Omega Healthcare Investors(OHI)2025-02-13 15:36Real Estate Investments - As of December 31, 2024, Omega Healthcare Investors, Inc. owned approximately $10.1 billion in real estate investments, with 98% related to long-term healthcare facilities[185]. - In 2024, Omega acquired 114 facilities for a total consideration of $740.5 million, with an initial cash yield between 9.5% and 11.5%[192]. - Omega sold 21 facilities for approximately $95.0 million in net cash proceeds in 2024, recognizing a net gain of approximately $13.2 million[192]. - The company recorded impairments of approximately $23.8 million on 14 facilities in 2024, with $10.9 million related to facilities classified as held for sale[192]. - The company recorded an impairment on real estate properties of $23.8 million in 2024, a decrease of $68.1 million from $91.9 million in 2023[199]. - The company acquired real estate assets totaling approximately $740.5 million in 2024, up from $261.2 million in 2023[235]. Financial Performance - Rental income for the year ended December 31, 2024, was $887.9 million, an increase of $61.5 million compared to $826.4 million in 2023[199]. - Interest income rose to $157.2 million in 2024, up by $37.3 million from $119.9 million in 2023, primarily due to new and refinanced loans[199]. - Nareit Funds from Operations (FFO) for 2024 was $733.9 million, an increase from $591.2 million in 2023[209]. - The company recognized a provision for credit losses of $15.5 million in 2024, a decrease of $60.0 million compared to a provision of $44.6 million in 2023[199]. - The total gain on assets sold decreased by $66.5 million in 2024, resulting from the sale of 21 facilities compared to 69 facilities in 2023[202]. Debt and Financing - As of December 31, 2024, the company had total assets of $9.9 billion, total equity of $4.7 billion, and total debt of $4.9 billion, with debt representing approximately 50.7% of total capitalization[211]. - The weighted average annual interest rate of the company's debt was 4.6% as of December 31, 2024, with approximately 95% of the debt having fixed interest payments[212]. - The company had $400 million of 4.50% senior notes due January 2025, which were repaid on January 15, 2025, using available cash[214]. - The company’s next senior note maturity is $600 million of 5.25% senior notes due January 2026[214]. - The company maintained compliance with all affirmative and negative covenants for its secured and unsecured borrowings as of December 31, 2024[215]. - The company has $478.5 million of interest rate swaps and £190.0 million of interest rate caps outstanding as of December 31, 2024[240]. Cash Flow and Investments - The company reported net cash provided by operating activities of $749.4 million for the year ended December 31, 2024, an increase of $131.7 million compared to 2023[224]. - Cash used in investing activities increased by $670.4 million primarily due to a $490 million decrease in proceeds from real estate sales and a $146.2 million increase in real estate acquisitions[228]. - The company had $221.8 million in commitments for the construction of new leased and mortgaged facilities and capital improvements as of December 31, 2024[221]. - Cash proceeds from the issuance of common stock increased by $899.2 million due to higher volume under the ATM Program and DRSCPP[229]. - The company has a 2024 ATM Program allowing for the sale of common stock with an aggregate gross sales price of up to $1.25 billion, with $821 million remaining as of December 31, 2024[218]. Operational Changes - During 2024, Omega placed 21 operators on a cash basis of revenue recognition, representing 20.5% of total revenues for the year[195]. - LaVie Care Centers, LLC paid a total of $28.6 million in contractual rent during 2024, reflecting a recovery in payments after bankruptcy proceedings[198]. - The company transitioned six facilities from Guardian Healthcare to a new operator, resulting in a minimum initial contractual rent of $5.5 million per annum[198]. Interest Rate Sensitivity - Interest expense related to variable rate borrowings was $14.9 million for the year ended December 31, 2024[238]. - A hypothetical 1% increase in interest rates would result in a $0.6 million increase in annual interest expense, while a 1% decrease would lead to a $1.3 million decrease[238]. - The estimated fair value of total long-term fixed-rate borrowings was approximately $3.9 billion as of December 31, 2024[239]. - A hypothetical 1% increase in interest rates would decrease the fair value of long-term fixed-rate borrowings by approximately $235.0 million[239]. Foreign Currency Exposure - The company has 11 foreign currency forward contracts with notional amounts totaling £258.0 million to hedge net investments in the U.K.[242]. - A 10% change in the exchange rate of the British Pound Sterling relative to the U.S. Dollar would impact net income from U.K.-based investments by $3.2 million[241].