Fourth Quarter 2015 Normalized FFO Totals
$0.85 Per Diluted Share
2016 Normalized FFO Guidance of $2.85 to
$2.95 Per Diluted Share
Care Capital Properties, Inc. (NYSE: CCP) (“CCP”) today
announced operating results for the quarter ended December 31,
2015, its first full quarter as a standalone company, and for the
full year 2015. CCP began operating as an independent, publicly
traded company on August 18, 2015, following the completion of its
spin-off from Ventas, Inc. (NYSE: VTR) (“Ventas”). The financial
results reported for the full year represent a combination of
operating results that have been “carved-out” of Ventas’s
consolidated financial statements for the period prior to the
spin-off and standalone operating results for the period subsequent
to the spin-off.
“2015 was a monumental year for CCP, as we completed the
spin-off from Ventas, and the company has accomplished a great deal
in our first six months,” CCP Chief Executive Officer Raymond J.
Lewis said. “We have posted strong results, paid an attractive
dividend and made significant strides in each of our four strategic
priorities: growing our portfolio; establishing our permanent
capital structure; actively managing our assets; and building our
team and infrastructure.”
2015 Highlights and Recent
Events
- Normalized Funds from Operations
(“FFO”) for the quarter ended December 31, 2015 was $71 million, or
$0.85 per diluted common share. FFO, as defined by the National
Association of Real Estate Investment Trusts (“NAREIT”), for the
same time period was $69 million, or $0.83 per diluted common
share.
- As previously announced, normalized FFO
and NAREIT FFO for the quarter ended September 30, 2015 were $70
million, or $0.84 per diluted common share, and $67 million, or
$0.80 per diluted common share, respectively. The increases in the
fourth quarter are primarily attributable to acquisitions completed
in the third quarter and contractual rent increases for existing
properties, partially offset by a full quarter of interest
expense.
- Normalized Funds Available for
Distribution (“FAD”) for the quarter ended December 31, 2015 was
$66 million, or $0.79 per diluted common share.
- Net income attributable to CCP for the
quarter ended December 31, 2015 was $32 million, or $0.38 per
diluted common share.
- For the year ended December 31, 2015,
net income attributable to CCP was $143 million, or $1.71 per
diluted common share, NAREIT FFO was $277 million, or $3.31 per
diluted common share, and normalized FFO was $286 million, or $3.42
per diluted common share.
- In August 2015, CCP entered into an
unsecured credit facility comprised of a $600 million revolver and
$1.4 billion in term loans. Approximately $1.3 billion in proceeds
from borrowings under the term loans was distributed to Ventas in
connection with the spin-off.
- In September 2015, CCP received
investment grade issuer ratings from both Moody’s Investors Service
and Fitch Ratings and a corporate rating of “BB+” from Standard
& Poor’s Ratings Services, who indicated that it would expect
senior unsecured bonds issued by CCP’s operating partnership, Care
Capital Properties, LP, to be rated “BBB-”.
- Investments during 2015 totaled
approximately $786 million, including redevelopments. New
investments of $236 million were completed subsequent to the
spin-off at an average initial cash yield of eight percent.
- Dispositions during the year totaled
just over $6 million, substantially all of which were completed
subsequent to the spin-off. During the fourth quarter, CCP disposed
of four properties for total proceeds of $4.5 million.
- On September 30, 2015, CCP paid a full
quarter cash dividend of $0.57 per share to stockholders of record
as of September 14, 2015. On December 31, 2015, CCP paid a cash
dividend of $0.57 per share to stockholders of record as of
December 21, 2015, representing a payout ratio of 67 percent of
normalized FFO for the fourth quarter.
- Cash net operating income for CCP’s 316
same-store properties decreased 2.2 percent for 2015 over 2014.
Same-store results were lower in 2015 due to the former Kindred
Healthcare, Inc. assets that were re-leased by Ventas in 2014 and
2015.
- For the quarter ended September 30,
2015 (the latest period available), EBITDARM coverage for the total
portfolio was 1.8x, EBITDAR coverage was 1.4x and Q-mix was 54
percent.
- In December 2015, CCP facilitated the
acquisition by Signature HealthCARE, LLC (“Signature”) from
Elmcroft Senior Living, Inc. of the operations of 18 skilled
nursing facilities owned by CCP. In connection with the
acquisition, CCP funded a total of $9 million to Signature.
- At December 31, 2015, CCP had over $450
million of available borrowing capacity under its revolving credit
facility. Net debt to Adjusted Pro Forma EBITDA was 4.8x as of
December 31, 2015.
- Subsequent to year end, CCP entered
into a $200 million seven-year unsecured term loan and used the net
proceeds to repay a portion of its $600 million unsecured term loan
due 2017. CCP also entered into swap arrangements relating to a
total of $600 million of debt, $200 million of which effectively
converted the seven-year term loan to a fixed rate of 3.25 percent
and $400 million of which effectively converted a portion of CCP’s
unsecured term loan due 2020 to a fixed rate of 2.73 percent.
- In March 2016, CCP entered into a
transition and settlement agreement with a tenant who operated 14
properties that provides for, among other things, a consensual
transition of the properties to two replacement operators. The
tenant stopped paying rent as of January 1, 2016. The replacement
operators assumed management of the properties on March 1st and
entered into master leases which will become effective upon receipt
of regulatory approvals. Rent relating to the properties in 2015
was approximately $10 million. Rent under the new leases will be
approximately $7 million in year one, stepping up to approximately
$9.5 million in year three.
- CCP currently has 27 corporate
employees and has established its new corporate headquarters
location which remains in Chicago, Illinois.
- The CCP board of directors declared a
dividend for the first quarter of 2016 in the amount of $0.57 per
share, payable on March 31, 2016 to stockholders of record on March
21, 2016.
“We are very pleased to report strong fourth quarter results and
to announce our first annual guidance for 2016. Our guidance
reflects the implementation of our strategic plan to optimize our
portfolio and migrate to a permanent capital structure to enhance
CCP’s long-term value and create a strong platform for growth,” CCP
Executive Vice President and Chief Financial Officer Lori B.
Wittman said.
2016 Normalized FFO Guidance
CCP currently expects its 2016 normalized FFO to range between
$2.85 and $2.95 per diluted common share. NAREIT FFO is expected to
range from $2.80 to $2.90 per diluted common share for the year.
This 2016 guidance assumes:
- No new acquisitions other than $51
million of identified investments and redevelopment capital at an
average yield of nine percent.
- The refinancing of $1.2 billion of debt
(inclusive of the swaps and term loan already completed) at an
average rate of 3.9 percent. The assumed overall average rate of
CCP's debt for the year is 3.5 percent.
- Identified dispositions of
approximately $120 million at an average yield of 8.5 percent.
- A reduction of $8 million resulting
from downtime and reduced rent pursuant to the tenant transition
described above.
- A reduction of $4.5 million resulting
from the net impact of escalations, portfolio optimization
activities and reductions in non-cash rent.
CCP’s guidance is predicated on a number of other assumptions
that are subject to change and many of which are outside of CCP’s
control. If actual results vary from these assumptions, CCP’s
expectations may change. There can be no assurance that CCP will
achieve these results.
Fourth Quarter Conference Call
CCP will hold a conference call to discuss its fourth quarter
and full year 2015 results and 2016 guidance in more detail today
at 10:00 A.M. Eastern Time (9:00 A.M. Central Time). The dial-in
number for the conference call is (888) 317-6016 or (412) 317-6016
for international callers and (855) 669-9657 for Canadian callers.
Please ask to be joined to the Care Capital Properties, Inc. call.
The call will also be webcast live and can be accessed at CCP’s
website at www.carecapitalproperties.com. A replay of the call will
be available at CCP’s website, or by calling (877) 344-7529 or
(412) 317-0088 for international callers and (855) 669-9658 for
Canadian callers, passcode 10081236, beginning on March 10, 2016 at
approximately 2:00 P.M. Eastern Time, and will remain available
until April 10, 2016.
Care Capital Properties, Inc. is a healthcare real estate
investment trust with a diversified portfolio of triple-net leased
properties focused on the post-acute sector. Its skilled management
team is fully invested in delivering excellent returns by forging
strong relationships with shareholders, operators and employees.
More information about Care Capital Properties, Inc. can be found
at: www.carecapitalproperties.com.
Supplemental information regarding CCP can be found on CCP’s
website under the “Investors” section or at
www.carecapitalproperties.com/investors/financial-information/documents.
This press release includes 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. All statements regarding CCP’s or its tenants’ or
borrowers’ expected future financial condition, results of
operations, cash flows, funds from operations, dividends and
dividend plans, financing opportunities and plans, capital markets
transactions, business strategy, budgets, projected costs,
operating metrics, capital expenditures, competitive positions,
acquisitions, investment opportunities, dispositions, growth
opportunities, expected lease income, continued qualification as a
real estate investment trust (“REIT”), plans and objectives of
management for future operations and statements that include words
such as “anticipate,” “if,” “believe,” “plan,” “estimate,”
“expect,” “intend,” “may,” “could,” “should,” “will” and other
similar expressions are forward-looking statements. These
forward-looking statements are inherently uncertain, and actual
results may differ from CCP’s expectations. CCP does not undertake
a duty to update these forward-looking statements, which speak only
as of the date on which they are made.
CCP’s actual future results and trends may differ materially
from expectations depending on a variety of factors discussed in
its filings with the Securities and Exchange Commission. These
factors include without limitation: (a) the ability and willingness
of CCP’s tenants, borrowers and other third parties to satisfy
their obligations under their respective contractual arrangements
with CCP, including, in some cases, their obligations to indemnify,
defend and hold harmless CCP from and against various claims,
litigation and liabilities; (b) the ability of CCP’s tenants and
borrowers to maintain the financial strength and liquidity
necessary to satisfy their respective obligations and liabilities
to third parties, including without limitation obligations under
their existing credit facilities and other indebtedness; (c) CCP’s
success in implementing its business strategy and its ability to
identify, underwrite, finance, consummate and integrate suitable
acquisitions and investments; (d) macroeconomic conditions such as
a disruption of or lack of access to the capital markets, changes
in the debt rating on U.S. government securities, default or delay
in payment by the United States of its obligations, and changes in
the federal or state budgets resulting in the reduction or
nonpayment of Medicare or Medicaid reimbursement rates; (e) the
nature and extent of competition in the markets in which CCP’s
properties are located; (f) the impact of pending and future
healthcare reform and regulations, including cost containment
measures, quality initiatives and changes in reimbursement
methodologies, policies, procedures and rates; (g) increases in
CCP’s borrowing costs as a result of changes in interest rates and
other factors; (h) the ability of CCP’s tenants to operate CCP’s
properties in compliance with applicable laws, rules and
regulations, to deliver high-quality services, to hire and retain
qualified personnel and to attract residents and patients; (i)
changes in general economic conditions or economic conditions in
the markets in which CCP may, from time to time, compete for
investments, capital and talent, and the effect of those changes on
CCP’s earnings and financing sources; (j) CCP’s ability to repay,
refinance, restructure or extend its indebtedness as it becomes
due; (k) CCP’s ability and willingness to maintain its
qualification as a REIT in light of economic, market, legal, tax
and other considerations; (l) final determination of CCP’s taxable
net income for the year ended December 31, 2015 and for current and
future years; (m) the ability and willingness of CCP’s tenants to
renew their leases with CCP upon expiration of the leases, CCP’s
ability to reposition its properties on the same or better terms in
the event of nonrenewal or in the event CCP exercises its right to
replace an existing tenant, and obligations, including
indemnification obligations, CCP may incur in connection with the
replacement of an existing tenant; (n) year-over-year changes in
the Consumer Price Index and the effect of those changes on the
rent escalators contained in CCP’s leases and on CCP’s earnings;
(o) CCP’s ability and the ability of its tenants and borrowers to
obtain and maintain adequate property, liability and other
insurance from reputable, financially stable providers; (p) the
impact of increased operating costs and uninsured professional
liability claims on CCP’s or its tenants’ or borrowers’ liquidity,
financial condition and results of operations, and the ability of
CCP and its tenants and borrowers to accurately estimate the
magnitude of those claims; (q) consolidation in the healthcare
industry resulting in a change of control of, or a competitor’s
investment in, one or more of CCP’s tenants or borrowers or
significant changes in the senior management of CCP’s tenants or
borrowers; (r) the impact of litigation or any financial,
accounting, legal or regulatory issues that may affect CCP or its
tenants or borrowers; and (s) changes in accounting principles, or
their application or interpretation, and CCP’s ability to make
estimates and the assumptions underlying the estimates, which could
have an effect on CCP’s earnings. Many of these factors are beyond
the control of CCP and its management.
COMBINED CONSOLIDATED BALANCE SHEETS
(Unaudited) (In thousands, except per share amounts)
2015 Quarters 2014 Fourth
Fourth Third Second
First Quarter Assets Real estate investments:
Land and improvements $ 287,193 $ 288,199 $ 282,034 $ 287,336 $
249,504 Buildings and improvements 2,984,257 3,010,206 2,848,646
2,926,094 2,446,688 Construction in progress 33,646 19,457 16,713
15,711 10,433 Acquired lease intangibles 101,869
102,130 96,929 106,574
87,194 3,406,965 3,419,992 3,244,322 3,335,715
2,793,819 Accumulated deprecation and amortization (704,210
) (685,727 ) (659,534 ) (633,175 )
(602,578 ) Net real estate property 2,702,755 2,734,265 2,584,788
2,702,540 2,191,241 Net investment in direct financing lease
22,075 21,960 21,844
21,730 21,626 Net real estate investments
2,724,830 2,756,225 2,606,632 2,724,270 2,212,867 Secured and
unsecured loans receivable, net 29,727 29,480 8,659 8,741 9,491
Cash 16,995 10,444 1,497 1,376 2,424 Goodwill 145,374 146,017
135,736 162,705 88,959 Other assets 38,043
29,105 20,969 18,932
18,009 Total assets $ 2,954,969 $ 2,971,271 $
2,773,493 $ 2,916,024 $ 2,331,750
Liabilities and equity Liabilities: Term loans and other
debt $ 1,524,863 $ 1,518,437 $ — $ — $ — Tenant deposits 57,974
67,177 58,438 51,801 50,168 Lease intangible liabilities, net
130,348 135,354 140,942 147,328 145,640 Accounts payable and other
liabilities 24,048 13,650 8,271 5,886 12,863 Deferred income taxes
1,889 2,341 — —
— Total liabilities 1,739,122 1,736,959
207,651 205,015 208,671 Commitments and contingencies Equity:
Preferred stock, $0.01 par value; 10,000 shares authorized,
unissued — — — — — Common stock, $0.01 par value; 300,000 share
authorized; 83,803 and 83,801 shares issued at December 31, 2015
and September 30, 2015, respectively 838 838 — — — Additional
paid-in-capital 1,264,650 1,263,848 — — — Dividends in excess of
net income (51,056 ) (35,084 ) — — — Net parent investment —
— 2,561,082 2,706,205
2,118,216 Total CCP equity 1,214,432 1,229,602
2,561,082 2,706,205 2,118,216 Noncontrolling interests 1,415
4,710 4,760 4,804
4,863 Total equity 1,215,847
1,234,312 2,565,842 2,711,009
2,123,079 Total liabilities and equity $ 2,954,969
$ 2,971,271 $ 2,773,493 $ 2,916,024 $
2,331,750
COMBINED CONSOLIDATED STATEMENTS OF
INCOME (Unaudited) (In thousands, except per share
amounts) For the
Three Months For the Year Ended December 31,
Ended December 31, 2015 2014 2015
2014 Revenues: Rental income, net $ 84,685 $ 70,113 $
321,785 $ 291,962 Income from investments in direct financing lease
and loans 1,138 858 3,818 3,400 Real estate services fee income
1,484 — 2,247 — Interest and other income 24 —
91 2 Total revenues 87,331 70,971
327,941 295,364
Expenses: Interest 8,272 — 12,347 —
Depreciation and amortization 31,064 22,889 111,752 91,612
Impairment on real estate investments 6,491 — 23,139 8,769 General,
administrative and professional fees 7,723 4,098 29,222 22,412
Merger-related expenses and deal costs 1,608 583 6,354 1,547 Other
188 5,932 1,466 13,183
Total expenses 55,346 33,502
184,280 137,523 Income before income taxes,
real estate dispositions and noncontrolling interests 31,985 37,469
143,661 157,841 Income tax expense 86 — (938 ) — Gain (loss) on
real estate dispositions (224 ) — 632
(61 ) Net income 31,847 37,469 143,355 157,780 Net income
attributable to noncontrolling interests 51 48
189 185 Net income attributable to CCP
$ 31,796 $ 37,421 $ 143,166 $ 157,595
Earnings per common share: Basic: Net income attributable to
CCP $ 0.38 $ 0.45 $ 1.71 $ 1.89 Diluted: Net
income attributable to CCP $ 0.38 $ 0.45 $ 1.71 $
1.88
Weighted average shares used in computing earnings
per common share: Basic 83,488 83,488 83,488 83,488 Diluted
83,612 83,658 83,607 83,658
COMBINED CONSOLIDATED
STATEMENTS OF CASH FLOWS (Unaudited) (In
thousands) For the
Three Months For the Year Ended December 31,
Ended December 31, 2015 2014 2015
2014 Cash flows from operating activities: Net income $
31,847 $ 37,469 $ 143,355 $ 157,780 Adjustments to reconcile net
income to net cash provided by operating activities: Depreciation,
amortization and impairment on real estate investments 34,390
21,818 128,372 95,522 Amortization of above and below market lease
intangibles, net (2,133 ) (2,414 ) (8,968 ) (11,184 ) Amortization
of deferred financing fees 1,426 — 2,072 — Accretion of direct
financing lease (355 ) (317 ) (1,351 ) (1,207 ) Amortization of
leasing costs and other intangibles 3,166 1,072 6,519 4,859
Stock-based compensation 679 — 2,439 — Straight-lining of rental
income, net (38 ) (52 ) (163 ) (294 ) Loss (gain) on real estate
dispositions 224 — (632 ) 61 Income tax benefit (328 ) — (370 ) —
Other (197 ) (21 ) (298 ) 36 Changes in operating assets and
liabilities, net of effects of the September acquisition: Increase
in other assets (7,296 ) (2,262 ) (11,085 ) (4,832 ) (Decrease)
increase in tenant deposits (9,321 ) 6,920 5,627 15,466 Increase
(decrease) in accounts payable and other liabilities 9,069
9,796 1,657 (1,125 ) Net
cash provided by operating activities 61,133 72,009 267,174 255,082
Cash flows from investing activities: Net investment in real estate
property (666 ) (596 ) (455,498 ) (13,194 ) Investment in loans
receivable (1,372 ) 1 (21,463 ) (799 ) Proceeds from real estate
disposals 4,510 — 6,020 975 Proceeds from loans receivable 1,382
309 2,422 1,226 Development project expenditures (10,225 ) (4,506 )
(22,854 ) (11,163 ) Capital expenditures (2,234 )
(2,606 ) (15,738 ) (6,022 ) Net cash used in
investing activities (8,605 ) (7,398 ) (507,111 ) (28,977 ) Cash
flows from financing activities: Net change in borrowings under
credit facility 5,000 — 1,543,000 — Payment of deferred financing
costs — — (20,209 ) — Purchase of noncontrolling interest (3,100 )
— (3,100 ) — Distributions to noncontrolling interest (109 ) (132 )
(375 ) (420 ) Net contribution from (distribution to) parent prior
to separation — (64,751 ) 103,714 (225,428 ) Distribution to parent
— — (1,273,000 ) — Cash distribution to common stockholders
(47,768 ) — (95,522 ) — Net cash
(used in) provided by financing activities (45,977 )
(64,883 ) 254,508 (225,848 ) Net increase
(decrease) in cash 6,551 (272 ) 14,571 257 Cash at beginning of
period 10,444 2,696 2,424
2,167 Cash at end of period $ 16,995 $ 2,424
$ 16,995 $ 2,424
NON-GAAP FINANCIAL
MEASURES RECONCILIATION Funds From Operations (FFO) and
Funds Available for Distribution (FAD)1 (Dollars in
thousands, except per share amounts)
For the Three Months For the
Year Ended December 31, Ended December 31,
2015 2014 2015 2014 Net income
attributable to CCP $ 31,796 $ 37,421 $ 143,166 $ 157,595 Net
income attributable to CCP per share $ 0.38 $ 0.45 $ 1.71 $ 1.88
Adjustments: Real estate depreciation and amortization
30,875 14,016 111,242 91,199 Real estate depreciation related to
noncontrolling interests (68 ) (106 ) (270 ) (427 ) Impairment on
real estate investments 6,491 8,769 23,139 8,769 (Gain) loss on
real estate dispositions 224 —
(632 ) 61 Subtotal: FFO add-backs 37,522 22,679
133,479 99,602 Subtotal: FFO add-backs per share $
0.45 $ 0.27 $ 1.60
$ 1.19 FFO (NAREIT) attributable to CCP $ 69,318 $ 60,100 $
276,645 $ 257,197 FFO (NAREIT) attributable to CCP per share
$ 0.83 $ 0.72 $ 3.31
$ 3.07 Adjustments: Income tax expense
(86 ) — 938 — Stock-based compensation expense associated with
spin-related conversion of awards — — 542 — Transition services fee
expense 602 — 895 — Merger-related expenses and deal costs 1,608
583 6,354 1,547 Initial debt rating agency costs — — 477 —
Amortization of other intangibles 172 — 261 — Initial stock
exchange fee 236 — 236 — Non-recurring non-cash adjustment
(1,003 ) — — — Subtotal:
normalized FFO add-backs 1,529 583 9,703 1,547 Subtotal: normalized
FFO add-backs per share $ 0.02 $ 0.01
$ 0.12 $ 0.02 Normalized
FFO attributable to CCP $ 70,847 $ 60,683 $ 286,348 $ 258,744
Normalized FFO attributable to CCP per share $ 0.85
$ 0.73 $ 3.42 $
3.09 Non-cash items included in normalized FFO:
Amortization of above and below market
lease intangibles, net
(2,133 ) (2,414 ) (8,968 ) (11,184 ) Accretion of direct financing
lease (355 ) (317 ) (1,351 ) (1,207 ) Other amortization
(17
) (21 ) (298 ) 36 Straight-lining of rental income, net (38 ) (52 )
(163 ) (294 ) Other adjustments: Capital expenditures (2,235 )
(2,913 ) (15,888 ) (8,529 ) Stock-based compensation 848 — 2,647 —
Merger-related expenses and deal costs (531 )
(583 ) (5,277 )
(1,547 ) Normalized FAD attributable to CCP $
66,386
$ 54,383 $ 257,050 $ 236,019 Normalized FAD attributable to CCP per
share $ 0.79 $ 0.65
$ 3.07 $ 2.82 Weighted average diluted
shares 83,612 83,658 83,607 83,658 1 Totals and per share
amounts may not add due to rounding.
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, CCP considers FFO, normalized FFO and
normalized FAD to be appropriate measures of operating performance
of an equity REIT. In particular, CCP believes that normalized FFO
is useful because it allows investors, analysts and CCP management
to compare CCP’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 such as transactions.
NAREIT defines FFO as net income (computed in accordance with
GAAP), excluding gains (or losses) from sales of real estate
property and impairment write-downs of depreciable real estate,
plus real estate depreciation and amortization, and after
adjustments for joint ventures. Adjustments for joint ventures will
be calculated to reflect FFO on the same basis. CCP defines
normalized FFO as FFO excluding income taxes, stock-based
compensation expense associated with the spin-related conversion of
awards, transition services fee expense, merger-related expenses
and deal costs, initial debt rating agency costs and initial stock
exchange fee and amortization of other intangibles (which may be
recurring in nature). Normalized FAD represents normalized FFO
excluding amortization of above and below market lease intangibles,
accretion of direct financing lease, other amortization,
straight-line rental adjustments, non-revenue enhancing capital
expenditures and stock-based compensation, but including
merger-related expenses and deal costs.
FFO, normalized FFO and normalized FAD 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 definitions. FFO, normalized FFO and normalized FAD should
not be considered as alternatives to net income (determined in
accordance with GAAP) as indicators of CCP’s financial performance
or as alternatives to cash flow from operating activities
(determined in accordance with GAAP) as measures of CCP’s
liquidity, nor are they necessarily indicative of sufficient cash
flow to fund all of CCP’s needs. CCP believes that in order to
facilitate a clear understanding of the consolidated historical
operating results of CCP, FFO, normalized FFO and normalized FAD
should be examined in conjunction with net income attributable to
CCP as presented elsewhere herein.
NON-GAAP FINANCIAL MEASURES RECONCILIATION Funds
From Operations (FFO) and Funds Available for Distribution
(FAD) FY 2016 Guidance - Per
Share Low High Net
Income Attributable to Common Shareholders $ 1.57
$ 1.67 Depreciation &
Amortization 1.22 1.22
NAREIT FFO
$ 2.80 $ 2.90 Deal
Costs 0.03 0.03 Other 0.02 0.02
Normalized
FFO $ 2.85 $ 2.95
Deal Costs (0.03 ) (0.03 ) Non-Revenue-Generating CapEx
(0.09 ) (0.09 ) Stock-Based Compensation 0.07 0.07 Deferred
Financing Fees 0.05 0.05 Non-Cash Revenues (0.11 ) (0.11 )
Normalized FAD $ 2.74
$ 2.84
NON-GAAP FINANCIAL MEASURES
RECONCILIATIONNet Debt to Adjusted Pro Forma EBITDA
The following information considers the pro forma effect on net
income of non-recurring non-cash adjustments during the three
months ended December 31, 2015. The following table illustrates net
debt to pro forma earnings before interest, taxes, depreciation and
amortization and impairment, excluding stock-based compensation,
merger-related expenses and deal costs, gain on real estate
disposition, transition services fee expense and initial stock
exchange fee (“Adjusted Pro Forma EBITDA”) (dollars in
thousands):
Net income $ 31,847
Pro forma adjustments for non-recurring
non-cash adjustments
(1,003 )
Pro forma net income $ 30,844
Add back: Interest 8,272 Income tax expense (86 ) Depreciation and
amortization 31,064 Impairment on real estate investments 6,491
Stock-based compensation 848 Merger-related expenses and deal costs
1,608 Gain on real estate dispositions 224 Transition services fee
expense 602 Initial stock exchange fee 236
Adjusted Pro Forma EBITDA $ 80,103
Adjusted Pro
Forma EBITDA annualized $ 320,412 As of December
31, 2015: Debt $ 1,524,863 Unamortized debt issuance costs 18,137
Cash (16,995 ) Net debt (adjusted for unamortized debt
issuance costs) $ 1,526,005 Net debt to Adjusted Pro
Forma EBITDA 4.8 x
NON-GAAP FINANCIAL
MEASURES RECONCILIATION Same-Store Cash NOI
4Q15 vs
4Q14 4Q15 vs 3Q15 FY 2015 vs FY 2014
4Q15
4Q14
4Q15
3Q15
FY
2015
FY
2014
Rental income $84,685 $71,349 $84,685 $80,595
$321,985 $296,843 Adjustments: Less: NOI excluded
from same-store (14,362) (2,980) (4,148) (1,725) (44,323) (11,259)
Less: Non-cash rental income (2,343) (2,283) (2,300) (2,185)
(9,063) (10,519) Plus: 3 campuses not included in prior year
financials 1,698 1,629 0 0 6,652 6,443
Total Adjustments ($15,007)
($3,634) ($6,448) ($3,910)
($46,734) ($15,334)
Same-Store Cash NOI
$69,679 $67,714 $78,238 $76,685
$275,251 $281,508 Percentage Increase/Decrease
2.9% 2.0%
-2.2%
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160310005695/en/
Care Capital Properties, Inc.Lori B. WittmanExecutive Vice
President and Chief Financial
Officerlwittman@carecapitalproperties.com312.881.4702
Care Capital Properties, Inc. (delisted) (NYSE:CCP)
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