Sabra Health Care REIT, Inc. (NASDAQ:SBRA) Q3 2017 Earnings Conference Call Transcript

Nov 02, 2017 • 01:00 pm ET


Sabra Health Care REIT, Inc. (NASDAQ:SBRA) Q3 2017 Earnings Conference Call Transcript


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Good day, ladies and gentlemen, and welcome to the Sabra Health Care REIT Third Quarter 2017 Earnings Conference Call. This call is being recorded. I would now like to turn the call over to Michael Costa, EVP, Finance. Please go ahead, Mr. Costa.

Michael Costa

Thank you.

(Forward-Looking Cautionary Statements)

In addition, references will be made during this call to non-GAAP financial results. Investors are encouraged to review these non-GAAP financial measures as well as explanation and reconciliation of these measures to the comparable GAAP results included at the end of our earnings press release and the supplemental information materials included as Exhibits 99.1 and 99.2, respectively, to the Form 8-K we furnished to the SEC yesterday. These materials can also be accessed in the IR section of our website at

And with that, let me turn the call over to Rick Matros, Chairman and CEO of Sabra Health Care REIT.

Rick Matros

Thanks, Mike. Appreciate it. And thanks everybody for joining us today. Let me start by talking about Sabra 3.0 and give you all the update of where we are. My understanding there were some concerns about the level of activity that we've had and whether we have issues with integration and such and so I want to report today that the integration of CCP is going pretty flawlessly actually as expected and the integration of North American as well was uneventful. The closing was uneventful. And the closing of the Enlivant deal is proceeding as expected. Although we now expect it to close right after the 1st of January, but nothing is happening. That's actually causing that delay, so everything's going really smoothly.

We've increased our staffing here at Sabra, reporting the senior management team which has been really helpful to us obviously and added to our infrastructure generally. So, we are pretty much fully staffed and handling everything that we need to be handling. So now we should not have any concerns about that. In terms of some of the other benefits of all the deals that we've announced over the past few months that impacts now being realized, leverage levered 4.79 and the weighted average cost of our debt down to approximately 4%.

In addition to that, we're pleased with the increased scale we have at kind of diversity. So, we'll be at a point where we no longer will have any issue with any particular tenant controlling a whole narrative. About the Company, the larger credit facility is benefiting us pretty dramatically as is the investment grade ratings and Harold will talk in more detail about some of these savings. And we do anticipate addressing our outstanding bonds in the near term as well, given the benefit of now being investment grade.

And performance of 3.0, our skilled nursing exposure drops from 73.5% to 64%. So, we are still high at a price of the CCP announcement. That's a dramatic drop in a former field exposure just with doing one additional deal. So, we feel good about that