<0> Medical Properties Trust, Inc.Charles Lambert, 205-397-8897Managing Director – Capital Markets </0>
Medical Properties Trust, Inc. (the “Company”) (NYSE: MPW) today announced financial and operating results for the second quarter ended June 30, 2012.
Included in the financial tables accompanying this press release is information about the Company’s assets and liabilities, net income and reconciliations of net income to FFO and AFFO, all on a comparable basis to 2011 periods.
“High quality hospitals, like those Medical Properties Trust invests in, will remain a cornerstone of the U.S. healthcare system,” said Edward K. Aldag, Jr., Chairman, President and CEO of Medical Properties Trust. “Regardless of which reform legislation may be enacted, the healthcare system in the U.S. is expected to continue its focus on policy that supports the intersection of improved patient outcomes and cost savings. MPT’s high quality hospital operators are well-positioned to capitalize on this long-term trend.”
Second quarter 2012 total revenues increased 46% and Normalized FFO per share increased 37% compared to the second quarter of 2011. The improvements are the result of MPT’s continued successful execution of the growth and investment strategies the Company implemented in 2010. Since that time, MPT has raised capital and made hospital investments totaling more than $1.0 billion with average returns of more than 10%.
“When we restarted our investment program after waiting out the uncertainty and volatility of 2008 and 2009, we raised significant amounts of capital with the goal of creating a solid foundation to support long-term, profitable growth,” continued Mr. Aldag. “Our per-share results in the second quarter illustrate the benefits of our long-term investment strategy and validate our commitment to investing in high quality hospital operators. Per share Normalized FFO was substantially above the $0.20 dividend we paid last month, resulting in a payout ratio of 91%. This ratio is expected to be approximately 75% in early 2013. As we continue to execute our growth strategy and drive the payout ratio down, we believe we will be well positioned to continue to support initiatives that will enhance shareholder value.”
In the second quarter of 2012, the Company commenced two previously announced development projects: a 40-bed, $16.6 million inpatient rehabilitation facility with Ernest Health in Lafayette, IN; and a 26-bed, $9.4 million inpatient rehabilitation facility on the campus of an existing long-term acute care hospital leased by Post Acute Medical in Victoria, TX.
“The Lafayette, IN and Victoria, TX projects both demonstrate the current and future value to MPT shareholders of our close relationships with our tenants,” continued Aldag. “Upon completion of the Lafayette hospital, MPT will earn lease revenue pursuant to its master lease agreement with Ernest Health, and in addition will receive approximately 80% of the hospital’s operating earnings with no additional investment. The Victoria, TX project will be the sixth hospital that Post Acute Medical leases from MPT, two of which share operating earnings with MPT.”
At June 30, 2012, the Company had total real estate and related investments of approximately $2 billion comprised of 79 healthcare properties in 23 states leased to 21 hospital operating companies. In July 2012, the Company completed a $100 million mortgage loan investment secured by the Centinela Hospital Medical Center in Inglewood, CA, and restructured its leases to Prime Healthcare as a master lease structure. Among other benefits of the restructure, the lease terms were extended, a minimum annual rent escalator was established and all of MPT’s Prime Healthcare leases and loans were effectively cross-defaulted and cross-collateralized.
Based on the Company’s asset portfolio and capitalization as of June 30, 2012, the $100 million Centinela Hospital Medical Center mortgage loan, placement into service of the three Emerus emergency hospitals during the upcoming fourth quarter, and $200 million in anticipated fourth quarter acquisitions, the Company reaffirmed its expectation that calendar year 2012 Normalized FFO will approximate $0.85 per share.
For 2013, these guidance assumptions would result in a Normalized FFO run rate of approximately $1.06 per share excluding the impact of the effects of potential 2013 acquisition and financing activities.
Guidance estimates do not include the effects, if any, of real estate operating costs, litigation costs, debt refinancing costs, acquisition costs, new interest rate hedging activities, write-offs of straight-line rent or other non-recurring or unplanned transactions. These estimates will change if the Company acquires additional assets, market interest rates change, debt is refinanced, new shares are issued, additional debt is incurred, assets are sold, other operating expenses vary, income from investments in tenant operations vary from expectations, or existing leases do not perform in accordance with their terms.
The Company has scheduled a conference call and webcast for Thursday, August 9, 2012 at 11:00 a.m. Eastern Time to present the Company’s financial and operating results for the quarter ended June 30, 2012. The dial-in telephone numbers for the conference call 866-761-0748 (U.S.) and 617-614-2706 (International); using passcode 69186319. The conference call will also be available via webcast in the Investor Relations’ section of the Company’s website, .
A telephone and webcast replay of the call will be available from shortly after the completion through August 23, 2012. Telephone numbers for the replay are 888-286-8010 and 617-801-6888 for U.S. and International callers, respectively. The replay passcode is 32123617.
The Company’s supplemental information package for the current period will also be available on the Company’s website under the “Investor Relations” section.
Medical Properties Trust, Inc. is a Birmingham, Alabama based self-advised real estate investment trust formed to capitalize on the changing trends in healthcare delivery by acquiring and developing net-leased healthcare facilities. These facilities include inpatient rehabilitation hospitals, long-term acute care hospitals, regional acute care hospitals, ambulatory surgery centers and other single-discipline healthcare facilities, such as heart hospitals and orthopedic hospitals. For more information, please visit the Company’s website at .
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