Community Healthcare Trust(US:CHCT)2019-02-27 20:08Financial Data and Key Metrics Changes - Total revenues for Q4 2018 were approximately $12.2 million, an increase from $11 million in Q4 2017 [20] - Total revenues for 2018 were $48.6 million, compared to $37.3 million in 2017 [21] - The company reported a net loss of $1.885 million for Q4 2018, compared to a net income of $1.552 million in Q4 2017 [25] - Funds from operations (FFO) for Q4 2018 were $2.9 million, impacted by Highland's rent not recognized [26][27] - Adjusted funds from operations (AFFO) for Q4 2018 were $7.2 million or $0.41 per share diluted, compared to $6.6 million or $0.37 per share for the same period in 2017 [27][28] Business Line Data and Key Metrics Changes - Rental and investment interest revenues for Q4 2018 were $10.5 million, up from $9.5 million in Q4 2017 [21] - The real estate portfolio was approximately 89% leased, with a pro forma total of $10.8 million in rental and interest revenues if all Q4 acquisitions had occurred at the start of the quarter [22] Market Data and Key Metrics Changes - The company acquired 11 properties in Q4 2018 for approximately $24.1 million, with anticipated annual returns of 9.04% to 9.51% [14] - Two properties were acquired in early 2019 for approximately $32.7 million, with anticipated annual returns of 9% to 9.3% [15] Company Strategy and Development Direction - The company plans to continue utilizing its ATM program to access equity markets opportunistically [17] - The company aims to maintain debt below 40% of the book-to-total cap, with a long-term goal of 35% [57] - The management is focused on building a future pipeline of acquisitions to ensure visibility into future growth [34] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in collecting previously unrecognized amounts from Highland's rent and interest, citing strong cash flow from the facility [46] - The company anticipates occupancy levels to begin increasing in 2019, despite a recent decline [48][49] Other Important Information - The company declared a dividend of $40.75 per common share for Q4 2018, marking a continuous increase since its IPO [18] - The company has a signed lease with a new operator for the Highlands facility, expected to provide similar cash flow as before [10] Q&A Session Summary Question: Impact of operator situation on Q1 earnings - Management indicated that the transition agreement is in place and expects minimal impact on Q1 earnings, with payments being received [30] Question: Acquisition volume comparison to last year - Management noted that the acquisition volume is significantly higher this year due to a developed pipeline and ongoing opportunities [31][34] Question: Update on restructured tenant - Management reported positive performance from the restructured tenant and anticipates a good year ahead, with potential for significant paydown of the loan [38] Question: Concerns about other tenants - Management stated that while there are over 300 tenants, none are of significant concern at this time [42] Question: Expected trends in lease percentage - Management expects lease percentages to rise throughout 2019, with improved metrics compared to previous years [48][49] Question: General and administrative expenses outlook - Management anticipates a 5% to 10% increase in G&A expenses due to potential new hires [56]