-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PMxdDpj09udAHcMEWsBezZKJDhk7uCPR17vBRIsrkoflD8klElZ2O9LEK0+T9FEC kzvBk2XPHA19EJx1l9Dj5Q== 0000950131-96-003844.txt : 19960814 0000950131-96-003844.hdr.sgml : 19960814 ACCESSION NUMBER: 0000950131-96-003844 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960813 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: NATIONWIDE HEALTH PROPERTIES INC CENTRAL INDEX KEY: 0000780053 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [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: 96610236 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 FOR THE PERIOD ENDING JUNE 30, 1996 =============================================================================== 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, 1996 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 INCORPORATION (I.R.S. EMPLOYER 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, 1996 -- 41,781,432. =============================================================================== NATIONWIDE HEALTH PROPERTIES, INC. FORM 10-Q JUNE 30, 1996 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.................................... 7 PART II--OTHER INFORMATION Item 4. Submission of Matters to a Vote of Security Holders.................... 9 Item 6. Exhibits and Reports on Form 8-K....................................... 9
1 PART I NATIONWIDE HEALTH PROPERTIES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS ASSETS
JUNE 30, DECEMBER 31, 1996 1995 ------------ ----------- (UNAUDITED) (DOLLARS IN THOUSANDS) Investments in real estate Real estate properties: Land............................................................. $ 67,123 $ 61,748 Buildings and improvements....................................... 550,824 530,979 ------------ ----------- 617,947 592,727 Less accumulated depreciation....................................... (81,751) (73,722) ------------ ----------- 536,196 519,005 Mortgage loans receivable, net...................................... 133,093 133,226 ------------ ----------- 669,289 652,231 Cash and cash equivalents............................................. 10,450 7,937 Receivables........................................................... 3,586 3,478 Other assets.......................................................... 5,455 6,465 ------------ ----------- $688,780 $670,111 ============ ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Bank borrowings......................................................... $ 14,700 $ 93,900 Senior notes due 2000-2015.............................................. 150,000 100,000 Notes and bonds payable................................................. 9,882 23,364 Convertible debentures.................................................. 65,000 65,000 Accounts payable and accrued liabilities................................ 19,197 16,025 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: 1996 - 41,781,432, 1995 - 38,720,532........ 4,179 3,872 Capital in excess of par value........................................ 462,384 401,438 Cumulative net income................................................. 270,723 245,135 Cumulative dividends.................................................. (307,285) (278,623) ------------ ----------- Total stockholders' equity....................................... 430,001 371,822 ------------ ----------- $ 688,780 $ 670,111 ============ ===========
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, ----------------------- ----------------------- 1996 1995 1996 1995 ---------- ---------- ---------- ---------- Revenues: Minimum rent............................................ $ 16,472 $ 13,195 $ 32,639 $ 26,001 Interest and other income............................... 3,972 3,927 7,928 7,157 Additional rent and additional interest................. 2,856 2,843 5,664 5,659 ---------- ---------- ---------- ---------- 23,300 19,965 46,231 38,817 Expenses: Depreciation and non-cash charges....................... 4,144 3,396 8,256 6,683 Interest and amortization of deferred financing costs... 5,300 3,564 10,731 6,888 General and administrative.............................. 847 808 1,656 1,592 ---------- ---------- ---------- ---------- 10,291 7,768 20,643 15,163 ---------- ---------- ---------- ---------- Net income................................................ $ 13,009 $ 12,197 $ 25,588 $ 23,654 ========== ========== ========== ========== Net income per share...................................... $ 0.33 $ .33 $ .66 $ .64 ========== ========== ========== ========== Dividends paid per share.................................. $ 0.37 $ .35 $ .74 $ .69 ========== ========== ========== ========== Weighted average shares outstanding....................... 39,168 37,228 38,948 36,880 ========== ========== ========== ==========
See accompanying notes. 3 NATIONWIDE HEALTH PROPERTIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (IN THOUSANDS)
SIX MONTHS ENDED JUNE 30, --------------------- 1996 1995 --------- --------- Cash flow from operating activities: Net income.......................................... $ 25,588 $ 23,654 Depreciation and non-cash charges................... 8,256 6,683 -------- -------- Funds from operations............................ 33,844 30,337 Amortization of deferred financing costs............ 374 314 Net decrease in other assets and liabilities........ 3,308 1,293 -------- -------- Net cash provided by operating activities........ 37,526 31,944 Cash flow from investing activities: Acquisition of real estate properties............... (25,220) (53,583) Disposition of real estate properties............... - 586 Investment in mortgage loans receivable............. (3,800) (21,450) Principal payments on mortgage loans receivable..... 4,672 10,741 -------- -------- Net cash used in investing activities............ (24,348) (63,706) Cash flow from financing activities: Issuance of common stock............................ 61,149 35,588 Bank borrowings, net................................ (79,200) (32,400) Issuance of senior debt............................. 50,000 56,000 Dividends paid...................................... (28,662) (25,352) Principal payments on notes and bonds............... (13,482) (466) Other, net.......................................... (470) (444) -------- -------- Net cash provided by financing activities........ (10,665) (32,926) -------- -------- Increase in cash and cash equivalents................. 2,513 1,164 Cash and cash equivalents, beginning of period........ 7,937 3,742 -------- -------- Cash and cash equivalents, end of period.............. $ 10,450 $ 4,906 ======== ========
See accompanying notes. 4 NATIONWIDE HEALTH PROPERTIES, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 1996 (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, 1996 and 1995 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 1995 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, 1996 and 1995 are not necessarily indicative of the results for a full year. (ii) On January 19, 1996, the Board of Directors of Nationwide Health Properties, Inc. authorized a two-for-one stock split of the Company's common stock effective March 8, 1996. The financial statements included herein have been restated to reflect the stock split. Additionally, certain amounts in the 1995 financial statements have been reclassified for consistent financial statement presentation. (iii) 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. (iv) The Company invests in health care related real estate and, as of June 30, 1996, had investments in 213 facilities, including 173 long-term health care facilities, 38 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 19 years, and the leases generally have two or more multiple-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. Forty-five of the facilities were leased to and operated by subsidiaries of Beverly Enterprises, Inc. (v) During the six-month period ended June 30, 1996, the Company acquired three assisted living facilities and two long-term care facilities in four separate transactions for an aggregate purchase price of approximately $20,800,000. The acquisitions were funded by bank borrowings on the Company's bank line of credit and cash on hand. 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 $2,830,000 in accordance with certain existing lease agreements. Such capital improvements will result in an increase in the minimum rents earned by the Company. 5 Proceeds of approximately $3,608,000 were received in connection with the repayment of two mortgage loans secured by two long-term health care facilities. Additionally, a $3,000,000 note was funded which is cross-collateralized by properties under existing mortgage loans with the Company. During the first six months of 1996, the Company issued $50,000,000 in medium-term notes. The notes bear fixed interest at a weighted average of 7.19% and have a weighted average maturity of 6 years. The proceeds were used to reduce borrowings on the Company's bank line of credit. In June 1996, the Company issued 3,047,500 shares of common stock in a public offering at a price of $21.125 per share. Proceeds from the offering, net of underwriters' fees and associated expenses, were approximately $61,159,000. The net proceeds were used to repay borrowings under the Company's bank line of credit. 6 NATIONWIDE HEALTH PROPERTIES, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS JUNE 30, 1996 OPERATING RESULTS Six Months 1996 Compared to Six Months 1995 Revenues for the six-months ended June 30, 1996 increased $7,414,000 or 19% over the same period in 1995. The increase is due to increased minimum rent and interest income resulting from investments in additional facilities during the last twelve months. Total expenses for the six-month period increased $5,480,000 or 36% over the same period in 1995. The increase is primarily due to increased interest expense as a result of the issuance of medium term notes during 1995 and 1996 and greater borrowings under the Company's bank line of credit. The increase in total expenses was also attributable to increased depreciation due to the acquisition of additional facilities in the last twelve months. Second Quarter 1996 Compared to Second Quarter 1995 Revenues for the three months ended June 30, 1996 increased $3,335,000 or 17% over the same period in 1995. The increase is primarily due to increased minimum rent and interest income resulting from investments in additional facilities during the last twelve months. Total expenses for the three-months ended June 30, 1996 increased $2,523,000 or 32% over the same period in 1995. The increase is primarily due to the issuance of medium term notes during 1995 and 1996 and increased interest expense as a result of greater borrowings under the Company's bank line of credit. The increase in total expenses was also attributable to increased depreciation due to the acquisition of additional facilities in the last twelve months. The Company expects increased rental revenues due to the addition of facilities to its property base in the last twelve months 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-month period ended June 30, 1996, the Company acquired three assisted living facilities and two long-term care facilities in four separate transactions for an aggregate purchase price of approximately $20,800,000. The acquisitions were funded by bank borrowings under the Company's bank line of credit and cash on hand. 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 $2,830,000 in accordance with certain existing lease agreements. Such capital improvements will result in an increase in the minimum rents earned by the Company. 7 Proceeds of approximately $3,608,000 were received in connection with the repayment of two mortgage loans secured by two long-term health care facilities. Additionally, a $3,000,000 note was funded which is cross-collateralized by properties under existing mortgage loans with the Company. During the first six months of 1996, the Company issued $50,000,000 in medium-term notes. The notes bear fixed interest at a weighted average of 7.19% and have a weighted average maturity of 6 years. The proceeds were used to reduce borrowings under the Company's bank line of credit. In June 1996, the Company issued 3,047,500 shares of common stock in a public offering at a price of $21.125 per share. Proceeds from the offering, net of underwriters' fees and associated expenses were approximately $61,129,000. The net proceeds were used to repay borrowings under the Company's bank line of credit. At June 30, 1996, the Company had $85,300,000 available under its $100,000,000 bank line of credit. The Company has effective shelf registrations on file with the Securities and Exchange Commission under which the Company may issue (a) up to $150,000,000 in aggregate principal amount of medium term notes and (b) up to $33,121,562 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. STATEMENT REGARDING FORWARD LOOKING DISCLOSURE Certain information contained in this report includes forward looking statements, which can be identified by the use of forward looking terminology such as "may", "will", "expect", "should" or comparable terms or the negative thereof. These statements involve risks and uncertainties that could cause actual results to differ materially from those described in the statements. These risks and uncertainties include (without limitation) the following; the effect of economic and market conditions and changes in interest rates, government regulations, changes in the health industry, the amount of any additional investments, access to capital markets and changes in the ratings of the Company's debt securities. 8 OTHER INFORMATION PART II ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. The Annual Meeting of Stockholders was held on April 19, 1996 ("Annual Meeting"). At the Annual Meeting, R. Bruce Andrews and Charles D. Miller were re-elected as directors to serve for a three-year terms until the 1999 Annual Meeting of Stockholders. The other directors whose term of office continued after the meeting are Milton J. Brock, Jr., David R. Banks, Sam A. Brooks, Jr. and Jack Samuelson. At the Annual Meeting, the proposal to amend the Company's Stock Option and Restricted Stock Plan, as set forth in the Company's Proxy Statement dated March 14, 1996, was approved and the selection of Arthur Andersen LLP as independent accountants for the year ending December 31, 1996 was ratified. Voting at the Annual Meeting was as follows:
Abstentions Votes Votes and broker Matter cast for cast against non-votes ------ ------------ ------------ ----------- Election of R. Bruce Andrews 26,036,179 96,321 - Election of Charles D. Miller 26,050,360 82,130 - Amendment to the Company's Stock Option and Restricted Stock Plan 22,325,610 3,582,324 136,422 Ratification of selection of Arthur Andersen LLP 26,065,347 23,636 43,507
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits None. (b) Reports on Form 8-K During the three-month period ended June 30, 1996, the Company filed a report on Form 8-K dated June 12, 1996 to file exhibits with respect to the Company's public offering of 3,047,500 shares of common stock in June 1996.
9 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 12, 1996 NATIONWIDE HEALTH PROPERTIES, INC. By /s/ MARK L. DESMOND --------------------------------------- Mark L. Desmond Senior Vice President and Chief Financial Officer (Principal Financial Officer) 10 EX-27 2 FINANCIAL DATA SCHEDULE - ARTICLE 5
5 1,000 6-MOS DEC-31-1996 JAN-01-1996 JUN-30-1996 10,450 0 3,586 0 0 5,455 617,947 81,751 688,780 19,197 239,582 0 0 4,179 425,822 688,780 0 46,231 0 20,643 0 0 10,731 25,588 0 25,588 0 0 0 25,588 .66 .66
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