-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, iJfjvEsYf3ke3DYuBdL/VmMO/ea4HoxMRjLXODoocqlWwPMUQlL1qkTDQaQYk4Ep /QlBfl8DcW6xjuj6s9KQBg== 0000898430-94-000572.txt : 19940815 0000898430-94-000572.hdr.sgml : 19940815 ACCESSION NUMBER: 0000898430-94-000572 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19940630 FILED AS OF DATE: 19940811 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NATIONWIDE HEALTH PROPERTIES INC CENTRAL INDEX KEY: 0000780053 STANDARD INDUSTRIAL CLASSIFICATION: 6798 IRS NUMBER: 953997619 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-09028 FILM NUMBER: 94543040 BUSINESS ADDRESS: STREET 1: 4675 MACARTHUR COURT STE 1170 CITY: NEWPORT BEACH STATE: CA ZIP: 92660 BUSINESS PHONE: 7142511211 MAIL ADDRESS: STREET 1: 4675 MACARTHUR COURT STREET 2: STE 1170 CITY: NEWSPORT BEACH STATE: CA ZIP: 92660 FORMER COMPANY: FORMER CONFORMED NAME: BEVERLY INVESTMENT PROPERTIES INC DATE OF NAME CHANGE: 19890515 10-Q 1 FORM 10-Q - - -------------------------------------------------------------------------------- - - -------------------------------------------------------------------------------- UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (MARK ONE) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1994 ------------- OR [_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____________________to _____________________ Commission file number 1-9028 NATIONWIDE HEALTH PROPERTIES, INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) MARYLAND 95-3997619 (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER) 4675 MACARTHUR COURT, SUITE 1170 NEWPORT BEACH, CALIFORNIA 92660 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (714) 251-1211 (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE) INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS REQUIRED TO BE FILED BY SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DURING THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE REGISTRANT WAS REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO SUCH FILING REQUIREMENTS FOR THE PAST 90 DAYS. YES X NO --- --- Shares of registrant's common stock, $.10 par value, outstanding at July 31, 1994--18,200,530. - - -------------------------------------------------------------------------------- - - -------------------------------------------------------------------------------- NATIONWIDE HEALTH PROPERTIES, INC. FORM 10-Q JUNE 30, 1994 TABLE OF CONTENTS PART I--FINANCIAL INFORMATION
PAGE ---- Item 1. Financial Statements Condensed Consolidated Balance Sheets.......................... 2 Condensed Consolidated Statements of Operations................ 3 Condensed Consolidated Statements of Cash Flows................ 4 Notes to Condensed Consolidated Financial Statements........... 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations...................................... 6 PART II--OTHER INFORMATION Item 4. Submission of Matters to a Vote of Security Holders............ 7 Item 6. Exhibits and Reports on Form 8-K............................... 7
1 PART I NATIONWIDE HEALTH PROPERTIES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS ASSETS
JUNE 30, DECEMBER 31, 1994 1993 ----------- ------------ (UNAUDITED) (DOLLARS IN THOUSANDS) Investments in real estate Real estate properties: Land........................................... $ 37,343 $ 33,441 Buildings and improvements..................... 400,419 361,909 -------- -------- 437,762 395,350 Less accumulated depreciation.................. (55,876) (50,180) -------- -------- 381,886 345,170 Mortgage loans receivable, net................... 96,180 83,303 -------- -------- 478,066 428,473 Cash and cash equivalents.......................... 3,260 3,627 Receivables........................................ 3,002 2,854 Other assets....................................... 5,024 5,211 -------- -------- $489,352 $440,165 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY Bank borrowings.................................... $ 51,800 $ 3,800 Convertible debentures............................. 65,000 65,000 Senior subordinated convertible debentures......... 4,045 8,609 Notes and bonds payable............................ 21,333 23,047 Accounts payable and accrued liabilities........... 10,930 6,782 Stockholders' equity: Preferred stock $1.00 par value; 5,000,000 shares authorized; none issued or outstanding Common stock $.10 par value; 100,000,000 shares authorized; issued and outstanding: 1994-- 18,172,690, 1993--17,979,516.................... 1,817 1,797 Capital in excess of par value................... 363,389 358,869 Cumulative net income............................ 172,103 149,951 Cumulative dividends............................. (201,065) (177,690) -------- -------- Total stockholders' equity..................... 336,244 332,927 -------- -------- $489,352 $440,165 ======== ========
See accompanying notes. 2 NATIONWIDE HEALTH PROPERTIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
THREE MONTHS ENDED SIX MONTHS ENDED JUNE 30, JUNE 30, ----------------- ----------------- 1994 1993 1994 1993 -------- -------- -------- -------- Revenues: Minimum rent........................... $ 11,706 $ 10,019 $ 22,862 $ 19,852 Additional rent........................ 2,453 2,073 4,740 3,956 Interest and other income.............. 3,221 2,636 6,278 5,345 -------- -------- -------- -------- 17,380 14,728 33,880 29,153 Expenses: Depreciation and amortization.......... 2,926 2,427 5,713 4,787 Interest............................... 2,427 1,418 4,347 3,048 General and administrative............. 819 818 1,668 1,619 -------- -------- -------- -------- 6,172 4,663 11,728 9,454 -------- -------- -------- -------- Net income............................... $ 11,208 $ 10,065 $ 22,152 $ 19,699 ======== ======== ======== ======== Net income per share..................... $ .62 $ .58 $ 1.22 $ 1.14 ======== ======== ======== ======== Dividends paid per share................. $ .65 $ .60 $ 1.2875 $ 1.1875 ======== ======== ======== ======== Weighted average shares outstanding...... 18,172 17,479 18,136 17,270 ======== ======== ======== ========
See accompanying notes. 3 NATIONWIDE HEALTH PROPERTIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (IN THOUSANDS)
SIX MONTHS ENDED JUNE 30, --------------------------- 1994 1993 ------- ------- Cash flow from operating activities: Net income.......................................... $22,152 $19,699 Depreciation, amortization and non-cash charges..... 6,166 4,994 ------- ------- Funds from operations............................. 28,318 24,693 Net (increase) decrease in other assets and liabilities........................................ 2,611 (180) ------- ------- Net cash provided by operating activities......... 30,929 24,513 Cash flow from investing activities: Acquisition of real estate properties............... (42,412) (17,832) Secured acquisition financing....................... -- 1,060 Investment in mortgage loans receivable............. (20,656) (17,838) Principal payments on mortgage loans receivable......................................... 9,004 17,108 ------- ------- Net cash used in investing activities............. (54,064) (17,502) Cash flow from financing activities: Bank borrowings, net................................ 48,000 9,150 Dividends paid...................................... (23,374) (20,681) Principal payments on notes and bonds............... (1,714) (493) Other, net.......................................... (144) (479) ------- ------- Net cash provided by (used in) financing activities....................................... 22,768 (12,503) ------- ------- Decrease in cash and cash equivalents................. (367) (5,492) Cash and cash equivalents, beginning of period........ 3,627 8,281 ------- ------- Cash and cash equivalents, end of period.............. $ 3,260 $ 2,789 ======= =======
See accompanying notes. 4 NATIONWIDE HEALTH PROPERTIES, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 1994 (UNAUDITED) (i) The condensed consolidated financial statements included herein have been prepared by the Company, without audit, and include all adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations for the three-month and six-month periods ended June 30, 1994 and 1993 pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. Although the Company believes that the disclosures in such financial statements are adequate to make the information presented not misleading, these condensed consolidated financial statements should be read in conjunction with the Company's financial statements and the notes thereto included in the Company's 1993 Annual Report on Form 10-K filed with the Securities and Exchange Commission. The results of operations for the three- month and six-month periods ended June 30, 1994 and 1993 are not necessarily indicative of the results for a full year. (ii) The Company qualifies as a real estate investment trust under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended. The Company intends to continue to qualify as such and therefore to distribute at least 95 percent of its taxable income to its stockholders. Accordingly, no provision has been made for federal income taxes. (iii) The Company invests in health care related real estate and, as of June 30, 1994, has investments in 169 facilities, including 163 long-term health care facilities, 4 assisted living facilities and 2 rehabilitation hospitals. The Company's facilities which are owned and leased under "net" leases are accounted for as operating leases. The leases have initial terms ranging from 10 to 14 years, and most of the leases have eight five-year renewal options. The Company earns fixed monthly minimum rents and may earn periodic additional rents. The additional rent payments are generally computed as a percentage of facility net patient revenues in excess of base amounts. The base amounts, in most cases, are net patient revenues for the first year of the lease. Under the terms of the leases, the lessee is responsible for all maintenance, repairs, taxes and insurance on the leased properties. Fifty-six of the facilities were leased to and operated by subsidiaries of Beverly Enterprises, Inc. (iv) During the six-month period ended June 30, 1994, the Company acquired seven long-term health care facilities and three assisted living facilities in seven separate transactions for an aggregate purchase price of approximately $39,943,000. The facilities were concurrently leased under terms generally similar to the Company's existing leases. In addition to the acquisitions, the Company provided capital improvement funding in the aggregate amount of approximately $2,456,000 in accordance with certain existing lease provisions. Such capital improvements will result in an increase in the minimum rents earned by the Company. During the six-month period ended June 30, 1994, the Company provided two mortgage loans secured by three long-term health care facilities and one assisted living facility in the aggregate amount of $19,450,000. Proceeds of approximately $5,960,000 were received in connection with the repayment of three mortgage loans secured by 9 long-term health care facilities. 5 NATIONWIDE HEALTH PROPERTIES, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS JUNE 30, 1994 OPERATING RESULTS Six Months 1994 Compared to Six Months 1993 Revenues for the six-months ended June 30, 1994 increased $4,727,000 or 16% over the same period in 1993. The increase is primarily due to increased minimum rent and interest income resulting from investments in additional facilities during the last twelve months and increased additional rent earned under the Company's existing leases. Total expenses for the six-month period increased $2,274,000 or 24% over the same period in 1993. The increase is due to an increase in depreciation due to the acquisition of facilities in 1993 and 1994, and to increased interest expense in connection with the issuance of $65,000,000 of convertible debentures in November 1993 and increased bank borrowings in 1994. This increase was partially offset by a decrease in interest expense in connection with the conversion of a portion of the Company's senior subordinated convertible debentures during the last twelve months. Second Quarter 1994 Compared to Second Quarter 1993 Revenues for the three months ended June 30, 1994 increased $2,652,000 or 18% over the same period in 1993. The increase is primarily due to increased minimum rent and interest income resulting from investments in additional facilities during the last twelve months and increased additional rent earned under the Company's existing leases. Total expenses for the three-months ended June 30, 1994 increased $1,509,000 or 32% over the same period in 1993. The increase is due to an increase in depreciation due to the acquisition of facilities in 1993 and 1994, and to increased interest expense in connection with the issuance of $65,000,000 of convertible debentures in November 1993 and increased bank borrowings in 1994. This increase was partially offset by a decrease in interest expense in connection with the conversion of a portion of the Company's senior subordinated convertible debentures during the last twelve months. The Company expects increased rental revenues due to the addition of facilities to its property base during 1993 and 1994 and due to increased additional rents under its leases. The Company also expects increased interest income resulting from additional investments in mortgage loans over the last twelve months. Additional investments in health care facilities would also increase rental and/or interest income. As additional investments in facilities are made, depreciation and/or interest expense could also increase. Any such increases, however, are expected to be more than offset by rents or interest income associated with the investments. LIQUIDITY AND CAPITAL RESOURCES During the six months ended June 30, 1994, the Company acquired seven long- term health care facilities and three assisted living facilities in seven separate transactions for an aggregate purchase price of approximately $39,943,000. Additionally, the Company provided two mortgage loans secured by three long-term health care facilities and one assisted living facility in an aggregate amount of $19,450,000. Such acquisitions and mortgages were funded by bank borrowings. 6 On April 28, 1994, the Company amended the terms of its bank line of credit to increase the amount of the line of credit from $70,000,000 to $100,000,000 and to extend its maturity to March 31, 1997. At June 30, 1994, the Company had $48,200,000 available under such bank line of credit. Additionally, the Company has effective shelf registrations on file with the Securities and Exchange Commission under which the Company may issue (a) up to $100,000,000 in aggregate principal amount of medium term notes and (b) up to $135,000,000 of securities including debt, convertible debt, common and preferred stock. The Company anticipates making additional investments in health care related facilities. Financing for such future investments may be provided by borrowings under the Company's bank line, private placements or public offerings of debt or equity, and the assumption of secured indebtedness. The Company believes it has sufficient liquidity and financing capability to finance future investments as well as repay borrowings at or prior to their maturity. PART II OTHER INFORMATION ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. The Annual Meeting of Stockholders was held on April 22, 1994 ("Annual Meeting"). At the Annual Meeting, Sam A. Brooks, Jr. and Robert H. Finch were re-elected as directors to serve for a three-year term until the 1997 Annual Meeting of Stockholders. The other directors whose term of office continued after the meeting are Milton J. Brock, Jr., David R. Banks, R. Bruce Andrews and Charles D. Miller. At the Annual Meeting, the proposal to amend the Company's Amended and Restated Articles of Incorporation to increase the total number of authorized shares of the Company's Common Stock, par value $.10 per share, from 25,000,000 to 100,000,000 was approved, and the selection of Arthur Andersen & Co. as independent accountants for the year ending December 31, 1994 was ratified. Voting at the Annual Meeting was as follows:
VOTES ABSTENTIONS VOTES CAST AND BROKER MATTER CAST FOR AGAINST NON-VOTES ------ ---------- --------- ----------- Election of Sam A. Brooks 15,978,536 131,189 -- Election of Robert H. Finch 15,976,361 133,364 -- Amendment of the Company's Amended and Restated Articles of Incorporation 12,123,682 3,864,275 121,768 Ratification of selection of Arthur Andersen & Co 15,802,413 233,006 74,306
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (b) Reports on Form 8-K No reports on Form 8-K were filed by the Company during the three- month period ended June 30, 1994. 7 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Date: August 11, 1994 NATIONWIDE HEALTH PROPERTIES, INC. By MARK L. DESMOND --------------------------------------- Mark L. Desmond Vice President and Treasurer (Principal Financial Officer) 8 -----END PRIVACY-ENHANCED MESSAGE-----