EX-99.1 2 earningspressrelease2023q3.htm EX-99.1 Document

Exhibit 99.1

News Release

Community Healthcare Trust Announces Results for the Three Months Ended September 30, 2023

FRANKLIN, Tenn., October 31, 2023 / PRNewswire / -- Community Healthcare Trust Incorporated (NYSE: CHCT) (the "Company") today announced results for the three months ended September 30, 2023. The Company reported net income for the three months ended September 30, 2023 of approximately $3.5 million, or $0.11 per diluted common share. Funds from operations ("FFO") and adjusted funds from operations ("AFFO") for the three months ended September 30, 2023 totaled $0.58 and $0.63, respectively, per diluted common share. 

Items Impacting Our Results include:
•During the three months ended September 30, 2023, the Company acquired seven real estate properties for an aggregate purchase price of approximately $51.7 million. Upon acquisition, the properties totaling approximately 177,000 square feet, were 99.8% leased in the aggregate with lease expirations through 2038.

•Subsequent to September 30, 2023, the Company acquired two medical office buildings in a single transaction for an aggregate purchase price and cash consideration of approximately $7.1 million. Upon acquisition, the properties were 96.8% leased in the aggregate with lease expirations through 2031. The acquisitions were funded with proceeds from the Company's Revolving Credit Facility.

•The Company has seven properties under definitive purchase agreements, to be acquired after completion and occupancy, for an aggregate expected purchase price of approximately $166.5 million. The Company's expected returns on these investments are approximately 9.1% to 9.75%. The Company anticipates closing on these properties throughout 2024 and 2025; however, the Company cannot provide assurance as to the timing of when, or whether, these transactions will actually close.

•During the third quarter of 2023, the Company issued, through its at-the-market offering program, 552,000 shares of common stock at an average gross sales price of $32.93 per share for net proceeds of approximately $17.8 million at an approximate 5.61% current equity yield.

•On October 26, 2023, the Company’s Board of Directors declared a quarterly common stock dividend in the amount of $0.455 per share. The dividend is payable on November 24, 2023 to stockholders of record on November 9, 2023.



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About Community Healthcare Trust Incorporated
Community Healthcare Trust Incorporated is a real estate investment trust that focuses on owning income-producing real estate properties associated primarily with the delivery of outpatient healthcare services in our target sub-markets throughout the United States. As of September 30, 2023, the Company had investments of approximately $1.05 billion in 191 real estate properties (including a portion of one property accounted for as a sales-type lease and one property classified as held for sale). The properties are located in 34 states, totaling approximately 4.2 million square feet in the aggregate.

Additional information regarding the Company, including this quarter's operations, can be found at www.chct.reit.  Please contact the Company at 615-771-3052 to request a printed copy of this information.


Cautionary Note Regarding Forward-Looking Statements
In addition to the historical information contained within, the matters discussed in this press release may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are generally identifiable by use of forward-looking terminology such as “believes”, “expects”, “may”, “will,” “should”, “seeks”, “approximately”, “intends”, “plans”, “estimates”, “anticipates” or other similar words or expressions, including the negative thereof. Forward-looking statements are based on certain assumptions and can include future expectations, future plans and strategies, financial and operating projections or other forward-looking information. Such forward-looking statements reflect management’s current beliefs and are based on information currently available to management. Because forward-looking statements relate to future events, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of the control of Community Healthcare Trust Incorporated (the "Company"). Thus, the Company’s actual results and financial condition may differ materially from those indicated in such forward-looking statements. Some factors that might cause such a difference include the following: general volatility of the capital markets and the market price of the Company’s common stock, changes in the Company’s business strategy, availability, terms and deployment of capital, the Company’s ability to refinance existing indebtedness at or prior to maturity on favorable terms, or at all, changes in the real estate industry in general, interest rates or the general economy, adverse developments related to the healthcare industry, changes in governmental regulations, the degree and nature of the Company’s competition, the ability to consummate acquisitions under contract, catastrophic or extreme weather and other natural events and the physical effects of climate change, the occurrence of cyber incidents, effects on global and national markets as well as businesses resulting from increased inflation, rising interest rates, supply chain disruptions, labor conditions, the conflict between Russia and Ukraine, and/or new and ongoing hostilities between Israel and Hamas, and the other factors described in the section entitled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, and the Company’s other filings with the Securities and Exchange Commission from time to time. Readers are therefore cautioned not to place undue reliance on the forward-looking statements contained herein which speak only as of the date hereof. The Company intends these forward-looking statements to speak only as of the time of this press release and undertakes no obligation to update forward-looking statements, whether as a result of new information, future developments, or otherwise, except as may be required by law.


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COMMUNITY HEALTHCARE TRUST INCORPORATED
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars and shares in thousands, except per share amounts)
(Unaudited)
September 30, 2023December 31, 2022
ASSETS
Real estate properties:
Land and land improvements
$135,809 $117,657 
Buildings, improvements, and lease intangibles
908,788 825,257 
Personal property
296 253 
Total real estate properties
1,044,893 943,167 
Less accumulated depreciation
(192,962)(165,341)
Total real estate properties, net
851,931 777,826 
Cash and cash equivalents
3,885 11,233 
Restricted cash
1,048 835 
Other assets, net
98,262 86,531 
Total assets
$955,126 $876,425 
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Debt, net
$401,192 $352,997 
Accounts payable and accrued liabilities
15,446 11,377 
Other liabilities, net
16,194 15,237 
Total liabilities
432,832 379,611 
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; 27,265 and 25,897 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively
273 259 
Additional paid-in capital
676,716 625,136 
Cumulative net income
84,289 81,142 
Accumulated other comprehensive gain
29,038 22,667 
Cumulative dividends
(268,022)(232,390)
Total stockholders’ equity
522,294 496,814 
Total liabilities and stockholders' equity
$955,126 $876,425 

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.
 

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COMMUNITY HEALTHCARE TRUST INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022
(Unaudited; Dollars and shares in thousands, except per share amounts)

Three Months Ended
September 30,		Nine Months Ended
September 30,
2023202220232022
REVENUES
Rental income
$27,690 $23,919 $80,582 $69,720 
Other operating interest
1,045 888 3,139 2,617 
28,735 24,807 83,721 72,337 
EXPENSES
Property operating
5,456 4,327 15,115 12,480 
General and administrative (1)
3,618 3,762 23,610 10,688 
Depreciation and amortization
11,208 8,003 29,445 24,022 
20,282 16,092 68,170 47,190 
INCOME BEFORE INCOME TAXES AND OTHER ITEMS
8,453 8,715 15,551 25,147 
Impairment of real estate asset
(102)— (102)— 
Interest expense
(4,641)(3,028)(12,773)(8,409)
        Deferred income tax expense
(221)(21)(306)(20)
Interest and other income
3 7 777 63 
NET INCOME
$3,492 $5,673 $3,147 $16,781 
NET INCOME PER COMMON SHARE (1):
Net income per common share – Basic
$0.11 $0.21 $0.05 $0.62 
Net income per common share – Diluted
$0.11 $0.21 $0.05 $0.62 
WEIGHTED AVERAGE COMMON SHARE OUTSTANDING-BASIC
25,514 23,587 24,940 23,578 
WEIGHTED AVERAGE COMMON SHARE OUTSTANDING-DILUTED
25,514 23,587 24,940 23,578 
___________
(1) General and administrative expenses for the nine months ended September 30, 2023 included stock-based compensation expense totaling approximately $17.9 million, including the accelerated amortization of stock-based compensation totaling approximately $11.8 million, or $0.47 per diluted common share, recognized upon the passing of our former CEO and President during the first quarter of 2023. General and administrative expenses for the nine months ended September 30, 2022 included stock-based compensation expense totaling approximately $6.8 million.

The Condensed Consolidated Statements of Income 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.


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COMMUNITY HEALTHCARE TRUST INCORPORATED
RECONCILIATION OF FFO and AFFO (1)
(Unaudited; Dollars and shares in thousands, except per share amounts)
Three Months Ended September 30,
20232022
Net income$3,492 $5,673 
   Real estate depreciation and amortization11,375 8,078 
   Impairment of real estate asset102 — 
   Total adjustments11,477 8,078 
FFO$14,969 $13,751 
   Straight-line rent(444)(853)
   Stock-based compensation1,898 2,464 
AFFO$16,423 $15,362 
   FFO per Common Share-Diluted
$0.58 $0.57 
   AFFO per Common Share-Diluted$0.63 $0.63 
Weighted Average Common Shares Outstanding-Diluted (2)
26,025 24,312 
 
(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.

CONTACT: Bill Monroe, 615-771-3052
SOURCE: Community Healthcare Trust Incorporated
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