Welltower Inc (NYSE:WELL) Q4 2018 Earnings Conference Call - Final Transcript

Feb 12, 2019 • 10:00 am ET

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Welltower Inc (NYSE:WELL) Q4 2018 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good morning, ladies and gentlemen, and welcome to the Fourth Quarter 2018 Welltower Earnings Conference Call. My name is Nicole, and I will be your operator today. At this time, all participants are in a listen-only mode. We will be facilitating a question-and-answer session towards the end of this conference. [Operator Instructions] As a reminder, this conference is being recorded for replay purposes.

Now, I would like to turn the call over to Tim McHugh, Vice President of Finance and Investment. Please go ahead, sir.

Executive
Tim McHugh

Thank you, Nicole. Good morning, everyone. And thank you for joining us today to discuss Welltower's fourth quarter 2018 results. Following the safe Harbor, you'll hear prepared remarks from Tom DeRosa, CEO; Shankh Mitra, CIO; and John Goodey, CFO.

Before we begin, let me remind you that certain statements made during this conference call may be deemed forward-looking statements in the meaning of the Private Securities Litigation Reform Act of 1995. Although, Welltower believes results projected in any forward-looking statements are based on reasonable assumptions, the company can give no assurances that these projected results will be obtained. Factors and risks that could cause actual results to differ materially from those in the forward-looking statements are detailed in this morning's press release and from time to time in the company's filings with the SEC. If you did not receive a copy of this morning's press release, you may access it via the company's website at welltower.com.

Before I hand the call over to Tom DeRosa, I want to highlight a few significant points regarding our fourth quarter results. Welltower achieved 1.6% total same-store growth in the quarter. We are particularly encouraged by the 40 basis points year-over-year occupancy increase in our senior housing operating portfolio, and the sequential coverage increases in both our triple-net senior housing and long-term post-acute portfolios.

The fundamental performance in the quarter was consistent with our expectations, partially offset by delayed timing of investment activity and equity issued to pre-fund announced acquisitions, resulting in $1.01 per share of normalized funds from operations. In the fourth quarter, we issued $552 million of equity at a weighted average share price of $68.41. [Technical Issues]

And with that, I'll hand the call over to Tom for his remarks on this quarter and the year. Tom?

Executive
Thomas J. DeRosa

Thanks, Tim. At our Investor Day on December 4th, we took a notable step of announcing 2019 FFO guidance. Based on our Q4 results and our confidence in our outlook for 2019, I'm pleased to reaffirm that guidance this morning. Our guidance of $4.10 to $4.25 in normalized FFO per share represents a 4% increase at the midpoint in our guidance range over our 2018 results.

As Tim highlighted, our continued strong operating results in Q4 reflected the positive momentum in our seniors housing business that we've talked about throughout the year. Most notable in the quarter was the fact that we completed $559 million in acquisitions at a blended yield of 5.6%, nearly 90% of which are medical office