Community Healthcare Trust(US:CHCT)2025-02-19 17:11Financial Data and Key Metrics Changes - Total revenue for Q4 2024 was $29.3 million, slightly down from $29.6 million in Q3 2024 [17] - Property operating expenses decreased by approximately $500,000 quarter over quarter to $5.5 million [17] - Funds from operations (FFO) was $12.7 million in Q4 2024, a decline of 14.5% year over year from $14.9 million in Q4 2023 [18] - Adjusted funds from operations (AFFO) totaled $14.6 million in Q4 2024, unchanged from Q3 2024, but down 9% year over year from $16.1 million in Q4 2023 [20] Business Line Data and Key Metrics Changes - The company acquired three physician clinics totaling 38,000 square feet for $8.2 million, with leases running through 2029 and anticipated annual returns of approximately 9.4% [8] - For the year, nine properties were acquired totaling 261,000 square feet for $72.1 million, approximately 99.3% leased with leases running through 2039 [9] Market Data and Key Metrics Changes - Occupancy at year-end decreased slightly to 90.9%, with a weighted average remaining lease term declining to 6.7 years [7] Company Strategy and Development Direction - The company is focused on selective acquisitions and has signed definitive purchase agreements for six properties to be acquired after completion, with an expected investment of $146 million [10] - The company increased its revolving credit facility from $150 million to $400 million, extending the maturity date by five years [12] - The company is evaluating capital recycling opportunities and anticipates sufficient capital from selected asset sales to fund near-term acquisitions [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in resolving issues with a tenant in six properties, which could lead to significant additional AFFO [50] - The company aims to maintain occupancy in the 91% to 93% range long-term, with no significant changes expected in the near term [55] Other Important Information - The company declared a fourth-quarter dividend of $0.4675 per common share, raising it to an annualized rate of $1.87 per share [14] Q&A Session Summary Question: Timeline for geriatric psychiatric hospital operator - Management indicated that they received a small payment and expect the tenant to make payments of $100,000 to $200,000 per quarter, with a clearer timeline expected in the coming quarters [26][28] Question: Funding acquisitions and capital allocation - Management stated that all options are on the table for funding acquisitions, including using the revolving credit facility and capital recycling to maintain leverage at acceptable levels [34] Question: Expected closings in Q1 2025 - Management confirmed two properties expected to close in Q1 2025: a behavioral residential treatment facility for $9.5 million and an inpatient rehab facility for $23.5 million [42][43] Question: Dividend coverage and cash flow - Management expressed confidence in dividend coverage, noting that the coverage has been compressed due to the tenant issue but expects resolution to improve AFFO [50][51] Question: Occupancy expectations for 2025 - Management does not expect significant changes in occupancy, aiming to maintain levels between 91% and 93% [55]