Health Care REIT Inc. Reports Operating Results (10-Q)
Health Care Reit, Inc. has a market cap of $13.13 billion; its shares were traded at around $61.2 with a P/E ratio of 18.16 and P/S ratio of 9.24. The dividend yield of Health Care Reit, Inc. stocks is 4.84%. Health Care Reit, Inc. had an annual average earning growth of 0.2% over the past 10 years.
Highlight of Business Operations:For the six months ended June 30, 2012, rental income, resident fees and services and interest income represented 62%, 36% and 2%, respectively, of total gross revenues (including revenues from discontinued operations). Substantially all of our operating leases are designed with either fixed or contingent escalating rent structures. Leases with fixed annual rental escalators are generally recognized on a straight-line basis over the initial lease period, subject to a collectability assessment. Rental income related to leases with contingent rental escalators is generally recorded based on the contractual cash rental payments due for the period. Our yield on loans receivable depends upon a number of factors, including the stated interest rate, the average principal amount outstanding during the term of the loan and any interest rate adjustments.
· we received $156,689,000 in proceeds on property sales and loan payoffs, generating $33,219,000 in gains during the six months ended June 30, 2012;
extent that they exceed new acquisitions, could result in decreased revenues. Our leases could renew above or below current rent rates, resulting in an increase or decrease in rental income. For the three months ended June 30, 2012, we had no lease renewals but we had 24 leases with rental rate increasers ranging from 0.20% to 0.50% in our seniors housing triple-net portfolio. Interest income declined primarily due to non-recurring income earned in connection with loan payoffs in the prior year.
The increases in rental income, property operating expenses and depreciation and amortization are primarily attributable to the acquisitions and construction conversions of medical facilities subsequent to June 30, 2011 from which we receive rent. Certain of our leases contain annual rental escalators that are contingent upon changes in the Consumer Price Index (CPI). These escalators are not fixed, so no straight-line rent is recorded; however, rental income is recorded based on the contractual cash rental payments due for the period. If the CPI does not increase, a portion of our revenues may not continue to increase. Sales of real property would offset revenue increases and, to the extent that they exceed new acquisitions, could result in decreased revenues. Our leases could renew above or below current rent rates, resulting in an increase or decrease in rental income. For the three months ended June 30, 2012, our consolidated medical office building portfolio signed 67,701 square feet of new leases and 167,945 square feet of renewals. The weighted average term of these leases was six years, with a rate of $23.20 per square foot and tenant improvement and lease commission costs of $13.64 per square foot. Substantially all of these leases contain an annual fixed rent escalation structure ranging from 1.5% to 3.0%. For the three months ended June 30, 2012, we had no lease renewals and three leases with rent increases ranging from 2.0% to 2.6% in our hospital portfolio. Other income is attributable to third party management fee income.
General and administrative expenses as a percentage of consolidated revenues (including revenues from discontinued operations) for the three months ended June 30, 2012 and 2011 were 5.71% and 5.29%, respectively. The change from prior year is primarily related to the increasing revenue base as a result of our seniors housing operating partnerships.
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