Summary
Welltower Inc. (WELL) reported its third-quarter 2018 financial results, showcasing growth in its seniors housing operating segment and a significant acquisition of Quality Care Properties (QCP). Total assets grew to $30.2 billion from $27.9 billion at the end of 2017, driven by substantial property acquisitions. While revenues saw a slight decrease in rental income, resident fees and services increased significantly. The company’s strategic focus remains on its core segments: triple-net, seniors housing operating, and outpatient medical properties, with a commitment to protecting stockholder capital and enhancing value through consistent dividend payments and portfolio growth. The acquisition of QCP, which closed in July 2018 for approximately $3.5 billion, significantly expanded its seniors housing portfolio and created a joint venture with ProMedica. Financially, the company maintained a strong liquidity position with substantial cash and cash equivalents and available borrowing capacity under its credit facility. Borrowings under its unsecured credit facility increased significantly in the nine months ended September 30, 2018, largely to fund acquisitions, including the QCP transaction. The company also actively managed its debt through issuances and repayments of senior unsecured notes. While the company incurred some impairment charges related to held-for-sale properties, overall performance indicates continued strategic execution in a dynamic healthcare real estate market.
Financial Highlights
39 data points| Revenue | $1.24B |
| Cost of Revenue | $657.16M |
| Gross Profit | $579.22M |
| SG&A Expenses | $28.75M |
| Operating Expenses | $1.18B |
| Interest Expense | $138.03M |
| Net Income | $84.23M |
| EPS (Basic) | $0.17 |
| EPS (Diluted) | $0.17 |
| Shares Outstanding (Basic) | 373.02M |
| Shares Outstanding (Diluted) | 374.49M |
Key Highlights
- 1Total assets increased to $30.2 billion as of September 30, 2018, up from $27.9 billion at December 31, 2017, primarily due to significant acquisitions.
- 2Completed the acquisition of Quality Care Properties (QCP) for approximately $3.5 billion, significantly expanding the seniors housing portfolio and forming a joint venture with ProMedica.
- 3Seniors Housing Operating segment's Net Operating Income (NOI) increased by 18% year-over-year for the three months ended September 30, 2018, and by 12% for the nine-month period.
- 4Total revenues for the nine months ended September 30, 2018, were $3.46 billion, an increase from $3.21 billion in the prior year period, driven by growth in resident fees and services.
- 5Cash provided from operating activities remained strong, totaling $1.21 billion for the nine months ended September 30, 2018, compared to $1.16 billion in the prior year.
- 6Increased borrowings under the unsecured credit facility to $1.31 billion as of September 30, 2018, up from $719 million at December 31, 2017, to support acquisition activity.
- 7Maintained compliance with all debt covenants and managed a significant debt portfolio with various issuances and repayments of senior unsecured notes.