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Sep 30, 2021
Sabra Health Care REIT Q3 2021 Earnings Report
Sabra Health Care REIT reported third quarter results, provided a business update, and reaffirmed 2021 NFFO and NAFFO guidance.
Key Takeaways
Sabra Health Care REIT announced its Q3 2021 results, with net income per diluted common share at $0.05, FFO per diluted common share at $0.27, Normalized FFO per diluted common share at $0.38, AFFO per diluted common share at $0.38 and Normalized AFFO per diluted common share at $0.38. The company reaffirmed its full-year 2021 guidance for Normalized FFO and Normalized AFFO.
Net income, FFO, Normalized FFO, AFFO and Normalized AFFO per diluted common share were $0.05, $0.27, $0.38, $0.38 and $0.38, respectively.
EBITDARM Coverage for Skilled Nursing/Transitional Care and Specialty Hospitals and Other portfolios were 1.78x and 3.86x, respectively.
From the beginning of the COVID-19 pandemic through October 2021, Sabra collected 99.7% of forecasted rents.
Year-to-date investment activity totals $396.7 million with a weighted average estimated stabilized cash yield of 7.55%.
Sabra Health Care REIT
Sabra Health Care REIT
Sabra Health Care REIT Revenue by Segment
Revenue by Segment
Rental and related revenues Revenue
CapyFin.comResident fees and services Revenue
CapyFin.comInterest and other income Revenue
CapyFin.com Forward Guidance
Sabra reaffirms its previously issued per diluted common share guidance for Normalized FFO and Normalized AFFO for the year ending December 31, 2021. Previously issued guidance did not include the impact of two matters that affect the full year 2021 per diluted common share guidance for net loss, FFO and AFFO.
Positive Outlook
- The portfolio continues to recover from the COVID-19 pandemic.
- Vaccination uptake for the workforce continues to improve and the mandate should help that.
- The vaccines have been effective materially limiting the impact of the Delta variant on patients, residents and staff.
- With workforce vaccine uptake improving, there could effectively be a protective wall around the facilities as we expect that we will be living with some level of the virus in communities going forward.
- The investment pipeline is robust, and our acquisition team continues to source and close accretive investments.
Challenges Ahead
- Workforce shortages continue to be one of the most significant impediments left to a more speedy operational recovery.
- There is not seeing a material impact on our tenants and operators, at this time, from supply chain issues.
- Avamere has experienced cash flow constraints over the past several months from census declines as a result of a spike in COVID-19 cases in Oregon, Colorado and Washington together with admissions limitations in these states, as well as from increased labor pressure.
- The lease with Avamere should no longer be accounted for on an accrual basis. We consequently wrote off $25.2 million of non-cash rent receivable balances related to this lease.
- Cash NOI and margin both decreased in the managed portfolio during the third quarter of 2021 despite an increase in revenue. This change is a result of the lack of federal grant income during the third quarter of 2021 as well as increased labor costs in our higher acuity properties.
Revenue & Expenses
Visualization of income flow from segment revenue to net income