EPR Properties (NYSE:EPR) Q1 2018 Earnings Conference Call Transcript

May 08, 2018 • 05:00 pm ET

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EPR Properties (NYSE:EPR) Q1 2018 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good afternoon, ladies and gentlemen, and welcome to the Q1 2018 EPR Properties Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. (Operator Instructions) As a reminder, this conference call is being recorded.

I would now like to turn the call over to your host, Mr. Brian Moriarty, Vice President of Corporate Communications.

Executive
Brian Moriarty

Thank you, operator, and thanks to everyone for joining us today for our first quarter 2018 earnings call. I will start the call by informing you that this call may include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Identified by such words as will be, intend, continue, believe, may, expect, hope, anticipate, or other comparable terms. The Company's actual financial condition and results of operations may vary materially from those contemplated by such forward-looking statements, discussion of these factors that could cause results to differ materially from these forward-looking statements are contained in the Company's SEC filings, including the Company's reports on Form 10-K and 10-Q.

Now, I will turn the call over to Company President and CEO, Greg Silvers.

Executive
Greg Silvers

Thank you, Brain. Hello, everyone, and welcome to our first quarter call. I would like to start by reminding everyone that slides are available to follow along via our website at www.eprkc.com.

With me on the call today is our CFO, Mark Peterson, who will review the Company's financial summary.

Executive
Mark Peterson

Good afternoon.

Executive
Greg Silvers

Now, I will get started on today's headlines before discussing the business in greater detail. First, strong quarter, anchored by significant top-line revenue growth. We are pleased to announce another quarter of record-setting results. As compared to the same quarter previous year, our top-line revenue grew by 20% and FFO, as adjusted per share, grew by 6%. These results demonstrate the combination of consistency and growth inherent in our model, which benefits from our non-commodity focus.

Second, executing our capital recycling strategy. We are making significant progress on our stated intention of recycling capital through our recent pay down of ski mortgage note with Och-Ziff Real Estate. Based on how we structure the note, this pay down and associated fees implies a cap rate of 6.8%. As we've stated, we are increasingly focused on accretive capital recycling and this transaction demonstrates the quality and desirability of our assets in the private market. I will provide more color on this shortly.

Third, increasing earnings guidance, reaffirming investment spending and disposition guidance. We are happy to announce that we're increasing our earnings guidance while reaffirming our investment spending and disposition guidance. The increase in earnings is largely driven by the pre-payment fee associated with the Och-Ziff mortgage pay down, and we are pleased that the economics of our deal structure will allow all parties to benefit.

Fourth, debt management further strengthens balance sheet. Maintaining a strong balance sheet, which supports our business objectives is one of our core principles. As of the end of the quarter, we have no debt maturities