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Jun 30, 2023
Welltower Q2 2023 Earnings Report
Welltower reported mixed results for Q2 2023, with strong SSNOI growth offset by a net income decrease.
Key Takeaways
Welltower's Q2 2023 results showed a net income of $0.20 per diluted share and normalized FFO of $0.90 per diluted share. The company experienced a 12.7% year-over-year same-store NOI growth, driven by a 24.2% increase in the Seniors Housing Operating portfolio. Welltower revised its full-year net income outlook to $0.73 to $0.84 per diluted share and normalized FFO guidance to $3.48 to $3.59 per diluted share.
Net income attributable to common stockholders was $0.20 per diluted share.
Normalized FFO attributable to common stockholders was $0.90 per diluted share.
Total portfolio year-over-year same store NOI grew by 12.7%, with Seniors Housing Operating portfolio growth of 24.2%.
The company closed or is under contract to close 26 new transactions representing pro rata acquisition and loan funding of approximately $2.3 billion since the beginning of Q2.
Welltower
Welltower
Welltower Revenue by Segment
Revenue by Segment
Seniors Housing Ops Revenue
CapyFin.com Forward Guidance
Welltower revised its full-year 2023 outlook, increasing the midpoint of the normalized FFO attributable to common stockholders guidance range and updating assumptions for same-store NOI growth, interest rates, and other factors.
Positive Outlook
- Average blended SSNOI growth is expected to be 10% to 13%.
- Seniors Housing Operating SSNOI is projected to grow approximately 20% to 25%.
- The company anticipates funding an additional $441 million of development in 2023 related to projects underway on June 30, 2023.
- Pro rata disposition proceeds are expected to be $966 million at a blended yield of 5.0% in the next twelve months.
- Net income attributable to common stockholders guidance has been revised to a range of $0.73 to $0.84 per diluted share.
Challenges Ahead
- Increased interest rates on floating rate debt are expected to reduce 2023 normalized FFO attributable to common stockholders by approximately $0.20 per diluted share versus 2022.
- Earnings guidance includes only those acquisitions closed to date, with no transitions or restructures beyond those announced.
- Updated guidance does not include any additional Provider Relief Funds in 2023.
- Guidance does not include any additional investments, dispositions or capital transactions beyond those announced.
- The company expects pro rata disposition proceeds of $966 million at a blended yield of 5.0% in the next twelve months.