1
Exhibit 99.4
FOR IMMEDIATE RELEASE
FEBRUARY 3, 2000
FOR MORE INFORMATION CONTACT:
ERIN IBELE - (419) 247-2800
ED LANGE - (419) 247-2800
HEALTH CARE REIT, INC. REPORTS 1999
OPERATING RESULTS
1999 YEAR END RESULTS 1999 YEAR END HIGHLIGHTS
--------------------- ------------------------
- $129 million gross income - $1.3 billion total assets
- $2.76 per diluted share FFO - $275 million new investments
- $2.27 per share dividends - 18% asset growth
- 82% FFO payout ratio - 7% per diluted share FFO growth
Toledo, Ohio, February 3, 2000........HEALTH CARE REIT, INC. (NYSE/HCN) today
announced operating results for the fourth quarter and year ended December 31,
1999.
For 1999, funds from operations (FFO), the generally accepted measure of
operating performance for the real estate investment trust industry, achieved a
record level of $78.4 million, or $2.76 per diluted share, a 7 percent per share
increase from $66.8 million, or $2.57 per diluted share, for the same period in
1998. Revenues for 1999 increased 32 percent to $129.3 million from $98 million
a year ago. Net income available to common shareholders for 1999, totaled $62.8
million, or $2.21 per diluted share, as compared with net income available to
common shareholders of $58.1 million, or $2.24 per diluted share, for the same
period in 1998.
For the fourth quarter of 1999, FFO totaled $19.9 million, or $0.70 per diluted
share, a 6 percent per share increase from $18.4 million, or $0.66 per diluted
share, for the same period in 1998. Revenues for the quarter increased 22
percent to $33.8 million from $27.8 million for the three months ended December
31, 1998. Net income available to common shareholders for the fourth quarter of
1999 totaled $14.6 million, or $0.51 per diluted share, as compared with net
income available to common shareholders of $16.5 million, or $0.59 per diluted
share, for the same period in 1998.
Revenue growth was generated primarily by new investment activity in 1998 and
1999 of $397.5 million and $275 million, respectively. Investment activity
contributed to an 18 percent increase in total assets, which at December 31,
1999, totaled $1.3 billion as compared with total assets of $1.1 billion at
December 31, 1998.
Dividend payments to common shareholders for the year ended December 31, 1999,
totaled $64.4 million, or $2.27 per share, as compared with dividend payments of
$56.5 million, or $2.19 per share, for the same period in 1998. Correspondingly,
the FFO payout ratio for 1999 was 82 percent as compared with 85 percent for
1998.
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At December 31, 1999, the company had a total outstanding debt balance of $539
million, and shareholders' equity of $707 million, which represents a debt to
total capitalization ratio of 0.43 to 1.0.
"We are pleased with the company's 1999 operating results, which were consistent
with consensus estimates and met management's expectations," commented George L.
Chapman, chairman and chief executive officer. "The company's FFO growth was
generated by continued investment activity, which was supported by the proceeds
realized from the placement of $75 million of convertible preferred stock in
January, the issuance of $50 million of senior unsecured notes in March and $56
million of asset sales.
"However, the past 12 months have presented many challenges to the health care
REIT sector. The underperformance of publicly owned nursing home and assisted
living companies, combined with the much publicized shift in equity funds flow
from income-oriented investments to high-growth opportunities, have impaired the
stock valuations of all health care REITs. The availability of external capital
is limited and expensive, constraining new investment activity and earnings
growth. We believe the restrictive capital environment will continue until the
prospects for the long-term care industry improve.
"Our top priority remains to preserve the company's outstanding fundamentals,
that include a well capitalized balance sheet with modest leverage, strong
interest coverage and an attractive FFO payout ratio that demonstrates
significant dividend coverage.
"In October 1999, we announced a $200 million asset divestiture program, which
is proceeding as planned. The limited asset sales will strengthen the company's
portfolio and generate liquidity, enhancing the company's balance sheet. This
strategy positions the company for new investment and growth opportunities in
the future."
Health Care REIT, Inc., with headquarters in Toledo, Ohio, is a real estate
investment trust that invests in health care facilities, primarily nursing homes
and assisted living facilities. At December 31, 1999, the company had
investments in 238 health care facilities in 34 states and had total assets of
approximately $1.3 billion. For more information on Health Care REIT, Inc., via
facsimile at no cost, dial 1-800-PRO-INFO and enter the company code - HCN. More
information is available on the Internet at http://www.hcreit.com.
FINANCIAL SCHEDULES FOLLOW
This document and supporting schedules may contain "forward-looking" statements
as defined in the Private Securities Litigation Reform Act of 1995.
Forward-looking statements involve known and unknown risks and uncertainties,
which may cause the company's actual results in the future to differ materially
from expected results. These risks and uncertainties include, among others,
general economic conditions, the availability of capital, competition within the
financial services and real estate markets, the performance of operators within
Health Care REIT's portfolio, and regulatory and other changes in the health
care sector, as described in the company's filings with the Securities and
Exchange Commission.
#####
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HEALTH CARE REIT, INC.
FINANCIAL SUPPLEMENT
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(AMOUNTS IN THOUSANDS)
DECEMBER 31
---------------------------------
1999 1998
---------------------------------
ASSETS Real estate investments:
Real property owned:
Land $ 73,234 $ 44,722
Buildings & improvements 730,337 443,574
Construction in progress 58,954 151,317
----------- -----------
862,525 639,613
Less accumulated depreciation (35,746) (19,624)
----------- -----------
Total real property owned 826,779 619,989
Loans receivable 401,019 412,704
----------- -----------
1,227,798 1,032,693
Less allowance for losses on loans receivable (5,587) (4,987)
----------- -----------
Net real estate investments 1,222,211 1,027,706
Other assets:
Direct investments 25,361 26,180
Marketable securities 863 4,106
Deferred loan expenses 3,311 2,389
Cash and cash equivalents 2,129 1,269
Receivables and other assets 17,296 11,774
----------- -----------
48,960 45,718
----------- -----------
TOTAL ASSETS $ 1,271,171 $ 1,073,424
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Borrowings under line of credit obligations $ 177,500 $ 171,550
Senior unsecured notes 290,000 240,000
Secured debt 71,342 7,429
Accrued expenses and other liabilities 25,333 20,686
----------- -----------
Total liabilities $ 564,175 $ 439,665
Shareholders' equity:
Preferred Stock, $1.00 par value:
Authorized - 10,000,000 shares
Issued and outstanding - 6,000,000 in 1999
and 3,000,000 in 1998 150,000 75,000
Common Stock, $1.00 par value:
Authorized - 40,000,000 shares
Issued and outstanding -28,532,419
in 1999 and 28,240,165 in 1998 28,532 28,240
Capital in excess of par value 524,204 520,692
Undistributed net income 8,883 10,434
Accumulated other
comprehensive income 593 3,982
Unamortized restricted stock (5,216) (4,589)
----------- -----------
TOTAL SHAREHOLDERS' EQUITY $ 706,996 $ 633,759
----------- -----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 1,271,171 $ 1,073,424
=========== ===========
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HEALTH CARE REIT, INC.
FINANCIAL SUPPLEMENT
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(AMOUNTS IN THOUSANDS EXCEPT PER SHARE DATA)
THREE MONTHS ENDED TWELVE MONTHS ENDED
DECEMBER 31 DECEMBER 31
---------------------------------- -----------------------------------
1999 1998 1999 1998
----------------- ---------------- ----------------- -----------------
Revenues:
Operating lease rents $ 20,872 $ 12,471 $ 72,700 $ 41,953
Interest income 11,574 12,274 48,076 48,488
Commitment fees and other income 1,365 1,809 6,263 5,914
Prepayment fees 0 167 1,565 588
Gain on sale of properties 0 1,049 703 1,049
-------------- ----------- ------------ -----------
$ 33,811 $ 27,770 $ 129,307 $ 97,992
Expenses:
Interest expense $ 8,234 $ 4,451 $ 26,916 $ 18,030
Provision for depreciation 5,271 3,128 17,885 10,254
General and administrative 1,932 1,757 7,359 6,114
Loan expense 250 152 909 685
Provision for losses 150 150 600 600
-------------- ----------- ------------ -----------
15,837 9,638 53,669 35,683
-------------- ----------- ------------ -----------
Net Income 17,974 18,132 75,638 62,309
Preferred stock dividends 3,351 1,664 12,814 4,160
-------------- ----------- ------------ -----------
Net Income Available to
Common Shareholders $ 14,623 $ 16,468 $ 62,824 $ 58,149
============== =========== ============ ===========
Average number of common shares outstanding:
Basic 28,216 27,572 28,128 25,579
Diluted 28,457 27,930 28,384 25,954
Net income per share:
Basic $ 0.52 $ 0.60 $ 2.23 $ 2.27
Diluted 0.51 0.59 2.21 2.24
Funds from operations $ 19,894 $ 18,380 $ 78,441 $ 66,766
Funds from operations per share:
Basic $ 0.71 $ 0.67 $ 2.79 $ 2.61
Diluted 0.70 0.66 2.76 2.57
Dividends per share $ 0.575 $ 0.555 $ 2.270 $ 2.190
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HEALTH CARE REIT, INC.
FINANCIAL SUPPLEMENT - DECEMBER 31, 1999
PORTFOLIO COMPOSITION ($000'S)
- ------------------------------
EXHIBIT 1
BALANCE SHEET DATA # Properties # Beds/Units Balance (1) % Balance
-------------------- ------------------- -------------------- -----------------
Real Property 165 12,804 $ 826,779 66%
Loans Receivable & Other 73 7,675 401,019 32%
Direct Investments -na- -na- 25,361 2%
-------------------- ------------------- -------------------- -----------------
Total Investments 238 20,479 $ 1,253,159 100%
INVESTMENT DATA # Properties # Beds/Units Investment (2) % Investment
-------------------- ------------------- -------------------- -----------------
Assisted Living Facilities 182 12,683 $ 865,634 70%
Nursing Homes 48 6,807 281,594 22%
Specialty Care Facilities 6 695 83,807 7%
Behavioral Care 2 294 9,188 1%
-------------------- ------------------- -------------------- -----------------
Real Estate Investments 238 20,479 $ 1,240,223 100%
INVESTMENT BY OWNER TYPE # Properties # Beds/Units Investment (2) % Investment
-------------------- ------------------- -------------------- -----------------
Publicly Traded 83 5,536 $ 365,360 29%
Key Private 109 10,403 693,471 56%
Privately Held 46 4,540 181,392 15%
-------------------- ------------------- -------------------- -----------------
Real Estate Investments 238 20,479 $ 1,240,223 100%
NOTES: (1) TOTAL INVESTMENTS INCLUDE GROSS REAL ESTATE INVESTMENTS AND DIRECT
INVESTMENTS WHICH AMOUNTED TO $1,227,798,000 AND $25,361,000,
RESPECTIVELY.
(2) REAL ESTATE INVESTMENTS INCLUDE GROSS REAL ESTATE INVESTMENTS AND
CREDIT ENHANCEMENTS WHICH AMOUNTED TO $1,227,798,000 AND
$12,425,000, RESPECTIVELY.
REVENUE COMPOSITION ($000'S)
- ----------------------------
EXHIBIT 2
Three Months Ended Twelve Months Ended
December 31, 1999 December 31, 1999
---------------------------------- ------------------------------
REVENUE BY INVESTMENT TYPE
Real Property $ 21,654 64% $ 77,491 60%
Loans Receivable & Other 11,595 34% 49,275 38%
Direct Investments 562 2% 2,541 2%
------------------ --------------- ----------------- -------------
Total $ 33,811 100% $ 129,307 100%
REVENUE BY FACILITY TYPE
Assisted Living Facilities $ 22,807 68% $ 82,022 64%
Nursing Homes 8,180 24% 35,323 27%
Specialty Care Facilities 2,824 8% 11,962 9%
Behavioral Care 0 0% 0 0%
------------------ --------------- ----------------- -------------
Total $ 33,811 100% $ 129,307 100%
REVENUE BY OWNER TYPE
Publicly Traded $ 11,532 34% $ 40,716 31%
Key Private 17,957 53% 67,291 52%
Privately Held 4,322 13% 21,300 17%
------------------ --------------- ----------------- -------------
Total $ 33,811 100% $ 129,307 100%
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REVENUE COMPOSITION (CONTINUED) ($000'S) EXHIBIT 3
- ----------------------------------------
OPERATING LEASE EXPIRATIONS & LOAN MATURITIES
Current Lease Current Interest Interest and
Year Revenue (1) Revenue (1) Lease Revenue % of Total
- ------------------- ------------------------ ------------------------ ----------------------- -------------------
2000 $ 1,417 $ 1,268 $ 2,685 2%
2001 0 1,004 1,004 1%
2002 1,241 1,247 2,488 2%
2003 3,677 7,382 11,059 8%
2004 0 7,116 7,116 5%
Thereafter 87,263 24,726 111,989 82%
------------------------ ------------------------ ----------------------- -------------------
Total $ 93,598 $ 42,743 $ 136,341 100%
NOTES: (1) REVENUE IMPACT BY YEAR, ANNUALIZED
EXHIBIT 4
COMMITTED INVESTMENT BALANCES
- -----------------------------
($000'S EXCEPT INVESTMENT PER BED/UNIT)
Committed Balance Investment per
# Properties # Beds/Units (1) Bed/Unit
-------------------- ------------------- -------------------- ------------------
Assisted Living Facilities 182 12,683 $ 910,527 $ 71,791
Nursing Homes 48 6,807 290,057 42,612
Specialty Care Facilities 6 695 83,807 120,586
Behavioral Care 2 294 9,188 31,252
-------------------- ------------------- -------------------- ------------------
Total 238 20,479 $ 1,293,579 n/a
NOTES: (1) COMMITTED BALANCE INCLUDES REAL ESTATE INVESTMENTS, CREDIT
ENHANCEMENTS AND UNFUNDED COMMITMENTS FOR WHICH INITIAL FUNDING HAD
COMMENCED.
EXHIBIT 5
OPERATOR CONCENTRATION ($000'S)
- -------------------------------
CONCENTRATION BY INVESTMENT # Properties Investment % Investment
----------------------- ---------------------- -----------------------
Summerville Healthcare 17 $ 171,139 14%
Atria Senior Quarters 11 93,117 8%
Alterra Healthcare 38 88,219 7%
Life Care Centers of America, Inc. 13 87,337 7%
Olympus Healthcare Group, Inc. 11 80,584 6%
Remaining Operators 148 719,827 58%
----------------------- ---------------------- -----------------------
Total 238 $ 1,240,223 100%
CONCENTRATION BY REVENUE # Properties Revenue (1) % Revenue
----------------------- ---------------------- -----------------------
Summerville Healthcare 17 $ 11,248 9%
Atria Senior Quarters 11 10,160 8%
Olympus Healthcare Group, Inc. 11 9,218 7%
Alterra Healthcare 38 8,628 7%
Life Care Centers of America, Inc. 13 7,974 6%
Remaining Operators 148 82,079 63%
----------------------- ---------------------- -----------------------
Total 238 $ 129,307 100%
NOTES: (1) YEAR ENDED DECEMBER 31, 1999
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SELECTED FACILITY DATA
- ----------------------
EXHIBIT 6
Coverage Data
% Payor Mix ----------------------------------
------------------------------------ Before After
Census Private Medicare Mgt. Fees Mgt. Fees
------------------ ------------------------------------ ------------------ ---------------
Nursing Homes 84% 24% 12% 1.89x 1.36x
Assisted Living Facilities 92% 100% 0% 1.34x 1.16x
Specialty Care Facilities 53% 22% 31% 3.27x 2.71x
Behavioral Care 44% 12% 88% 3.39x 2.17x
------------------ ---------------
Weighted Averages 1.85x 1.46x
NOTES: DATA AS OF SEPTEMBER 30, 1999
SECURITY DEPOSITS & OTHER CREDIT SUPPORT ($000'S) EXHIBIT 7
- -------------------------------------------------
Balance % Investment
--------------- -----------------
Cross Defaulted $ 1,146,058 92% of gross real estate investments
Cross Collateralized 384,594 96% of mortgage loans
Bank Letters of Credit & Cash 44,790 4% of investment balance
CURRENT CAPITALIZATION ($000'S) Balance % Balance LEVERAGE & PERFORMANCE RATIOS
- ------------------------------- --------------- ----------------- ----------------------------------------
Borrowings Under Bank Lines $ 177,500 14% Debt/Total Book Cap 43%
Long-Term Debt Obligations 361,342 29% Debt/Equity 76%
Shareholders' Equity 706,996 57% Interest Coverage 3.42x 4th Qtr.
--------------- -----------------
Total Book Capitalization $ 1,245,838 100% 3.66x L12M
FFO Payout Ratio 82% 4th Qtr.
82% L12M
EXHIBIT 8
DEBT MATURITIES AND PRINCIPAL PAYMENTS ($000'S)
- -----------------------------------------------
Year Lines of Credit (1) Senior Notes Secured Debt Total
- ------------------- ------------------------ ------------------------ ----------------------- -------------------
2000 $ 20,000 $ 35,000 $ 99 $ 55,099
2001 175,000 10,000 109 185,109
2002 0 20,000 121 20,121
2003 0 35,000 133 35,133
2004 0 40,000 64,186 94,186
2005 0 0 549 549
Thereafter 0 150,000 6,145 156,145
------------------------ ------------------------ ----------------------- -------------------
Total $ 195,000 $ 290,000 $ 71,342 $ 556,342
NOTES: (1) LINES OF CREDIT REFLECT 100% CAPACITY
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INVESTMENT ACTIVITY ($000'S)
----------------------------
EXHIBIT 9
Three Months Ended Twelve Months Ended
December 31, 1999 December 31, 1999
--------------------------------- ---------------------------------
FUNDING BY INVESTMENT TYPE
Real Property $ 1,478 4% $ 81,008 29%
Mortgage & Other Loans 2,829 8% 17,565 6%
Construction Advances 28,498 83% 169,085 62%
Direct Investments 1,565 5% 7,461 3%
----------------- --------------- ---------------- ----------------
Total $ 34,370 100% $ 275,119 100%
REAL ESTATE INVESTMENTS
Assisted Living Facilities $ 29,790 91% $ 239,216 89%
Nursing Homes 3,015 9% 28,442 11%
Behavioral Care 0 0% 0 0%
Specialty Care Facilities 0 0% 0 0%
----------------- --------------- ---------------- ----------------
Total $ 32,805 100% $ 267,658 100%
GEOGRAPHIC CONCENTRATION ($000'S) EXHIBIT 10
- ---------------------------------
CONCENTRATION BY REGION # Properties Investment % Investment
----------------------- ---------------------- -----------------------
South 140 $ 636,048 51%
Northeast 38 284,848 23%
West 32 182,423 15%
Midwest 28 136,904 11%
----------------------- ---------------------- -----------------------
Total 238 $ 1,240,223 100%
CONCENTRATION BY STATE # Properties Investment % Investment
----------------------- ---------------------- -----------------------
Texas 47 $ 189,120 15%
Florida 30 148,645 12%
Massachusetts 14 99,130 8%
North Carolina 18 87,690 7%
Pennsylvania 14 82,781 7%
Remaining States 115 632,857 51%
----------------------- ---------------------- -----------------------
Total 238 $ 1,240,223 100%
REVENUE BY STATE # Properties Revenue (1) % Revenue
----------------------- ---------------------- -----------------------
Texas 47 $ 21,364 17%
Florida 30 12,507 10%
Massachusetts 14 11,424 9%
Pennsylvania 14 9,699 7%
North Carolina 18 8,285 6%
Remaining States 115 66,028 51%
----------------------- ---------------------- -----------------------
Total 238 $ 129,307 100%
NOTES: (1) YEAR ENDED DECEMBER 31, 1999
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FUNDS FROM OPERATIONS COMPUTATION EXHIBIT 11
- ---------------------------------
Three Months Ended Twelve Months Ended
December 31, 1999 December 31, 1999
------------------------------- --------------------------
Net Income Available to Common Shareholders $ 14,623 $ 62,824
Add: Depreciation Expense 5,271 17,885
Loss on Sale of Assets 0 0
Asset Impairment Charges 0 0
Deduct: Gain on Sale of Assets 0 (703)
Prepayment Fees 0 (1,565)
---------------------------- -- --------------------------
Funds From Operations (FFO) $ 19,894 $ 78,441
Average Common Shares Outstanding:
Basic 28,216 28,128
Diluted 28,457 28,384
FFO Per Common Share:
Basic $0.71 $2.79
Diluted $0.70 $2.76
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