 5,546 - 5,546 -
Proceeds from sales of real
estate 2,641 15,642 24,681 297,341
Proceeds from mortgages and
notes receivable repayments 2,555 26 2,634 65,545
Net cash provided by (used
in) investing activities (95,339) (52,884) (117,228) 253,185
Cash flows from financing activities:
Borrowings on notes and bonds
payable 190,000 99,001 280,000 403,840
Repayments on notes and bonds
payable (280,895) (102,895) (350,720) (468,556)
Repurchase of notes payable (25,906) - (31,238) -
Special dividend paid - - - (227,157)
Quarterly dividends paid (19,542) (18,458) (58,609) (81,623)
Proceeds from issuance of
common stock 196,701 68,791 197,062 70,558
Stock issuance costs (18) - (32) -
Common stock redemption - - (282) (30)
Credit facility amendment fee - - (326) -
Net cash provided by (used
in) financing activities 60,340 46,439 35,855 (302,968)
Increase (decrease) in cash and
cash equivalents 274 15,478 (3,363) 14,170
Cash and cash equivalents,
beginning of period 4,882 642 8,519 1,950
Cash and cash equivalents, end
of period $5,156 $16,120 $5,156 $16,120
(1) The Condensed Consolidated Statements of Cash Flows do not include
all of the information and footnotes required by generally accepted
accounting principles for complete financial statements.
RECONCILIATION OF FUNDS FROM OPERATIONS (1) (2):
(Dollars in thousands, except per share data)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2008 2007 2008 2007
Net Income $5,527 $5,486 $26,093 $55,474
Gain on sales of real
estate properties (746) (3,587) (9,098) (41,459)
Real estate depreciation
and amortization 13,456 12,664 39,878 39,734
Total adjustments 12,710 9,077 30,780 (1,725)
Funds From Operations -
Basic and Diluted $18,237 $14,563 $56,873 $53,749
Funds From Operations
Per Common Share - Basic $0.37 $0.31 $1.15 $1.15
Funds From Operations
Per Common Share - Diluted $0.36 $0.31 $1.13 $1.13
Weighted Average Common
Shares Outstanding -
Basic 49,530,813 46,683,619 49,438,796 46,680,455
Weighted Average Common
Shares Outstanding -
Diluted 50,614,173 47,601,330 50,481,469 47,596,154
RECONCILIATION OF FUNDS AVAILABLE FOR DISTRIBUTION (2):
(Dollars in thousands, except per share data)
(Unaudited)
Three Months Ended
September 30, 2008
Net Income $5,527
Gain on sales of real estate properties (746)
Total non-cash items included in cash
flows from operating activities (3) 17,310
Funds Available For Distribution $22,091
Funds Available For Distribution Per Common Share - Diluted 0.44
Weighted Average Common Shares Outstanding - Diluted 50,614,173
(1) Funds from operations ("FFO") is calculated according to the
definition of the National Association of Real Estate Investment
Trusts ("NAREIT") and is comprised primarily of net income and
depreciation from real estate, but is not adjusted for certain
non-cash income and expense items. Gains on the sale of real estate
properties are excluded from FFO and FFO per share, while impairments
are included in FFO and FFO per share.
(2) FFO and Funds Available For Distribution ("FAD") do not represent
cash generated from operating activities determined in accordance
with accounting principles generally accepted in the United States
and are not necessarily indicative of cash available to fund cash
needs. FFO and FAD should not be considered alternatives to net
income as indicators of the Company's operating performance or as
alternatives to cash flow as measures of liquidity.
(3) See the Condensed Consolidated Statements of Cash Flows that are
included in this earnings release.
