SOURCE: Global Healthcare REIT

Global Healthcare REIT

March 31, 2015 16:07 ET

Global Healthcare REIT Reports 2014 Results

Company to Issue Dividend of $0.01 per Share in Q1 and Q2 2015, With Plans to Increase Dividend to $0.02 per Share in Q3

ATLANTA, GA--(Marketwired - Mar 31, 2015) -  Global Healthcare REIT, Inc. (OTCQB: GBCS), a leading real estate investment trust that owns healthcare properties and leases them to senior care facility operators, reported results for the year ended December 31, 2014.

2014 Highlights

  • Completed acquisitions of seven properties for $27.9 million in total
  • Rental revenue increased 318% to $1.9 million versus the period from March 13, 2013 (date of inception) through December 31, 2013
  • Net income to common shareholders improved to $1.3 million or $0.06 per diluted share from a net loss to common shareholders of $0.7 million or $0.09 per basic and diluted share in the period from March 13, 2013 (date of inception) through December 31, 2013
  • Total assets up 270% to $46.5 million versus the period from March 13, 2013 (date of inception) through December 31, 2013
  • Paid quarterly cash dividend of $0.01 in Q1 and Q4 of 2014

2014 Financial Summary
Rental revenue increased 318% to $1.9 million in 2014, as compared to $443,000 in the period from March 13, 2013 (date of inception) through December 31, 2013. The increase in revenue was due to the additional days of operation and the contribution of facilities acquired in 2014, with the number of facilities totaling 11 as of December 31, 2014 versus two at December 31, 2013. Rental revenue in 2014 was derived from eight out of 11 facilities in the company's portfolio, and does not reflect the full run rate the company expects from its healthcare property portfolio. As of March 1, 2015, 10 of the facilities were contributing rental revenue, with the Southern Hills independent living facility currently undergoing renovations that are scheduled for completion by the end of the year.

Total expenses were $2.1 million in 2014, compared to $0.8 million in the period from March 13, 2013 (date of inception) through December 31, 2013. The increase in total expenses was due the greater number of days of operation, as well as increased general and administrative expenses, and increased depreciation expense due to the addition of properties to the company's portfolio in 2014. As the company continues its acquisition campaign for healthcare real estate, it anticipates revenue and cash flow will increase while holding general and administrative costs relatively flat and fixed costs at approximately $205,000 per quarter.

Net income to common shareholders improved to $1.3 million or $0.06 per diluted share in 2014 as compared to a net loss of $0.7 million or $0.09 per basic and diluted share in the period from March 13, 2014 (date of inception) through December 31, 2013. The improvement in net income was partly due to a gain of $3.0 million that resulted from the excess of fair value in the acquisition of Southern Hills Retirement Center.

Cash and cash equivalents totaled $0.5 million as of December 31, 2014, as compared to $1.2 million as of December 31, 2013.

2014 Acquisition Activity
During 2014, Global Healthcare REIT completed acquisitions of seven properties for $27.9 million in total. Six were skilled nursing facilities and one property was a senior living campus comprised of a skilled nursing facility, assisted living facility and independent living facility.

The 2014 acquisitions bring the company's total properties owned to nine (see "Summary of Property Portfolio," below, for more details.) There are no capital improvement and recurring capital expenditure commitments at the properties, except for renovations at the company's Southern Hills Retirement Center, which are expected to be completed by the end of 2015.

Management Commentary
"In 2014, we experienced extraordinary growth as our rental revenue increased four-fold over last year, driven by nine senior care facility acquisitions," said Global Healthcare REIT's president and CEO, Christopher Brogdon. "The successful 2014 acquisitions expanded our footprint from only Georgia to Arkansas, Kansas and Oklahoma. We plan to continue this expansion by acquiring four skilled nursing facilities in Texas, as well as other acquisitions in key states. Our current plan is to double our portfolio to more 20 facilities by the end of this year."

Quarterly Dividend
As previously announced, the company declared a regular quarterly cash dividend in the amount of $0.01 per common share for the first quarter of 2015. The dividend will be paid April 30, 2015 to shareholders of record on the close of business on April 10, 2015.

"We recently announced our second consecutive quarterly dividend and expect our dividend to grow over time in correlation to the growth in our healthcare facilities portfolio," commented Brogdon. "Given our acquisition pipeline, we expect to issue a quarterly cash dividend in the amount of $0.01 per common share for the second quarter of 2015, with plans to increase the dividend to $0.02 per share in the third quarter of 2015."

Management Appointment
During the current quarter, the company promoted Ryan Scates from general counsel and secretary to the new position of executive vice president. Scates previously served in a management capacity at Winter Haven Homes to help facilitate healthcare facility acquisitions. His prior experience also includes working in the Office of the Executive Counsel to the Governor of Georgia and as a member of the University of Georgia's Athletic Association Board of Directors. Scates holds undergraduate and law degrees from the University of Georgia.

Conference Call
Global Healthcare REIT will host a conference call tomorrow to discuss the fourth quarter of 2014, followed by a question and answer period.

Date: Wednesday, April 1, 2015
Time: 10:00 a.m. Eastern time (7:00 a.m. Pacific time)
Dial-In number: 1-888-523-1228
International: 1-719-325-2315
Conference ID: 6073989
Webcast: http://public.viavid.com/index.php?id=113672

Please call the conference telephone number five minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Liolios Group at 1-949-574-3860.

A replay of the call will be available after 1:00 p.m. Eastern time on the same day through April 8, 2015.

Toll-free replay number: 1-877-870-5176
International replay number: 1-858-384-5517
Replay ID: 6073989

Summary of Property Portfolio

ALF = Assisted Living Facility      SNF = Skilled Nursing Facility      ILF = Independent Living Facility

                             
Property Name   Property Count   Facility Type   Beds/Units   Gross Annual Rent   Membership Interest   Location   Date Acquired
Middle Georgia   1   SNF   100 beds   $570,000   88%   Eastman, GA   3-15-2013
Warrenton   1   SNF   110 beds   $334,448   95%   Warrenton, GA   12-31-2013
        SNF   106 beds   $420,000            
Southern Hills     ILF   86 units   Under renovations   100%   Tulsa, OK   2-7-2014 
        ALF   32 beds   $240,000            
Goodwill   1   SNF   152 beds   $734,400   90%   Macon, GA   5-19-2014
Edwards Redeemer   1   SNF   106 beds   $540,000   100%   Oklahoma City, OK   9-16-2014
Golden Years Manor   1   SNF   141 beds   $763,000   78%   Lonoke, AK   9-16-2014
Sparta   1   SNF   71 beds   $237,372   83%   Sparta, GA   9-16-2014
Greene Point   1   SNF   71 beds   $254,220   100%   Union Point, GA   9-16-2014
Meadowview   1   SNF   90 beds   $361,000   100%   Seville, OH   9-30-2014
Total   9   11   1,065   $4.5 Million            
                             

About Global Healthcare REIT
Global Healthcare REIT recently completed a reverse acquisition with Global Casinos, Inc. to acquire real estate properties primarily engaged in the healthcare industry, including skilled nursing homes, medical offices, hospitals and emergency care facilities. It intends to make a tax election in the future to take advantage of the tax incentives available to real estate investment trusts. As a REIT, the Company will not operate its healthcare facilities but rather will lease its properties under long term operating leases. It currently owns interest in 11 facilities and plans on acquiring more properties in the future. For further information, visit www.gbcsreit.com.

Forward-looking Statements
This press release may contain projection and other forward-looking statements. Any such statement reflects the Company's current views with respect to future events and financial performance. No assurances can be given, however, that these events will occur and actual results could differ materially from those presented. A discussion of important factors that could cause actual results to differ from those presented is included in the Company's periodic reports filed with the Securities and Exchange Commission (at http://www.sec.gov).

   
GLOBAL HEALTHCARE REIT, INC.  
CONSOLIDATED BALANCE SHEETS  
   
 
 
  December 31, 2014 (unaudited)     December 31,
2013
 
ASSETS                   
Property and Equipment, net   $ 40,259,357     $ 8,088,600  
Cash and Cash Equivalents     533,597       1,180,192  
Advances to Related Parties     353,211       485,300  
Restricted Cash     904,157       307,638  
Notes Receivable - Related Parties, net of discount     1,186,822       600,148  
Prepaid Expenses, Deferred Loan Costs, and Other     1,490,634       139,673  
Goodwill     1,750,454       1,750,454  
  Total Assets   $ 46,478,232     $ 12,552,005  
LIABILITIES AND EQUITY                   
Liabilities                
Debt, net   $ 37,610,874     $ 7,332,756  
Accounts Payable and Accrued Liabilities     268,942       295,432  
Advances from Related Parties             7,345  
Lease Security Deposit     176,667       25,000  
    Total Liabilities     38,056,483       7,660,533  
Commitments and Contingencies                
Equity                
Stockholders' Equity                
    Preferred Stock:                
      Series A - No Dividends, $2.00 Stated Value, Non-Voting; 2,000,000 Shares Authorized, 200,500 Shares Issued and Outstanding     401,000       401,000  
                       
      Series D - 8% Cumulative, Convertible, $1.00 Stated Value, Non-Voting; 1,000,000 Shares Authorized, 375,000 and 700,000 Shares Issued and Outstanding at December 31, 2014 and December 31, 2013, respectively                
  375,000       700,000  
                 
  Common Stock - $0.05 Par Value; 50,000,000 Shares Authorized, 21,640,051 and 14,556,115 Shares Issued and Outstanding at December 31, 2014 and December 31, 2013, respectively     1,082,003       727,807  
  Common Stock Subscribed but Not Issued             106,500  
  Additional Paid-In Capital     8,540,520       3,768,764  
  Retained Earnings (Accumulated Deficit)     212,573       (687,057 )
      Total Global Healthcare REIT, Inc. Stockholders' Equity     10,611,096       5,017,014  
  Noncontrolling Interests     (2,189,347 )     (125,542 )
    Total Equity     8,421,749       4,891,472  
    Total Liabilities and Equity   $ 46,748,232     $ 12,552,005  
   
   
   
GLOBAL HEALTHCARE REIT, INC.  
CONSOLIDATED STATEMENTS OF OPERATIONS  
   
 
 
 
 
 
 
Year Ended December 31, 2014 (unaudited)     March 13, 2013 (date of inception) to December 31, 2013  
Revenue                
  Rental Revenue   $ 1,853,809     $ 443,333  
Expenses                
  General and Administrative     809,356       330,747  
  Acquisition Costs     250,909       173,743  
  Bad Debt     440,219       108,182  
  Depreciation     624,311       153,847  
    Total Expenses     2,124,795       766,519  
Income (Loss) from Operations     (270,986 )     (323,186 )
Other (Income) Expense                
  Bargain Purchase Gain     (3,000,000 )     -  
  Loss on Sale of Property and Equipment     381,395       -  
  Interest Income     (91,373 )     -  
    Interest Expense     968,613       423,302  
      Total Other (Income) Expense     (1,741,365 )     423,302  
Equity in Loss from Unconsolidated Partnership     (23,292 )     -  
Net Income (Loss)     1,447,087       (746,488 )
  Net (Income) Loss Attributable to Noncontrolling Interests     (89,940 )     102,403  
Net Income (Loss) Attributable to Global Healthcare REIT, Inc.     1,357,147       (644,085 )
  Series D Preferred Dividends     (42,904 )     (60,089 )
Net Income (Loss) Attributable to Common Stockholders   $ 1,314,243     $ (704,174 )
Per Share Data:                
  Net Income (Loss) per Share Attributable to Common Stockholders -                
    Basic   $ 0.07     $ (0.09 )
    Diluted   $ 0.06     $ (0.09 )
Weighted Average Common Shares Outstanding:                
    Basic     19,456,590       8,240,492  
    Diluted     22,002,036       8,240,492  
                     

Contact Information

  • Company Contact:
    Ryan Scates, Executive Vice President
    Global Healthcare REIT, Inc.
    Tel 404-781-2852
    Email Contact

    Investor Relations Contact:
    Ron Both
    Liolios Group, Inc.
    Tel 949-574-3860
    Email Contact