National Health Investors and The Pennant Group held third-quarter earnings calls on Wednesday.

National Health Investors

“Our third-quarter results exceeded our expectations, driven by strong rent collections, record deferral repayments of $2.3 million, discrete payments of $1.0 million from two cash-basis accounting tenants and no unexpected rent concessions,” National Health Investors CEO Eric Mendelsohn said in a press release issued in conjunction with the real estate investment trust’s earnings call.

“The senior housing industry continues to recover, and we are experiencing greater stability across our real estate Investment and SHOP [senior housing operating portfolio] segments as occupancy rebuilds and labor pressures become more manageable,” he added.

Mendelssohn on the call said that the Murfreesboro, TN-based REIT’s funds available for distribution, or FAD, exceeded expectations by increasing 2% year over year and 8% compared with the second quarter.

“The foundation for the higher results this quarter is the hard work of our operating partners, who continue to make steady improvement in operating fundamentals,” he said.

NHI Chief Investment Officer Kevin Pascoe said that in the third quarter and so far in the fourth quarter, the REIT has closed on the sale of four properties for net proceeds of $8.3 million, plus $1.6 million in seller financing.

“These underperforming properties were formerly leased by two cash-basis tenants, which now puts them in better financial health, thereby improving coverage, limiting future rent concessions, and accelerating deferral repayments,” Pascoe said.

According to Chief Financial Officer John Spaid, the REIT’s net income, funds from operations, or FFO, and normalized FFO per duly-declared common share were $0.68, $1.08 and $1.08 per share, respectively. Third-quarter funds available for distribution, or FAD, was $48.2 million. FAD increased by $3.6 million compared with the second quarter. 

“When compared to the second quarter of 2023, the quarter FAD included $2.3 million of deferral repayments, which was an increase of $1.6 million,” Spaid said.

The REIT announced Tuesday that it will pay a quarterly dividend of $0.90 per common share on Jan. 26, 2024, to stockholders of record as of Dec. 29.

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

The Pennant Group

“With solid census gains, robust top-line growth and improved margin and earnings, we are poised to execute through the remainder of 2023 and beyond,” Pennant CEO Brent Guerisoli said in a press release issued in conjunction with Wednesday’s earnings call.

Total revenue for the third quarter was $140.2 million, an increase of $21.8 million or 18.5% over the prior year quarter. Net income for the third quarter was $4.4 million, and adjusted net income for the third quarter was $6 million, an increase of $1.8 million or 44.4% over the same quarter in 2022.

Chief Financial Officer Lynette Walbom said that total revenue for the third quarter was $140.2 million, an increase of $21.8 million, or 18.5%, over the prior year quarter. Additionally, she said, the company also reported earnings per share of $0.15, a 6.3% decrease over the same quarter in 2022, and net earnings per share of $0.20, a 42.9% increase over the prior year quarter. 

“We continue to expect healthy cash flow from operations based on organic revenue growth, solid cash collections and continued bottom-line improvement. This will enable us to respond opportunistically to potential acquisitions while maintaining a solid balance sheet,” Walbom said.

The Eagle, ID-based company’s revenue for senior living segment was $38.7 million, an increase of $6.1 million, or 18.9%, over the prior year quarter. Average occupancy for the third quarter was 78.9%, an increase of 240 basis points over the same quarter in 2022, and average monthly revenue per occupied room, or RevPOR, for the third quarter was $3,991 an increase of $431, or 12.1%, over the prior year quarter.

Same-store senior living services segment revenue for the third quarter was $37.2 million, an increase of $5 million or 15.5% over the prior year quarter; same-store senior living average occupancy for the third quarter was 80.1%, an increase of 250 basis points over the same quarter in 2022, and average monthly RevPOR for the third quarter was $3,973, an increase of 416, or 11.7%, over the prior year quarter.

President and Chief Operations Officer John Gochnour noted that the company’s home health and hospice business brought in segment revenue of $101.5 million, an increase of 18.3% over the same quarter in 2022. 

The home health and hospice services segment adjusted earnings before interest, taxes, depreciation, amortization and restructuring or rent costs from operations for the third quarter was $17.3 million, an increase of $1.9 million, or 12.3%, over the prior year quarter; and segment adjusted EBITDA from operations for the third quarter was $15.9 million, an increase of $1.7 million, or 11.9%, over the prior year quarter

“Our home health business showed remarkable resiliency, and despite the negative impacts of last year’s rate adjustment, home health revenue grew to $51.1 million, a 12.7% increase on admissions growth of 6.7% each over the prior year quarter,” Gochnour said.

For additional coverage of the Pennant Group earnings call, see McKnight’s Senior Living and McKnight’s Home Care.