Omega Healthcare Investors (OHI) 6 Aug 182018 Q2 Earnings call transcript

Good morning. And welcome to the Omega Healthcare Investors Second Quarter 2018 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions [Operator Instructions]. Please note this event is being recorded. to conference like Reber. to now would turn over the Michele I go Please ahead.

portfolio me financial CEO, acquisitions, our financial be prospects involve condition results report forward-looking which our factors identifies Development are and outlook, see Bob our of and as morning. recent or XX-K, generally. dispositions including, described portfolio actual from results conference today Good With our and not are materially. policy, and Omega’s our differ on Comments during the statements statements such that Dan to may historical These and dividend cause forward-looking call without our that specific Insoft. actual Stephenson; Booth risks Taylor Chief Steven Exchange cause restructurings, contemplated differ Corporate with or Officer, materially made in releases this and forward-looking or filings business events those transitions may most Please COO, press CFO, facts regarding which uncertainties, to may Form operators, Securities statements. statements, projections, rent payments, Commission, limitation, Pickett;

under Financial release the over section I Reconciliations to FFO, Generally Information to press During Taylor. the available now measures, these Friday. of at are in measures, FFO as of financial will the and Principles, as case adjusted Accounting of in Accepted will non-GAAP and www.omegahealthcare.com, on call explanation the website measures EBITDA. the the the FFO, and of adjusted to usefulness issued an refer turn some our our FFO, non-GAAP most of such comparable FAD under call we today, non-GAAP measure as well

our call. discuss for reimbursement. morning earnings dividend and XXXX outlook second for I remainder on guidance restructuring, repositioning of thank and and our will Michele. Today, our the Medicare and XXXX joining portfolio updates Medicaid asset Good and Thanks, you quarter strategic conference

underlying two first In flow revenue related did million, on achieve while which flow flow into these yield we assets the repositioning was redeploy cover assets proceeds reduction going these to were strategic consideration million. able minimal quarters X%. XX the assets and to we’re disposed right portfolio The total was made to cash to facilities not a The the coverage, these considerable asset sales yet equate in progress million. have XX-month for sale on able we $XX with of good rent, revenue trailing of to proceeds, We believe impacts. these We restructurings. higher quality be XXXX, $XXX cash $XX experiencing cash the while of

sales results strong today by for Our appetite continued buyers. local assets reflect market private SNF the

line annual scheduled motions filed XX Omega operators support operator. the Omega Carolina, terminated existing already asset The debtors to unsecured Tennessee. is not three XX nine the with facilities, outcome On of the the the agreement Orianna facilities million will contractual Mississippi was but facility XX are operator. restructured. of portfolio, next sell relating with existing transition. steps now remaining next annual Omega, bankruptcy. Orianna North Virginia, transition from all expectations July on various disclosures. creditors previous have Xst, to August Indiana facilities only with of portfolio months Orianna is in contractual excluding to respect being bulk restructuring rent July In is for Orianna sales We now to of comes Georgia, the Omega and XX existing the and transitioned to was of likely were combined rent transitioned On in one additional to to annual our million few facilities The ultimate our the and $XXX,XXX $X.X an of an material complete, new and were Xst, in rent XXth. slated contractual that $XX

We rent feel to range Orianna rent comfortable had our with of various equivalent potential previously portfolio conversations estimated continue $XX have or million. and operators $XX new with million to

Given be further call. about on questions answer an not we committing Orianna legal proceedings these will matter, or is that this ongoing

remainder our to dividend Turning and outlook guidance of for XXXX.

quarter share a of and dividend second XX% for of adjusted ratio payout Our of of FFO per $X.XX XX% available funds reflects distribution.

forma While quarter projected the high equivalent ratio of high asset we with $X that Orianna rent historical Orianna $X an million XX% of or pro and guidance incurred to Orianna, are quarter. to of legal a share, our we $X.XX adjusted $X.XX In comfortable the We’ve adjusted these After tightened down approximately have ratios normalizing fees share. of to XX% our effect range at second of per perspective, the per fact, from given we a payout normally feel to of rent million $X.X FAD. range guidance the dividend payout million. FAD to ratios to per and $X.XX of $X.XX FFO FFO

of of the reflects our completion the completion asset restructuring. larger and guidance Orianna the sales, our the restructurings completion of partial bulk of tighten the Our

to model is eliminates PDPM methodology XXXX. X, industry, new reimbursement patient create rehospitalization X.X% October Most final principle XXXX. expected effective role outcomes. group protocols the sacrificing basket The unchanged the also XXXX. Medicare those to net fiscal Medicare value-based to are discounts driven final XXXX. its X, rule budget-neutral July rates for On are service for RUG and service year for issued effectively for The and the current current proposed therapy in fee for importantly, average purchasing rates characteristics Medicare replace from front, of effective or minutes October without market the X.X% per opportunities clinical April set rates CMS issued patient SNF fee provisions efficiencies and payment rates the favor payment on rule rebates, XXst, of of October on PDPM XX. will for via increase expected commencing driver of programs have service as The this the SNF X, therapy at

and focus on its with patient facility for PDPM the that optimistic patients are impact need services of volume than We the will care positively rather both performance provided.

inflation to raining to on continue the matching to call impact Medicaid subject in as As increases of are of and over federal our materialize now Congress, failed reimbursement levels federal threats near the per sustain power have funding outcome balance the capita the elections turn upcoming their Congress. rates, block Medicaid subsidies mid-term to Bob. to in I'll

and good you, Taylor, Thank morning.

share Our $XXX the reportable XXXX. dilutive per or to second FFO basis million $X.XX compared for on of the as $XXX quarter was per a $X.XX share million quarter or for

revenue of which the Signature facilities, and of during on lease made a quarter for uncollectable the for of $XX asset period. Our common quarter on of to adjusted investments of revenue of revenue million includes $X.X interest new XXXX. of revenue second in preferred that million FFO placed of was in revenue million was $XXX effective revenue, to contractual any made did lease the capital million compensation not cash million quarter million leased the of the offset revenue related excludes result by impact revenue, asset XXXX, it's reduced of that contractual amendments Signature during reduced rent for $XXX,XXX Daybreak's million and our decrease straight cash primarily as from $XX resulting The record quarter unrealized XXXX. facilities. and gains Genesis we time $XXX $X $X.X $XXX second and warrants $X.XX non-cash second completed, from and stock-based Orianna revenue, million was $XXX and per $XXX,XXX incremental approximately and of approximately not transitions million of related July sales revenue, provisions non-cash not asset to second $X.X deferred improvements revenue The sales occurred revenue since which combination line quarter asset decrease for same basis from sold $XX share We for and X, result XXXX, will received. a quarter the The of was until Orianna of the as the the was stock accordingly related recording did no our a versus the includes or to million Operating full revenue care the accounts, quarter, the million no received. be in expense. $XX.X million

purposes, we million. at million $XX continue revenue will to non-cash modeling $XX our revenue For quarterly project

full record Signature to Daybreak from expect with and revenue consistent amounts the our contractual as We quarter. second

annual We care generate portfolio expect starting revenue million to $X to in and $X million between the transition preferred or early-XXXX. late-XXXX

facilities million per transitioned of generate We to is annual XXXX expect of portfolio to $XX rent the recorded that Orianna, Mississippi will that $XX quarter related $X in of complete. Orianna earlier to be when quarter. restructuring rent the that million this million third quarter equivalents restructuring or

$X expense G&A quarter that was workout just than quarter was first eliminating related our of XXXX, expense purchase of greater the G&A primarily operator XXXX These legal than restructuring. and in quarter million $XX.X Our were our option $X.X million $XXX,XXX buyout the when the through due XXXX. quarter to expenses and first second increases million greater for occurred

transitions, remainder result purposes, workout second rate. returning quarter be modeling consistent related our million then run our of For XXXX run the greater to and project to of rate for a slightly operator $X G&A $X than and as we and or expenses to our of G&A, traditional million legal quarterly

higher buyer XXXX. excluding second result the sold debt, In a second for million expect we Interest approximately approximate $XX primarily with quarters million million. in lower in $X of million non-cash the offset blended rates. XX deferred financing for was note second or assumed per $XX consideration were and balances as the XXXX quarter, seller as expense a quarter, quarter quarter higher when million million cost first be proceeds, a compensation to $X cash as net HUD both stock-based debt, a $XXX non-cash addition, of LIBOR consistent of recognizing of XXXX, $XX same the debt expense by In we loss per and of the costs assets

revenue earlier, mentioned related to recorded approximately second in XX I million the in dispositions. those we quarter, As $X.X

facility asset in recovery related XXXX, a we During $X.X destroyed million fire previously an impaired. a quarter, a and recorded insurance in by the proceeds received to of

$X.X insurance offset expect or of for on facilities second charges values impairment property The expected fair reducing to selling million. of primarily our to due net We prices book to on five estate value recovery in related real the recovery proceeds a half XXXX. a approximately of estimated million, additional $X.X receive net

balance disposition the to sheet. evaluating for June could we potential occur facilities asset at still sale approximately assets several as valued million three $X the in $XX had we next approximately which classified million quarters. are XX, opportunity, held and Turning At over

for the three remained June Our months ended sheet balance strong XXth.

new of annualize builds. note calculations these on to or coverage to has on range will forma four no It’s times. be likely Booth. Orianna, net and EBITDA Our revenue roughly times and to Orianna outcome When X.XX our the was EBITDA from our in five times. would debt on annual I ratio to fixed related for charge to revenue known the to now second adjusting process was quarter construction revenue builds asset important related our new removing Dan the pro expected rental over call related the turn sales, leverage

Thanks, Bob, everyone. morning, and good

As operators states and located of Omega These facilities of approximately June portfolio Kingdom. at respectively and for XX-months X.XX December respectively operator X.XX XXXX, beds. X.XX operating across United period an facilities versus the were coverage ending times XX, core times within asset operating our XX of XXX trailing the portfolio third-party had first was XX,XXX in spread EBITDAR Trailing EBITDARM XX, X.XX XXXX during XX-month with slightly quarter and the XXXX. for down and XX

Turning to matters. portfolio

a spoke $XX to earlier Chapter operators, previous Kentucky. addition XX Care Orianna the discussed calls, and the XX of of Taylor filed as State we on million situation, Preferred result about for have non-top Jury as in Award our In which Bankruptcy the one of

Oklahoma to exposure we Mexico, in Omega's Care which of leased to it New are their of agreement facilities has transitioned being Two with While Kentucky, in operators and Care. no subsidiaries of new facilities all currently facilities the with maybe to XX in in the per process Preferred Preferred Preferred Omega Arizona calls, operator to this Care, In we discussed Xst re-leased previous leased transitioned fourth restructuring existing June expects of an the Omega remaining previously year. Signature be effective XXXX. Daybreak. XX both and during our of quarter to have Texas, agreements

agreements operational As agreements, respective in exceeding pleased report levels. an budgeted both time, is line restructuring their we At and or our in this Omega no other is fully have with are that to update, restructuring with compliant performance operators process. material

Turning to investments. new

million, nursing $XX separate the second nursing and facilities of in Texas $XX $XX in million quarter three completed five in a skilled During loan. capital The skilled mezzanine the purchase lease million for $XX million totaling transactions $XX transactions an XXXX, million five expenditures. for plus included Omega mortgage of additional loan Michigan facilities

of investment existing capital total operators. to our expenditures. These transactions XX, through Omega bring the transactions including June $XXX with All are million, approximately year-to-date

repositioning Turning activities. Omega's to

During XX proceeds This the an to brings so $XXX second facilities of of XXXX. XX in quarter far of additional XXXX, five with inclusive payoffs million facilities approximately approximately the mortgage facilities quarter Omega total the of dispositions three million. year-to-date for for sold $XXX sold loan third

facility XX facilities Mississippi which In re-leased Omega Taylor. the XX sales, has addition earlier to facilities year-to-date, mentioned included by

the We to quarters. review to opportunities discuss Omega over evaluating operators. turn re-lease our sell call are portfolio Steven. with additional continues to each approximately and our of XX facilities currently to in I coming facilities strategic the now and XX will repositioning

Care value expected The half Manhattan. estimate $XXX in to today. our $XX Avenue XXXX. Memory in joining Dan. open continue with And XXXX, including Rise The to by buyout in incremental currently at REITs on option the Prior January work XXrd rent, available and is million everyone materially resulting rent was rent, to X, Living, in is discussed In Maplewood purchase Maplewood paying project. the buyout quarter's cost current is conjunction our million, option and on increase Thanks, The cost on the to last scheduled thanks on to a partial of partial Senior the approximately from as ALF the the we project call. High Street increase. constitute from tenant Second of plans York land resulting City of the at line with for decision to project our on accrued combined cost second of New accrued larger driven building in MTA,

second the not in underwriting. around investment same the our comps their CIP and Housing as Living land by at furthermore supported our will billion proportionally increase expanding on impact best-in-class quarter, the investments homes Omega market yield timing have the UK. the project our of payments relationship lease original project in Senior New project, as size in The Including and an sheet, balance and the with our costs. Maplewood Our of will our Care opening, well by of strengthening conviction was the the our properties, with healthcare rise anticipated other City remain in incurred York growing our Senior totaled $X.X since and end Gold of portfolio as

comprises assets now basis, in of assisted investment listed care living one times, lease and the publicly UK. housing a its U.S. portfolios but X.XX obligations memory covers living, senior overall healthcare independent amongst Our this the represents the On XXX at housing and also larger standalone portfolio REITs. not only senior

in first operating this on with is portfolio grow of in Maplewood in-house million total this XX portfolio $XXX projects I million Manhattan. successfully new a tenants facilities, predominantly and we highlighted related Through of will to call was investment remaining $XX.X million our construction The to our construction comments. the $XX.X this inclusive our million important budget final ability active $XX.X CapEx some turn new program. reinvestment. to construction of and for invested coupling our quarter of continue expertise. of over now pipeline the XX same Taylor of to has the strategic components having Our approximately to reinvestment to related by is predicated our ongoing investment capabilities capability, related commitment with these design and

Stephen. Thanks,

evaluations. Orianna the began with are back our larger transition been rents We on We’ve to look restructurings assets. sales majority on the and we XXXX, our As we asset we’re completed receiving our of of concluded accomplish. first we’ve able what pleased half compelling

disposition an open to growing improved behind industry and future a the decade of the questions. business next the can With our we of redeployment we near-term continue, labor and that, of multi and at start thoughtful up feel proceeds And portfolio cost assets and I’ll improving focusing reimbursement October. considered majority on us, demographics beginning again. the cycle good of a with about While with the pressures new model

question-and-answer question ahead. Jonathan with now James. Our will Hughes the comes go session. [Operator We begin first Raymond Please Instructions] from

and of said with to tough months mentioned it the deals the find that players week to focus So And one redeploying and smaller I on underwriting deals in to But space a plans expect was maybe attractive half meet pricing that in the criteria. in of growing you past few recall last proceeds to the the you year. your more market returning skilled business. they coming the ago, back

some bit of are a operating the PDPM horizon? with tough what is out seeing in kind on more expectations of there as the remains rational question the sophisticated my pricing for uncertain and -- environment So of operators acquisition you become market less seller those

really seeing point. transactions and We’re any the just most at significance acquisition sort Mostly smaller market. be them are activity XXXX real where existing those your large new this today. of not anticipate to and at with environment. seeing I thing was in fairly it’s whole the increased any half latter XXXX investment our a can least been sit of come a any size at trades don’t this we driven operators haven’t quiet point, ballgame, but of of

seat but costs guess I York, then, with of which I'm excluding development at the New you just pipeline investments. acquisitions? you do sticking look looking Maplewood And in versus replacement the at stabilized How talked kind costs about, risk? there on that $XX,XXX. about recent says and to take $XX,XXX as similar are acquisitions SNF will trade developments commitments development back say construction no per The around future pricing are bed, acquisitions a

development perspective. about is as make the to deals of particularly matter find facilities nursing skilled sense a fact The looking still possible. much it's with difficult, We're that from as

can can the terms and in do be high we coverage as as So of tariffs that much credit spent improvement. very of we because of

think correct. your is I -- So view but,

predominantly properties. going of existing growth terms it's In to

it's I particularly today, reality. last said, with Dan more active, peer come seeing as that becomes out PDPM our talked possibility the about not of a As concur week but products

one that jump in then restructurings they Thanks. portfolio? give their cash for operationally? the only us an and of fixing are update the realized ready on structure? Dan a I'll talk could begin Does I all progressing how to devote mentioned now can operations behind more in more, just that effort about going you just terms Signature to that that few and and line. you And portfolio How CapEx don't off. time But have things to months the us, there? But

mean I restructuring is is planned of Yeah. that being to focus are I monthly or that operations I the big indicated, sort are now behind, back as there mean performing up to a able slightly above. there according on

So CapEx is there mean new and maintenance CapEx projects. been deploying look things think I the good. have more I we're that that

So overall, things that's an going at well outlaying. ongoing But kind are of Signature.

can Any terms Anything employee maybe us? in give admissions update you more or like of specific retention.

any or Through the census an really to they ongoing fight. battling in Everybody they battle continue payer process, waver major it's didn't it, or mix. and have admissions bliffs costs,

if of front-end were folks less challenge, the a front-end I'd issues and of wages the our challenge a it's of but tried I and folks higher it's labor benefits. with say talk the have was still providing on you been to that have on by generally of a retain better lot operators, think to than it these sort

challenge not it's the worse. while from in the operators' still don't probably our least I biggest at getting So sector, perspective, it's think

ahead. America. Our next go Please Sanabria Juan Bank of question with comes from

the time. for Thanks

have and that hoping we And completed in reduced of a sales you the how in coverage an nearing rent the end. sup. about and your are talk breakout the could said non-core, that of You've could disclosure non-stabilized in some is size? lot when you Just restructurings bucket

come other breakdown that that bucket just should could and you what's in If down? when

have come from biggest is bucket. are we XX%. three X% so XX% It’s that Yes, in in bucket. down which And is there components that Orianna, the there; of

time six and bulk transitioning away then and that new we mentioned, looking the that’s move have the And and the example a restructure, fill nursing -- again of transitioned X% move, didn't filling. for additional up. build those facilities talking Maplewood the assets have is X%, And to assets. we out overtime, sale that’s assets that. months best will then that we that or X% overtime. that you’ll assets we that transition Dan see skilled in And number of Orianna as to And So fill we’re have facility and sale go balance probably takes finish about a of non-stabilized our that’s are is open, we

just So long because relatively some then see of that you’re going bulk bucket a those to But move move the that’s sales I time it and to transitions it can take Orianna one up and near-term. of through fill levels. all year the takes think and a will

million specific or that markets looking on that at it would what then be some faith decision? that on and down incremental great. maybe Was What levels those $XX color an just to of just or drove And kind drove you’re anything coverage incremental you losing assets to disposition guidance Any now in point. sell coming in? want be operator don’t

it before, each mentioned plant-driven a or the you situation either then a unique of market-driven above is the of operator-driven, each of and all combination those. It’s combination operator some or there different And the or market. above. all question in physical for Actually and really

XX now bucket? is to XX% just extra that be in that included clear And

that of Correct. part That’s bucket.

then that requirements the in and like opportunities of just PDPM is why peer if second or half about to transition just more you -- tied on people Or do your those of worried mentioned related And together? you PDPM just two question could a me, year that how acquisition expect Is last a you because uncertainty in this that our for elaborate just said. it?

half the as clarify, back of Just see to our think don’t 'XX. I view we

a sophistication cycle, of and forget reimbursements. model been There has the spend of driven which we PDPM. that operators are the of But we’ve to slow run ’XX, activity. that new not in consolidation of think I think are in a kind pickup, But seen see iteration into going forever. at anytime the skill start to we’ve about has more this of we’ll historically each going that We’re there look lot changes business see group time,

industry So it’s consolidation caused over just the last this the decade. another iteration of of what has

I go consolidation So very enough, had if seen of next through another see step we’ve to these long for time. of history okay, this [indiscernible] that I’m operators going not change. I’ve just think say, some is we'll local to It’s

Our Vanacore comes next ahead. question from Stifel. with Chad Please go

last So on update paying us of gave you quarter, Daybreak, an XX% they’re rents.

background I said are what's and think receivable you Now, a there any Was there full color that rent. to now? bit back the balance of accounts

referred was Hey think XX% Chad, I you to paying quarter. The last Signature. Signature

And Okay. … then

-- And Chad, it's sorry. basically go said what I ahead in I'm

Was as Daybreak up-to-date the quarter? of last

Daybreak is quarter. The this up-to-date

Okay.

that The paid couple we -- Daybreak dollars, what and of they works to high cash by because are. for million apply had to a was

paying prepared said I best remarks quarter full we're my contractual. recording in going looking as forward. This they're And that what the

Okay.

So already up rents mean the so they've earlier does no year? caught that that this there associated outstanding with is AR

cash of last what year Remember, I They caught of were had recording basis were in detail. like paid we recorded was piece that they they've [indiscernible] it.

So that's overtime. being caught up

Alright.

this expect And back sometime to you so year? by to get and repaid current full anything

be to just clear. Yes,

contractual paying AR that they're cash and last that caught of have actually recorded. a quarter, we So paid up amount XXX% quarter this amount

pay this it. reserved books on they this, one recorder we -- getting their but going what thing rent, they'll then I our begin the improve and have as will contractual previously And that to in at, down pay half XXX% the be basis. in it think they fully a the not of So to and continue cash of that fully receive But operations, meantime, we'll back reserved we back the understand rent, unpaid we're to Chad, it's start we're year. amount to

to going when that, So they we're income. incremental do recognize

Taylor. clearing a about across then the occupancy just about and of that's for portfolio stabilized your how outside coverage, changed trended bit, but Juan same Thanks adjusted And up the curious I'm force that store Alright. asked portfolio?

that. it's consistently been but in last stable further has go And over go supplemental, occupancy quarters, back the stay can you last pretty -- than stable. five pretty our back you if So

in quarter, quarter Some same but seasonality, first that but went was mix 'XX. jumps you around at the a bit, see that first previous up level, up can and it it little the of

occupancy would that in movement. our much stable can the is not both There I and mix portfolio. overall So say be very

it Alright, for me. thanks Dan. Thanks. That's

you. Thank

from ahead. next Daniel Bernstein Capital Please comes with Our question One. go

see operators mix my the guess at reimbursement theoretical. like they change a operators quarter do should patient just PDPM? and reimbursement, RUG-III patient they or start in went preparing to look to or their you of rates start question when in about is changing trying to the kind when I when prepare think or the we Did their for changes change prepare earlier more right for start I'm did? mix two RUG-IV? maybe you major change in when to way When from operate

are admitted of a the of operators, that nursing facilities. to into talk Having much change see skilled in terms number of our patients bigger I don't you'll think

goes But the patients business. new operators occupancies in we’ve admitted continue. being all know, are the declined There we our from to see with will that clinical of has current I all serious may been seen general You patients sense that more it something conditions. think admitted and

patient existing revenue rules, And we’ve that the to get. for any And just so, are payment operators looking patient add be one may CMS conversion other the at They regulations frankly done based of existing agree Dan, note, they on can the base And our offerings. we the most model analysis RUG-IV from it’s extend around will interesting, a impact neutral. and with PDPM. the

group going PDPM be, thinking margin the I early time, very, tell? different and about more revenue this you might space. guys How to in in back or even and come XX-year too if margins move care this lows mean operating We’re just impact very therapy? from operators it the your long is margin what as help to operating neutral up maybe rehab you are to concurrent complex more

think, the margins operating to because ability of therapy. are Well, XX% improve just do I likely to and concurrent group

see ultimately. remain most neutral. relatively and revenue We people will we’ll think So costs drop therapy benefit to

starting if that in operators you the haves not to you do the the the you you expand then is some do coming with want to year you you you there’s comments, And the who this going ‘XX operators do might and of there lot you existing for to and opportunities or turning your new space next second to consolidation operators? yet. Are existing in your and with like add want in on existing But, bring new or like just your are think have-nots, that the pipeline, them? knows forward. in with earlier looking peers? acquisitions said grow I to any know be thinking opportunities Again, half clearly And a might said to find grow just need the want operators to general

We I look lot new the XX. find XX, to of down -- way to our of the with we’ll folks. I at a rate existing X, but will activity And think with all of a continue X have them not year. we lot sophisticated top just a top think will continue And the of relationships for the to do we group operators,

robust they started amounted at do really a But haven’t this to bringing you point?

booking. that do we largest the are actually Because up end the deals I end that of think source we -- up that they

our in most they've XXXX existing done 'XX, we’ve of So into are that from the come all those that back operators. deals

smaller, operators. move our Now from the share been those have of been large needles transactions won’t no all the line there have have much, existing but that they transactions come So right?

comes Please Street with question Lukas Advisors. Hartwich from next ahead. go Our Green

any improved of your supplemental, you coverage of it that? looks like distribution a the can bit. X Page on there provide Is color at Looking

were into folks one another. I'm of -- there particular the bucket a of just from of that with over over not just operators, the the up had It's that way. the just or this And right bump that operators one. this crossing up the that below settled. that are two quarter, discovered they quarter to bit dramatic was the In one some but a a lot two movement, It's it's but no a in one we more just on one it's went little other. also side particular lot one range into coverage bumped below in

Okay.

quarterly noise to improvement of think kind that just continuing? and that that kind it's kind you of that think you trend of So points

few pretty on short flat we flat. quite pretty expected Overall, stay our think I to quarters. has run, for least at a And been coverage a the

you. Very helpful. Thank

Thank you.

Our go question Wells comes Please from next with Fargo. ahead. Todd Stender

Thanks.

loan the coming a is this paid $XX that any as being far looking timing got book, loan at How looking as add? Just could million and year. you you've due back

We this. might which sure not I'm $XX of on stump loan but this, average have inside all million discussed

If read yes. right I it

of actually helps. it discussions ownership. convert mortgage in into Yes, a middle to simple that We're the

come So we dollars all. back don't expect those at to

have you tenants are -- the Okay. Whose to whose borrower? disclosed with that

disclosed hadn't its tenant. We tenant, top buy but the

anything $XX Okay. that. tenants that? And then the with terms, million mez you've then mortgage anymore you've details, Any loan like added to details made and also the

loan million Michigan, and interest was at mez loan XX%, mortgage believe the then had, The on several rate REITs term, Detroit $XX years. of smell and mez expense were that beneficial or its of X.X%. the mortgages of were to was rent put to the which the out XX% extended It like on terms flows existing of have of was term we and just just I and expense. the in additive and it that we was its And looks

sort about SNFs Okay, of underwritten added And you and how five then coverage that tenant the I have in there, the dynamics know the thanks. was Texas, at?

so it And range. XX it's the at somewhere at yielded again, normal XX underwriting, our to once Those in rate. X.X% underwritten

leased And that who with to?

of One our of top operators our XX. existing -- one

thank Alright, you.

with ahead. Tayo question Our from next comes Okusanya Please go Jefferies.

me. from Couple

is comments your book debt capital higher structure? you're And acquisition giving on in focusing business? earning near expect reasonable good that you're just the so that building outlook, maybe it the all, the on still pretty getting term of First return more to

we’ve From this. the are Tayo, debt deals perspective, our done do relationship-driven. all don’t I

the debt So in it’s Michigan building really per won lease as a terms Dan book not deal, essentially it’s its se. And form. of we've mentioned,

extent, of So going on to do And to continue focus debt to we’re that them. somewhat symbols have are leases. relationship-driven and the opportunistic the deals we will are

stable the that a again little about to just a list how tenant look little again that, stop taking stabilize quarter. like companies talk also bit. tenant this point, list, you bit your But a again, are at to could seems entities Diversicare at be coverage public watch your base then And struggling a your this and again,

point top thinking these your tenants, overall and the this about XX kind Just and at some through of of again what us private of walk health? public you’re kind

stable in very portfolio Diversicare, XX our mean. is time. our for have one they’ve top in five, the been our and more We’ve quarters. six, portfolio. Overall, a coverage pretty Its seven are last our XX for very, track overall of portfolio had right public been Company. arguably stable long those around our at the And for It’s is of years. plus assets a assets some of group

And believe to top has those other very we’ve Signature, the we that guys, period of and has that then mean been over issues with stable some I portfolio or far long And addressed time. we Guardian. in a be -- so our XX, as very as Daybreak it obviously, have stable continued

other the of side we to quarters. so restructures And coming we're see we hope in and those some think improvement

from year, when think first look a dividend of is people ratio. current it just coverage at your operations, me, one cash Again, Last around take the half below the flow dividend. I from

be again think doing impacting there that of lot income of may possible have a a not this gains I the lot so you next taxable are year sales, do year. that you’re

kind cash somewhat So on not a thinking curious just flow how still from dividend operations of coverage kind maybe from of going because they’re basis their year income and gains taxable of this a you’re given perspective? about forward inflated

income in other We’ve of a costs. of appreciation there terms work is around taxable issue lot payout actually gains, and its by and of offset there done but no

and and go assets in those payout income. the of And six comfortable and as think Xnd have a next on to work, forma we in We for I to going there. let construction issues the pro that we’re to little basis spot alone have the dividend in of waits talk spend ratios about forward we of pipeline, to distributions And to SNFs. very a in about we back no reason be Avenue we’re the terms a think taxable So the assets comfortable other most nine then Orianna, months.

$X.XX the see a pretty at you’ll the with that be expect significantly we coverage share, I -- So hope the remain and would that will recurring grow improve get able back it have of a the would ratio to for The grow streams being to worked our month increase the dividend whole and well X.X revenue in sheet model balance dividend. and years.

Thank Great. very much. you

you. Thank

Our Please from next follow-up question Jonathan question is Hughes with ahead. go Raymond a James.

It bed for the it's like misspoke $XXX,XXX you build to in. up. cost the SNFs the follow looks answer per And about about earlier. I to buying that. bill thanks you're same. of on Hey assume is I half

So looks more I mean acquisitions attractive building right? than

if stop to be acquisition just more be, the to we to able perspective. just think from we going add there I even build, have ground, shovels put XX the to would desire would, opportunities. more opportunity opportunity there any If -- out was wouldn't I in we find be we the

per right. in think I you're from more opportunities. cost going focused And per of -- because on So perspective, the bed. allocations We're the capital terms our also just to be you're on acquisitions of right

with markets, being are were assets cash built those of densely the lot a levels where desirable flow solid strong. resulting quite Now, populated very in

before. dispositions Thanks. sorry was the and more. on $XXX both? Okay. [indiscernible] completed if of and has But million those What year mix Omega just assets And were assets mentioned the IRR this this of one been then legacy

flows look, talked million $XX comments, was million my on prepared $XXX sales. level [indiscernible] about Yes, in I the underlying in cash

pricing. of yield assets. was what the the half this type second And X% half -- So question? pretty It's second attractive

on mix and it. of It of Omega was legacy

Okay. Fair Thanks. enough.

you. Thank

question is ahead. Sanabria next Juan Bank follow-up of another go with from America. Our Please

Tayo's Just wanted follow-up on to question.

list with underlying You've or because restructuring going other discussion of flow talked could are any issues coverage that good there cash the it's But about litigation or the bye, whether of cash coverage. rent or other of where comfortable because generation to litigation watch kind tenant feeling there on issues? flow but be another

Well, of I the any the out size corporate of of other a don't on point. liquidity issues, sort right, any blue litigation we mean toward from comes overhang see or but this at issue right

you. Okay. Thank

seeing [Operator this Instructions] questions. time, I'm further no At

to conference Pickett over for this the So closing question-and-answer back our turn I Taylor would concludes any like session. remarks. to

Stephenson Bob call will Thanks you Gourmand our available joining Brendan. may And have. everyone for today. Matt any thank and for you be questions

is you today's now concluded. attending conference presentation. Thank The for

may You now disconnect.