Sabra(SBRA) - 2024 Q2 - Quarterly Report

FORM 10-Q Sabra Health Care REIT, Inc. filed its quarterly report for the period ended June 30, 2024, confirming its large accelerated filer status - Sabra Health Care REIT, Inc. filed its Quarterly Report on Form 10-Q for the period ended June 30, 2024, confirming its status as a large accelerated filer and compliance with SEC filing requirements[1] | Metric | Value | | :----- | :---- | | Common Stock Outstanding (as of Aug 1, 2024) | 234,263,766 shares | | Par Value per Share | $0.01 | PART I. FINANCIAL INFORMATION This part presents the company's unaudited financial statements and management's discussion and analysis for the second quarter of 2024 Item 1. Financial Statements This section presents the company's unaudited consolidated financial statements and accompanying notes for the quarter ended June 30, 2024 Consolidated Balance Sheets The balance sheets detail the company's assets, liabilities, and equity as of June 30, 2024, compared to December 31, 2023 | Metric | June 30, 2024 (in thousands) | December 31, 2023 (in thousands) | | :----- | :--------------------------- | :------------------------------- | | Total Assets | $5,351,116 | $5,386,150 | | Total Liabilities | $2,589,141 | $2,583,616 | | Total Equity | $2,761,975 | $2,802,534 | Consolidated Statements of Income The income statements present revenues, expenses, and net income for the three and six months ended June 30, 2024 and 2023 | Metric (in thousands) | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total Revenues | $176,141 | $161,166 | $342,888 | $322,490 | | Total Expenses | $153,663 | $131,166 | $293,868 | $277,696 | | Net Income | $23,975 | $21,188 | $50,229 | $11,701 | | Basic EPS | $0.10 | $0.09 | $0.22 | $0.05 | | Diluted EPS | $0.10 | $0.09 | $0.22 | $0.05 | Consolidated Statements of Comprehensive Income These statements report net income and other comprehensive income changes for the three and six-month periods | Metric (in thousands) | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net Income | $23,975 | $21,188 | $50,229 | $11,701 | | Total Other Comprehensive (Loss) Income | $(50) | $14,801 | $7,400 | $13,176 | | Comprehensive Income | $23,925 | $35,989 | $57,629 | $24,877 | Consolidated Statements of Equity This statement details the changes in stockholders' equity during the second quarter of 2024 | Metric (in thousands) | Balance, March 31, 2024 | Balance, June 30, 2024 | | :-------------------- | :---------------------- | :--------------------- | | Common Shares | 231,494,286 | 234,262,497 | | Common Stock Amounts | $2,315 | $2,343 | | Additional Paid-in Capital | $4,495,663 | $4,536,645 | | Cumulative Distributions in Excess of Net Income | $(1,761,999) | $(1,808,158) | | Accumulated Other Comprehensive Income (Loss) | $31,195 | $31,145 | | Total Equity | $2,767,174 | $2,761,975 | - During the three months ended June 30, 2024, the company reported net income of $23,975 thousand, common stock issuance (net) of $38,983 thousand, and common dividends paid of $70,134 thousand[16] Consolidated Statements of Cash Flows This statement summarizes cash flows from operating, investing, and financing activities for the six months ended June 30, 2024 and 2023 | Cash Flow Activity (in thousands) | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $132,923 | $138,618 | | Net cash (used in) provided by investing activities | $(70,531) | $104,982 | | Net cash used in financing activities | $(66,642) | $(264,544) | | Net decrease in cash, cash equivalents and restricted cash | $(4,250) | $(20,944) | | Cash, cash equivalents and restricted cash, end of period | $42,309 | $32,380 | Notes to Consolidated Financial Statements These notes provide detailed disclosures on accounting policies, portfolio composition, debt, and other financial statement components 1. BUSINESS This note describes the company's business as a healthcare-focused real estate investment trust (REIT) - Sabra Health Care REIT, Inc. operates as a REIT, primarily acquiring, financing, and owning real estate in the healthcare sector across the U.S. and Canada[23] - The company's investment portfolio includes skilled nursing/transitional care facilities, senior housing communities (leased and managed), behavioral health facilities, specialty hospitals, joint ventures, loans receivable, and preferred equity investments[23] 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES This note outlines the significant accounting policies and estimates used in preparing the financial statements - The consolidated financial statements are prepared in accordance with U.S. GAAP for interim financial information, with management making estimates and assumptions that affect reported amounts[25][31] - The company evaluates variable interest entities (VIEs) and joint ventures to determine consolidation, concluding it was not the primary beneficiary of any VIEs as of June 30, 2024[26][28][30] - Recently adopted ASUs 2020-04, 2021-01, and 2022-06 (Reference Rate Reform) did not materially impact the financial statements. ASUs 2023-07 (Segment Reporting) and 2023-09 (Income Tax Disclosures) are being evaluated for future impact[32][33][34] 3. RECENT REAL ESTATE ACQUISITIONS (CONSOLIDATED) This note details the company's real estate acquisition activities during the first half of 2024 - During the six months ended June 30, 2024, Sabra acquired one Senior Housing - Leased community for $36.1 million[35] | Acquisition Metric (in thousands) | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Total Consideration | $36,128 | $51,474 | | Total Revenues from Acquired Facilities | $800 | $4,300 | | Net Income from Acquired Facilities | $600 | $100 | 4. INVESTMENT IN REAL ESTATE PROPERTIES This note provides a breakdown of the company's real estate investment portfolio by property type | Property Type | Number of Properties (June 30, 2024) | Number of Beds/Units (June 30, 2024) | Total Real Estate Investments, Net (June 30, 2024, in thousands) | | :-------------- | :----------------------------------- | :----------------------------------- | :--------------------------------------------------------------- | | Skilled Nursing/Transitional Care | 236 | 26,538 | $2,464,407 | | Senior Housing - Leased | 39 | 3,319 | $413,270 | | Senior Housing - Managed | 66 | 6,341 | $1,104,758 | | Behavioral Health | 18 | 1,159 | $406,057 | | Specialty Hospitals and Other | 15 | 392 | $175,335 | | Total | 374 | 37,749 | $4,563,827 | - As of June 30, 2024, the company had an aggregate commitment of approximately $17 million for future capital and other expenditures for triple-net operating lease facilities[40] - Resident fees and services for Senior Housing - Managed communities included ancillary service revenue of $0.9 million and $1.6 million for the three and six months ended June 30, 2024, respectively[41] 5. ASSET HELD FOR SALE, IMPAIRMENT OF REAL ESTATE AND DISPOSITIONS This note discloses information on assets held for sale, impairment charges, and property dispositions - As of June 30, 2024, one skilled nursing/transitional care facility with a net book value of $2.2 million was classified as held for sale and subsequently sold for $2.3 million[45] | Metric (in millions) | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------- | :----------------------------- | :----------------------------- | | Real Estate Impairment | $18.5 | $7.1 | | Number of Facilities Disposed | 4 | 12 | | Consideration, net of closing costs | $6.2 | $176.9 | | Net Gain (Loss) on Sale | $1.8 | $(29.4) | 6. OPERATING LEASES This note details future minimum rental payments under operating leases and the company's role as both lessor and lessee - The majority of Sabra's properties are leased under triple-net operating leases with a weighted average remaining term of seven years as of June 30, 2024[50] - As of June 30, 2024, the company had $10.7 million in ROU assets and $12.4 million in lease liabilities for operating leases where it is the lessee[55] | Future Minimum Rental Payments (in thousands) | | :-------------------------------------------- | | July 1 through December 31, 2024: $186,733 | | 2025: $371,459 | | 2026: $355,491 | | 2027: $335,059 | | 2028: $312,759 | | Thereafter: $1,377,855 | | Total: $2,939,356 | 7. LOANS RECEIVABLE AND OTHER INVESTMENTS This note provides a breakdown of the company's loan and preferred equity investment portfolio | Investment Type | Quantity (June 30, 2024) | Book Value (June 30, 2024, in thousands) | Book Value (Dec 31, 2023, in thousands) | Weighted Average Contractual Interest Rate (June 30, 2024) | | :---------------- | :----------------------- | :--------------------------------------- | :-------------------------------------- | :------------------------------------------------------- | | Mortgage Loans | 3 | $335,600 | $319,000 | 7.7% | | Other Loans | 11 | $52,453 | $50,440 | 7.8% | | Preferred Equity | 5 | $57,329 | $57,849 | 10.8% | | Total | 19 | $439,015 | $420,624 | 8.1% | | Allowance for Loan Losses (in thousands) | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--------------------------------------- | :----------------------------- | :----------------------------- | | Balance at beginning of period | $6,665 | $6,611 | | (Recovery of) provision for loan losses | $(298) | $221 | | Balance at end of period | $6,367 | $6,832 | - As of June 30, 2024, one loan receivable investment had deteriorated credit quality with a principal balance of $1.214 million, and three loans were on nonaccrual status[58] 8. DEBT This note outlines the company's debt structure, including secured debt, senior unsecured notes, and credit facilities | Debt Type | Principal Balance (June 30, 2024, in thousands) | Weighted Average Interest Rate (June 30, 2024) | Maturity Dates | | :---------- | :-------------------------------------------- | :--------------------------------------------- | :------------- | | Secured Debt | $47,134 | 2.85% | May 2031 - August 2051 | | Senior Unsecured Notes | $1,750,000 | 4.01% (effective) | August 2026 - December 2031 | | Revolving Credit Facility | $130,367 | 6.46% | January 2027 | | Term Loans | $539,665 | 6.68% (U.S. dollar), 6.35% (Canadian dollar) | January 2028 | - The Credit Agreement includes a $1.0 billion revolving credit facility and $430.0 million U.S. dollar and CAD $150.0 million Canadian dollar term loans, with an accordion feature to increase total available borrowings to $2.75 billion[65] - Sabra was in compliance with all applicable financial covenants under its Senior Notes Indentures and Credit Agreement as of June 30, 2024[63][70] 9. DERIVATIVE AND HEDGING INSTRUMENTS This note describes the company's use of derivative instruments to manage interest rate and foreign exchange risk - Sabra uses derivative financial instruments, including interest rate swaps and collars, to manage exposure to interest rate and foreign exchange rate fluctuations, primarily for cash flow and net investment hedges[73][75][76][77] - Approximately $8.9 million of gains from cash flow hedges are expected to be reclassified into earnings within the next 12 months[76] | Derivative Type | Notional Amount (June 30, 2024, in thousands) | Fair Value (June 30, 2024, in thousands) | | :---------------- | :------------------------------------------ | :--------------------------------------- | | Cash Flow Hedges (U.S. Dollars) | $753,750 | $22,226 (asset) | | Cash Flow Hedges (Canadian Dollars) | $300,000 | $ | | Net Investment Hedges (Canadian Dollars) | $49,545 (derivatives), $188,800 (financial instruments) | $4,252 (asset), $138,032 (liability) | 10. FAIR VALUE DISCLOSURES This note provides fair value measurements for the company's financial assets and liabilities - Sabra classifies fair value measurements into Level 1, 2, or 3 based on input observability, with most financial instruments valued using Level 2 or Level 3 inputs[84][88] - Derivative instruments are classified as Level 2, while loans receivable, preferred equity investments, and secured indebtedness are classified as Level 3 due to significant unobservable inputs in their valuation models[86][87][88][90] | Financial Instrument (in thousands) | Carrying Amount (June 30, 2024) | Fair Value (June 30, 2024) | Fair Value Level | | :---------------------------------- | :------------------------------ | :------------------------- | :--------------- | | Loans receivable | $381,686 | $397,123 | Level 3 | | Preferred equity investments | $57,329 | $59,201 | Level 3 | | Senior Notes | $1,735,653 | $1,577,367 | Level 2 | | Secured indebtedness | $46,315 | $35,080 | Level 3 | 11. EQUITY This note details the company's equity offering programs and dividend declarations - Sabra utilized its at-the-market (ATM) equity offering program, settling 2.7 million shares for $39.1 million net proceeds during the six months ended June 30, 2024[95] - As of June 30, 2024, $455.0 million remained available under the ATM Program[95] | Dividend Declaration | Record Date | Amount Per Share | | :------------------- | :---------- | :--------------- | | February 1, 2024 | February 13, 2024 | $0.30 | | May 8, 2024 | May 20, 2024 | $0.30 | 12. EARNINGS PER COMMON SHARE This note presents the calculation of basic and diluted earnings per common share | EPS Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Basic EPS | $0.10 | $0.09 | $0.22 | $0.05 | | Diluted EPS | $0.10 | $0.09 | $0.22 | $0.05 | | Basic Weighted Average Common Shares | 231,620,291 | 231,204,531 | 231,536,286 | 231,184,355 | | Diluted Weighted Average Common Shares | 233,750,823 | 232,244,588 | 233,583,871 | 232,214,443 | 13. COMMITMENTS AND CONTINGENCIES This note discusses the company's commitments and potential contingencies, including environmental and legal matters - Sabra is subject to various environmental laws but does not expect compliance to have a material adverse effect on its financial condition or results of operations[101] - Management is not aware of any material legal proceedings where the likelihood of a loss contingency is reasonably possible and material to the company's financial results[102] 14. SUBSEQUENT EVENTS This note discloses significant events that occurred after the balance sheet date - On August 7, 2024, the board of directors declared a quarterly cash dividend of $0.30 per share of common stock, payable on August 30, 2024[104] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on financial condition, operational results, market trends, and liquidity Overview This section provides an overview of the company's business model as a healthcare REIT and its strategic objectives - Sabra operates as a self-administered, self-managed REIT, investing in healthcare real estate and generating revenue primarily by leasing properties to third-party tenants in the U.S. and Canada[107] - The company aims to grow and diversify its investment portfolio by tenant, facility type, and geography within the healthcare sector, including through direct investments, development, and select asset sales[108] Market Trends and Uncertainties This section discusses the impact of economic conditions, labor shortages, and reimbursement rates on the healthcare industry - Economic and market conditions, including increased interest rates, labor shortages, and inflation, continue to impact operations by increasing costs and limiting capital availability[110] - While occupancy rates have increased, they remain below pre-pandemic levels, and labor costs, though improved from peak, are still higher than pre-pandemic levels[112] - Increases in skilled nursing/transitional care reimbursement rates are leading to margin recovery despite lower occupancy[112] Acquisitions This section summarizes the company's acquisition activity during the first half of 2024 - During the first six months of 2024, Sabra acquired one Senior Housing - Leased community for $36.1 million[113] Dispositions This section details the sale of properties as part of the company's capital recycling strategy - Sabra completed the sale of four skilled nursing/transitional care facilities for $6.2 million, resulting in a net gain of $1.8 million, as part of its capital recycling initiative[114] Critical Accounting Policies and Estimates This section confirms no significant changes to critical accounting policies during the period - There have been no significant changes to Sabra's critical accounting policies during the six months ended June 30, 2024[115] Recently Issued Accounting Standards Update This section refers to Note 2 for information on recently issued accounting standards - Information regarding recently issued accounting standards updates is provided in Note 2 to the Consolidated Financial Statements[116] Results of Operations This section details the company's operational performance, comparing revenues and expenses for the three and six months ended June 30, 2024 and 2023 Comparison of results of operations for the three months ended June 30, 2024 versus the three months ended June 30, 2023 This section analyzes the key drivers of revenue and expense changes for the second quarter of 2024 versus 2023 | Metric (in thousands) | 3 Months Ended June 30, 2024 | 3 Months Ended June 30, 2023 | Increase / (Decrease) | Percentage Difference | | :-------------------- | :--------------------------- | :--------------------------- | :-------------------- | :-------------------- | | Rental and Related Revenues | $99,096 | $94,274 | $4,822 | 5% | | Resident Fees and Services | $67,939 | $58,428 | $9,511 | 16% | | Interest and Other Income | $9,106 | $8,464 | $642 | 8% | | Depreciation and Amortization | $41,681 | $44,142 | $(2,461) | (6)% | | Interest Expense | $29,314 | $28,328 | $986 | 3% | | Senior Housing - Managed Portfolio Operating Expenses | $50,355 | $43,964 | $6,391 | 15% | | General and Administrative | $12,741 | $9,532 | $3,209 | 34% | | Impairment of Real Estate | $15,335 | $0 | $15,335 | NM | | Net Gain (Loss) on Sales of Real Estate | $1,776 | $(7,833) | $9,609 | (123)% | | Income (Loss) from Unconsolidated Joint Ventures | $80 | $(653) | $733 | (112)% | - The $9.5 million increase in Resident Fees and Services was primarily due to a $5.7 million increase from seven facilities transitioned to Senior Housing - Managed communities and increased occupancy and rates[121] - General and administrative expenses increased by $3.2 million, mainly due to a $3.5 million increase in compensation for teammates[127] Comparison of results of operations for the six months ended June 30, 2024 versus the six months ended June 30, 2023 This section analyzes the key drivers of revenue and expense changes for the first half of 2024 versus 2023 | Metric (in thousands) | 6 Months Ended June 30, 2024 | 6 Months Ended June 30, 2023 | Increase / (Decrease) | Percentage Difference | | :-------------------- | :--------------------------- | :--------------------------- | :-------------------- | :-------------------- | | Rental and Related Revenues | $190,872 | $190,144 | $728 | 0% | | Resident Fees and Services | $133,970 | $115,149 | $18,821 | 16% | | Interest and Other Income | $18,046 | $17,197 | $849 | 5% | | Depreciation and Amortization | $84,595 | $96,969 | $(12,374) | (13)% | | Interest Expense | $57,722 | $56,868 | $854 | 2% | | Senior Housing - Managed Portfolio Operating Expenses | $100,024 | $87,601 | $12,423 | 14% | | General and Administrative | $24,631 | $20,034 | $4,597 | 23% | | Impairment of Real Estate | $18,472 | $7,064 | $11,408 | 161% | | Loss on Extinguishment of Debt | $0 | $(1,541) | $1,541 | (100)% | | Net Gain (Loss) on Sales of Real Estate | $1,776 | $(29,348) | $31,124 | (106)% | | Loss from Unconsolidated Joint Ventures | $(515) | $(1,491) | $976 | (65)% | - The $18.8 million net increase in Resident Fees and Services was primarily due to a $10.8 million increase from seven transitioned Senior Housing - Managed facilities and a $6.7 million increase from higher occupancy and rates[138] - Depreciation and amortization decreased by $12.4 million, largely due to an $8.1 million decrease from accelerating the useful life of a demolished facility and $3.9 million from disposed properties[140] Funds from Operations and Adjusted Funds from Operations This section presents a reconciliation of net income to the non-GAAP measures of FFO and AFFO - Sabra uses FFO and AFFO as non-GAAP supplemental measures to evaluate operating performance, excluding items like depreciation, real estate gains/losses, and non-cash adjustments[152] | Metric | 3 Months Ended June 30, 2024 | 3 Months Ended June 30, 2023 | 6 Months Ended June 30, 2024 | 6 Months Ended June 30, 2023 | | :----- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | FFO | $81,423 | $75,365 | $155,957 | $149,332 | | AFFO | $83,853 | $77,268 | $165,003 | $155,492 | | FFO per diluted common share | $0.35 | $0.32 | $0.67 | $0.64 | | AFFO per diluted common share | $0.36 | $0.33 | $0.70 | $0.67 | Liquidity and Capital Resources This section details the company's liquidity position, capital resources, cash flows, and material cash requirements Overview of Liquidity This section provides an overview of the company's total liquidity and financing sources | Liquidity Metric (in millions) | As of June 30, 2024 | | :----------------------------- | :------------------ | | Unrestricted Cash and Cash Equivalents | $36.4 | | Available Borrowings under Revolving Credit Facility | $869.6 | | Total Liquidity | $906.0 | - Sabra has a shelf registration statement expiring in November 2025 and an ATM equity offering program with $455.0 million available as of June 30, 2024, to finance future investments[157][158] - The company expects current liquidity sources to be sufficient for short-term requirements and plans to use various financing options for long-term needs[159][160] Cash Flows from Operating Activities This section details the primary sources and uses of cash from the company's core business operations - Net cash provided by operating activities was $132.9 million for the six months ended June 30, 2024, primarily from rental payments, resident fees, and interest income[161] Cash Flows from Investing Activities This section outlines cash flows related to acquisitions, dispositions, and capital expenditures - Net cash used in investing activities was $70.5 million for the six months ended June 30, 2024, driven by $36.1 million for acquisitions and $25.4 million for real estate additions, partially offset by $6.2 million from real estate sales[162] Cash Flows from Financing Activities This section summarizes cash flows from debt management, equity issuance, and dividend payments - Net cash used in financing activities was $66.6 million for the six months ended June 30, 2024, primarily due to $138.9 million in dividends paid, partially offset by $36.9 million from the Revolving Credit Facility and $36.4 million from common stock issuance[163][164] Material Cash Requirements This section details the company's future material cash requirements for debt service and capital expenditures | Debt Type | Principal Balance (June 30, 2024, in thousands) | Maturity Date | | :---------- | :-------------------------------------------- | :------------ | | 5.125% Senior Unsecured Notes | $500,000 | August 15, 2026 | | 5.88% Senior Unsecured Notes | $100,000 | May 17, 2027 | | 3.90% Senior Unsecured Notes | $350,000 | October 15, 2029 | | 3.20% Senior Unsecured Notes | $800,000 | December 1, 2031 | | Secured Indebtedness | $47,134 | May 2031 - August 2051 | | Revolving Credit Facility | $1,000,000 (total facility) | January 4, 2027 | | Term Loans | $430,000 (U.S. dollar), CAD $150,000 (Canadian dollar) | January 4, 2028 | - Estimated interest and facility fee payments are $52.6 million for the remainder of 2024 and $105.6 million in 2025[169] - Future capital and other expenditures committed for triple-net operating leases are approximately $17 million, with $7 million expected to be spent in the next 12 months[170] Concentration of Credit Risk This section discusses the diversification of the company's portfolio by tenant and geography - Sabra's portfolio of 374 real estate properties is diversified across healthcare-related real estate and geographical locations in the U.S. and Canada[173] - No single tenant relationship represented 10% or more of total revenues for the three and six months ended June 30, 2024[174] Skilled Nursing Facility Reimbursement Rates This section discusses the impact of Medicare and Medicaid reimbursement rates on skilled nursing facility tenants - For the six months ended June 30, 2024, 40.0% of Sabra's revenues were derived directly or indirectly from skilled nursing/transitional care facilities[175] - CMS issued a final rule for fiscal year 2024 Medicare rates for skilled nursing facilities, providing an estimated net increase of 4.0% effective October 1, 2023[177] - CMS's Minimum Staffing Standards, effective June 21, 2024, will require 3.48 hours per resident day of total nurse staffing, which Sabra believes will exacerbate staffing challenges for its tenants[178] - CMS issued a final rule for fiscal year 2025 Medicare rates, providing an estimated net increase of 4.2% effective October 1, 2024, and expanding civil monetary penalties for noncompliance[179] Item 3. Quantitative and Qualitative Disclosures About Market Risk There have been no material changes to the company's quantitative and qualitative disclosures about market risk since its 2023 Annual Report on Form 10-K - No material changes to market risk disclosures from the 2023 Annual Report on Form 10-K[180] Item 4. Controls and Procedures Management concluded that Sabra's disclosure controls and procedures were effective as of June 30, 2024, with no material changes to internal control Disclosure Controls and Procedures This section confirms management's conclusion that disclosure controls and procedures were effective - Management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of June 30, 2024[181][182] Changes in Internal Control Over Financial Reporting This section states there were no material changes to internal controls during the quarter - There were no material changes in internal control over financial reporting during the quarter ended June 30, 2024[183] PART II. OTHER INFORMATION This part contains other required information, including legal proceedings, risk factors, and exhibits Item 1. Legal Proceedings Sabra is not a party to any material legal proceedings that would have a significant adverse effect on its financial condition or operations - Neither the company nor its subsidiaries are party to any material legal proceedings[185] Item 1A. Risk Factors There have been no material changes to the risk factors previously disclosed in the company's 2023 Annual Report on Form 10-K - No material changes in risk factors from the 2023 Annual Report on Form 10-K[186] Item 5. Other Information This section indicates that there is no other information to report for the period - No other information to report[187] Item 6. Exhibits This section lists all exhibits filed as part of the Form 10-Q, including organizational documents, certifications, and XBRL data files - The report includes various exhibits such as Articles of Amendment and Restatement, Amended and Restated Bylaws, Certifications of CEO and CFO, and XBRL Instance Documents[188][190] SIGNATURES This section contains the official signatures of the company's certifying officers - The report was duly signed on August 7, 2024, by Richard K. Matros, Chief Executive Officer, President and Chair, and Michael Costa, Chief Financial Officer, Secretary and Executive Vice President[192][193]