EPR Properties (NYSE:EPR) Q4 2017 Earnings Conference Call Transcript

Feb 28, 2018 • 05:00 pm ET

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EPR Properties (NYSE:EPR) Q4 2017 Earnings Conference Call Transcript

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Q & A
Operator
Operator

Thank you. (Operator Instructions) And our first question comes from the line of Anthony Paolone from JP Morgan.

Analyst
Anthony Paolone

All right thanks, and good afternoon. First question is just to make sure I understand that the midpoint of your guidance, is that suggest that at the midpoint, its zero net investment activity?

Executive
Mark Peterson

Yes, that would be correct.

Analyst
Anthony Paolone

Okay. And then when you think about the midpoint on the prior guidance to the new midpoint, how much of that is credit related versus investments?

Executive
Mark Peterson

You can reconcile the Number 1 down by $0.10 at the midpoint and that's about the number we had in for CLA, consider all CLA related. Couple of other things going on with the redemption and the redemption of bonds, which reduced our interest cost of course, that was about $0.06 about a $0.01 difference in termination fees. And then, obviously, having lower spending and higher dispositions was the remaining impact, but if you kind of got through it all, really the main impact is the CLA reduction.

Analyst
Anthony Paolone

Okay. And then my second question is set on CLA. Can you just step back and maybe give us a sense as to how many stores do you own that are operating versus under construction versus it looks like maybe some landslides, like what's the starting point here?

Executive
Greg Silvers

Yes, I think we have 21 stores that are operating, we have two under some stage of construction that we stopped then we have two land parcels.

Analyst
Anthony Paolone

Okay, so 20, 25. And then what's the total basis in all of this?

Executive
Greg Silvers

About, I think we discussed about $255 million.

Executive
Mark Peterson

Of properties and we have some land parcels to go.

Analyst
Anthony Paolone

Okay. And then to just understand, throughout the course of 2017, did you get any cash or was it just all accrual through 2017 in terms of..

Executive
Greg Silvers

Yes, we did receive some cash and that kind of went to pay property taxes. So kind of consider that as I watched as far as that goes. Like I said, the $15 million, the charge we took this quarter, $7.5 million was kind of the income we recognized this year, the 16 regular rents, $1.5 million being straight-line and then other $7.5 million of the $15 million was really prior year straight-line rent. That's it breaks down. $15 million in total $7.5 million related to the prior, and $7.5 million to where we had recognized. And like I said while we did get some cash that was really an offset to property taxes.

Analyst
Anthony Paolone

So it would be -- what was the expected yield on all 25 sites like how much cash and why would that have been?

Executive
Mark Peterson

I think the expectation would have been that it would have been about a $20 million contributor. We, as Mark said, we had kind of geared it back down to above an expectation of about $7.5 million with that growing because our stores were actually performing, and so, but Tony, when the bankruptcy came, we felt it and candidly,