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Jun 30, 2024
LTC Properties Q2 2024 Earnings Report
Reported an increase in revenue and net income for the second quarter of 2024.
Key Takeaways
LTC Properties reported increased revenues and net income for Q2 2024, driven by higher interest income from loan originations and insurance proceeds. Expenses decreased due to the absence of an impairment loss and lower interest expense, offset by increased general and administrative expenses and credit loss provisions. The company originated a $12.7 million mortgage loan and engaged in joint venture investments with ALG Senior.
Total revenues increased due to higher interest income from mortgage and mezzanine loan originations, construction loan funding, interest rate escalations, and insurance proceeds.
Expenses decreased primarily due to the impairment loss in the year-ago period and a decrease in interest expense.
Originated a $12.7 million mortgage loan secured by a skilled nursing and assisted living campus in Texas.
Investments with ALG are now cross-defaulted and cross-collateralized.
Revenue by Segment
Forward Guidance
LTC committed to fund a $26.1 million mortgage loan for construction in Illinois and sold an assisted living community in Texas for $8.0 million.
Positive Outlook
- Committed to fund a $26.1 million mortgage loan for the construction of a 116-unit independent living, assisted living and memory care community in Illinois.
- The borrower contributed $12.3 million of equity which will initially fund the construction.
- The loan term is approximately six years at a current rate of 9.0% and IRR of 9.5%.
- Sold an 80-unit assisted living community in Texas to the operator for $8.0 million.
- LTC anticipates recording a gain on sale of approximately $3.6 million.
Challenges Ahead
- LTC deferred a total of $1.5 million in rent from ALG for May and June of 2024.
- LTC agreed to defer up to approximately $250,000 in rent per month for July through December 2024, or a total of up to $1.5 million.
- Under the amendment, no rent is due for May through September 2024, with quarterly market-based rent resets thereafter.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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