Welltower(US:WELL)2024-04-30 17:05Financial Data and Key Metrics Changes - Welltower reported a net income attributable to common stockholders of $0.22 per diluted share and normalized funds from operations (FFO) of $1.01 per diluted share, representing an 18.8% year-over-year growth [41] - The company achieved nearly 19% year-over-year growth in FFO per share, with strong contributions from all business segments [6] - Total portfolio same-store net operating income (NOI) growth was 12.9% year-over-year [41] Business Line Data and Key Metrics Changes - The Senior Housing operating portfolio saw a 25.5% year-over-year same-store NOI increase, marking the sixth consecutive quarter of growth exceeding 20% [21] - The outpatient medical portfolio produced year-over-year same-store NOI growth of 2% for Q1 2024, with a retention rate exceeding 90% [20] - Same-store revenue growth for independent living and wellness housing portfolios was strong, while assisted living continued to outperform [11] Market Data and Key Metrics Changes - Same-store occupancy grew by 340 basis points year-over-year, with a reported same-store revenue per occupied room (RevPOR) growth of 4.8%, adjusted for Leap Year impact, the growth was 5.6% [8][9] - Revenue growth in Canada was 9.1%, while the U.S. and U.K. grew at 10.1% and 14.8%, respectively [22] - Overall same-store expenses increased by 5.7% year-over-year, with unit expenses (ExpPOR) up 0.4% [9][22] Company Strategy and Development Direction - The company aims to achieve significant regional density by focusing on granular transactions and partnerships with operators that deliver strong results [17][36] - Welltower is converting eight additional communities from triple-net to RIDEA, which is expected to enhance long-term earnings [13] - The capital markets environment is favorable for deploying capital, with $2.8 billion of investments closed or under contract across 23 transactions [14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the demand-supply backdrop for Senior Housing, noting that new construction remains challenging [7] - The company is focused on improving customer and employee experiences, which are expected to drive financial performance [12][25] - Management acknowledged the uncertainty in the market and emphasized the importance of the upcoming summer leasing season [61] Other Important Information - The company raised $2.4 billion in gross proceeds through equity issuance to fund investment activities and extinguish approximately $1.5 billion of debt [47] - The updated full-year 2024 guidance for net income attributable to common stockholders is projected to be between $1.48 and $1.61 per diluted share [50] Q&A Session Summary Question: Guidance assumptions and peak leasing season indications - Management indicated that it is too early in the year to define annual results, emphasizing a healthy level of caution regarding market conditions [61] Question: Outlook for FAD growth and dividend policy - Management noted that FAD growth remains strong, and discussions regarding the dividend policy are ongoing, reflecting confidence in cash flow recovery [63][65] Question: Acquisitions and yield expectations - Management stated that the $2.6 billion in closed or under contract transactions is entirely focused on Senior Housing and Wellness Housing, with yield expectations similar to previous quarters [68][69] Question: Senior housing operators' rent increase strategies - Management reported that there has been no pushback on rent increases, with strong demand supporting the value proposition [72] Question: Investments in analytics and operations team - Management highlighted ongoing investments in operational efficiency and analytics capabilities to enhance capital deployment opportunities [74][85] Question: Performance of the Cogir, PLR portfolio in Canada - Management expressed satisfaction with the performance of the Cogir partnership, indicating strong expectations for the portfolio [87] Question: Managing potential risks and market conditions - Management acknowledged the challenges in the industry, emphasizing the importance of maintaining a strong balance sheet and focusing on long-term value creation [99][103]