Sabra(SBRA) - 2025 Q2 - Quarterly Results

Sabra Health Care REIT, Inc. Non-GAAP Financial Measures Reconciliation 2025 Full-Year Guidance Sabra Health Care REIT projects 2025 Normalized FFO per diluted share between $1.45-$1.47 and Normalized AFFO between $1.49-$1.51, based on portfolio growth assumptions | Per Diluted Common Share | Low | High | | :--- | :--- | :--- | | Net income | $0.77 | $0.79 | | FFO | $1.52 | $1.54 | | Normalized FFO | $1.45 | $1.47 | | AFFO | $1.47 | $1.49 | | Normalized AFFO | $1.49 | $1.51 | - Key assumptions for the 2025 guidance include: low-single-digit Cash NOI growth for the triple-net portfolio and low-to-mid teens Cash NOI growth for the same-store Senior Housing - Managed portfolio[5] - General and administrative expenses are projected at approximately $50 million, with cash interest expense around $102 million[5] - The weighted average diluted share count is approximately 241.5 million for Normalized FFO and 242.5 million for Normalized AFFO[5] Reconciliation of FFO and AFFO The company reports significant year-over-year growth in Q2 and H1 2025 Net Income and Normalized FFO per share, reflecting improved financial performance Q2 and H1 2025 vs 2024 Performance (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income | $65,542 | $23,975 | $105,846 | $50,229 | | FFO | $105,300 | $81,423 | $191,278 | $155,957 | | Normalized FFO | $89,159 | $82,536 | $174,966 | $160,975 | | AFFO | $89,200 | $83,853 | $177,354 | $165,003 | | Normalized AFFO | $91,641 | $84,979 | $179,879 | $167,235 | Q2 and H1 2025 vs 2024 Per Share Performance | Per Diluted Share | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income | $0.27 | $0.10 | $0.44 | $0.22 | | FFO | $0.44 | $0.35 | $0.79 | $0.67 | | Normalized FFO | $0.37 | $0.35 | $0.73 | $0.69 | | Normalized AFFO | $0.38 | $0.36 | $0.74 | $0.71 | - Normalizing items for FFO in Q2 2025 included a $17.2 million gain from terminated interest rate swaps and $3.2 million in transition expenses for Senior Housing - Managed communities[7] Reconciliation of EBITDA and Net Debt As of June 30, 2025, Sabra's Net Debt was approximately $2.37 billion, with an annualized Adjusted EBITDA of $473.7 million, resulting in a 5.00x Net Debt to Adjusted EBITDA ratio EBITDA and Net Debt Calculation (Q2 2025, in thousands) | Metric | Amount (in thousands) | | :--- | :--- | | Net income | $65,542 | | EBITDA | $137,173 | | Adjusted EBITDA, as adjusted | $118,416 | | Adjusted EBITDA, as adjusted, annualized | $473,664 | | Consolidated Debt | $2,497,955 | | Cash and cash equivalents | ($128,697) | | Net Debt | $2,369,258 | - The Net Debt to Adjusted EBITDA ratio was 5.00x as of June 30, 2025[9] Supplemental Revenue Information This section details rental and related revenues, showing total revenues of $195.9 million for H1 2025, driven by cash and non-cash components Rental and Related Revenues Breakdown (in thousands) | Component | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :--- | :--- | :--- | | Cash rental income | $92,397 | $182,468 | | Straight-line rental income | $1,382 | $2,671 | | Recoveries (write-offs) | $1,463 | $1,463 | | Above/below market lease amortization | $1,059 | $2,198 | | Operating expense recoveries | $3,522 | $7,060 | | Total Rental and related revenues | $99,823 | $195,860 | Segment Performance Analysis This section analyzes Cash Net Operating Income (Cash NOI) across segments, detailing performance by property type, payor source, and operator relationship Senior Housing - Managed Performance The Senior Housing - Managed portfolio shows strong quarterly growth, with same-store Cash NOI increasing to $22.4 million in Q2 2025 Quarterly Same Store Performance (in thousands) | Metric | June 30, 2024 | March 31, 2025 | June 30, 2025 | | :--- | :--- | :--- | :--- | | Same store resident fees and services | $66,705 | $69,775 | $70,440 | | Same store Cash Net Operating Income | $19,128 | $21,106 | $22,401 | Cash NOI by Property Type Skilled Nursing/Transitional Care was the largest Cash NOI contributor in Q2 2025 at $64.9 million, followed by Total Senior Housing at $36.8 million Cash NOI by Property Type (Q2 2025, in thousands) | Property Type | Cash NOI | | :--- | :--- | | Skilled Nursing/Transitional Care | $64,937 | | Total Senior Housing | $36,795 | | Behavioral Health | $11,011 | | Specialty Hospitals and Other | $4,828 | | Other | $10,345 | | Total | $127,916 | Annualized Cash NOI by Property Type (H1 2025, in thousands) | Property Type | Annualized Cash NOI | | :--- | :--- | | Skilled Nursing/Transitional Care | $251,026 | | Total Senior Housing | $148,270 | | Behavioral Health | $43,610 | | Specialty Hospitals and Other | $19,311 | | Other | $36,506 | | Total | $498,723 | Annualized Cash NOI by Payor Source H1 2025 Annualized Cash NOI shows a balanced payor mix, with Non-Private Payors contributing $249.3 million and Private Payors $212.9 million Annualized Cash NOI by Payor Source (H1 2025, in thousands) | Payor Source | Annualized Cash NOI | | :--- | :--- | | Private Payors | $212,948 | | Non-Private Payors | $249,269 | | Other | $36,506 | | Total | $498,723 | Annualized Cash NOI by Relationship The portfolio shows operator diversification, with 'All Other Relationships' contributing $295.7 million to H1 2025 Annualized Cash NOI Annualized Cash NOI by Relationship (H1 2025, in thousands) | Relationship | Annualized Cash NOI | | :--- | :--- | | Avamere Family of Companies | $42,019 | | Ensign Group | $41,596 | | Signature Healthcare | $40,181 | | Signature Behavioral | $33,723 | | Recovery Centers of America | $27,465 | | The McGuire Group | $18,009 | | All Other Relationships | $295,730 | | Total | $498,723 | Reporting Definitions This section defines key non-GAAP financial measures and terms, including FFO, AFFO, EBITDA, Cash NOI, and Net Debt, for report clarity - Funds From Operations (FFO): Defined by Nareit as net income excluding gains/losses from real estate sales, plus real estate depreciation and amortization, and impairment charges[34] - Adjusted Funds from Operations (AFFO): Defined as FFO excluding various non-cash items such as stock-based compensation, non-cash rental revenues, non-cash interest, and provision for loan losses[34] - Normalized FFO/AFFO: Represents FFO or AFFO adjusted for certain income and expense items that management does not believe are indicative of ongoing operating results, aiming to improve comparability between periods[40] - Cash Net Operating Income (Cash NOI): Defined as total revenues less operating expenses and non-cash revenues and expenses, used to evaluate the operating performance of the company's investments[32]