Summary
WELLTOWER INC. (WELL), operating as Health Care REIT, Inc., reported significant growth in its third quarter and year-to-date 2003 results, driven by a substantial increase in rental income. The company's real estate investments expanded considerably, with new acquisitions and construction in progress contributing to asset growth. Despite an increase in interest expense due to higher borrowings, the company demonstrated a strong ability to generate revenue, offsetting these costs and showing robust growth in net income available to common stockholders. Financially, WELLTOWER has strengthened its capital structure through a mix of debt and equity offerings, including new senior unsecured notes and preferred stock issuances. The company also successfully redeemed certain preferred stock, optimizing its capital costs. Management expresses confidence in its liquidity and capital resources to fund ongoing operations, meet financial obligations, and pursue future investment opportunities in the healthcare facility sector.
Key Highlights
- 1Rental income increased by 35% for the third quarter and 38% year-to-date compared to the prior year, signaling strong operational performance.
- 2Net income available to common stockholders grew to $20.6 million ($0.46 per diluted share) for the third quarter and $53.8 million ($1.28 per diluted share) year-to-date, up from $16.9 million ($0.43 per diluted share) and $42.9 million ($1.18 per diluted share) respectively in 2002.
- 3Total assets grew to $2.03 billion as of September 30, 2003, up from $1.59 billion at December 31, 2002, driven by significant investments in real estate.
- 4The company raised substantial capital through various offerings, including $100 million in senior unsecured notes, $96.85 million from Series D Preferred Stock, and significant common stock issuances, alongside the issuance of Series E Convertible Preferred Stock for an acquisition.
- 5WELLTOWER successfully redeemed all 3 million shares of its 8.875% Series B Cumulative Redeemable Preferred Stock, optimizing its capital structure and reducing preferred dividend expenses.
- 6Moody's Investor Services upgraded its rating on the company's senior unsecured notes from Ba1 to Baa3, reflecting strengths in financial leverage, debt management, and portfolio fundamentals.
- 7The company's investment in Atlantic Healthcare Finance L.P. was sold in October 2003, expected to generate a net gain of approximately $800,000 in the fourth quarter.