Community Healthcare Trust Announces Results for the Three Months Ended December 31, 2024

COMMUNITY HEALTHCARE TRUST INCORPORATED
CONSOLIDATED BALANCE SHEETS
(Dollars and shares in thousands, except per share amounts)

(Unaudited)

December 31, 2024

December 31, 2023

ASSETS

Real estate properties:

Land and land improvements

$                     149,501

$                 136,532

Buildings, improvements, and lease intangibles

996,104

913,416

Personal property

326

299

Total real estate properties

1,145,931

1,050,247

Less accumulated depreciation

(242,609)

(200,810)

Total real estate properties, net

903,322

849,437

Cash and cash equivalents

4,384

3,491

Restricted cash

—

1,142

Assets held for sale

6,755

7,466

Other assets, net

78,102

83,876

Total assets

$                     992,563

$                 945,412

LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities

Debt, net

$                     485,955

$                 403,256

Accounts payable and accrued liabilities

14,289

12,032

Other liabilities, net

16,354

16,868

Total liabilities

516,598

432,156

Commitments and contingencies

Stockholders' Equity

Preferred stock, $0.01 par value; 50,000 shares authorized; none issued and outstanding

—

—

Common stock, $0.01 par value; 450,000 shares authorized; 28,242 and 27,613 shares
issued and outstanding at December 31, 2024 and December 31, 2023, respectively

282

276

Additional paid-in capital

704,524

688,156

Cumulative net income

85,675

88,856

Accumulated other comprehensive gain

17,631

16,417

Cumulative dividends

(332,147)

(280,449)

Total stockholders' equity

475,965

513,256

Total liabilities and stockholders' equity

$                     992,563

$                 945,412

The Consolidated Balance Sheets do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.

COMMUNITY HEALTHCARE TRUST INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2024 AND 2023
(Unaudited; Dollars and shares in thousands, except per share amounts)

Three Months Ended
December 31,

Twelve Months Ended
December 31,

2024

2023

2024

2023

REVENUES

Rental income

$          28,983

$          28,100

$        114,565

$        108,682

Other operating interest, net

315

1,024

1,221

4,163

29,298

29,124

115,786

112,845

EXPENSES

Property operating

5,485

5,598

22,834

20,713

General and administrative ⁽¹⁾

4,809

3,728

19,058

27,338

Depreciation and amortization

10,797

10,248

42,778

39,693

21,091

19,574

84,670

87,744

OTHER (EXPENSE) INCOME

Net gain on sale and impairments of depreciable real estate assets

14

—

(121)

(102)

Interest expense

(6,405)

(5,019)

(23,706)

(17,792)

Credit loss reserve

—

—

(11,000)

—

Deferred income tax expense

—

—

—

(306)

Interest and other income, net

16

36

530

813

(6,375)

(4,983)

(34,297)

(17,387)

NET INCOME (LOSS)

$            1,832

$            4,567

$          (3,181)

$            7,714

NET INCOME (LOSS) PER COMMON SHARE ⁽¹⁾

Net income (loss) per common share - Basic

$              0.04

$              0.15

$            (0.23)

$              0.20

Net income (loss) per common share - Diluted

$              0.04

$              0.15

$            (0.23)

$              0.20

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING-
BASIC

26,682

25,981

26,530

25,202

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING-
DILUTED

26,682

25,981

26,530

25,202

⁽¹⁾ General and administrative expenses for the twelve months ended December 31, 2024 included stock-based compensation expense totaling approximately $10.0 million. General and administrative expenses for the twelve months ended December 31, 2023 included stock-based compensation expense totaling approximately $20.0 million, including the accelerated amortization of stock-based compensation totaling approximately $11.8 million, recognized upon the passing of our former CEO and President in the first quarter of 2023.

The Consolidated Statements of Operations do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.

COMMUNITY HEALTHCARE TRUST INCORPORATED
RECONCILIATION OF FFO and AFFO ⁽¹⁾
(Unaudited; Dollars and shares in thousands, except per share amounts)

Three Months Ended December 31,

2024

2023

Net income

$                    1,832

$                    4,567

   Real estate depreciation and amortization

10,927

10,347

Net gain on sale of depreciable real estate assets

(14)

—

   Total adjustments

10,913

10,347

FFO ⁽¹⁾

$                  12,745

$                  14,914

   Straight-line rent

(712)

(872)

   Stock-based compensation

2,597

2,029

AFFO ⁽¹⁾

$                  14,630

$                  16,071

   FFO per Common Share-Diluted ⁽¹⁾

$                      0.48

$                      0.57

   AFFO per Common Share-Diluted ⁽¹⁾

$                      0.55

$                      0.61

Weighted Average Common Shares Outstanding-Diluted ⁽²⁾

26,786

26,346

(1)

Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time.  However, since real estate values have historically risen or fallen with market conditions, many industry investors deem presentations of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. For that reason, the Company considers funds from operations ("FFO") and adjusted funds from operations ("AFFO") to be appropriate measures of operating performance of an equity real estate investment trust ("REIT"). In particular, the Company believes that AFFO is useful because it allows investors, analysts and Company management to compare the Company's operating performance to the operating performance of other real estate companies and between periods on a consistent basis without having to account for differences caused by unanticipated items and other events. 

The Company uses the National Association of Real Estate Investment Trusts, Inc. ("NAREIT") definition of FFO. FFO is an operating performance measure adopted by NAREIT. NAREIT defines FFO as the most commonly accepted and reported measure of a REIT's operating performance equal to net income (calculated in accordance with GAAP), excluding gains or losses from the sale of certain real estate assets, gains and losses from change in control, impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity, plus depreciation and amortization related to real estate properties, and after adjustments for unconsolidated partnerships and joint ventures. NAREIT also provides REITs with an option to exclude gains, losses and impairments of assets that are incidental to the main business of the REIT from the calculation of FFO.

In addition to FFO, the Company presents AFFO and AFFO per share. The Company defines AFFO as FFO, excluding certain expenses related to closing costs of properties acquired accounted for as business combinations and mortgages funded, excluding straight-line rent and the amortization of stock-based compensation, and including or excluding other non-cash items from time to time. AFFO presented herein may not be comparable to similar measures presented by other real estate companies due to the fact that not all real estate companies use the same definition. 

FFO and AFFO should not be considered as alternatives to net income (determined in accordance with GAAP) as indicators of the Company's financial performance or as alternatives to cash flow from operating activities (determined in accordance with GAAP) as measures of the Company's liquidity, nor are they 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 AFFO should be examined in conjunction with net income as presented elsewhere herein.

(2)

Diluted weighted average common shares outstanding for FFO and AFFO are calculated based on the treasury method, rather than the 2-class method used to calculate earnings per share.