Welltower(WELL)2024-10-29 11:30Financial Performance - Net income for September 30, 2024, was $456.8 million, showing significant growth compared to $134.7 million in September 2023[113] - FFO (Funds From Operations) increased to $635.8 million in September 2024, up from $419.1 million in September 2023[113] - NOI (Net Operating Income) reached $842.9 million in September 2024, compared to $666.7 million in September 2023[113] - Net income for the three months ended September 30, 2024 increased by 239% to $456.8 million compared to $134.7 million in the same period in 2023[131] - FFO (Funds From Operations) for the nine months ended September 30, 2024 increased by 33% to $1.69 billion compared to $1.27 billion in the same period in 2023[131] - EBITDA for the nine months ended September 30, 2024 increased by 38% to $2.42 billion compared to $1.75 billion in the same period in 2023[131] - NOI (Net Operating Income) for the nine months ended September 30, 2024 increased by 17% to $2.32 billion compared to $1.98 billion in the same period in 2023[131] - FFO (Funds From Operations) for Q3 2024 was $635,817 thousand, compared to $419,124 thousand in Q3 2023, showing a significant increase[155] - Net income attributable to common stockholders for Q3 2024 was $449,849 thousand, up from $127,470 thousand in Q3 2023[155] - Consolidated NOI (Net Operating Income) for Q3 2024 was $842,962 thousand, up from $666,740 thousand in Q3 2023[158] - EBITDA for the nine months ended September 30, 2024, reached $2.423 billion, up from $1.754 billion in the same period in 2023[167] - Adjusted EBITDA for September 30, 2024, was $2,981.885 million, showing an increase from $2,816.379 million in June 2024 and $2,669.153 million in March 2024[168] - Net income for September 30, 2024, was $937.544 million, compared to $615.466 million in June 2024 and $461.138 million in March 2024[168] Portfolio and Property Operations - Welltower's consolidated portfolio for Q3 2024 shows NOI of $808.7 million, with Seniors Housing Operating contributing $394.5 million (48.8%), Triple-net $271.2 million (33.5%), and Outpatient Medical $143.1 million (17.7%)[104] - The company's Seniors Housing Operating segment consists of 1,008 properties, Triple-net has 606 properties, and Outpatient Medical includes 371 properties as of September 30, 2024[104] - Welltower acquired 100 properties during the nine months ended September 30, 2024, with a total investment of $2.85 billion and an average capitalization rate of 5.8%[108] - The company disposed of 31 properties during the same period, generating $580.1 million in proceeds with an average capitalization rate of 4.5%[109] - Seniors Housing Operating accounted for 49% of NOI in September 2024, up from 45% in September 2023[116] - Triple-net properties contributed 34% of NOI in September 2024, down from 35% in September 2023[116] - California remained the top geographic contributor with 11% of NOI in September 2024, consistent with September 2023[116] - Base rent for Triple-net properties in 2033 is projected at $59.5 million, representing 8.8% of total base rent[117] - Outpatient Medical base rent in September 2024 was $29.0 million, accounting for 5.0% of total base rent[117] - Total properties included in the SSNOI (Same Store Net Operating Income) pool were 2,137, with 1,490 being same-store properties[161] - Recent acquisitions and development conversions totaled 218 properties, which will enter the QTD Pool after five full quarters[161] - Redevelopment properties totaled 6, which will enter the QTD Pool after five full quarters of operations post redevelopment completion[161] - Consolidated NOI for Seniors Housing Operating increased to $394.463 million in Q3 2024, up from $284.909 million in Q3 2023[164] - SSNOI at Welltower Share for Seniors Housing Operating rose to $277.912 million in Q3 2024, compared to $229.596 million in Q3 2023[164] - Consolidated NOI for Triple-net properties reached $271.170 million in Q3 2024, up from $226.278 million in Q3 2023[164] - SSNOI at Welltower Share for Triple-net properties increased to $134.513 million in Q3 2024, from $128.789 million in Q3 2023[164] - Consolidated NOI for Outpatient Medical grew to $143.069 million in Q3 2024, compared to $129.754 million in Q3 2023[164] - SSNOI at Welltower Share for Outpatient Medical rose to $127.484 million in Q3 2024, up from $123.813 million in Q3 2023[164] - Total SSNOI at Welltower Share increased to $539.909 million in Q3 2024, compared to $482.198 million in Q3 2023[164] Capital and Financing Activities - The company generated $5.29 billion in gross proceeds from selling 53.55 million shares of common stock under its ATM Programs during the nine months ended September 30, 2024[106] - Welltower closed on an expanded $5 billion unsecured revolving credit facility in July 2024, replacing its previous $4 billion line of credit[106] - As of September 30, 2024, Welltower had $3.56 billion in cash and cash equivalents, $219.47 million in restricted cash, and $5 billion in available borrowing capacity[105] - Welltower OP issued $1.04 billion in 3.125% exchangeable senior unsecured notes in July 2024, maturing in 2029[106] - The company issued $1,035,000,000 of 3.125% exchangeable senior unsecured notes in July 2024, maturing July 15, 2029[123] - The company expanded its unsecured revolving credit facility to $5,000,000,000, replacing the previous $4,000,000,000 facility[123] - Total contractual obligations as of September 30, 2024, amounted to $23,154,611 thousand, with $6,043,344 thousand due between 2027-2028[126] - The company has $696,822,000 of remaining capacity under its ATM Program for issuing common stock as of October 25, 2024[127] - The company filed a prospectus supplement for the registration of up to 23,471,419 shares of common stock related to exchangeable senior notes[127] - The ending balance of debt as of September 30, 2024, was $1.938687 billion, with a weighted average interest rate of 4.44%[139] - Debt issued during the nine months ended September 30, 2024, was $3.708 million, compared to $381.369 million in the same period in 2023[139] - Debt extinguished during the nine months ended September 30, 2024, was $196.939 million, compared to $288.063 million in the same period in 2023[139] - Principal payments during the nine months ended September 30, 2024, were $29.580 million, compared to $36.292 million in the same period in 2023[139] - The ending weighted average interest rate for debt decreased to 4.01% as of September 30, 2024, from 4.39% in the same period in 2023[143] - The company extinguished $112 million of medical secured debt during the three months ended September 30, 2024, compared to $40.14 million in the same period in 2023[149] - Total net debt increased to $12,070,529 as of September 30, 2024, compared to $11,163,530 in June 2024 and $11,807,351 in March 2024[171] - Net debt to book capitalization ratio improved to 28% in September 2024 from 34% in December 2023[171] - Common equity market capitalization rose to $79,173,240 in September 2024, up from $63,399,742 in June 2024[171] - Net debt to consolidated enterprise value ratio decreased to 13% in September 2024 from 21% in December 2023[171] - Variable rate debt outstanding was $947,699,000 as of September 30, 2024, with a 1% interest rate increase resulting in $9,477,000 additional annual interest expense[177] - Total equity and noncontrolling interests grew to $31,064,003 in September 2024 from $26,371,727 in December 2023[171] - Undepreciated book capitalization reached $53,411,041 in September 2024, up from $49,385,684 in December 2023[171] - Net debt to undepreciated book capitalization ratio improved to 23% in September 2024 from 28% in December 2023[171] - Consolidated enterprise value increased to $91,973,491 in September 2024 from $65,584,105 in December 2023[171] Revenue and Expenses - For the nine months ended September 30, 2024, resident fees and services accounted for 74% of total revenues, while rental income represented 21%[105] - Resident fees and services revenue for the nine months ended September 30, 2024 increased by 22% to $4.27 billion compared to $3.49 billion in the same period in 2023[133] - Interest income for the nine months ended September 30, 2024 increased by 447% to $37.4 million compared to $6.8 million in the same period in 2023[133] - Property operating expenses for the nine months ended September 30, 2024 increased by 19% to $3.19 billion compared to $2.69 billion in the same period in 2023[133] - Depreciation and amortization expenses for the nine months ended September 30, 2024 increased by 17% to $770 million compared to $656 million in the same period in 2023[133] - Revenue for the three months ended September 30, 2024, was $277.912 million, a $48.316 million increase compared to $229.596 million in the same period in 2023, representing a 19.1% growth[136] - Revenue for the nine months ended September 30, 2024, was $720.750 million, a $115.822 million increase compared to $604.928 million in the same period in 2023, representing a 19.1% growth[136] - Impairment charges for the nine months ended September 30, 2024, were $65.996 million related to fourteen properties, compared to $15.029 million related to six properties in the same period in 2023[137] - The company transitioned operations for 89 Atria Senior Living properties to six existing operating partners, recognizing $26 million in other expenses during the second quarter of 2024[137] - Construction conversions completed during the nine months ended September 30, 2024, represented $462.246 million or $379,824 per unit[137] - As of September 30, 2024, the company had 29 properties under construction with a total in-progress balance of $989.792 million, including 6 properties expected to convert in 2024 with $366.086 million remaining funding[138] - Rental income for the three months ended September 30, 2024 increased by $32.6 million (17%) to $227.5 million, driven by acquisitions and annual rent increases, partially offset by property transitions[140] - Rental income for the nine months ended September 30, 2024 decreased by $5.8 million (1%) to $590.4 million, primarily due to a $97.7 million write-off related to lease conversions, partially offset by acquisitions and rent increases[140] - Interest income for the three months ended September 30, 2024 increased by $11.9 million (30%) to $51.9 million, driven by increased loan advances in late 2023[140] - SSNOI (Same Store Net Operating Income) for the three months ended September 30, 2024 increased by $5.7 million (4.4%) to $134.5 million, based on 458 same-store properties[142] - SSNOI for the nine months ended September 30, 2024 increased by $18.2 million (4.9%) to $390.2 million, based on 450 same-store properties[142] - The company recorded a $179.8 million gain on the acquisition of a 25% minority interest in a joint venture owning 39 triple-net lease properties[142] - The company recognized $92.6 million in gains from the sale of 15 properties previously under operating leases, now classified as sales-type leases[142] - Depreciation and amortization expenses for the nine months ended September 30, 2024 increased by $13.9 million (8%) to $181.9 million, driven by property acquisitions and dispositions[142] - The company recorded a $3.2 million impairment charge for two properties in the nine months ended September 30, 2024, compared to $6.1 million for two properties in the same period of 2023[142] - Net income attributable to common stockholders for the three months ended September 30, 2024 increased by $327.0 million (217%) to $477.9 million[140] - Rental income increased by $13.36 million (7%) for the three months ended September 30, 2024, compared to the same period in 2023, driven by acquisitions and construction conversions[145] - Interest income surged by $754 thousand (769%) for the three months ended September 30, 2024, compared to the same period in 2023[145] - Total revenues grew by $13.89 million (7%) for the three months ended September 30, 2024, compared to the same period in 2023[145] - Net Operating Income (NOI) increased by $13.32 million (10%) for the three months ended September 30, 2024, compared to the same period in 2023[145] - The company completed construction conversions representing $162.7 million or $641 per square foot during the nine months ended September 30, 2024[148] - The weighted-average term of new leases and renewals for the nine months ended September 30, 2024, was 8 years, with a rate of $42.01 per square foot[145] - Same Store Net Operating Income (SSNOI) increased by $3.67 million (3.0%) for the three months ended September 30, 2024, compared to the same period in 2023[146] - The construction in progress balance for Outpatient Medical projects as of September 30, 2024, was $307.52 million[148] - Total revenues increased by 31% to $38.95 million for the three months ended September 30, 2024, compared to $29.83 million in the same period in 2023[151] - Consolidated net operating income (loss) rose by 33% to $34.26 million for the three months ended September 30, 2024, from $25.80 million in the same period in 2023[151] - General and administrative expenses increased by 69% to $77.90 million for the three months ended September 30, 2024, compared to $46.11 million in the same period in 2023[151] - Interest expense decreased by 6% to $130.79 million for the three months ended September 30, 2024, from $139.49 million in the same period in 2023[151] - Net income (loss) attributable to common stockholders improved by 2% to $(511.47) million for the nine months ended September 30, 2024, compared to $(519.86) million in the same period in 2023[151] - Senior unsecured notes interest expense decreased by 8% to $122.06 million for the three months ended September 30, 2024, from $133.17 million in the same period in 2023[152] - Unsecured credit facility and commercial paper program interest expense increased by 3% to $1.60 million for the three months ended September 30, 2024, compared to $1.55 million in the same period in 2023[152] - Loan expense increased by 50% to $7.14 million for the three months ended September 30, 2024, from $4.76 million in the same period in 2023[152] - General and administrative expenses as a percentage of consolidated revenues were 3.25% for the nine months ended September 30, 2024, compared to 2.76% in the same period in 2023[151] - The company recognized $29.84 million as a cumulative catch-up of stock compensation expense during the three months ended September 30, 2024[151] - Depreciation and amortization expenses for Q3 2024 were $403,779 thousand, compared to $339,314 thousand in Q3 2023[155] - Interest expense for September 30, 2024, was $574.366 million, slightly lower than $591.848 million in June 2024 and $610.761 million in March 2024[168] - Depreciation and amortization for September 30, 2024, was $1,532.417 million, up from $1,467.952 million in June 2024 and $1,427.852 million in March 2024[168] - Impairment of assets for September 30, 2024