EX-99.2 3 d723217dex992.htm EX-99.2 EX-99.2

Exhibit 99.2

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InvestIng In the future of healthcare.

FIRST QUARTER 2014

SUPPLEMENTAL INFORMATION


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Table of Contents

Company Information

  

 

1

  

Reconciliation of Net Income to Funds from Operations

  

 

2

  

Investment and Revenue by Asset Type, Operator, Country and State

  

 

3

  

Lease Maturity Schedule

  

 

4

  

Debt Summary

  

 

5

  

Consolidated Statements of Income

  

 

6

  

Consolidated Balance Sheets

  

 

7

  

Acquisitions and Summary of Development Projects

  

 

8

  

Detail of Other Assets

  

 

9

  

The information in this supplemental information package should be read in conjunction with the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other information filed with the Securities and Exchange Commission. You can access these documents free of charge at www.sec.gov and from the Company’s website at www.medicalpropertiestrust.com. The information contained on the Company’s website is not incorporated by reference into, and should not be considered a part of, this supplemental package.

For more information, please contact:

Charles Lambert, Managing Director—Capital Markets at (205) 397-8897 Tim Berryman, Director—Investor Relations at (205) 397-8589


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Company Information

Headquarters: Medical Properties Trust, Inc. 1000 Urban Center Drive, Suite 501 Birmingham, AL 35242 (205) 969-3755 Fax: (205) 969-3756

Website: www.medicalpropertiestrust.com

Executive Officers: Edward K. Aldag, Jr., Chairman, President and Chief Executive Officer R. Steven Hamner, Executive Vice President and Chief Financial Officer Emmett E. McLean, Executive Vice President, Chief Operating Officer, Secretary and Treasurer

Frank R. Williams, Senior Vice President, Senior Managing Director—Acquisitions

Investor Relations: Medical Properties Trust, Inc. 1000 Urban Center Drive, Suite 501 Birmingham, AL 35242 Attn: Tim Berryman (205) 397-8589

tberryman@medicalpropertiestrust.


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MEDICAL PROPERTIES TRUST, INC. AND SUBSIDIARIES

Reconciliation of Net Income to Funds From Operations

(Unaudited)

For the Three Months Ended March 31, 2014 March 31, 2013 (A) FFO information: Net income attributable to MPT common stockholders $ 7,241,294 $ 26,156,492 Participating securities’ share in earnings (209,370) (193,062) Net income, less participating securities’ share in earnings $ 7,031,924 $ 25,963,430 Depreciation and amortization: Continuing operations 13,689,602 8,469,200 Discontinued operations - 177,950 Funds from operations $ 20,721,526 $ 34,610,580 Write-off of straight line rent 950,338 - Loan impairment charge 20,496,463 - Acquisition costs 512,016 190,549 Normalized funds from operations $ 42,680,343 $ 34,801,129 Share-based compensation 2,043,410 1,918,855 Debt costs amortization 1,048,722 896,732 Additional rent received in advance (B) (300,000) (300,000) Straight-line rent revenue and other (4,702,867) (3,892,628) Adjusted funds from operations $ 40,769,608 $ 33,424,088 Per diluted share data: Net income, less participating securities’ share in earnings $ 0.04 $ 0.18 Depreciation and amortization: Continuing operations 0.09 0.06 Discontinued operations - - Funds from operations $ 0.13 $ 0.24 Write-off of straight line rent 0.01 - Loan impairment charge 0.12 - Acquisition costs - 0.01 Normalized funds from operations $ 0.26 $ 0.25 Share-based compensation 0.01 0.01 Debt costs amortization 0.01 0.01 Additional rent received in advance (B) - - Straight-line rent revenue and other (0.03) (0.03) Adjusted funds from operations $ 0.25 $ 0.24

(A) Financials have been restated to reclass the operating results of certain properties sold after the 2013 first quarter to discontinued operations.

(B) Represents additional rent from one tenant in advance of when we can recognize as revenue for accounting purposes. This additional rent is being recorded to revenue on a straight-line basis over the lease life.

Investors and analysts following the real estate industry utilize funds from operations, or FFO, as a supplemental performance measure. FFO, reflecting the assumption that real estate asset values rise or fall with market conditions, principally adjusts for the effects of GAAP depreciation and amortization of real estate assets, which assumes that the value of real estate diminishes predictably over time. We compute FFO in accordance with the definition provided by the National Association of Real Estate Investment Trusts, or NAREIT, which represents net income (loss) (computed in accordance with GAAP), excluding gains (losses) on sales of real estate and impairment charges on real estate assets, plus real estate depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures.

In addition to presenting FFO in accordance with the NAREIT definition, we also disclose normalized FFO,which adjusts FFO for items that relate to unanticipated or non-core events or activities or accounting changes that, if not noted, would make comparison to prior period results and market expectations less meaningful to investors and analysts. We believe that the use of FFO, combined with the required GAAP presentations, improves the understanding of our operating results among investors and the use of normalized FFO makes comparisons of our operating results with prior periods and other companies more meaningful. While FFO and normalized FFO are relevant and widely used supplemental measures of operating and financial performance of REITs, they should not be viewed as a substitute measure of our operating performance since the measures do not reflect either depreciation and amortization costs or the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties, which can be significant economic costs that could materially impact our results of operations. FFO and normalized FFO should not be considered an alternative to net income (loss) (computed in accordance with GAAP) as indicators of our financial performance or to cash flow from operating activities (computed in accordance with GAAP) as an indicator of our liquidity.

We calculate adjusted funds from operations, or AFFO, by subtracting from or adding to normalized FFO (i) unbilled rent revenue, (ii) non-cash share-based compensation expense, and (iii) amortization of deferred financing costs. AFFO is an operating measurement that we use to analyze our results of operations based on the receipt, rather than the accrual, of our rental revenue and on certain other adjustments. We believe that this is an important measurement because our leases generally have significant contractual escalations of base rents and therefore result in recognition of rental income that is not collected until future periods, and costs that are deferred or are non-cash charges. Our calculation of AFFO may not be comparable to AFFO or similarly titled measures reported by other REITs. AFFO should not be considered as an alternative to net income (calculated pursuant to GAAP) as an indicator of our results of operations or to cash flow from operating activities (calculated pursuant to GAAP) as an indicator of our liquidity.


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INVESTMENT AND REVENUE BY ASSET TYPE, OPERATOR, COUNTRY AND STATE

Investments and Revenue by Asset Type—As of March 31, 2014

Total Assets

Percentage of Gross Assets

Total Revenue

Percentage of Total Revenue

General Acute Care Hospitals A $1,831,995,556 57.3% $41,387,839 56.6% Rehabilitation Hospitals 663,008,286 20.7% 17,528,056 24.0% Long-Term Acute Care Hospitals 460,653,144 14.4% 13,757,420 18.8% Wellness Centers 15,624,817 0.5% 415,339 0.6% Other assets 228,785,634 7.1% —   —   Total gross assets 3,200,067,437 100.0% Accumulated depreciation and amortization (173,474,957) Total $3,026,592,480 $73,088,654 100.0%

Investments and Revenue by Operator—As of March 31, 2014

Total Assets

Percentage of Gross Assets

Total Revenue

Percentage of Total Revenue

Prime Healthcare $710,960,240 22.2% $21,292,094 29.1% Ernest Health, Inc. 479,273,281 15.0% 14,285,650 19.5% IASIS Healthcare 347,611,962 10.9% 6,837,750 9.4% RHM 240,957,499 7.5% 5,470,459 7.5% IJKG/HUMC 125,398,498 3.9% 3,860,221 5.3% 23 other operators 1,067,080,323 33.4% 21,342,480 29.2% Other assets 228,785,634 7.1% —   —   Total gross assets 3,200,067,437 100.0% Accumulated depreciation and amortization (173,474,957) Total $3,026,592,480 $73,088,654 100.0%

Investment and Revenue by Country and State—As of March 31, 2014

Total Assets Percentage of Gross Assets Total Revenue Percentage of Total Revenue

United States Texas $681,565,565 21.3% $17,382,436 23.8% California 542,826,939 17.0% 16,335,799 22.4% New Jersey 240,398,498 7.5% 3,860,221 5.3% Arizona 200,844,185 6.3% 1,668,852 2.3% Louisiana 137,780,879 4.3% 5,415,143 7.4% 20 other states 926,908,238 29.0% 22,955,744 31.3% Other assets 228,785,634 7.1% —   —   United States Total 2,959,109,938 92.5% 67,618,195 92.5% International Germany 240,957,499 7.5% 5,470,459 7.5% International Total 240,957,499 7.5% Total gross assets 3,200,067,437 100.0% Accumulated depreciation and amortization (173,474,957) Total $3,026,592,480 $73,088,654 100.0% A Includes two medical office buildings and free-standing emergency rooms.


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LEASE MATURITY SCHEDULE—AS OF MARCH 31, 2014

Total portfolio (1)

  

 
 

Total
leases

  
  

  

 

Base rent

(2) 

 

 
 
 
 

Percent
of total
base
rent

  
  
  
  

2014

  

 

1

  

  

$

2,122,416

  

 

 

0.9

2015

  

 

2

  

  

 

4,155,412

  

 

 

1.8

2016

  

 

1

  

  

 

2,250,000

  

 

 

1.0

2017

  

 

—  

  

  

 

—  

  

 

 

0.0

2018

  

 

1

  

  

 

2,019,936

  

 

 

0.9

2019

  

 

8

  

  

 

6,547,245

  

 

 

2.8

2020

  

 

1

  

  

 

1,060,512

  

 

 

0.4

2021

  

 

4

  

  

 

15,522,785

  

 

 

6.8

2022

  

 

12

  

  

 

39,298,052

  

 

 

17.2

2023

  

 

4

  

  

 

12,029,276

  

 

 

5.3

2024

  

 

1

  

  

 

2,478,388

  

 

 

1.1

2025

  

 

3

  

  

 

7,499,572

  

 

 

3.3

Thereafter

  

 

56

  

  

 

133,859,546

  

 

 

58.3

    

 

94

  

  

$

228,843,140

  

 

 

100.0

(1)

Excludes 14 of our properties that are under development.

Also, lease expiration is based on the fixed term of the lease and does not factor in potential renewal options provided for in our leases.

(2)

Represents base rent on an annualized basis but does not include tenant recoveries, additional rents and other lease-related adjustments to revenue (i.e., straight-line rents and deferred revenues).


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DEBT SUMMARY AS OF MARCH 31, 2014

Instrument

  

 
 
 

Rate
Type
Rate

  
  
  

  

 

Balance

  

 

 

2014

  

  

 

2015

  

  

 

2016

  

  

 

2017

  

  

 

2018

  

  

 

Thereafter

  

        

6.875% Notes Due 2021

  

 

Fixed

  

  

 

6.88

 

$

450,000,000

  

  

$

—  

  

  

$

—  

  

  

$

—  

  

  

$

—  

  

  

$

—  

  

  

$

450,000,000

  

6.375% Notes Due 2022

  

 

Fixed

  

  

 

6.38

 

 

350,000,000

  

  

 

—  

  

  

 

—  

  

  

 

—  

  

  

 

—  

  

  

 

—  

  

  

 

350,000,000

  

2015 Credit Facility Revolver

  

 

Variable

  

  

 

3.02

%(1) 

 

 

155,000,000

  

  

 

—  

  

  

 

155,000,000

  

  

 

—  

  

  

 

—  

  

  

 

—  

  

  

 

—  

  

2016 Term Loan

  

 

Variable

  

  

 

2.43

 

 

100,000,000

  

  

 

—  

  

  

 

—  

  

  

 

100,000,000

  

  

 

—  

  

  

 

—  

  

  

 

—  

  

2016 Unsecured Notes

  

 

Fixed

  

  

 

5.59

%(2) 

 

 

125,000,000

  

  

 

—  

  

  

 

—  

  

  

 

125,000,000

  

  

 

—  

  

  

 

—  

  

  

 

—  

  

2020 Notes (Euro)

  

 

Fixed

  

  

 

5.75

%(3) 

 

 

275,380,000

  

  

 

—  

  

  

 

—  

  

  

 

—  

  

  

 

—  

  

  

 

—  

  

  

 

275,380,000

  

Northland—Mortgage Capital Term Loan

  

 

Fixed

  

  

 

6.20

 

 

13,880,315

  

  

 

197,739

  

  

 

282,701

  

  

 

298,582

  

  

 

320,312

  

  

 

12,780,982

  

  

 

—  

  

                     

$

1,469,260,315

  

  

$

197,739

  

  

$

155,282,701

  

  

$

225,298,582

  

  

$

320,312

  

  

 

12,780,982

  

  

$

1,075,380,000

  

Debt Premium

           

$

2,785,159

  

                                                             
                     

$

1,472,045,474

  

                                                     

(1)

 

Represents a $400 million unsecured revolving credit facility with spreads over LIBOR ranging from 2.60% to 3.40%.

(2) Represents the weighted-average rate for four traunches of the Notes at March 31, 2014 factoring in interest rate swaps in effect at that time.

The Company has entered into two swap agreements which began in July and October 2011. Effective July 31, 2011, the Company is paying 5.507% on $65 milllion of the Notes and effective October 31, 2011, the Company is paying 5.675% on $60 million of Notes.

(3)

 

Represents 200,000,000 of bonds issued in EUR and converted to USD at March 31, 2014.


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MEDICAL PROPERTIES TRUST, INC. AND SUBSIDIARIES

Consolidated Statements of Income

(Unaudited)

For the Three Months Ended March 31, 2014 March 31, 2013 (A) Revenues Rent billed $ 42,956,745 $ 31,498,931 Straight-line rent 2,148,220 2,651,453 Income from direct financing leases 12,215,388 8,756,471 Interest and fee income 15,768,301 14,706,897 Total revenues 73,088,654 57,613,752 Expenses Real estate depreciation and amortization 13,689,602 8,469,200 Loan impairment charge 20,496,463 - Property-related 738,305 408,887 Acquisition expenses 512,016 190,549 General and administrative 8,958,790 7,765,949 Total operating expenses 44,395,176 16,834,585 Operating income 28,693,478 40,779,167 Interest and other income (expense) (21,442,535) (15,157,366) Income tax (expense) benefit 57,324 (52,247) Income from continuing operations 7,308,267 25,569,554 Income (loss) from discontinued operations (1,500) 640,571 Net income 7,306,767 26,210,125 Net income attributable to non-controlling interests (65,473) (53,633) Net income attributable to MPT common stockholders $ 7,241,294 $ 26,156,492 Earnings per common share - basic : Income from continuing operations $ 0.04 $ 0.18 Income from discontinued operations - 0.01 Net income attributable to MPT common stockholders $ 0.04 $ 0.19 Earnings per common share - diluted: Income from continuing operations $ 0.04 $ 0.18 Income from discontinued operations - - Net income attributable to MPT common stockholders $ 0.04 $ 0.18 Dividends declared per common share $ 0.21 $ 0.20 . Weighted average shares outstanding - basic 163,973,178 140,346,579 Weighted average shares outstanding - diluted 164,548,581 141,526,311

(A) Financials have been restated to reclass the operating results of certain properties sold after the

2013 first quarter to discontinued operations.


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MEDICAL PROPERTIES TRUST, INC. AND SUBSIDIARIES

Consolidated Balance Sheets

March 31, 2014 December 31, 2013 Assets (Unaudited) (A) Real estate assets Land, buildings and improvements, and intangible lease assets $ 1,964,466,055 $ 1,823,683,129 Construction in progress and other 43,956,015 41,771,499 Net investment in direct financing leases 432,657,330 431,024,228 Mortgage loans 388,650,000 388,650,000 Gross investment in real estate assets 2,829,729,400 2,685,128,856 Accumulated depreciation and amortization (173,474,957) (159,776,091) Net investment in real estate assets 2,656,254,443 2,525,352,765 Cash and cash equivalents 50,309,266 45,979,648 Interest and rent receivables 63,173,762 58,499,609 Straight-line rent receivables 48,022,702 45,828,697 Other assets 208,832,307 228,909,650 Total Assets $ 3,026,592,480 $ 2,904,570,369 Liabilities and Equity Liabilities Debt, net $ 1,472,045,474 $ 1,421,680,749 Accounts payable and accrued expenses 74,183,992 94,311,177 Deferred revenue 25,418,580 23,786,819 Lease deposits and other obligations to tenants 23,963,665 20,583,283 Total liabilities 1,595,611,711 1,560,362,028 Equity Preferred stock, $0.001 par value. Authorized 10,000,000 shares; no shares outstanding - - Common stock, $0.001 par value. Authorized 250,000,000 shares; issued and outstanding - 170,212,741 shares at March 31, 2014 and 161,309,725 shares at December 31, 2013 170,213 161,310 Additional paid in capital 1,732,915,820 1,618,054,133 Distributions in excess of net income (293,595,304) (264,804,113) Accumulated other comprehensive income (loss) (8,247,617) (8,940,646) Treasury shares, at cost (262,343) (262,343) Total Equity 1,430,980,769 1,344,208,341 Total Liabilities and Equity $ 3,026,592,480 $ 2,904,570,369

(A) Financials have been derived from the prior year audited financials.


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ACQUISITIONS FOR THE THREE MONTHS ENDED MARCH 31, 2014

Name Location Property Type Acquisition / Development Investment/Commitment Legacy Health Partners Montclair, NJ Acute Care Hospital Acquisition $115,000,000 Total Investments / Commitments $115,000,000

SUMMARY OF DEVELOPMENT PROJECTS AS OF MARCH 31, 2014

Property Location Property Type Operator Commitment Costs Incurred as of 3/31/14 Percent Leased Estimated Completion Date First Choice ER- Brodie Austin, TX Acute Care Hospital First Choice ER, LLC $5,465,968 $2,828,828 100% 2Q 2014 First Choice ER- Briar Forest Houston, TX Acute Care Hospital First Choice ER, LLC 5,844,432 1,595,261 100% 3Q 2014 First Choice ER- Cedar Hill Cedar Hill, TX Acute Care Hospital First Choice ER, LLC 5,768,924 1,709,617 100% 3Q 2014 First Choice ER- Firestone Firestone, CO Acute Care Hospital First Choice ER, LLC 5,172,522 1,699,280 100% 3Q 2014 Oakleaf Surgical Hospital Altoona, WI Acute Care Hospital National Surgical Hospitals 33,500,000 22,780,236 100% 3Q 2014 First Choice ER—Allen Allen, TX Acute Care Hospital First Choice ER, LLC 6,186,769 2,041,774 100% 3Q 2014 First Choice ER—Frisco Frisco, TX Acute Care Hospital First Choice ER, LLC 5,893,196 2,060,459 100% 3Q 2014 First Choice ER—Broomfield Broomfield, CO Acute Care Hospital First Choice ER, LLC 5,238,100 1,117,705 100% 3Q 2014 Frist Choice ER—Spring Spring, TX Acute Care Hospital First Choice ER, LLC 5,803,500 1,804,404 100% 3Q 2014 Frist Choice ER—North Gate Colorado Springs, CO Acute Care Hospital First Choice ER, LLC 5,248,745 895,699 100% 3Q 2014 First Choice ER—Fountain Fountain, CO Acute Care Hospital First Choice ER, LLC 6,194,181 1,557,714 100% 3Q 2014 First Choice ER—Missouri City (Sienna) Houston, TX Acute Care Hospital First Choice ER, LLC 5,393,656 1,062,244 100% 3Q 2014 First Choice ER—Pearland Pearland, TX Acute Care Hospital First Choice ER, LLC 5,691,295 1,402,569 100% 4Q 2014 First Choice ER—Thornton Thornton, CO Acute Care Hospital First Choice ER, LLC 6,029,465 1,400,225 100% 4Q 2014 First Choice Emergency Rooms Various Acute Care Hospital First Choice ER, LLC 10,615,106 —   $118,045,859 $43,956,015


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DETAIL OF OTHER ASSETS AS OF MARCH 31, 2014

Operator InvestmentInterest Rate Annual (4) Ridea Income YTD Security / Credit Enhancements

Non-Operating Loans

Vibra Healthcare acquisition loan (1) $11,367,502 10.25% Secured and cross-defaulted with real estate, other agreements and guaranteed by Parent

Vibra Healthcare working capital 5,232,500 9.50% Secured and cross-defaulted with real estate, other agreements and guaranteed by Parent

Post Acute Medical working capital 8,188,689 11.10% Secured and cross-defaulted with real estate; certain loans are cross-defaulted with other loans

and real estate

Monroe Hospital (2) 1,372,573

IKJG/HUMC working capital 14,046,667 10.40% Secured and cross-defaulted with real estate and guaranteed by Parent

Ernest Health 4,583,333 9.38% Secured and cross-defaulted with real estate and guaranteed by Parent

Other 209,307

45,000,571

Operating Loans

Ernest Health, Inc. (3) 93,200,000 15.00% 4,230,259 Secured and cross-defaulted with real estate and guaranteed by Parent

IKJG/HUMC convertible loan 3,351,832 53,629 Secured and cross-defaulted with real estate and guaranteed by Parent

96,551,832 4,283,888

Equity investments 13,171,086 219,846

Deferred debt financing costs 26,230,500 Not applicable

Lease and cash collateral 5,565,303 Not applicable

Other assets (5) 22,313,015 Not applicable

Total $208,832,307 $4,503,734

(1)

Original amortizing acquistion loan was $41 million; loan matures in 2019

(2)

Ceased accruing interest in 2010 and rent in 2013; net of $32 million reserve.

(3)

Cash rate is 7% in 2013 and increases to 10% in 2014.

(4)

Income earned on operating loans is reflected in the interest income line of the income statement.

(5)

Includes prepaid expenses, office property and equipment and other.


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Medical Properties Trust, Inc. 1000 Urban Center Drive, Suite 501 Birmingham, AL 35242 (205) 969-3755 www.medicalpropertiestrust.com

Contact:

Charles Lambert, Managing Director—Capital Markets (205) 397-8897 or clambert@medicalpropertiestrust.com or Tim Berryman, Director—Investor Relations (205) 397-8589 or tberryman@medicalpropertiestrust.com