Diversified Healthcare Trust (NASDAQ:DHC) Q2 2022 Earnings Conference Call August 4, 2022 10:00 AM ET Company Participants Michael Kodesch - Director of Investor Relations Jennifer Francis - President & Chief Executive Officer Rick Siedel - Chief Financial Officer & Treasurer Conference Call Participants Bryan Maher - B. Riley Securities Daniel Byun - Bank of America Aaron Hecht - JMP Securities Operator Good morning and welcome to the Diversified Healthcare Trust Second Quarter 2022 Earnings Call. All part ...

Table of Contents Securities registered pursuant to Section 12(b) of the Act: Title Of Each Class Trading Symbol(s) Name Of Each Exchange On Which Registered Common Shares of Beneficial Interest DHC The Nasdaq Stock Market LLC 5.625% Senior Notes due 2042 DHCNI The Nasdaq Stock Market LLC 6.25% Senior Notes due 2046 DHCNL The Nasdaq Stock Market LLC Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐ UNITED STATES SECURITIES AND EXCHANG ...

Financial Data and Key Metrics Changes - For Q1 2022, the company reported net income attributable to common shareholders of $240.4 million or $1.1 per share, which includes a $327.5 million gain from the joint venture sale of 10 office portfolio assets [29] - Normalized FFO was negative $21.9 million, approximately $5 million lower than the previous quarter, primarily due to the impact of joint venture sales [32] - The company ended the quarter with approximately $1.5 billion in cash available to repay debt and invest in the portfolio, with total outstanding debt of $3.6 billion [32] Business Line Data and Key Metrics Changes - The consolidated same property cash basis NOI increased by 10.3% compared to the last quarter, driven by a $6.6 million increase in same property SHOP NOI [31] - In the Office Portfolio segment, 27 new and renewal leases were executed totaling over 200,000 square feet, with an average rent increase of 8.2% [11] - Occupancy in the SHOP segment increased approximately 100 basis points from the prior quarter, with non-same property revenue growth of $4.5 million or 5.8% compared to the fourth quarter [20][21] Market Data and Key Metrics Changes - The company’s office portfolio consists of approximately 8.7 million square feet, while the senior living portfolio includes 264 communities with over 27,000 units [8] - The leasing pipeline is nearly 900,000 square feet, with about 40% of it for new tenants [12] - The senior living industry has seen modest occupancy improvements, but the recovery pace has been slower than anticipated [19] Company Strategy and Development Direction - The company aims to reduce debt and accelerate earnings growth while focusing on rejuvenating and stabilizing the SHOP segment [9] - Significant capital projects are planned, with a budgeted spend of approximately $110 million in 2022 for the same property portfolio [26] - The company is also exploring redevelopment opportunities in various locations, including Atlanta and Washington, DC [14][16] Management's Comments on Operating Environment and Future Outlook - Management noted that labor remains the biggest challenge facing the senior living industry, with expectations for wages and benefits to increase [23] - The company is optimistic about the recovery of the SHOP segment and believes that the right operator mix will yield benefits from capital investments [21][25] - Management emphasized the importance of converting tours to move-ins in the senior living segment, as occupancy growth is more pronounced in needs-based communities [40] Other Important Information - The company welcomed David Pierce as a new member of the Board of Trustees, bringing over 30 years of healthcare industry experience [28] - The company is not looking to add existing properties into joint ventures, indicating a strategic focus on current assets [37] Q&A Session Summary Question: Are there plans for more joint venture sales? - Management indicated they are not looking to add existing properties into joint ventures [37] Question: What is the strategy for the $1.5 billion in cash and callable debt? - Management plans to prepay some portion of the callable notes while assessing investments and liquidity [38] Question: What are the expectations for refinancing debt given rising interest rates? - Management noted they are not focused on issuing more debt currently, given their strong cash position [39] Question: What are the challenges in the SHOP segment regarding occupancy recovery? - Management highlighted that recovery is more weighted towards needs-based communities and emphasized the importance of converting tours to move-ins [40] Question: Can you provide a breakdown of CapEx for 2022? - Management expects total CapEx for the year to be close to $400 million, with approximately $125 million allocated to the Office Portfolio and the remainder to SHOP [41][43]

Table of Contents Securities registered pursuant to Section 12(b) of the Act: Title Of Each Class Trading Symbol(s) Name Of Each Exchange On Which Registered Common Shares of Beneficial Interest DHC The Nasdaq Stock Market LLC 5.625% Senior Notes due 2042 DHCNI The Nasdaq Stock Market LLC 6.25% Senior Notes due 2046 DHCNL The Nasdaq Stock Market LLC Large Accelerated Filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐ UNITED STATES SECURITIES AND EXCHANG ...

Rent-A-Center, Inc. (RCII) Q4 2021 Earnings Conference Call February 24, 2022 10:00 AM ET Company Participants Michael Kodesch - Director, IR Jennifer Francis - President & CEO Rick Siedel - CFO & Treasurer Conference Call Participants Bryan Maher - B. Riley Michael Carroll - RBC Capital Markets David Toti - Colliers International Operator Good day and welcome to DHC Fourth Quarter 2021 Conference Call. All participants will be in a listen-only mode. [Operator Instructions] Please note this event is being r ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 1-15319 DIVERSIFIED HEALTHCARE TRUST (Exact Name of Registrant as Specified in Its Charter) Maryland 04-3445278 (State of Organization) (IRS Employer Identification N ...

Diversified Healthcare Trust (NASDAQ:DHC) Q3 2021 Earnings Conference Call November 4, 2021 10:00 AM ET Company Participants Michael Kodesch - Director, Investor Relations Jennifer Francis - President & Chief Executive Officer Rick Siedel - Chief Financial Officer and Treasurer Conference Call Participants Bryan Maher - B. Riley Michael Carroll - RBC Capital Markets Operator Good morning. Welcome to the Diversified Healthcare Trust Third Quarter 2021 Conference Call. All participants will be in listen-only ...

Table of Contents Title Of Each Class Trading Symbol(s) Name Of Each Exchange On Which Registered Common Shares of Beneficial Interest DHC The Nasdaq Stock Market LLC 5.625% Senior Notes due 2042 DHCNI The Nasdaq Stock Market LLC 6.25% Senior Notes due 2046 DHCNL The Nasdaq Stock Market LLC Large Accelerated Filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q ☒ QUARTERLY REPO ...

Diversified Healthcare Trust (NASDAQ:DHC) Q2 2021 Earnings Conference Call August 5, 2021 10:00 AM ET Company Participants Michael Kodesch - Director, IR Jennifer Francis - President, CEO & Managing Trustee Richard Siedel - CFO & Treasurer Conference Call Participants Bryan Maher - B. Riley Securities, Inc. Jason Idoine - RBC Capital Markets Vikram Malhotra - Morgan Stanley Operator Good day, ladies and gentlemen, and welcome to the Diversified Healthcare Trust Second Quarter 2021 Earnings Conference Call. ...

[PART I Financial Information](index=3&type=section&id=PART%20I%20Financial%20Information) [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements for Diversified Healthcare Trust as of June 30, 2021, and for the three and six-month periods then ended [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2021, total assets increased to $7.18 billion from $6.48 billion at year-end 2020, primarily driven by a significant increase in cash and cash equivalents Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | June 30, 2021 | December 31, 2020 | | :--- | :--- | :--- | | **Total Assets** | **$7,179,852** | **$6,476,424** | | Cash and cash equivalents | $849,079 | $74,417 | | Total real estate properties, net | $5,732,466 | $5,715,829 | | **Total Liabilities** | **$4,674,703** | **$3,857,202** | | Revolving credit facility | $800,000 | $— | | Senior unsecured notes, net | $2,803,497 | $2,608,189 | | **Total Equity** | **$2,505,149** | **$2,619,222** | [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) For the second quarter of 2021, the company reported a net loss attributable to common shareholders of $34.2 million, or ($0.14) per share, compared to a net loss of $26.1 million, or ($0.11) per share, in the same period of 2020 Income Statement Highlights (in thousands, except per share data) | Metric | Q2 2021 | Q2 2020 | H1 2021 | H1 2020 | | :--- | :--- | :--- | :--- | :--- | | Total Revenues | $346,341 | $410,311 | $709,065 | $852,778 | | Rental income | $102,394 | $106,207 | $205,152 | $216,705 | | Residents fees and services | $243,947 | $304,104 | $503,913 | $636,073 | | Total Expenses | $353,717 | $409,314 | $714,629 | $815,058 | | Net Loss | ($32,645) | ($24,742) | ($98,828) | ($13,599) | | Net Loss Attributable to Common Shareholders | ($34,222) | ($26,072) | ($101,727) | ($16,337) | | Net Loss Per Share (basic and diluted) | ($0.14) | ($0.11) | ($0.43) | ($0.07) | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2021, net cash from operating activities decreased significantly to $27.0 million from $110.7 million in the prior-year period Cash Flow Summary (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2021 | Six Months Ended June 30, 2020 | | :--- | :--- | :--- | | Net cash provided by operating activities | $27,046 | $110,673 | | Net cash provided by (used in) investing activities | $19,589 | ($7,397) | | Net cash provided by (used in) financing activities | $770,605 | ($61,732) | | **Increase in cash and cash equivalents** | **$817,240** | **$41,544** | [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail significant accounting policies and events, including property sales, debt issuance, credit facility drawdown, and management agreement amendments - During the first six months of 2021, the company sold five properties for an aggregate sales price of **$104.5 million**, resulting in a net gain of **$30.6 million**[38](index=38&type=chunk)[39](index=39&type=chunk) - In February 2021, the company issued **$500 million** of 4.375% senior notes due 2031. Proceeds were used to prepay a **$200 million** term loan and redeem **$300 million** of 6.75% senior notes due 2021[51](index=51&type=chunk) - On June 9, 2021, the company amended its management arrangements with Five Star Senior Living, initiating the transition of **108 senior living communities** to other third-party managers and extending the management term for **120 retained communities** to 2036[84](index=84&type=chunk)[85](index=85&type=chunk) - The company has two operating segments: Office Portfolio and SHOP (senior housing operating portfolio). For Q2 2021, the Office Portfolio generated net income of **$52.2 million**, while the SHOP segment had a net loss of **$6.7 million**[69](index=69&type=chunk)[72](index=72&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the significant negative impact of the COVID-19 pandemic on its operations, particularly the SHOP segment, which saw lower occupancy and higher expenses [Overview and Portfolio](index=24&type=section&id=Overview%20and%20Portfolio) As of June 30, 2021, DHC owned 392 properties with a gross book value of $8.2 billion, divided into Office Portfolio and Senior Housing Operating Portfolio (SHOP) segments - The company owned **392 properties** in 36 states and Washington, D.C. as of June 30, 2021, with a gross book value of **$8.2 billion**[110](index=110&type=chunk) - The COVID-19 pandemic has caused significant disruptions, including lower occupancy in senior living communities and increased operating expenses for labor and personal protective equipment[111](index=111&type=chunk)[113](index=113&type=chunk) - In June 2021, DHC amended its agreement with Five Star to transition management of **108 senior living communities** to other operators and close skilled nursing units in retained communities to reposition them[119](index=119&type=chunk) Portfolio Overview as of June 30, 2021 | Segment | Number of Properties | % of Total Gross Book Value | Q2 2021 Revenues | Q2 2021 NOI | Occupancy | | :--- | :--- | :--- | :--- | :--- | :--- | | Office Portfolio | 118 | 45.3% | $92.8M | $61.5M | 91.0% | | SHOP | 235 | 49.5% | $243.9M | $10.6M | 70.9% | | Other | 39 | 5.2% | $9.6M | $9.6M | N/A | [Results of Operations](index=29&type=section&id=Results%20of%20Operations) Comparing Q2 2021 to Q2 2020, total NOI decreased by 24.6% to $81.7 million, primarily driven by a 67.8% plummet in the SHOP segment's NOI NOI by Segment - Q2 2021 vs Q2 2020 (in thousands) | Segment | Q2 2021 | Q2 2020 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Office Portfolio | $61,483 | $64,617 | ($3,134) | (4.9)% | | SHOP | $10,636 | $33,082 | ($22,446) | (67.8)% | | Non-Segment | $9,590 | $10,697 | ($1,107) | (10.3)% | | **Total NOI** | **$81,709** | **$108,396** | **($26,687)** | **(24.6)%** | NOI by Segment - H1 2021 vs H1 2020 (in thousands) | Segment | H1 2021 | H1 2020 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Office Portfolio | $123,513 | $130,681 | ($7,168) | (5.5)% | | SHOP | $14,504 | $81,172 | ($66,668) | (82.1)% | | Non-Segment | $19,025 | $22,425 | ($3,400) | (15.2)% | | **Total NOI** | **$157,042** | **$234,278** | **($77,236)** | **(33.0)%** | - SHOP comparable property NOI decreased **68.1%** in Q2 2021 vs Q2 2020, driven by a decline in occupancy to **71.0%** from **80.7%** and the closure of skilled nursing units[149](index=149&type=chunk)[150](index=150&type=chunk) [Non-GAAP Financial Measures](index=38&type=section&id=Non-GAAP%20Financial%20Measures) The company reported a significant decline in its key non-GAAP performance metrics, with Normalized FFO per share dropping sharply in Q2 and H1 2021 due to operational challenges FFO and Normalized FFO per Share | Per Share Data | Q2 2021 | Q2 2020 | H1 2021 | H1 2020 | | :--- | :--- | :--- | :--- | :--- | | Net loss attributable to common shareholders | ($0.14) | ($0.11) | ($0.43) | ($0.07) | | FFO attributable to common shareholders | ($0.01) | $0.25 | $0.01 | $0.61 | | Normalized FFO attributable to common shareholders | $0.05 | $0.25 | $0.08 | $0.56 | Reconciliation of Net Loss to NOI (in thousands) | Metric | Q2 2021 | Q2 2020 | H1 2021 | H1 2020 | | :--- | :--- | :--- | :--- | :--- | | Net loss | ($32,645) | ($24,742) | ($98,828) | ($13,599) | | Adjustments... | ... | ... | ... | ... | | **Total NOI** | **$81,709** | **$108,396** | **$157,042** | **$234,278** | [Liquidity and Capital Resources](index=40&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity position has been significantly impacted by the pandemic, leading to a full drawdown of its credit facility and new senior notes issuance, while facing debt incurrence limitations - As of June 30, 2021, the company had **$849.1 million** in cash and cash equivalents and had fully drawn the **$800 million** available under its revolving credit facility[232](index=232&type=chunk)[233](index=233&type=chunk) - The company's ratio of consolidated income available for debt service to debt service was below the **1.5x** incurrence requirement, preventing it from incurring additional debt as of June 30, 2021[214](index=214&type=chunk)[246](index=246&type=chunk) - In January 2021, credit agreements were amended to waive certain financial covenants through June 2022, reduce the revolver commitment to **$800 million**, and limit annual capital expenditures to **$350 million**[234](index=234&type=chunk) - In February 2021, Moody's and S&P downgraded the company's senior unsecured debt ratings to **B1** and **BB-** respectively, increasing borrowing costs under the credit facility[241](index=241&type=chunk)[247](index=247&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=47&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to interest rate risk primarily through its $800 million floating-rate debt, with a hypothetical 1% rate increase impacting annual interest expense by $8.0 million - At June 30, 2021, the company had **$800.0 million** in outstanding floating-rate debt under its revolving credit facility[268](index=268&type=chunk) - A hypothetical **1%** increase in floating interest rates would increase annual interest expense by approximately **$8.0 million**, impacting annual earnings per share by about **$0.03** (based on the difference between $0.10 and $0.13 per share impact)[271](index=271&type=chunk) - The company has **$3.53 billion** in fixed-rate debt, including senior unsecured notes and mortgage notes. Changes in market rates affect the fair value of this debt but not the cash interest payments[264](index=264&type=chunk)[265](index=265&type=chunk) - The company is monitoring the planned phase-out of LIBOR, which is the basis for interest on its revolving credit facility, and expects its credit agreement to be amended to provide for a replacement benchmark rate[273](index=273&type=chunk) [Controls and Procedures](index=49&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2021, with no material changes in internal control over financial reporting during the quarter - The President and Chief Executive Officer, along with the Chief Financial Officer and Treasurer, concluded that the company's disclosure controls and procedures are **effective** as of June 30, 2021[274](index=274&type=chunk) - No changes occurred in the company's internal control over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[275](index=275&type=chunk) [PART II Other Information](index=57&type=section&id=PART%20II%20Other%20Information) [Risk Factors](index=57&type=section&id=Item%201A.%20Risk%20Factors) The company states that there have been no material changes to the risk factors from those previously disclosed in its Annual Report on Form 10-K - There have been **no material changes** to risk factors from those previously disclosed in the company's Annual Report[297](index=297&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=57&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q2 2021, the company purchased 13,906 common shares at an average price of $4.18 per share to satisfy tax withholding obligations for former officers and employees Issuer Purchases of Equity Securities (Q2 2021) | Calendar Month | Number of Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | June 2021 | 13,906 | $4.18 | | **Total** | **13,906** | **$4.18** | - The share purchases were conducted to satisfy tax withholding and payment obligations related to the vesting of common share awards for certain former RMR LLC officers and employees[298](index=298&type=chunk) [Exhibits](index=57&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including amendments to management agreements and required certifications - Filed exhibits include the Amended and Restated Master Management Agreement with Five Star and the Third Amended and Restated Property Management Agreement with RMR LLC, both dated June 9, 2021[300](index=300&type=chunk) - Certifications pursuant to Rule 13a-14(a) and Section 1350 were filed, along with XBRL data files[300](index=300&type=chunk)