Press Release

EX-99.1 2 dex991.htm PRESS RELEASE Press Release

Exhibit 99.1

LOGO

Ventas, Inc. 111 South Wacker Drive, Suite 4800 Chicago, Illinois 60606 (877) 4-VENTAS www.ventasreit.com


Contact:		David J. Smith
		(877) 4-VENTAS

VENTAS REPORTS SECOND QUARTER NORMALIZED FFO OF $0.68

PER DILUTED SHARE

Ventas Continues to Raise Attractive Long-Term Capital, Build Liquidity and Increase Cash Flow

Ventas Increases 2009 Normalized FFO Per Diluted Share Guidance to $2.55 to $2.62

CHICAGO, IL (July 30, 2009) – Ventas, Inc. (NYSE: VTR) (“Ventas” or the “Company”) said today that second quarter 2009 normalized Funds From Operations (“FFO”) increased 7.6 percent to $105.1 million, from $97.8 million for the comparable 2008 period. Normalized FFO per diluted common share was $0.68 in the second quarter of 2009, compared to $0.70 in the comparable 2008 period.

“Strong cash flow and successful capital markets execution contributed to our excellent second quarter, as we continue to build financial strength and liquidity,” Ventas Chairman, President and Chief Executive Officer Debra A. Cafaro said. “Our high-quality, diversified healthcare and seniors housing assets are performing very well due to demographic and need-driven demand, and Ventas is well positioned to deliver value to our constituents.

“We are pleased to increase our guidance for both normalized FFO per diluted share and NOI from our Sunrise operating portfolio. Our aim is to deliver strong cash flow while maintaining a best in class balance sheet. That combination should create value for Ventas shareholders.”

Second quarter normalized FFO per share benefited from rental increases from the Company’s triple-net lease portfolio, including the May 2009 rent increase with Kindred Healthcare, Inc. (NYSE: KND) (“Kindred”); a lease termination fee of $2.3 million received from Kindred; higher Net Operating Income after management fees (“NOI”) at the Company’s medical office building (“MOB”) operating portfolio; and lower interest expense, offset in part by lower NOI at the Company’s senior living operating portfolio and higher weighted average diluted shares outstanding. Weighted average diluted shares outstanding in the second quarter of 2009 were 154.5 million, compared to 138.7 million in 2008.

Normalized FFO for the quarter ended June 30, 2009 excludes the net expense (totaling $8.5 million, or $0.05 per share) from merger-related expenses and deal costs and loss on extinguishment of debt, offset by income tax benefit; and normalized FFO for the quarter ended June 30, 2008 excluded the net benefit (totaling $2.7 million, or $0.02 per share) from income tax benefit, offset by merger-related expenses and deal costs and loss on extinguishment of debt.

FFO, as defined by the National Association of Real Estate Investment Trusts (“NAREIT”), for the second quarter of 2009 decreased 3.9 percent to $96.6 million, from $100.5 million in the prior year. Second quarter 2009 NAREIT FFO per diluted common share decreased 12.5 percent to $0.63, from $0.72 a year earlier due to the above stated factors.

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Ventas Reports Second Quarter Results

July 30, 2009

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Normalized FFO for the six months ended June 30, 2009 was $200.8 million, or $1.35 per diluted common share, a 6.1 percent increase from $189.2 million, or $1.37 per diluted common share, for the comparable 2008 period. Normalized FFO for the six months ended June 30, 2009 excludes the net expense (totaling $9.8 million, or $0.07 per share) from merger-related expenses and deal costs and loss on extinguishment of debt, offset by income tax benefit.

SUNRISE PORTFOLIO

Total Portfolio Performance Improves Sequentially

The Company’s operating portfolio contains 79 seniors housing communities in North America that are managed by Sunrise Senior Living, Inc. (NYSE: SRZ) (“Sunrise”). Ventas owns 100 percent of 19 of these communities and has a partnership share of between 75 percent and 85 percent in the remaining 60 communities, with Sunrise owning the noncontrolling interest in those 60 communities.

NOI for those 79 communities was $33.9 million for the quarter ended June 30, 2009, compared to $38.0 million for the comparable 2008 period. NOI in the second quarter of 2008 benefited from approximately $4 million of property-level expense credits and reconciliations that did not recur in the second quarter of 2009. In addition, unfavorable movements in the Canadian dollar exchange rate had a negative impact on NOI of $0.8 million for the second quarter of 2009 compared to the second quarter of 2008.

NOI for these 79 communities increased to $33.9 million for the second quarter of 2009, compared to $30.5 million for the first quarter of 2009, due to 1.2 percent average daily rate increases and lower expenses in the second quarter of 2009. Operating margin for the total portfolio also improved from 29.6 percent to 32.7 percent sequentially.

Same-Store Stabilized Community Results Improve Sequentially

For the 74 Sunrise communities that were stabilized in the second quarters of both 2009 and 2008, total community NOI was $32.2 million in 2009, versus $36.8 million for the comparable 2008 period. NOI in the second quarter of 2008 benefited from approximately $4 million of property-level expense credits and reconciliations that did not recur in the second quarter of 2009.

For the 78 communities stabilized in the first and second quarters of 2009, NOI increased to $33.7 million in the second quarter of 2009, compared to $30.1 million in the first quarter of 2009. This increase is due to average daily rate increases of 1.2 percent and lower expenses in the second quarter of 2009. Operating margin for these 78 communities also increased from 29.7 percent to 33.2 percent sequentially.

One additional asset was moved from lease-up to the same-store stabilized pool this quarter. The Company had one Sunrise asset in lease-up as of the end of the second quarter of 2009.

GAAP NET INCOME

Net income attributable to common stockholders for the quarter ended June 30, 2009 was $88.4 million, or $0.57 per diluted common share, after discontinued operations of $42.2 million, compared with net income attributable to common stockholders for the quarter ended June 30, 2008 of $70.2 million, or $0.51 per diluted common share, after discontinued operations of $28.8 million.

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Ventas Reports Second Quarter Results

July 30, 2009

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Net income attributable to common stockholders for the six months ended June 30, 2009 was $162.6 million, or $1.09 per diluted common share, after discontinued operations of $71.2 million, compared with net income attributable to common stockholders for the six months ended June 30, 2008 of $101.3 million, or $0.74 per diluted common share, after discontinued operations of $31.0 million.

SECOND QUARTER HIGHLIGHTS AND OTHER RECENT DEVELOPMENTS

Portfolio, Performance and Balance Sheet Highlights

Liquidity & Balance Sheet

•

In April 2009, the Company issued and sold 13.1 million shares of common stock for gross proceeds of $312 million, before the underwriting discount and expenses.

•

In April 2009, the Company issued unsecured Senior Notes due June 1, 2016, receiving total proceeds of $168.5 million, before the underwriting discount and expenses.

•

In June 2009, Ventas raised $114.2 million in ten-year, 6.76 percent first mortgage financing secured by 16 assisted, independent and dementia seniors housing communities under triple-net leases. The valuation on the assets represented a 6.8 percent cap rate on annual cash rent and loan proceeds exceeded ten times Ventas’s annual cash rent on the mortgaged properties.

•

In the second quarter of 2009, the Company repaid or purchased in open market transactions or by cash tender offers $385.6 million of its Senior Notes, which included $49.8 million principal amount of 2009 Senior Notes, $100.7 million principal amount of 2010 Senior Notes, $104.4 million principal amount of 2012 Senior Notes, $103.4 million principal amount of 2014 Senior Notes and $27.3 million principal amount of 2015 Senior Notes. The Company recognized a net loss on extinguishment of debt of approximately $6 million in the second quarter of 2009.

•

In the second quarter of 2009, Ventas repaid $33.4 million in secured mortgage debt.

•

Cash flow from operations for the second quarter of 2009 increased 17.4 percent to $81.6 million, compared to the second quarter of 2008.

•

At June 30, 2009, the Company had $10.4 million outstanding under its Revolving Credit Facilities; $852.3 million of undrawn availability; and $102.2 million of cash and short-term cash investments.

•

At July 29, 2009, the Company had $10.1 million outstanding under its Revolving Credit Facilities; $852.9 million of undrawn availability; and approximately $139.2 million of cash and short-term cash investments.

•

The Company’s debt to total capitalization at June 30, 2009 was approximately 36 percent. The Company’s net debt to pro forma EBITDA at quarter end was 4.1x.

•

As of July 29, 2009, the Company has $18.8 million in total debt maturities remaining in 2009 and $172.8 million in total debt maturities in 2010, excluding normal periodic principal amortization payments. Additional detail on the Company’s debt maturities can be found on the Company’s website under the “For Investors” section or at www.ventasreit.com/investors/supplemental.asp.

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Ventas Reports Second Quarter Results

July 30, 2009

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Investments and Dispositions

•

As previously announced, in June 2009, the Company sold six underperforming skilled nursing facilities (“SNFs”) to Kindred for total cash consideration of $58 million, or $75,000 per bed, including a $2.3 million lease termination fee. Ventas recognized a gain from the sale of approximately $38.9 million in the second quarter of 2009.

•

In June 2009, the Company completed the development and commenced operations of a 97,975 rentable square foot MOB in Greenville, South Carolina. The building was over 85 percent pre-leased at completion.

Portfolio

•

The 197 SNFs and hospitals (“LTACs”) leased by the Company to Kindred produced EBITDARM (earnings before interest, taxes, depreciation, amortization, rent and management fees) to actual cash rent coverage of 2.2 times for the trailing twelve-month period ended March 31, 2009 (the latest date available).

Additional Information

•

In July 2009, Fitch Ratings upgraded Ventas’s unsecured debt rating to BBB from BBB-, with a stable outlook.

•

Ventas expects to present its case for tortious interference with business expectation against HCP, Inc. (“HCP”) in the United States District Court for the Western District of Kentucky (the “Court”) in a trial by jury set to commence on August 18, 2009. On July 16, 2009, the Court denied a summary judgment motion by HCP requesting that the Court dismiss that claim by Ventas. In its claim, Ventas alleges that in May 2007 HCP interfered with Ventas’s expectation of purchasing Sunrise Senior Living REIT and that HCP made certain improper and misleading public statements. Ventas is seeking substantial monetary relief and punitive damages against HCP. There can be no assurance that Ventas will prevail in its case against HCP or the amount of any potential recovery Ventas may obtain from HCP.

•

Beginning in 2009, consistent with U.S. generally accepted accounting principles (“GAAP”), Ventas is recognizing additional non-cash interest expense in connection with the Company’s $230 million principal amount of 3⁷/8% convertible debt securities due 2011. This non-cash interest expense will decrease 2009 FFO per diluted share by approximately $0.01 per share per quarter. As required by GAAP, this additional non-cash interest expense is reflected in the Company’s prior period results, which have been restated for comparability.

•

Supplemental information regarding the Company can be found on the Company’s website under the “For Investors” section or at www.ventasreit.com/investors/supplemental.asp.

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Ventas Reports Second Quarter Results

July 30, 2009

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VENTAS INCREASES GUIDANCE FOR 2009 NORMALIZED FFO AND SUNRISE PORTFOLIO NOI

Ventas currently expects its 2009 normalized FFO per diluted share to range between $2.55 and $2.62, improving its previously announced 2009 guidance of between $2.48 and $2.58 per diluted share. Normalized FFO per diluted share in 2008 was $2.71.

The Company also increased its guidance for its 79 high-quality seniors housing assets operated by Sunrise to generate between $122 million and $129 million in NOI for the full year, improving its previously announced range of $110 million to $125 million.

The Company’s normalized FFO guidance for all periods assumes that all of the Company’s tenants and borrowers continue to meet all of their obligations to the Company. In addition, the Company’s normalized FFO guidance (and related GAAP earnings projections) excludes (a) gains and losses on the sales of assets, (b) the impact of future unannounced acquisitions or divestitures (including pursuant to tenant options to purchase) and capital transactions, (c) merger-related costs and expenses that are not capitalized under GAAP, including expenses relating to the Company’s lawsuit against HCP, (d) the impact of any expenses related to asset impairment and valuation allowances, the write-off of unamortized deferred financing fees, or additional costs, expenses, discounts or premiums incurred as a result of early retirement or payment of the Company’s debt, (e) the non-cash effect of income tax benefits or expenses, (f) deal costs and expenses and earnout payments required by GAAP to be expensed rather than capitalized into asset cost, and (g) the reversal or incurrence of contingent liabilities.

The Company’s guidance is based on a number of other assumptions, which are subject to change and many of which are outside the control of the Company. If actual results vary from these assumptions, the Company’s expectations may change. There can be no assurance that the Company will achieve these results.

A reconciliation of the Company’s guidance to the Company’s projected GAAP earnings is provided on a schedule attached to this press release. The Company may from time to time update its publicly announced guidance, but it is not obligated to do so.

SECOND QUARTER CONFERENCE CALL

Ventas will hold a conference call to discuss this earnings release today, at 9:00 a.m. Eastern Time (8:00 a.m. Central Time). The dial-in number for the conference call is (617) 614-3450. The participant passcode is “Ventas.” The conference call is being webcast live by CCBN and can be accessed at the Company’s website at www.ventasreit.com or www.earnings.com. An online replay of the webcast will be available today at approximately 1:00 p.m. Eastern Time and will be archived for one month.

Ventas, Inc., an S&P 500 company, is a leading healthcare real estate investment trust. At the date of this press release, Ventas owns 501 seniors housing and healthcare properties located in 43 states and two Canadian provinces. Its diverse portfolio includes 243 seniors housing communities, 187 skilled nursing facilities, 40 hospitals, and 31 medical office buildings and other properties. More information about Ventas can be found on its website at www.ventasreit.com.

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements regarding the Company’s or its tenants’, operators’, managers’ or borrowers’ expected future financial position, results of operations, cash flows, funds from operations, dividends and dividend plans, financing plans, business strategy, budgets, projected costs, capital expenditures, competitive positions, acquisitions, investment opportunities, merger integration, growth opportunities, dispositions, expected lease income, continued qualification as a real estate investment trust (“REIT”), plans and objectives of management for future operations and statements that include words such as “anticipate,” “if,” “believe,” “plan,” “estimate,” “expect,” “intend,” “may,” “could,” “should,” “will” and other similar expressions are forward-looking statements. Such forward-looking statements are inherently uncertain, and security holders must recognize that actual results may differ from the Company’s expectations. The Company does not undertake a duty to update such forward-looking statements, which speak only as of the date on which they are made.

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Ventas Reports Second Quarter Results

July 30, 2009

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The Company’s actual future results and trends may differ materially depending on a variety of factors discussed in the Company’s filings with the Securities and Exchange Commission. These factors include without limitation: (a) the ability and willingness of the Company’s operators, tenants, borrowers, managers and other third parties to meet and/or perform their obligations under their respective contractual arrangements with the Company, including, in some cases, their obligations to indemnify, defend and hold harmless the Company from and against various claims, litigation and liabilities; (b) the ability of the Company’s operators, tenants, borrowers and managers to maintain the financial strength and liquidity necessary to satisfy their respective obligations and liabilities to third parties, including without limitation obligations under their existing credit facilities and other indebtedness; (c) the Company’s success in implementing its business strategy and the Company’s ability to identify, underwrite, finance, consummate and integrate diversifying acquisitions or investments, including those in different asset types and outside the United States; (d) the nature and extent of future competition; (e) the extent of future or pending healthcare reform and regulation, including cost containment measures and changes in reimbursement policies, procedures and rates; (f) increases in the Company’s cost of borrowing as a result of changes in interest rates and other factors; (g) the ability of the Company’s operators and managers, as applicable, to deliver high quality services, to attract and retain qualified personnel and to attract residents and patients; (h) the results of litigation affecting the Company; (i) changes in general economic conditions and/or economic conditions in the markets in which the Company may, from time to time, compete, and the effect of those changes on the Company’s revenues and its ability to access the capital markets or other sources of funds; (j) the Company’s ability to pay down, refinance, restructure and/or extend its indebtedness as it becomes due; (k) the Company’s ability and willingness to maintain its qualification as a REIT due to economic, market, legal, tax or other considerations; (l) final determination of the Company’s taxable net income for the year ended December 31, 2008 and for the year ending December 31, 2009; (m) the ability and willingness of the Company’s tenants to renew their leases with the Company upon expiration of the leases and the Company’s ability to reposition its properties on the same or better terms in the event such leases expire and are not renewed by the Company’s tenants or in the event the Company exercises its right to replace an existing tenant upon default; (n) risks associated with the Company’s senior living operating portfolio, such as factors causing volatility in the Company’s operating income and earnings generated by its properties, including without limitation national and regional economic conditions, costs of materials, energy, labor and services, employee benefit costs, insurance costs and professional and general liability claims, and the timely delivery of accurate property-level financial results for those properties; (o) the movement of U.S. and Canadian exchange rates; (p) year-over-year changes in the Consumer Price Index and the effect of those changes on the rent escalators, including the rent escalator for Master Lease 2 with Kindred, and the Company’s earnings; (q) the Company’s ability and the ability of its operators, tenants, borrowers and managers to obtain and maintain adequate liability and other insurance from reputable and financially stable providers; (r) the impact of increased operating costs and uninsured professional liability claims on the liquidity, financial condition and results of operations of the Company’s operators, tenants, borrowers and managers, and the ability of the Company’s operators, tenants, borrowers and managers to accurately estimate the magnitude of those claims; (s) the ability and willingness of the lenders under the Company’s unsecured revolving credit facilities to fund, in whole or in part, borrowing requests made by the Company from time to time; (t) the impact of market or issuer events on the liquidity or value of the Company’s investments in marketable securities; and (u) the impact of any financial, accounting, legal or regulatory issues that may affect the Company’s major tenants, operators or managers. Many of these factors are beyond the control of the Company and its management.

CONSOLIDATED FINANCIAL INFORMATION

On January 1, 2009, the Company adopted Financial Accounting Standards Board Staff Position No. APB 14-1, “Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement)” (“APB 14-1”). APB 14-1 specifies that issuers of convertible debt instruments that may be settled in cash upon conversion (including partial cash settlement) should separately account for the liability and equity components in a manner that will reflect the entity’s nonconvertible debt borrowing rate when interest cost is recognized in subsequent periods. Additionally, on January 1, 2009, the Company adopted Statement of Financial Accounting Standards No. 160, “Noncontrolling Interests in Consolidated Financial Statements, an amendment of Accounting Research Bulletin No. 51” (“SFAS No. 160”). SFAS No. 160 changes the reporting for minority interests, which now must be characterized as noncontrolling interests and classified as a component of consolidated equity. The calculation of income and earnings per share continues to be based on income amounts attributable to the parent and is characterized as net income attributable to common stockholders. As required, all prior period amounts have been restated to reflect the adoption of APB 14-1 and SFAS No. 160.

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Ventas Reports Second Quarter Results

July 30, 2009

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CONSOLIDATED BALANCE SHEETS

As of June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008 and June 30, 2008

(In thousands, except per share amounts)


	June 30, 2009			March 31, 2009			December 31, 2008 *			September 30, 2008 *			June 30, 2008 *
Assets
Real estate investments:
Land	$	552,712		$	554,286		$	555,015		$	567,474		$	569,711
Buildings and improvements		5,603,042			5,592,051			5,593,024			5,694,198			5,700,555
Construction in progress		18,319			21,176			12,591			9,533			1,642

		6,174,073			6,167,513			6,160,630			6,271,205			6,271,908
Accumulated depreciation		(1,075,293	)		(1,036,617	)		(987,691	)		(951,523	)		(905,608	)

Net real estate property		5,098,780			5,130,896			5,172,939			5,319,682			5,366,300
Loans receivable, net		125,106			130,076			123,289			113,606			118,565

Net real estate investments		5,223,886			5,260,972			5,296,228			5,433,288			5,484,865
Cash and cash equivalents		46,523			95,806			176,812			115,923			29,268
Escrow deposits and restricted cash		94,470			38,275			55,866			43,841			40,038
Deferred financing costs, net		29,569			29,935			22,032			20,833			22,388
Notes receivable-related parties		—			—			—			1,769			1,752
Other		176,413			168,858			220,480			200,735			140,396

Total assets	$	5,570,861		$	5,593,846		$	5,771,418		$	5,816,389		$	5,718,707

Liabilities and equity
Liabilities:
Senior notes payable and other debt	$	2,616,304		$	2,942,401		$	3,136,998		$	3,123,815		$	3,239,059
Deferred revenue		5,305			6,307			7,057			7,564			8,050
Accrued interest		16,952			42,121			21,931			46,255			20,261
Accounts payable and other accrued liabilities		164,659			161,775			168,198			152,666			142,399
Deferred income taxes		255,175			255,570			257,499			256,525			282,080

Total liabilities		3,058,395			3,408,174			3,591,683			3,586,825			3,691,849
Commitments and contingencies
Equity:
Ventas stockholders’ equity:
Preferred stock, $1.00 par value; 10,000 shares authorized, unissued		—			—			—			—			—
Common stock, $0.25 par value; 156,539, 143,453, 143,302, 143,293 and 138,477 shares issued at June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008 and June 30, 2008, respectively		39,138			35,867			35,825			35,823			34,619
Capital in excess of par value		2,565,933			2,267,440			2,264,125			2,261,874			2,040,603
Accumulated other comprehensive (loss) income		(1,411	)		(18,322	)		(21,089	)		4,835			12,831
Retained earnings (deficit)		(109,012	)		(117,124	)		(117,806	)		(101,867	)		(92,134	)
Treasury stock, 0, 2, 15, 0 and 0 shares at June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008 and June 30, 2008, respectively		(5	)		(53	)		(457	)		(2	)		(18	)

Total Ventas stockholders’ equity		2,494,643			2,167,808			2,160,598			2,200,663			1,995,901
Noncontrolling interest		17,823			17,864			19,137			28,901			30,957

Total equity		2,512,466			2,185,672			2,179,735			2,229,564			2,026,858

Total liabilities and equity	$	5,570,861		$	5,593,846		$	5,771,418		$	5,816,389		$	5,718,707

*	Historical financial statements have been restated to reflect the adoption of APB 14-1 and SFAS No. 160.

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Ventas Reports Second Quarter Results

July 30, 2009

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CONSOLIDATED STATEMENTS OF INCOME

For the Three and Six Months Ended June 30, 2009 and 2008

(In thousands, except per share amounts)


	For the Three Months Ended June 30,					For the Six Months Ended June 30,
	2009		2008 *			2009			2008 *
Revenues:
Rental income	$	125,148	$	119,441		$	248,082		$	237,721
Resident fees and services		103,399		107,312			206,338			215,038
Income from loans and investments		3,333		1,480			6,614			1,947
Interest and other income		108		798			394			1,616

Total revenues		231,988		229,031			461,428			456,322
Expenses:
Interest		44,171		51,389			90,282			103,182
Depreciation and amortization		48,847		56,642			98,548			126,963
Property-level operating expenses		72,564		71,842			148,032			148,799
General, administrative and professional fees (including non-cash stock-based compensation expense of $3,078 and $2,541 for the three months ended 2009 and 2008, respectively, and $6,137 and $4,490 for the six months ended 2009 and 2008, respectively)		10,355		9,610			20,953			17,867
Foreign currency loss (gain)		5		(27	)		(1	)		(106	)
Loss on extinguishment of debt		5,975		195			6,080			116
Merger-related expenses and deal costs		3,502		1,234			5,556			1,880

Total expenses		185,419		190,885			369,450			398,701

Income before income taxes, discontinued operations and noncontrolling interest		46,569		38,146			91,978			57,621
Income tax benefit		395		3,712			942			13,750

Income from continuing operations		46,964		41,858			92,920			71,371
Discontinued operations		42,219		28,840			71,232			30,959

Net income		89,183		70,698			164,152			102,330
Net income attributable to noncontrolling interest, net of tax		802		545			1,543			1,023

Net income attributable to common stockholders	$	88,381	$	70,153		$	162,609		$	101,307

Earnings per common share:
Basic:
Income from continuing operations attributable to common stockholders	$	0.30	$	0.30		$	0.61		$	0.51
Discontinued operations		0.27		0.21			0.48			0.23

Net income attributable to common stockholders	$	0.57	$	0.51		$	1.09		$	0.74

Diluted:
Income from continuing operations attributable to common stockholders	$	0.30	$	0.30		$	0.61		$	0.51
Discontinued operations		0.27		0.21			0.48			0.23

Net income attributable to common stockholders	$	0.57	$	0.51		$	1.09		$	0.74

Weighted average shares used in computing earnings per common share:
Basic		154,441		138,133			148,798			137,257
Diluted		154,510		138,737			148,859			137,705
Dividends declared per common share	$	0.5125	$	0.5125		$	1.0250		$	1.0250

*	Historical financial statements have been restated to reflect the adoption of APB 14-1 and SFAS No. 160.

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Ventas Reports Second Quarter Results

July 30, 2009

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QUARTERLY CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)


	2009 Quarters					2008 Quarters *
	Second		First			Fourth			Third			Second
Revenues:
Rental income	$	125,148	$	122,934		$	122,735		$	121,172		$	119,441
Resident fees and services		103,399		102,939			105,609			108,610			107,312
Income from loans and investments		3,333		3,281			3,474			3,426			1,480
Interest and other income		108		286			697			1,913			798

Total revenues		231,988		229,440			232,515			235,121			229,031
Expenses:
Interest		44,171		46,111			50,622			50,745			51,389
Depreciation and amortization		48,847		49,701			54,003			49,997			56,642
Property-level operating expenses		72,564		75,468			76,447			81,698			71,842
General, administrative and professional fees (including non-cash stock-based compensation expense of $3,078, $3,059, $2,160, $3,326, and $2,541, respectively)		10,355		10,598			11,158			11,626			9,610
Foreign currency loss (gain)		5		(6	)		(11	)		(45	)		(27	)
Loss (gain) on extinguishment of debt		5,975		105			(2,858	)		344			195
Merger-related expenses and deal costs		3,502		2,054			1,332			1,248			1,234

Total expenses		185,419		184,031			190,693			195,613			190,885

Income before reversal of contingent liability, income taxes, discontinued operations and noncontrolling interest		46,569		45,409			41,822			39,508			38,146
Reversal of contingent liability		—		—			—			23,328			—
Income tax benefit		395		547			1,720			415			3,712

Income from continuing operations		46,964		45,956			43,542			63,251			41,858
Discontinued operations		42,219		29,013			14,609			1,555			28,840

Net income		89,183		74,969			58,151			64,806			70,698
Net income attributable to noncontrolling interest, net of tax		802		741			621			1,040			545

Net income attributable to common stockholders	$	88,381	$	74,228		$	57,530		$	63,766		$	70,153

Earnings per common share:
Basic:
Income from continuing operations attributable to common stockholders	$	0.30	$	0.32		$	0.30		$	0.44		$	0.30
Discontinued operations		0.27		0.20			0.10			0.01			0.21

Net income attributable to common stockholders	$	0.57	$	0.52		$	0.40		$	0.45		$	0.51

Diluted:
Income from continuing operations attributable to common stockholders	$	0.30	$	0.32		$	0.30		$	0.44		$	0.30
Discontinued operations		0.27		0.20			0.10			0.01			0.21

Net income attributable to common stockholders	$	0.57	$	0.52		$	0.40		$	0.45		$	0.51

Weighted average shares used in computing earnings per common share:
Basic		154,441		143,091			142,963			140,759			138,133
Diluted		154,510		143,145			143,047			141,141			138,737
Dividends declared per common share	$	0.5125	$	0.5125		$	0.5125		$	0.5125		$	0.5125

*	Historical financial statements have been restated to reflect the adoption of APB 14-1 and SFAS No. 160.

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Ventas Reports Second Quarter Results

July 30, 2009

Page 10

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Six Months Ended June 30, 2009 and 2008

(In thousands)


	2009			2008 *
Cash flows from operating activities:
Net income	$	164,152		$	102,330
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization (including amounts in discontinued operations)		98,815			129,811
Amortization of deferred revenue and lease intangibles, net		(3,587	)		(5,383	)
Other amortization expenses		2,374			2,940
Stock-based compensation		6,137			4,490
Straight-lining of rental income		(5,990	)		(7,429	)
Loss (gain) on extinguishment of debt		6,080			(91	)
Net gain on sale of real estate assets (including amounts in discontinued operations)		(66,891	)		(25,869	)
Income tax benefit		(942	)		(13,750	)
Other		(12	)		714
Changes in operating assets and liabilities:
Decrease in other assets		1,426			6,094
Decrease in accrued interest		(4,979	)		(570	)
Decrease in other liabilities		(1,441	)		(19,525	)

Net cash provided by operating activities		195,142			173,762
Cash flows from investing activities:
Net investment in real estate property		(19,358	)		(6,360	)
Investment in loans receivable		(7,373	)		(98,826	)
Purchase of marketable debt securities		—			(44,780	)
Proceeds from real estate disposals		95,373			58,379
Proceeds from loans receivable		7,701			288
Capital expenditures		(4,028	)		(4,480	)
Other		—			340

Net cash provided by (used in) investing activities		72,315			(95,439	)
Cash flows from financing activities:
Net change in borrowings under revolving credit facilities		(289,928	)		(83,416	)
Proceeds from debt		301,115			6,354
Repayment of debt		(541,775	)		(52,617	)
Payment of deferred financing costs		(13,422	)		(689	)
Issuance of common stock, net		299,201			191,668
Cash distribution to common stockholders		(153,815	)		(141,882	)
Contributions from noncontrolling interest		306			—
Distributions to noncontrolling interest		(5,024	)		(1,936	)
Other		5,457			5,257

Net cash used in financing activities		(397,885	)		(77,261	)

Net (decrease) increase in cash and cash equivalents		(130,428	)		1,062
Effect of foreign currency translation on cash and cash equivalents		139			(128	)
Cash and cash equivalents at beginning of period		176,812			28,334

Cash and cash equivalents at end of period	$	46,523		$	29,268

*	Historical financial statements have been restated to reflect the adoption of APB 14-1 and SFAS No. 160.

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Ventas Reports Second Quarter Results

July 30, 2009

Page 11

QUARTERLY CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)


	2009 Quarters						2008 Quarters *
	Second			First			Fourth			Third			Second
Cash flows from operating activities:
Net income	$	89,183		$	74,969		$	58,151		$	64,806		$	70,698
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization (including amounts in discontinued operations)		48,907			49,908			54,974			50,969			57,975
Amortization of deferred revenue and lease intangibles, net		(1,729	)		(1,858	)		(2,142	)		(1,819	)		(2,272	)
Other amortization expenses		1,766			608			376			678			1,404
Stock-based compensation		3,078			3,059			2,160			3,326			2,541
Straight-lining of rental income		(3,052	)		(2,938	)		(3,437	)		(3,786	)		(3,670	)
Loss (gain) on extinguishment of debt		5,922			158			(105	)		28			17
Net gain on sale of real estate assets (including amounts in discontinued operations)		(39,020	)		(27,871	)		(13,157	)		—			(25,869	)
Income tax benefit		(395	)		(547	)		(1,720	)		(415	)		(3,712	)
Reversal of contingent liability		—			—			—			(23,328	)		—
Provision for loan losses		—			—			—			5,994			—
Other		(169	)		157			(90	)		(10	)		391
Changes in operating assets and liabilities:
(Increase) decrease in other assets		(262	)		1,688			(2,247	)		(7,388	)		(9,634	)
(Decrease) increase in accrued interest		(25,169	)		20,190			(24,324	)		25,994			(26,528	)
Increase (decrease) in other liabilities		2,526			(3,967	)		9,660			12,997			8,133

Net cash provided by operating activities		81,586			113,556			78,099			128,046			69,474
Cash flows from investing activities:
Net investment in real estate property		(10,971	)		(8,387	)		(6,514	)		(40,927	)		(389	)
Investment in loans receivable		—			(7,373	)		(10,000	)		—			(98,826	)
Purchase of marketable debt securities		—			—			—			(18,900	)		(44,780	)
Proceeds from real estate disposals		—			95,373			45,804			—			58,379
Proceeds from loans receivable		6,051			1,650			13			(166	)		226
Capital expenditures		(158	)		(3,870	)		(4,185	)		(7,694	)		(3,548	)
Other		—			—			1,770			(18	)		357

Net cash (used in) provided by investing activities		(5,078	)		77,393			26,888			(67,705	)		(88,581	)
Cash flows from financing activities:
Net change in borrowings under revolving credit facilities		(202,882	)		(87,046	)		245,582			(88,800	)		88,800
Proceeds from debt		291,914			9,201			129,903			4,005			1,353
Repayment of debt		(428,659	)		(113,116	)		(333,750	)		(30,529	)		(23,413	)
Payment of deferred financing costs		(3,855	)		(9,567	)		(3,202	)		34			(14	)
Issuance of common stock, net		299,201			—			—			216,872			—
Cash distribution to common stockholders		(80,269	)		(73,546	)		(73,468	)		(73,499	)		(70,976	)
Contributions from noncontrolling interest		306			—			—			—			—
Distributions to noncontrolling interest		(3,610	)		(1,414	)		(10,400	)		(3,396	)		(2,274	)
Other		1,808			3,649			235			1,695			3,391

Net cash (used in) provided by financing activities		(126,046	)		(271,839	)		(45,100	)		26,382			(3,133	)

Net (decrease) increase in cash and cash equivalents		(49,538	)		(80,890	)		59,887			86,723			(22,240	)
Effect of foreign currency translation on cash and cash equivalents		255			(116	)		1,002			(68	)		161
Cash and cash equivalents at beginning of period		95,806			176,812			115,923			29,268			51,347

Cash and cash equivalents at end of period	$	46,523		$	95,806		$	176,812		$	115,923		$	29,268

*	Historical financial statements have been restated to reflect the adoption of APB 14-1 and SFAS No. 160.

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Ventas Reports Second Quarter Results

July 30, 2009

Page 12

FUNDS FROM OPERATIONS, NORMALIZED FFO AND FUNDS AVAILABLE

FOR DISTRIBUTION

(In thousands, except per share amounts)


	2009 Quarters						2008 Quarters *
	Second			First			Fourth			Third			Second
Net income attributable to common stockholders	$	88,381		$	74,228		$	57,530		$	63,766		$	70,153
Adjustments:
Depreciation and amortization on real estate assets		48,676			49,531			54,013			49,994			56,646
Depreciation on real estate assets related to noncontrolling interest		(1,496	)		(1,620	)		(1,582	)		(1,590	)		(1,578	)
Discontinued operations:
Gain on sale of real estate assets		(39,020	)		(27,871	)		(13,157	)		—			(25,869	)
Depreciation and amortization on real estate assets		62			207			788			789			1,145

FFO		96,603			94,475			97,592			112,959			100,497
Merger-related expenses and deal costs		3,502			2,054			1,332			1,248			1,234
Reversal of contingent liability		—			—			—			(23,328	)		—
Provision for loan losses		—			—			—			5,994			—
Income tax benefit		(936	)		(937	)		(2,059	)		(982	)		(4,171	)
Loss (gain) on extinguishment of debt		5,975			105			(2,858	)		344			195

Normalized FFO		105,144			95,697			94,007			96,235			97,755
Straight-lining of rental income		(3,052	)		(2,938	)		(3,437	)		(3,786	)		(3,670	)
Routine capital expenditures		(632	)		(1,144	)		(3,660	)		(2,512	)		(1,133	)

FAD	$	101,460		$	91,615		$	86,910		$	89,937		$	92,952

Per diluted share ⁽¹⁾:
Net income attributable to common stockholders	$	0.57		$	0.52		$	0.40		$	0.45		$	0.51
Adjustments:
Depreciation and amortization on real estate assets		0.32			0.35			0.38			0.35			0.41
Depreciation on real estate assets related to noncontrolling interest		(0.01	)		(0.01	)		(0.01	)		(0.01	)		(0.01	)
Discontinued operations:
Gain on sale of real estate assets		(0.25	)		(0.19	)		(0.09	)		—			(0.19	)
Depreciation and amortization on real estate assets		0.00			0.00			0.01			0.01			0.01

FFO		0.63			0.66			0.68			0.80			0.72
Merger-related expenses and deal costs		0.02			0.01			0.01			0.01			0.01
Reversal of contingent liability		—			—			—			(0.16	)		—
Provision for loan losses		—			—			—			0.04			—
Income tax benefit		(0.01	)		(0.01	)		(0.01	)		(0.01	)		(0.03	)
Loss (gain) on extinguishment of debt		0.04			0.00			(0.02	)		0.00			0.00

Normalized FFO		0.68			0.67			0.66			0.68			0.70
Straight-lining of rental income		(0.02	)		(0.02	)		(0.02	)		(0.03	)		(0.03	)
Routine capital expenditures		(0.00	)		(0.01	)		(0.03	)		(0.02	)		(0.01	)

FAD	$	0.66		$	0.64		$	0.61		$	0.64		$	0.67

⁽¹⁾

Per share amounts may not add due to rounding.

*	Historical financial statements have been restated to reflect the adoption of APB 14-1 and SFAS No. 160.

Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, many industry investors have considered presentations of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. To overcome this problem, the Company considers FFO and FAD appropriate measures of performance of an equity REIT. The Company uses the NAREIT definition of FFO. NAREIT defines FFO as net income, computed in accordance with GAAP, excluding gains (or losses)

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Ventas Reports Second Quarter Results

July 30, 2009

Page 13

from sales of property, plus real estate depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect FFO on the same basis. FAD represents normalized FFO excluding straight-line rental adjustments and routine capital expenditures.

FFO and FAD presented herein are not necessarily comparable to FFO and FAD presented by other real estate companies due to the fact that not all real estate companies use the same definitions. Neither FFO nor FAD should be considered as an alternative to net income (determined in accordance with GAAP) as an indicator of the Company’s financial performance or as an alternative to cash flow from operating activities (determined in accordance with GAAP) as a measure of the Company’s liquidity, nor is FFO or FAD necessarily indicative of sufficient cash flow to fund all of the Company’s needs. The Company believes that in order to facilitate a clear understanding of the consolidated historical operating results of the Company, FFO and FAD should be examined in conjunction with net income as presented elsewhere in this press release.

The Company’s normalized FFO excludes (a) gains and losses on the sales of assets, (b) merger-related costs and expenses that are not capitalized under GAAP, including expenses relating to the Company’s lawsuit against HCP, (c) the impact of any expenses related to asset impairment and valuation allowances, the write-off of unamortized deferred financing fees, or additional costs, expenses, discounts or premiums incurred as a result of early debt retirement or payment of the Company’s debt, (d) the non-cash effect of income tax benefits, (e) acquisition costs and expenses and earnout payments required by GAAP to be expensed rather than capitalized into asset cost beginning in 2009, and (f) the reversal of contingent liabilities.

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Ventas Reports Second Quarter Results

July 30, 2009

Page 14

Normalized FFO and FAD Guidance for the Year Ending December 31, 2009

The following table illustrates the Company’s normalized FFO and FAD per diluted common share guidance for the year ending December 31, 2009:


	UPDATED GUIDANCE For the Year Ending December 31, 2009							PRIOR GUIDANCE For the Year Ending December 31, 2009
Net income attributable to common stockholders	$	1.68		-	$	1.74		$	1.56		-	$	1.65
Adjustments:
Depreciation and amortization on real estate assets, depreciation related to noncontrolling interest and gain/loss on sale of real estate assets, net		0.77		-		0.77			0.82		-		0.82

FFO		2.45		-		2.51			2.38		-		2.47
Adjustments:
Income tax benefit/expense, gain/loss on extinguishment of debt and merger-related expenses and deal costs, net		0.10		-		0.11			0.10		-		0.11

Normalized FFO		2.55		-		2.62			2.48		-		2.58
Straight-lining of rental income and routine capital expenditures		(0.13	)	-		(0.13	)		(0.13	)	-		(0.13	)

FAD	$	2.42		-	$	2.49		$	2.35		-	$	2.45

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Ventas Reports Second Quarter Results

July 30, 2009

Page 15

Net Debt to Pro Forma EBITDA

The following pro forma information considers the effect on net income, interest and depreciation of the Company’s investments and other capital transactions that were completed during the three months ended June 30, 2009, as if the transactions had been consummated as of the beginning of the period. The following table illustrates net debt to pro forma earnings before interest, taxes, depreciation and amortization (“EBITDA”) (dollars in thousands):


Pro forma net income for the three months ended June 30, 2009	$	86,938
Add back:
Pro forma interest (including discontinued operations)		44,722
Pro forma depreciation and amortization (including discontinued operations)		49,061
Stock-based compensation		3,078
Loss on extinguishment of debt		5,975
Income tax benefit		(396	)
Noncontrolling interest		802
Net gain on real estate disposals		(39,020	)
Other taxes		302

Pro forma EBITDA	$	151,462

Pro forma EBITDA annualized	$	605,848

As of June 30, 2009:
Debt	$	2,616,304
Cash		(109,548	)

Net debt	$	2,506,756

Net debt to pro forma EBITDA		4.1 x

The Company considers EBITDA a profitability measure which indicates the Company’s ability to service debt. The Company considers the net debt to pro forma EBITDA ratio a useful measure to evaluate the Company’s ability to pay its indebtedness. EBITDA presented herein is not necessarily comparable to EBITDA presented by other companies due to the fact that not all companies use the same definition. EBITDA should not be considered as an alternative to net income (determined in accordance with GAAP) as an indicator of the Company’s financial performance or as an alternative to cash flow from operating activities (determined in accordance with GAAP) as a measure of the Company’s liquidity, nor is EBITDA necessarily indicative of sufficient cash flow to fund all of the Company’s needs. The Company believes that in order to facilitate a clear understanding of the consolidated historical operating results of the Company, EBITDA should be examined in conjunction with net income as presented elsewhere in this press release.

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Ventas Reports Second Quarter Results

July 30, 2009

Page 16

Non-GAAP Financial Measures Reconciliation (In thousands, except per share amounts)


	For the Six Months Ended June 30,
	2009			2008 *
Net income attributable to common stockholders	$	162,609		$	101,307
Adjustments:
Depreciation and amortization on real estate assets		98,207			126,599
Depreciation on real estate assets related to noncontrolling interest		(3,116	)		(3,079	)
Discontinued operations:
Gain on sale of real estate assets		(66,891	)		(25,869	)
Depreciation and amortization on real estate assets		269			2,848

FFO		191,078			201,806
Merger-related expenses		5,556			1,880
Income tax benefit		(1,873	)		(14,575	)
Loss on extinguishment of debt		6,080			116

Normalized FFO		200,841			189,227
Straight-lining of rental income		(5,990	)		(7,429	)
Routine capital expenditures		(1,776	)		(1,956	)

FAD	$	193,075		$	179,842

Per diluted share ⁽¹⁾:
Net income attributable to common stockholders	$	1.09		$	0.74
Adjustments:
Depreciation and amortization on real estate assets		0.66			0.92
Depreciation on real estate assets related to noncontrolling interest		(0.02	)		(0.02	)
Discontinued operations:
Gain on sale of real estate assets		(0.45	)		(0.19	)
Depreciation and amortization on real estate assets		0.00			0.02

FFO		1.28			1.47
Merger-related expenses		0.04			0.01
Income tax benefit		(0.01	)		(0.11	)
Loss on extinguishment of debt		0.04			0.00

Normalized FFO		1.35			1.37
Straight-lining of rental income		(0.04	)		(0.05	)
Routine capital expenditures		(0.01	)		(0.01	)

FAD	$	1.30		$	1.31

⁽¹⁾

Per share amounts may not add due to rounding.

*	Historical financial statements have been restated to reflect the adoption of APB 14-1 and SFAS No. 160.

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