CHCT - Earnings call transcript Q2 2022 | Community Healthcare Trust Incorporated

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Operator

Welcome to Community Healthcare Trust 2022 Second Quarter Earnings Release Conference Call.

On the call today, the company will discuss its 2022 second quarter financial results. They will also discuss progress made in various aspects of its business.

Following the remarks, the phone lines will be open for question-and-answer session. The company's earnings release was distributed last evening and has also been posted on its website. X, emphasize on of based risk this as today, to may information on and wants contain of discussed may be call August uncertainty. company that that the some that information forward-looking The statements and involve XXXX, will be Actual may statements. from forth in those results set materially such differ

MD&A regarding filings. as these its required earnings in future by company law. of discussion you as its a except obligation forward-looking statements factors and uncertainties, to may SEC new or should developments statements, a as forward-looking well and review undertakes no For whether be otherwise, risks information, the The result risk and company's its disclosures update release of as

company's available the A release, for the of property company. its archive that reconciliation An available not in permission. During are is and This without is otherwise or Call is which the call is being between written recorded playback XX GAAP this call, be of distributed the the call measures. will two earnings company website prior company's on conference the the call advised discuss participants purposes. its posted reproduced may this be made for website. financial approximately and or days recorded on Investor will Relations non-GAAP

Now Trust. turn CEO call the like of I to would Community over to Healthcare Wallace, Tim

Timothy Wallace

us for XXXX our today joining second call. for you thank conference and morning, Good quarter

our Dave Financial Accounting Ann is On and with our Dupuy, Chief Officer. today the me call Chief Stach, Officer; Leigh

and filed report Form is data an night and filed report quarterly supplemental normal were on earnings X-K, last our also and last announcement was As released with XX-Q night. our process, our

was investor our posted updated website last an night. to addition, presentation In

acquisition again operation albeit again, busy standpoint. was little an first the standpoint, quarter slow and quarter an from second The better than a from

or last place them, renovations redevelopment portions indicated renovation redevelopment different tenants when quarter, with long-term in or are have five that to significant we of properties, the I continue is undergoing done. As significant or

Our pickup above have and a activity. XX%, risen has we seen continued occupancy in leasing

by health activity see encouraged We of continue we providers. the be part on to the care

have maintaining Our been managers asset controlling satisfaction. expenses tenant busy while

remaining term less just at years. Our ticked up lease than weighted average slightly X

company approximately second the has through close $XX.X of XXXX diligence half in currently XX,XXX under X.X% company X.XX%. a XXX% of This second signed have definitive and of for properties leased due purchase property a year. and to approximately of an feet for square investment property aggregate one approximately The price million. five to for total agreements expected is company acquired million returns expected purchase investments on The performing three with to $XXX.X purchase $XX.X and properties on for purchase range The quarter, to million. the continues the annual expects of running lease price these with should of after During and return XX.XX%. sale of anticipated aggregate completion return occupancy expected be agreements approximately we expected to an an approximately and acquired up The properties was XX.XX%. the these

these throughout of fourth XXXX other quarter the and one XXXX. properties on close in four to expect We the of

to to and availability We properties We with equity strategically ATM opportunistically several properties credit to on term continue acquisitions, quarter markets. say, our share. to review we access care that and items of anticipate many to of I IPO. common expect the every for returns the have dividend front, dividend to This to and we X% to to to be first since cover. have sheets the utilize facilities out having another anticipated have our fund under On on XX%. we enough quarter our share. continue dividend per takes wanted annualized proud of I it our raised $X.XX per $X.XXXX continue an equates And the our declared believe raised I to

to hand I to numbers. the cover So Dave things will off

David Dupuy

share increased year. first at million, $X.X expenses the to quarter, was million to G&A pro forma revenue over of On operating the an of forma have am had G&A representing in Tim, the total second the 'XX in I day first an $X.X morning, million for This million X.X%. report our 'XX, From that deferred the to $X.XX in rates. the second I the quarter-over-quarter. year-over-year. totaled everybody. from operations, of second share increased 'XX, from per quarter to second expense fund if a were increase X.X% quarter from compared quarter-over-quarter. $X.XX flat representing 'XX million X.X%. per last total in for diluted diluted . in of of 'XX employee professional XXXX grew the quarter $XX million On Great. Interest well FFO primarily AFFO or straight-line pleased quarter growth driven grew 'XX, as by report and quarter in of expense. growth in growth first or as an second Revenue million 'XX quarter from basis, $X.XX occurred quarter, perspective, pro 'XX, funds travel good from a million to per from basis, on in in and first million. of expense to the would in $X.XX $XX to was of rent million the in borrowings diluted stock-based share increases same revenue second of million, to total the growth first funds the X.X% X% from quarter X.X%. a of an increase of 'XX, and second AFFO, 'XX acquisitions acquisition quarter-over-quarter of Adjusted per quarter or quarter the expenses and credit well the Increases increase in $X.X under share due in a am basis, floating compensation second compensation, per increased $XX.X operations, which per quarter revolving increases diluted $XX.X X.X%. with the or Thanks, X.X% the second pleased share increased additional $XX.X fees to share in as quarter by period remained increased quarter. On of property the quarter $XXX,XXX for facility $XX.X $XX.X in in million second of from the FFO, adjusts million second to or that increased $XX.X to as interest second $X.X representing $X.X 'XX quarter

increase AFFO approximately of have the to first second Danielle, question-and-answer million, the basis, AFFO increased second share that's for from pro a diluted to share. all quarter a a X.X% perspective. representing quarter, first numbers in Finally, to per per of $X.XX And on quarter-over-quarter. would acquisition of per have quarter $XX.X the by day the On from quarter was AFFO 'XX quarter forma $X.XX diluted I the 'XX. session. Anyway, pro diluted first share in start the basis, second a total ready increased on 'XX per forma of if $XXX,XXX $X.XX share of had $XX.X we a the occurred million, or are

Operator

Instructions]. [Operator

comes question from first Sheila of The Evercore. McGrath

Sheila McGrath

some have and was invested, you're redevelopment. what to is Tim, models? in insight mentioned we how capital of you that return investing so the I being if capital could I wondering our was on you kind just give you that timing wondering, much us add could

Timothy Wallace

These probably $X.X being have that will done already spread approximately X it's over we be in are it It's projects quarters. for. leases and million, out for the And tenants. specifically existing next five

that provide does So any detail?

Sheila McGrath

is Like similar kind Yes. like yield? Yes. And is what it... XX%? Or it of

Timothy Wallace

in X% range. It's XX% the to

Sheila McGrath

Okay. the tenant rehab their I'm that was facility. Great. moved up, the this acquisition And assuming on then your exposure from largest since quarter,

that Just transaction? Or relationship? wondering your widely opportunity came if it a like was given about marketed

Timothy Wallace

six No, quarter, it's the on relationship. agreement, these purchase our last of sale closed of and had and of one we of under -- one them. It's part we

we've now five. So got

it's part that's clients. So of existing an our of one relationship

Sheila McGrath

And that dialysis $XX The LOI, letter, potentially you last over have, million. Great. question. Okay.

just that the are curious, hurdles where get process? Just definitive in major stands that agreement? to to or Or purchase there

Timothy Wallace

They're market, operation out now as to ability I they said estate their last with with the PE funded, leads real -- I side, properties. the our and that identifying they're do quarter, their them. but and transactions funding to mean in acquiring -- got PE

Operator

The next question of Piper comes from Sandler. Alexander Goldfarb

Alexander Goldfarb

pipeline see First the good expand. to all, of

that's a thing. good So

a Just Tim. few questions,

as goes, far the you First, funding as referenced of line credit.

ATM. also referenced You the

still trade at good You guys to NAV. a premium

and So just as for positive debt markets, in the the But at the going your you as long markets forward, equity do funding how scenario? current we're see disruption that's in least both given accretion.

Timothy Wallace

has think question. Thanks we -- don't Basically, significantly. for don't changed the see the situation we

even after XX from point A at buying We it. first going up the camps, is that that point nine-plus that We other to market up up seen cap basis open rates with substantially it's basis -- we and of the are have had after second we're funding lot the dried at people more increase XX Fed. anticipate open increase. investing the

X.X% market seeing the our equity costs But open you more. substantially on debt, up X%, our funding accretive we're if buying anticipating very range. it's to at and So basically, both look still

same. the where hate capitalization of overall now, selling the still in We it a lot stock the thought to again, but to range offset total of can it money. keeping think $XX XX% ATM the our matter the is because, XX% is I we the stock. plan using plan So it's stock. a on and make The of debt of we fact is selling

Alexander Goldfarb

you of of REITs office, slowed in you there's have lot doesn't to into have on Okay. partially case it of or that leads is. second And think the which a cost you, and the the then that given from markets, And have a apartments, transaction in other like a down lot your question, the in transaction other people the disruption That said stop, just markets maybe will. really in on going going if it's markets, I But what's almost industrial, answered. what sectors, a lot sound the retail, capital. of come

back that stopped it as pulling at more own just look of in? general? that, as are the recipient? just maybe bit are in yes, to noticeably deals described, And you what's the you on deal your in sellers a going you're just pipeline, Or on So has is you and the a because transact flow lot therefore, color going stop, product

Timothy Wallace

No. our pipeline. are saying markets And pickup and the there saying. because they're more there's we recognition -- pickup lag to as a processing the we pipeline. anticipate sellers a year, is seen opposite. a after is pipeline. I the But mean potential significant first quarter, point we've Fourth a significant in XX that slowdown pickup basis year; quarter, said, in Actually, increase, last capital I the what a between saw be there this of what in our going of first that

But is probably can old there buyers buy prepandemic. cap dislocation already. So again, the because thinking the a capital think quarter cap we've a cost significant the that anticipating pickup and we same sellers of them We're are that deal saw more rate seen makes at pickup. will flow rate. We a have they still some be to back fourth higher of still get

So that we're well it and fairly bodes think seeing for excited what about we're us.

Operator

Stevenson The Janney. of next question comes from Rob

Robert Stevenson

looking in attractive type property marketplace already under the the stuff of any outside when Tim, sourcing today contract? others you're to that's stuff more

Timothy Wallace

We that continue very asked we're opportunistic. and get to question,

I one there was than ever was -- property thought another. type there's don't better that So think that we've particular

kind still while. bit. for seeing We're a a slowed there We seeing down of substantial were a are that's little facilities. of number some, but We behavioral

multi-tenanted here just of talking good to We parameters. couple in have office of of them are they what the months kind Alex qualities of meet -- that office medical more about, last part I building we medical if like as seeing all was but building our

property over we there's one So favor particular type another. not would that

Robert Stevenson

known in then any this downsizings -- this XXXX at expirations the any at are And lease Okay. there there point? point, are or move-outs

Timothy Wallace

XX%, our that I'm are I'm retention not to XX%. the is will Again, expirations. I up there in tied rate sure historic out. think end XXXX as lease some moving

have we So on any to out to effort management in already expirations XX% of the leasing given on the XX% people full and year. asset on pledged we both vacancy, a started XXXX But anticipate expiration. have move working

I up as from So activity we is. we've that has care the providers seen feel comfortable very picked leasing And with where substantially. that health mentioned,

in next and up the over picked XX we that our we bps continuing anticipate occupancy, north several quarters. noted, As

Robert Stevenson

the quarter last back then about a first second the And you Dave, Page of quarter shows guys the weighted did is for below the buy X average was. stock one second in Okay. XXX,XXX count me. supplemental some what that's share on basis, quarter?

David Dupuy

didn't stock We share any are very slightly. was No, calculated. down, at buybacks down the price calculation way the shares. issue -- price no That's share all. it's moved the because the shares And just of

what that's And so there. you're seeing

Operator

question next from The comes Baird. of Rodgers Dave

David Rodgers

a two ask Wanted by there. to the commence end Is will there questions spaces of we or redevelopment percentage delay your for expectation? you companies can remind those a to account I lag portfolio before happens? guess be portfolio today? that on Should vacancy of on assets. of of that me And redevelopment the anticipate Or that or that, the the XXXX? then today what leases

Timothy Wallace

Your being sometime XXXX. in of completed, anticipate the XXXX we first all part those question or is started and rent of

of the So of those end in first of the by think of should question. started And -- all rent part the be all answers XXXX, that the those. I

that. I've question, looked like a would probably we've basis like It's -- it mean, points my honest never sure. something the like or to looked to I you, it not don't guess As it of part XX I relates be that. just I'm guess. never it be quite with It's at the know, that. second at

David Rodgers

a as or can customers as that expansion more Okay. portfolio you for existing the of would tighter that have come be work Maybe acquisition? be square number. you seeing are you capital of to capital projects around returns But you or guess get might up with off footage can redevelopment in -- on my to put that, that than capital. effect, deploying something I I mean, well new market, that beneficial getting question the existing to to you I if other follow are

Timothy Wallace

probably that it's got gut now a months, and renovation My that We've type over these Well, last discussions feet that possibility we've with what's seen will that's reaction of space several square XX,XXX projects. good redevelopment the with to to of that kind X X continue. generated that, ongoing and continue? project. is of XX,XXX Will

and new So to we're in money we're properties look existing doing hopeful and that. the very to happy invest forward

Operator

[Operator comes Instructions]. next Securities. Michael from The question of Lewis Truist

Michael Lewis

dialysis it -- capital up talked you know I there about in And a the program. pipelines the Is that like sorry follow to for wanted on be that one? you'll in then past. expectation when about are programmatic any progress step putting making Is investment that to you've taking program? question Sheila's about work on that. other there I further,

Timothy Wallace

the taken of get at side We've it. to how slightly been disappointed long it's in capital invested dialysis

when, to several difficult calls, on come of as the other the is, it's relationships. I kind of couldn't mean, I -- to on period visit, there nobody mean, said other projects it given question will of happen. work are and still in or We were one, it previously ones the or of relationships. and to sit tenant. It's PE saying X these anticipate my all they're And We we've Number their time. why do. had a confident pandemic, one done, them, comments happening, wanted they get it yes, them up I pandemic on them. for that on -- money today. I've the of stuff. answer And we now got we put to this very done, didn't the neutral searching that already kind still X proven thing because They think good taking during they working that different these of for and to long us but I just part maybe are time that's mean we a started so that in talk very already. I X, other got a on focused several with I particular The things. But -- X wanted I is

growth, are having they a those focusing they discussions, of Now are mature. to we on but some and take while

but we increase announce we to part anything else point, and continue to work have look our So to on don't at it do of that this business.

Michael Lewis

what pricing million saw of maybe that Do have purchase help you expect of not those be you exercised. me, Great. the then Okay. might lastly kind exercise? been likelihood is, I of and $XX under us exercisable of to for the options properties understand share have that exercised And any options

Timothy Wallace

for and expect majority really And are exercisable up. inflation the going We is now capital basically, initial an plus of those that to everybody don't an that, the I rate particularly cost purchase think of at the price. purchase price

interest if we expect up, for everybody might So rates going with be the of those to cost don't up really interest of any were zero, answer my and capital different. still exercised. But going be rates

Operator

turn to for This over remarks. would concludes back I Wallace conference session. our Mr. to like closing question-and-answer the

Timothy Wallace

spend appreciate We to time talk taking you quarter. to everyone. us, next we'll the with you Thanks, and

Operator

has you for Thank conference concluded. now presentation. attending The today's

disconnect. may You now

Community Healthcare Trust (CHCT) 3 Aug 222022 Q2 Earnings call transcript