National HealthCare Corp., Omega Healthcare Investors and Ventas released their third-quarter earnings results on Friday.

National HealthCare Corp.

National Healthcare Corp. reported a 6.5% year-over-year increase in net operating revenues and grant income for the third quarter, $288.4 million in 2023 compared with $270.8 million a year ago.

Excluding the seven skilled nursing facilities in Massachusetts and New Hampshire where the Murfreesboro, TN-based company ceased operation in September 2022, same-facility net operating revenues increased 11.8% during the third quarter of 2023 compared with the same period a year ago.

Net income in the quarter was $10.3 million, compared with a net loss of $2.4 million for the same period in 2022. Adjusted net income for the third quarter was $13.2 compared with $7.7 million for the same quarter a year ago.

The increase in earnings for the third quarter of this year compared with the same quarter “was primarily due to the continued occupancy increase in our skilled nursing and assisted living facilities, skilled nursing per diem increases from some of our government payors, and the continued reduction of nurse agency staffing expenses within our operations,” the NHC said in a press release. 

NHC also announced Friday that on Feb. 1 it will pay a quarterly dividend of $0.59 per common share to shareholders of record as of Dec. 29.

NHC affiliates operate for themselves and for third parties 68 skilled nursing facilities, 26 assisted living communities, five independent living communities, 35 home care agencies, 30 hospice agencies and three behavioral health hospitals. NHC’s other services include Alzheimer’s and memory care units, pharmacy services, a rehabilitation services company, and providing management and accounting services to third-party post-acute operators.

Omega Healthcare Investors

Omega Healthcare Investors continued to work to strengthen its liquidity and capital in the third quarter while working to protect its overall cost of debt, Chief Financial Officer Bob Stephenson said Friday.

“Our third-quarter financial performance exceeded our expectations on higher-than-expected interest income and unanticipated rent payments from some operators on a cash basis,” Taylor Pickett, CEO of the Hunt Valley, MD-based real estate investment trust, said in a press release issued in conjunction with the REIT’s third-quarter earnings call. 

Omega completed $106 million in new investments during the quarter, an amount that included $55 million in real estate acquisitions, $26 million in real estate loans and $24 million in capital renovation and construction projects. 

Additionally during the third quarter, Omega received $99 million in proceeds related to facility sales. As of Sept. 30, Omega had sold 27 facilities in the third quarter for a total of $161 million in gross proceeds. After the end of the quarter, on Nov. 1, Omega sold for $305.2 million 29 skilled nursing facilities that had been leased to LaVie Care Centers; the total consisted of $91.9 million in gross cash proceeds and $213.3 million for the pay-off of HUD-related mortgages.

Net income for the quarter of $94 million, or $0.37 per common share, compared with $105 million, or $0.43 per common share, for the same period in 2022. Nareit funds from operations, or FFO, for the quarter was $161 million, or $0.63 per share, compared with $159 million, or $0.65 per share, for the third quarter of 2022. Adjusted FFO was $182 million, or $0.71 per share for the quarter. 

Funds available for destruction, or FAD, was $174 million, or $0.68 per share, $0.02 below the second quarter FAD of $0.70.

“The $0.02 decrease compared to the second quarter was primarily the result of LaVie, cash-based operators and the impact of additional weighted average shares, partially offset by the incremental short-term investment income,” Stephenson said. “Our fourth-quarter FAD will be impacted by a number of items, including the timing of payments received from cash-based operators and the availability of security deposits.” 

Stephenson said that Omega paid off a $350 million bond that matured in August. Additionally, the REIT entered into a $428.5 million term loan that has a two-year maturity with two one-year extensions at Omega’s option — effectively, a four-year term loan. 

“We swapped the term loan rate from floating to fixed at just under 5.6%,” he said.

Omega issued 4 million shares, or $126 million of equity, to continue to de-lever. In total, the REIT ended the quarter with more than $550 million of cash on the balance sheet.

For additional coverage of the Omega Healthcare Investors earnings call, including the performance of Maplewood Senior Living, see McKnight’s Senior Living. 

Ventas

Ventas saw normalized funds from operations of $0.75 per share, representing 6% year-over-year growth, and total company same-store cash net operating income growth of almost 8%, Ventas Chair and CEO Deb Carfaro told investors Friday morning.

“Consistent with our expectations, our senior housing operating portfolio (SHOP) led the way, with outstanding occupancy increases from the beginning to the end of the third quarter, across all geographies and product types, including independent living,” she said.

The Chicago-based real estate investment company’s SHOP saw double-digit same-store cash net operating income growth for the fifth consecutive quarter, according to Justin Hutchens, the REIT’s chief investment officer and executive vice president of senior housing.

“The multiyear growth and recovery cycle in senior housing is in full swing,” Cafaro said.

The REIT’s revenue growth was 7.6% year over year, driven by the sequential occupancy growth as well as revenue per occupied room, or RevPOR, growth of 6.2%, Hutchens said.

“As we look to finish the year, we are expecting an attractive top and bottom line SHOP same-store cash NOI growth of 17% to 19% for the full year,” Hutchen said. “The key assumptions that drive the midpoint of our range are average occupancy growth of about 110 basis points and RevPOR growth of about 6%, which was total revenue growth to at least 7.5%.

For additional coverage of the Ventas earnings call, see McKnight’s Senior Living.