LTC Properties Inc. (NYSE:LTC) Q4 2019 Earnings Conference Call - Final Transcript

Feb 21, 2020 • 11:00 am ET


LTC Properties Inc. (NYSE:LTC) Q4 2019 Earnings Conference Call - Final Transcript


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Good day, and welcome to the LTC Properties, Inc. 4Q '19 Analyst and Investor Conference Call and Webcast. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions]

Before management begins its presentation, please note that today's comments, including the question-and-answer session, may include forward-looking statements subject to risks and uncertainties that may cause actual results and events to differ materially. These risks and uncertainties are detailed in LTC Properties filings with the Securities and Exchange Commission from time-to-time, including the company's most recent 10-K dated December 31, 2019. LTC undertakes no obligation to revise or update these forward-looking statements to reflect events or circumstances after the date of this presentation. [Operator Instructions]

I would now like to turn the conference over to Wendy Simpson, CEO and President. Please go ahead.

Wendy Simpson

Thank you, operator and good morning. Welcome to LTC's 2019 fourth quarter and year end conference call. Joining me today are Pam Kessler, our Chief Financial Officer; and Clint Malin, our Chief Investment Officer. 2019 was a significant year for LTC, during which we made some tough decisions for change. Those changes have positioned us for future growth. We successfully addressed challenged portfolios, we strengthened our balance sheet by terming out some of our line of credit using proceeds from the sale of $100 million of senior unsecured notes and we move the company forward through acquisitions with operating partners new to LTC.

I'll spend the next few minutes detailing some of our progress, starting with operators on which we have or had a special focus. Anthem and Thrive are two examples of how we work through issues with portfolios that were not performing to LTC's expectations. In Anthem's case, we work to support them through their operational challenges and rationalization of corporate overhead. By the end of 2019, performance in our Anthem portfolio was greatly improved and rent collected from them was approximately 45% higher than the rent they paid us in 2018. We expect to collect $9.9 million of rent from Anthem in 2020, which is a 32% increase.

We had to take a different path with Thrive. After identify lease-up softness in 2018 at the [Phonetic] six communities they leased from us, we granted Thrive temporary rent relief to give them an opportunity to demonstrate forward progress. When that progress did not materialize, we move quickly to transition the portfolio to three separate regionally based operators, who we believe are better capitalized and better suited to meet the demands of their local markets.

One, Trilogy Management Services is an operating partner new to LTC and the other two, Veritas Healthcare Group and Affinity Living Group represent expanded existing relationships. We are pleased with the transitions and the progress that has been made as these partners implement their own cultures, marketing initiatives and care programming. Former Thrive assets will yield higher cash rents in 2020 over 2019. Transitioning this portfolio is just one example of how we've used our solid and robust network