Ventas Reports 13 Percent Increase in 2012 Normalized FFO to $3.80 Per Diluted Share

  Ventas Reports 13 Percent Increase in 2012 Normalized FFO to $3.80 Per
  Diluted Share

                     Company Generates Record Cash Flows

     Eight Percent Increase in First Quarter Dividend to $0.67 Per Share

 Guidance for 2013 Normalized FFO Per Diluted Share Ranges Between $3.99 and
                                    $4.07

Business Wire

CHICAGO -- February 15, 2013

Ventas, Inc. (NYSE: VTR) (“Ventas” or the “Company”) said today that
normalized Funds From Operations (“FFO”) for the year ended December 31, 2012
increased 44 percent to $1.1 billion, from $777.0 million for the comparable
2011 period. Normalized FFO per diluted common share was $3.80 for the year
ended December 31, 2012, a 13 percent increase from $3.37 for the comparable
2011 period. Weighted average diluted shares outstanding for the full year
rose by 28 percent to 294.5 million, compared to 230.8 million in 2011.

The substantial growth in 2012 normalized FFO per diluted common share
compared to 2011 is due primarily to the Company's $2.7 billion of investments
in 2012 and the full-year benefit of the Company's 2011 acquisitions,
including Nationwide Health Properties, Inc. (“NHP”) and the portfolio of
senior living communities managed by Atria Senior Living, Inc. (“Atria”).
Additionally, the Company benefited from excellent performance by its seniors
housing communities managed by Atria and Sunrise Senior Living, LLC
(“Sunrise”), rental increases from its triple-net lease portfolio and lower
weighted average interest rates. These benefits were partially offset by
higher debt balances, an increase in the Sunrise management fee, increases in
general and administrative expenses, asset sales and loan repayments in 2011
and 2012 and an increase in weighted average diluted shares outstanding.

“Ventas had another outstanding year of internal and external growth,
execution of our long-term strategy and performance, delivering over 22
percent total returns to shareholders and producing record cash flows,” Ventas
Chairman and Chief Executive Officer Debra A. Cafaro said. “Working
collaboratively, our team harnessed the power of our scale and platform to
make $2.7 billion in accretive private pay investments, raise capital
efficiently and manage our assets to drive strong growth in 2012. For more
than a dozen years, Ventas has fulfilled its commitments with consistent
superior performance and a strong financial profile, sustaining excellence
throughout our Company,” she added.

Normalized FFO for the year ended December 31, 2012 excludes the net expense
(totaling $95.7 million, or $0.32 per diluted share) from merger-related
expenses and deal costs (including integration costs), loss on extinguishment
of debt and amortization of other intangibles, partially offset by income tax
benefit. Normalized FFO for the year ended December 31, 2011 excluded the net
benefit (totaling $47.9 million, or $0.21 per diluted share) from net
litigation proceeds and income tax benefit, partially offset by merger-related
expenses and deal costs (including integration costs), loss on extinguishment
of debt, amortization of other intangibles and mark-to-market adjustment for
derivatives.

Net income attributable to common stockholders for the year ended December 31,
2012 was $362.8 million, or $1.23 per diluted common share, including
discontinued operations of $57.2 million. Net income attributable to common
stockholders for the year ended December 31, 2011 was $364.5 million, or $1.58
per diluted common share, including discontinued operations of $1.4 million.
This $1.7 million decrease in net income attributable to common stockholders
in 2012 over the prior year is primarily the result of the receipt of net
litigation proceeds totaling $202.3 million from HCP, Inc. (the “Litigation
Proceeds”) in 2011 and higher depreciation in 2012, almost entirely offset by
the growth experienced by the Company in 2012 and 2011, as described above.
Excluding the Litigation Proceeds from 2011 results, 2012 net income
attributable to common stockholders rose by 124 percent, or 76 percent per
diluted share. The Company recognized a net gain of $97.6 million during 2012
from real estate activity, which gain is excluded from both normalized FFO and
NAREIT FFO (as defined below).

FFO, as defined by the National Association of Real Estate Investment Trusts
(“NAREIT”), for the year ended December 31, 2012 increased 24 percent to $1.0
billion, from $824.9 million in the comparable 2011 period. This increase is
due primarily to the factors described above for net income excluding the net
impact of gains from real estate activity and depreciation.

NAREIT FFO per diluted common share for the year ended December 31, 2012
decreased 2.5 percent to $3.48, from $3.57 in 2011, due principally to the
receipt of the Litigation Proceeds in 2011 and higher weighted average diluted
shares outstanding in 2012. Excluding the Litigation Proceeds from 2011
results, 2012 FFO rose by 65 percent, or 29 percent per diluted share.

FOURTH QUARTER 2012

Fourth quarter 2012 normalized FFO increased 13 percent to $293.6 million,
from $259.3 million for the comparable 2011 period. Normalized FFO per diluted
common share was $0.99 for the quarter ended December 31, 2012, an increase of
11 percent from $0.89 for the comparable 2011 period. Weighted average diluted
shares outstanding for the fourth quarter rose by two percent to 297.1
million, compared to 290.6 million in 2011.

Net income attributable to common stockholders for the quarter ended December
31, 2012 was $86.3 million, or $0.29 per diluted common share, including
expense associated with discontinued operations of $11.7 million, compared
with net income attributable to common stockholders for the quarter ended
December 31, 2011 of $192.9 million, or $0.66 per diluted common share,
including expense associated with discontinued operations of $0.6 million and
the Litigation Proceeds of $116.9 million received in the fourth quarter of
2011.

NAREIT FFO for the quarter ended December 31, 2012 was $284.0 million, a
decrease from $359.1 million in the comparable 2011 period. NAREIT FFO per
diluted common share for the quarter ended December 31, 2012 decreased 23
percent to $0.96, from $1.24 in 2011. This decrease is primarily due to the
receipt of $116.9 million in Litigation Proceeds in the fourth quarter of 2011
and higher weighted average diluted shares outstanding in 2012.

FIRST QUARTER DIVIDEND INCREASES EIGHT PERCENT TO $0.67 PER COMMON SHARE

Ventas also said today that its Board of Directors increased the Company's
first quarter 2013 dividend by eight percent to $0.67 per share. The dividend
is payable in cash on March 28, 2013 to stockholders of record on March 8,
2013.

“Sustained dividend growth is an important part of the consistent superior
total returns we aim to provide our investors. We are pleased to increase our
first quarter dividend by eight percent, which reflects our strong cash flow
growth and our confidence in our business and our opportunities,” Cafaro said.

PRIVATE PAY SENIORS HOUSING OPERATING PORTFOLIO

Annual Total Portfolio NOI Exceeds $386 Million, Quarterly Same-Store NOI
Grows 6.2 Percent and Occupancy Rises 360 Basis Points

At December 31, 2012, the Company's seniors housing operating portfolio
included 125 private pay seniors housing communities managed by Atria and 95
private pay seniors housing communities managed by Sunrise. Net Operating
Income (“NOI”) for this portfolio totaled $386.6 million after management fees
and $455.8 million before management fees, including discontinued operations
and recent acquisitions. Excluding results from seniors housing communities
acquired in December and, therefore, not in the Company's previous NOI
guidance of $383 million to $385 million, NOI for 2012 totaled $386.2 million.

One hundred ninety-four of these private pay seniors housing communities were
owned by the Company for the full fourth quarters of 2012 and 2011
(“same-store”). Average unit occupancy in the same-store communities rose 360
basis points to 91.9 percent in the fourth quarter of 2012 compared to the
fourth quarter of 2011.

NOI before management fees for these same-store communities increased 6.2
percent to $107.3 million in the fourth quarter of 2012, versus $101.0 million
in the fourth quarter of 2011. Same-store NOI after management fees increased
by 2.1 percent, from $88.8 million in the fourth quarter of 2011 to $90.6
million in the fourth quarter of 2012. The Sunrise management fee increased in
2012 to its contractual level.

2012 RECAP

Investments and Dispositions

  *Ventas closed $2.7 billion in investments during 2012, including Cogdell
    Spencer, Inc. and 16 private pay seniors housing communities managed by
    Sunrise. Excluding the Atria transaction described below, the current
    unlevered cash yield on these investments approximates eight percent.
    Private pay assets accounted for 97 percent of the investments. Fourth
    quarter investments totaling $1 billion included seniors housing assets,
    medical office buildings and secured loans.
  *Ventas acquired 100 percent of various private investment funds (the
    “Funds”) previously managed by Lazard Frères Real Estate Investors LLC or
    its affiliates. The acquired Funds now own, among other things, (a) a 34
    percent interest in Atria and (b) 3.7 million shares of Ventas common
    stock. The total purchase price for these interests was approximately $242
    million. The Atria management team now owns the remaining 66 percent of
    Atria. Ventas also extinguished its obligation related to the “Earnout,” a
    contingent performance-based payment, for an additional $44 million, which
    represented the discounted net present value of the Earnout on the
    Company's balance sheet.
  *During 2012, Ventas sold 43 properties and received final repayment on
    loans totaling $422 million in aggregate proceeds, including certain fees.
    The Company recognized a net gain of $81.0 million from these
    dispositions. In the fourth quarter, Ventas sold assets and received final
    repayment on loans totaling $120 million in aggregate proceeds and
    recognized a net gain.

Returns and Dividends

  *Ventas delivered total shareholder return (“TSR”) of 22.3 percent in 2012
    and 25.1 percent compound annual TSR for the ten-year period ended
    December 31, 2012. Ventas TSR exceeded the RMS and S&P 500 Index in each
    of the trailing one-, three-, five- and ten-year periods.
  *Ventas paid an annual per share dividend of $2.48 in 2012, an eight
    percent increase over the prior year.

Liquidity, Capital Raising, Ratings and Balance Sheet

  *Ventas maintains investment grade ratings from all three nationally
    recognized rating agencies, and Moody's improved its outlook to “positive”
    in December 2012. Ventas's senior unsecured debt is currently rated BBB+
    (stable) by Fitch, Baa2 (positive) by Moody's and BBB (stable) by Standard
    & Poor's.
  *Ventas issued and sold $2.6 billion aggregate principal amount of senior
    notes and term loan at a weighted average stated interest rate of 3.2
    percent and a weighted average maturity at the time of issuance of 7.7
    years and redeemed or repaid $780.4 million aggregate principal amount of
    its outstanding unsecured debt and $344.2 million of mortgage debt. The
    $2.6 billion includes the previously announced $700 million aggregate
    principal amount of 2.00 percent senior notes due 2018 and the $225
    million aggregate principal amount of 3.25 percent senior notes due 2022
    the Company issued in December 2012.
  *Ventas sold approximately 6 million shares of its common stock in an
    underwritten public offering and received proceeds of $342.5 million and
    ended the year with 291.9 million shares outstanding.
  *The Company's debt to total capitalization at December 31, 2012 was
    approximately 31 percent.
  *The Company's net debt to Adjusted Pro Forma EBITDA (as defined herein) at
    December 31, 2012 was 5.4x.
  *At December 31, 2012, the Company had $541 million of borrowings
    outstanding under its unsecured revolving credit facility and $68 million
    of cash and cash equivalents.

Cash Flow Growth

  *Cash flows from operations totaled $992.8 million in 2012, an increase of
    74 percent over the prior year, excluding the $202.3 million of Litigation
    Proceeds received in 2011. The Company generated approximately $195
    million in cash flows from operations in 2012 after recurring capital
    expenditures and dividends. Weighted average diluted shares outstanding
    rose 28 percent year over year.
  *“Same-store” cash NOI growth for the Company's total portfolio (525
    assets) was 4.4 percent in 2012 compared to 2011, excluding the Sunrise
    management fee in both periods.

PORTFOLIO, UPDATE ON RE-LEASING & ADDITIONAL INFORMATION

  *Ventas has now entered into lease renewals, new leases or sale contracts
    for all 89 licensed healthcare facilities currently leased by Kindred
    Healthcare, Inc. (NYSE: KND) (“Kindred”) whose lease term was up for
    renewal May 1, 2013. The Company expects 2013 cash revenue and NOI from
    these 89 assets to be $125 million, compared to 2012 rent for all 89
    facilities of $125 million, consistent with Ventas's expectations. Of the
    54 properties marketed by Ventas, 49 properties have been leased to seven
    qualified skilled nursing facility operators, and five assets are under
    contract for sale. Kindred has renewed or entered into a new lease for 35
    properties. While definitive agreements have been executed for all 54
    marketed properties and Ventas expects all transactions to be completed,
    and for operating transitions to occur, during the first half of 2013,
    these transactions and operating transitions remain subject to normal
    closing conditions, including regulatory approval. Accordingly, there can
    be no assurance that the transactions will be completed, that the expected
    operating transitions will occur or that projected revenue and/or NOI will
    be achieved by the Company. More information on these 2013 renewal assets
    is contained at www.ventasreit.com/investor-relations.
  *The 196 skilled nursing facilities (“SNFs”) and long-term acute care
    hospitals (“LTACs”) master leased by the Company to Kindred produced
    EBITDARM (earnings before interest, taxes, depreciation, amortization,
    rent and management fees) to actual cash rent coverage of 1.9x for the
    trailing 12-month period ended September 30, 2012 (the latest date
    available).
  *Supplemental information regarding the Company can be found on the
    Company's website under the “Investor Relations” section or at
    www.ventasreit.com/investor-relations/financial-information/supplemental-information.

VENTAS ISSUES 2013 NORMALIZED FFO PER DILUTED SHARE GUIDANCE OF $3.99 TO $4.07

Ventas currently expects its 2013 normalized FFO per diluted share, excluding
the impact of unannounced acquisitions, divestitures and capital transactions,
to range between $3.99 and $4.07. The Company now expects 2013 NOI for its
total Atria- and Sunrise-managed seniors housing operating portfolio to be
between $430 million and $440 million, representing approximately five to
eight percent same-store NOI growth.

The Company's guidance assumes first quarter investments approximating $100
million and dispositions and loan repayments approximating $300 million during
the year. In addition, the guidance assumes $400 million of debt issuance.

Excluding non-cash items from normalized FFO (projected to be $0.12 per
diluted share), computed consistent with prior periods, the midpoint of the
Company's guidance range constitutes approximately nine percent per share
growth in 2013. A reconciliation of the Company's guidance, and the non-cash
items, to the Company's projected GAAP earnings is attached to this press
release at page 12.

The Company's normalized FFO guidance (and related GAAP earnings projections)
for all periods assumes, with certain immaterial exceptions, that all of the
Company's tenants and borrowers continue to meet all of their obligations to
the Company. In addition, the Company's normalized FFO guidance excludes,
other than as specifically stated, (a) net gains on the sales of real property
assets, including gain on re-measurement of equity method investments, (b)
merger-related costs and expenses, including amortization of intangibles and
transition and integration expenses, and deal costs and expenses, (c) the
impact of any expenses related to asset impairment and valuation allowances,
the write-off of unamortized deferred financing fees, or additional costs,
expenses, discounts, make-whole payments, penalties or premiums incurred as a
result of early retirement or payment of the Company's debt, (d) the non-cash
effect of income tax benefits or expenses and derivative transactions that
have non-cash mark-to-market impacts on the Company's income statement, and
(e) the impact of future unannounced acquisitions or divestitures (including
pursuant to tenant options to purchase) and capital transactions.

The Company's guidance is based on a number of other assumptions that are
subject to change and many of which are outside the control of the Company. If
actual results vary from these assumptions, the Company's expectations may
change. There can be no assurance that the Company will achieve these results.
The Company may from time to time update its publicly announced guidance, but
it is not obligated to do so.

FOURTH QUARTER CONFERENCE CALL

Ventas will hold a conference call to discuss this earnings release today at
10:00 a.m. Eastern Time (9:00 a.m. Central Time). The dial-in number for the
conference call is (617) 597-5380. The participant passcode is “Ventas.” The
conference call is being webcast live by Thomson Reuters and can be accessed
at the Company's website at www.ventasreit.com or www.earnings.com. A replay
of the webcast will be available today online, or by calling (617) 801-6888,
passcode 18439203, beginning at approximately 12:00 p.m. Eastern Time and will
be archived for 28 days.

Ventas, Inc., an S&P 500 company, is a leading healthcare real estate
investment trust. Its diverse portfolio of more than 1,400 assets in 47 states
(including the District of Columbia) and two Canadian provinces consists of
seniors housing communities, skilled nursing facilities, hospitals, medical
office buildings and other properties. Through its Lillibridge subsidiary,
Ventas provides management, leasing, marketing, facility development and
advisory services to highly rated hospitals and health systems throughout the
United States. More information about Ventas and Lillibridge can be found at
www.ventasreit.com and www.lillibridge.com.

This press release includes forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements regarding the
Company's or its tenants', operators', managers' or borrowers' expected future
financial condition, results of operations, cash flows, funds from operations,
dividends and dividend plans, financing opportunities and plans, capital
markets transactions, business strategy, budgets, projected costs, operating
metrics, capital expenditures, competitive positions, acquisitions, investment
opportunities, dispositions, merger integration, growth opportunities,
expected lease income, continued qualification as a real estate investment
trust (“REIT”), plans and objectives of management for future operations and
statements that include words such as “anticipate,” “if,” “believe,” “plan,”
“estimate,” “expect,” “intend,” “may,” “could,” “should,” “will” and other
similar expressions are forward-looking statements. These forward-looking
statements are inherently uncertain, and actual results may differ from the
Company's expectations. The Company does not undertake a duty to update these
forward-looking statements, which speak only as of the date on which they are
made.

The Company's actual future results and trends may differ materially from
expectations depending on a variety of factors discussed in the Company's
filings with the Securities and Exchange Commission. These factors include
without limitation: (a) the ability and willingness of the Company's tenants,
operators, borrowers, managers and other third parties to satisfy their
obligations under their respective contractual arrangements with the Company,
including, in some cases, their obligations to indemnify, defend and hold
harmless the Company from and against various claims, litigation and
liabilities; (b) the ability of the Company's tenants, operators, borrowers
and managers to maintain the financial strength and liquidity necessary to
satisfy their respective obligations and liabilities to third parties,
including without limitation obligations under their existing credit
facilities and other indebtedness; (c) the Company's success in implementing
its business strategy and the Company's ability to identify, underwrite,
finance, consummate and integrate diversifying acquisitions and investments,
including investments in different asset types and outside the United States;
(d) macroeconomic conditions such as a disruption of or lack of access to the
capital markets, changes in the debt rating on U.S. government securities,
default or delay in payment by the United States of its obligations, and
changes in the federal budget resulting in the reduction or nonpayment of
Medicare or Medicaid reimbursement rates; (e) the nature and extent of future
competition; (f) the extent of future or pending healthcare reform and
regulation, including cost containment measures and changes in reimbursement
policies, procedures and rates; (g) increases in the Company's borrowing costs
as a result of changes in interest rates and other factors; (h) the ability of
the Company's operators and managers, as applicable, to comply with laws,
rules and regulations in the operation of the Company's properties, to deliver
high quality services, to attract and retain qualified personnel and to
attract residents and patients; (i) changes in general economic conditions or
economic conditions in the markets in which the Company may, from time to
time, compete, and the effect of those changes on the Company's revenues,
earnings and funding sources; (j) the Company's ability to pay down,
refinance, restructure or extend its indebtedness as it becomes due; (k) the
Company's ability and willingness to maintain its qualification as a REIT due
to economic, market, legal, tax or other considerations; (l) final
determination of the Company's taxable net income for the year ended December
31, 2012 and the year ending December 31, 2013; (m) the ability and
willingness of the Company's tenants to renew their leases with the Company
upon expiration of the leases, the Company's ability to reposition its
properties on the same or better terms in the event of nonrenewal or in the
event the Company exercises its right to replace an existing tenant, and
obligations, including indemnification obligations, the Company may incur in
connection with the replacement of an existing tenant; (n) risks associated
with the Company's senior living operating portfolio, such as factors that can
cause volatility in the Company's operating income and earnings generated by
those properties, including without limitation national and regional economic
conditions, costs of food, materials, energy, labor and services, employee
benefit costs, insurance costs and professional and general liability claims,
and the timely delivery of accurate property-level financial results for those
properties; (o) changes in U.S. and Canadian currency exchange rates; (p)
year-over-year changes in the Consumer Price Index and the effect of those
changes on the rent escalators contained in the Company's leases, including
the rent escalators for two of the Company's master lease agreements with
Kindred, and the Company's earnings; (q) the Company's ability and the ability
of its tenants, operators, borrowers and managers to obtain and maintain
adequate property, liability and other insurance from reputable, financially
stable providers; (r) the impact of increased operating costs and uninsured
professional liability claims on the liquidity, financial condition and
results of operations of the Company's tenants, operators, borrowers and
managers, and the ability of the Company's tenants, operators, borrowers and
managers to accurately estimate the magnitude of those claims; (s) risks
associated with the Company's MOB portfolio and operations, including the
Company's ability to successfully design, develop and manage MOBs, to
accurately estimate its costs in fixed fee-for-service projects and to retain
key personnel; (t) the ability of the hospitals on or near whose campuses the
Company's MOBs are located and their affiliated health systems to remain
competitive and financially viable and to attract physicians and physician
groups; (u) the Company's ability to build, maintain and expand its
relationships with existing and prospective hospital and health system
clients; (v) risks associated with the Company's investments in joint ventures
and unconsolidated entities, including its lack of sole decision-making
authority and its reliance on its joint venture partners' financial condition;
(w) the impact of market or issuer events on the liquidity or value of the
Company's investments in marketable securities; (x) merger and acquisition
activity in the healthcare industry resulting in a change of control of one or
more of our tenants, operators, borrowers or managers or significant changes
in the senior management of our tenants, operators, borrowers or managers; and
(y) the impact of litigation or any financial, accounting, legal or regulatory
issues that may affect the Company or its tenants, operators, borrowers or
managers. Many of these factors are beyond the control of the Company and its
management.


CONSOLIDATED BALANCE SHEETS
As of December 31, 2012, September 30, 2012, June 30, 2012, March 31, 2012 and December 31, 2011
(In thousands, except per share amounts)
                                                                               
                 December 31,     September 30,    June 30,         March 31,        December 31,
                 2012             2012             2012             2012             2011
Assets
Real estate
investments:
Land and         $ 1,772,417      $ 1,754,826      $ 1,744,752      $ 1,616,947      $ 1,614,847
improvements
Buildings and    16,920,821       16,552,534       16,181,392       15,329,730       15,337,919
improvements
Construction     70,665           93,992           133,890          85,418           76,638
in progress
Acquired lease   981,704         965,500         920,116         799,136         800,858      
intangibles
                 19,745,607       19,366,852       18,980,150       17,831,231       17,830,262
Accumulated
depreciation     (2,634,075   )   (2,447,175   )   (2,256,197   )   (2,084,212   )   (1,916,530   )
and
amortization
Net real
estate           17,111,532       16,919,677       16,723,953       15,747,019       15,913,732
property
Secured loans
receivable,      635,002          215,775          213,193          222,218          212,577
net
Investments in
unconsolidated   95,409          90,992          104,636         106,086         105,303      
entities
Net real
estate           17,841,943       17,226,444       17,041,782       16,075,323       16,231,612
investments
Cash and cash    67,908           58,530           52,803           53,224           45,807
equivalents
Escrow
deposits and     105,913          76,908           114,883          114,420          76,590
restricted
cash
Deferred
financing        42,551           25,426           25,750           26,601           26,669
costs, net
Other assets     921,685         1,053,591       987,043         919,391         891,232      
Total assets     $ 18,980,000    $ 18,440,899    $ 18,222,261    $ 17,188,959    $ 17,271,910 
                                                                                     
Liabilities
and equity
Liabilities:
Senior notes
payable and      $ 8,413,646      $ 7,494,774      $ 7,204,727      $ 6,430,364      $ 6,429,116
other debt
Accrued          47,565           56,326           47,842           58,041           37,694
interest
Accounts
payable and      995,156          1,049,043        1,059,385        1,060,647        1,085,597
other
liabilities
Deferred         259,715         265,116         271,066         271,408         260,722      
income taxes
Total            9,716,082        8,865,259        8,583,020        7,820,460        7,813,129
liabilities
                                                                                     
Redeemable OP
unitholder and   174,555          113,908          116,635          106,264          102,837
noncontrolling
interests
                                                                                     
Commitments
and
contingencies
                                                                                     
Equity:
Ventas
stockholders'
equity:
Preferred
stock, $1.00
par value;       —                —                —                —                —
10,000 shares
authorized,
unissued
Common stock,
$0.25 par
value;
295,565,
295,534,
295,370,
289,027, and
288,823 shares
issued at        73,904           73,896           73,855           72,273           72,240
December 31,
2012,
September 30,
2012, June 30,
2012, March
31, 2012 and
December 31,
2011,
respectively
Capital in
excess of par    9,920,962        9,941,030        9,932,839        9,591,880        9,593,583
value
Accumulated
other            23,354           23,626           21,404           23,926           22,062
comprehensive
income
Retained
earnings         (777,927     )   (680,888     )   (609,487     )   (500,808     )   (412,181     )
(deficit)
Treasury
stock, 3,699,
0, 0, 10 and
14 shares at
December 31,
2012,
September 30,    (221,165     )   —               —               (536         )   (747         )
2012, June 30,
2012, March
31, 2012 and
December 31,
2011,
respectively
Total Ventas
stockholders'    9,019,128        9,357,664        9,418,611        9,186,735        9,274,957
equity
Noncontrolling   70,235          104,068         103,995         75,500          80,987       
interest
Total equity     9,089,363       9,461,732       9,522,606       9,262,235       9,355,944    
Total
liabilities      $ 18,980,000    $ 18,440,899    $ 18,222,261    $ 17,188,959    $ 17,271,910 
and equity
                                                                                                  


CONSOLIDATED STATEMENTS OF INCOME
For the three months and years ended December 31, 2012 and 2011
(In thousands, except per share amounts)
                                                              
                         For the Three Months        For the Years
                         Ended December 31,          Ended December 31,
                                                                   
                         2012          2011          2012          2011
Revenues:
Rental income:
Triple-net leased        $ 209,922     $ 204,169     $ 831,221     $ 637,294
Medical office           108,951      60,008       362,839      166,161   
buildings
                         318,873       264,177       1,194,060     803,455
Resident fees and        322,533       277,992       1,229,479     868,095
services
Medical office
building and other       3,950         10,421        20,741        36,471
services revenue
Income from loans and    14,690        9,867         39,913        34,415
investments
Interest and other       665          688          1,106        1,217     
income
Total revenues           660,711       563,145       2,485,299     1,743,653
                                                                   
Expenses:
Interest                 76,700        67,443        293,401       229,346
Depreciation and         187,754       161,439       725,981       447,664
amortization
Property-level
operating expenses:
Senior living            223,115       188,790       843,190       590,151
Medical office           39,684       20,018       126,152      57,042    
buildings
                         262,799       208,808       969,342       647,193
Medical office
building services        1,569         7,245         9,883         27,082
costs
General,
administrative and       23,022        23,527        98,801        74,537
professional fees
(Gain) loss on
extinguishment of        (699      )   2,393         37,640        27,604
debt, net
Litigation proceeds,     —             (116,932  )   —             (202,259  )
net
Merger-related
expenses and deal        13,617        22,317        63,183        153,923
costs
Other                    1,902        1,444        6,956        7,270     
Total expenses           566,664      377,684      2,205,187    1,412,360 
                                                                   
Income before
income/loss from
unconsolidated
entities, income         94,047        185,461       280,112       331,293
taxes, discontinued
operations and
noncontrolling
interest
Income (loss) from
unconsolidated           249           19            18,154        (52       )
entities
Income tax benefit       3,555        7,622        6,282        30,660    
Income from continuing   97,851        193,102       304,548       361,901
operations
Discontinued             (11,725   )   (605      )   57,227       1,360     
operations
Net income               86,126        192,497       361,775       363,261
Net loss attributable
to noncontrolling        (141      )   (451      )   (1,025    )   (1,232    )
interest
Net income
attributable to common   $ 86,267     $ 192,948    $ 362,800    $ 364,493 
stockholders
                                                                   
Earnings per common
share:
Basic:
Income from continuing
operations               $ 0.33        $ 0.67        $ 1.04        $ 1.59
attributable to common
stockholders
Discontinued             (0.04     )   (0.00     )   0.20         0.01      
operations
Net income
attributable to common   $ 0.29       $ 0.67       $ 1.24       $ 1.60    
stockholders
Diluted:
Income from continuing
operations               $ 0.33        $ 0.66        $ 1.04        $ 1.57
attributable to common
stockholders
Discontinued             (0.04     )   (0.00     )   0.19         0.01      
operations
Net income
attributable to common   $ 0.29       $ 0.66       $ 1.23       $ 1.58    
stockholders
                                                                   
Weighted average
shares used in
computing earnings per
common share:
Basic                    294,704       287,793       292,064       228,453
Diluted                  297,089       290,607       294,488       230,790
                                                                   
Dividends declared per   $ 0.62        $ 0.575       $ 2.48        $ 2.30
common share
                                                                             


QUARTERLY CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
                                                                    
                 2012 Quarters                                             2011 Fourth
                 Fourth        Third         Second        First           Quarter
                                                                           
Revenues:
Rental income:
Triple-net       $ 209,922     $ 209,666     $ 206,517     $ 205,116       $ 204,169
leased
Medical office   108,951      100,814      89,109       63,965         60,008    
buildings
                 318,873       310,480       295,626       269,081         264,177
                                                                           
Resident fees    322,533       317,131       304,020       285,795         277,992
and services
Medical office
building and     3,950         4,544         6,639         5,608           10,421
other services
revenue
Income from
loans and        14,690        9,035         8,152         8,036           9,867
investments
Interest and     665          330          65           46             688       
other income
Total revenues   660,711       641,520       614,502       568,566         563,145
                                                                           
Expenses:
Interest         76,700        74,895        73,321        68,485          67,443
Depreciation
and              187,754       189,616       187,783       160,828         161,439
amortization
Property-level
operating
expenses:
Senior living    223,115       216,861       207,548       195,666         188,790
Medical office   39,684       36,144       29,621       20,703         20,018    
buildings
                 262,799       253,005       237,169       216,369         208,808
Medical office
building         1,569         1,487         3,839         2,988           7,245
services costs
General,
administrative
and              23,022        26,872        26,709        22,198          23,527
professional
fees
(Gain) loss on
extinguishment   (699      )   (1,194    )   9,989         29,544          2,393
of debt, net
Litigation       —             —             —             —               (116,932  )
proceeds, net
Merger-related
expenses and     13,617        4,917         36,668        7,981           22,317
deal costs
Other            1,902        1,968        1,510        1,576          1,444     
Total expenses   566,664      551,566      576,988      509,969        377,684   
                                                                           
Income before
income from
unconsolidated
entities,
income taxes,    94,047        89,954        37,514        58,597          185,461
discontinued
operations and
noncontrolling
interest
Income from
unconsolidated   249           17,074        514           317             19
entities
Income tax
benefit          3,555        8,886        5,179        (11,338   )     7,622     
(expense)
Income from
continuing       97,851        115,914       43,207        47,576          193,102
operations
Discontinued     (11,725   )   (4,093    )   30,529       42,516         (605      )
operations
Net income       86,126        111,821       73,736        90,092          192,497
Net loss
attributable
to               (141      )   (61       )   (289      )   (534      )     (451      )
noncontrolling
interest
Net income
attributable     $ 86,267     $ 111,882    $ 74,025     $ 90,626       $ 192,948 
to common
stockholders
                                                                           
Earnings per
common share:
Basic:
Income from
continuing
operations       $ 0.33        $ 0.39        $ 0.15        $ 0.16          $ 0.67
attributable
to common
stockholders
Discontinued     (0.04     )   (0.01     )   0.11         0.15           (0.00     )
operations
Net income
attributable     $ 0.29       $ 0.38       $ 0.26       $ 0.31         $ 0.67    
to common
stockholders
Diluted:
Income from
continuing
operations       $ 0.33        $ 0.39        $ 0.15        $ 0.16          $ 0.66
attributable
to common
stockholders
Discontinued     (0.04     )   (0.01     )   0.10         0.15           (0.00     )
operations
Net income
attributable     $ 0.29       $ 0.38       $ 0.25       $ 0.31         $ 0.66    
to common
stockholders
                                                                           
Weighted
average shares
used in
computing
earnings per
common share:
Basic            294,704       294,928       290,170       288,375         287,793
Diluted          297,089       297,407       292,592       290,813         290,607
                                                                                     


CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended December 31, 2012 and 2011
(In thousands)
                                             2012           2011
                                                                
Cash flows from operating activities:
Net income                                     $  361,775       $ 363,261
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization (including       764,775          459,704
amounts in discontinued operations)
Amortization of deferred revenue and lease     (17,118    )     (12,159      )
intangibles, net
Other non-cash amortization                    (39,943    )     (13,163      )
Change in fair value of financial              99               2,959
instruments
Stock-based compensation                       20,784           19,346
Straight-lining of rental income, net          (24,042    )     (14,885      )
Loss on extinguishment of debt, net            37,640           27,604
Gain on real estate dispositions, net
(including amounts in discontinued             (80,952    )     —
operations)
Gain on real estate loan investments           (5,230     )     (3,255       )
Gain on sale of marketable securities          —                (733         )
Income tax benefit (including amounts in       (6,286     )     (31,137      )
discontinued operations)
(Income) loss from unconsolidated entities     (1,509     )     52
Gain on re-measurement of equity interest      (16,645    )     —
upon acquisition, net
Other                                          10,315           4,446
Changes in operating assets and
liabilities:
Decrease in other assets                       3,756            424
Increase (decrease) in accrued interest        9,969            (9,150       )
Decrease in accounts payable and other         (24,572    )     (20,117      )
liabilities
Net cash provided by operating activities      992,816          773,197
Cash flows from investing activities:
Net investment in real estate                  (1,453,065 )     (531,605     )
Purchase of private investment funds           (276,419   )     —
Purchase of noncontrolling interest            (3,934     )     (3,319       )
Investment in loans receivable                 (452,558   )     (628,133     )
Proceeds from real estate disposals            149,045          20,618
Proceeds from loans receivable                 43,219           220,179
Proceeds from sale or maturity of              37,500           23,050
marketable securities
Funds held in escrow for future                (28,050    )     —
development expenditures
Development project expenditures               (114,002   )     (47,591      )
Capital expenditures                           (69,430    )     (50,473      )
Other                                          (1,995     )     (165         )
Net cash used in investing activities          (2,169,689 )     (997,439     )
Cash flows from financing activities:
Net change in borrowings under revolving       84,938           537,452
credit facilities
Proceeds from debt                             2,710,405        1,343,640
Repayment of debt                              (1,193,023 )     (1,388,962   )
Payment of deferred financing costs            (23,770    )     (20,040      )
Issuance of common stock, net                  342,469          299,847
Cash distribution to common stockholders       (728,546   )     (521,046     )
Cash distribution to redeemable OP             (4,446     )     (2,359       )
unitholders
Purchases of redeemable OP units               (4,601     )     (185         )
Distributions to noncontrolling interest       (5,215     )     (2,556       )
Other                                          20,703          2,491        
Net cash provided by financing activities      1,198,914       248,282      
Net increase in cash and cash equivalents      22,041           24,040
Effect of foreign currency translation on      60               (45          )
cash and cash equivalents
Cash and cash equivalents at beginning of      45,807          21,812       
period
Cash and cash equivalents at end of period     $  67,908       $ 45,807     
                                                                
Supplemental schedule of non-cash
activities:
Assets and liabilities assumed from
acquisitions:
Real estate investments                        $  582,694       $ 10,973,093
Utilization of funds held for an Internal      (134,003   )     —
Revenue Code Section 1031 exchange
Other assets acquired                          77,730           594,176
Debt assumed                                   412,825          3,651,089
Other liabilities                              70,391           952,279
Deferred income tax liability                  4,299            43,889
Redeemable OP unitholder interests             —                100,888
Noncontrolling interests                       34,580           81,192
Equity issued                                  4,326            6,737,932
Debt transferred on the sale of assets         14,535           —
                                                                             


QUARTERLY CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
                 2012 Quarters                                          2011 Fourth
                  Fourth       Third        Second       First          Quarter
Cash flows from
operating
activities:
Net income        $  86,126     $ 111,821     $ 73,736      $ 90,092       $ 192,497
Adjustments to
reconcile net
income to net
cash provided
by operating
activities:
Depreciation
and
amortization
(including        201,748       196,622       201,769       164,636        166,163
amounts in
discontinued
operations)
Amortization of
deferred
revenue and       (4,153    )   (4,136    )   (3,669    )   (5,160   )     (4,701    )
lease
intangibles,
net
Other non-cash    (8,617    )   (10,141   )   (11,077   )   (10,108  )     (7,734    )
amortization
Change in fair
value of          (52       )   58            60            33             61
financial
instruments
Stock-based       4,255         5,443         6,252         4,834          5,750
compensation
Straight-lining
of rental         (7,330    )   (6,242    )   (5,580    )   (4,890   )     (5,631    )
income, net
(Gain) loss on
extinguishment    (699      )   (1,194    )   9,989         29,544         2,393
of debt, net
Gain on real
estate
dispositions,
net (including    (1,804    )   (357      )   (38,558   )   (40,233  )     —
amounts in
discontinued
operations)
(Gain) loss on
real estate       (5,789    )   —             —             559            —
loan
investments
Income tax
(benefit)
expense
(including        (3,555    )   (8,870    )   (5,166    )   11,305         (7,827    )
amounts in
discontinued
operations)
Income from
unconsolidated    (249      )   (429      )   (514      )   (317     )     (19       )
entities
Gain on
re-measurement
of equity         —             (16,645   )   —             —              —
interest upon
acquisition,
net
Other             3,994         424           2,848         3,049          2,442
Changes in
operating
assets and
liabilities:
Decrease
(increase) in     15,686        (12,791   )   (414      )   1,275          27,433
other assets
(Decrease)
increase in       (8,761    )   8,471         (10,193   )   20,452         (28,291   )
accrued
interest
Increase
(decrease) in
accounts          12,697       (13,524   )   (3,635    )   (20,110  )     (13,240   )
payable and
other
liabilities
Net cash
provided by       283,497       248,510       215,848       244,961        329,296
operating
activities
Cash flows from
investing
activities:
Net investment
in real estate    (298,153  )   (255,508  )   (898,904  )   (500     )     (186,918  )
property
Purchase of
private           (276,419  )   —             —             —              —
investment
funds
Purchase of
noncontrolling    —             —             (3,934    )   —              —
interest
Investment in
loans             (422,035  )   (3,263    )   (4,787    )   (22,473  )     (8,274    )
receivable
Proceeds from
sale or
maturity of       37,500        —             —             —              —
marketable
securities
Proceeds from
real estate       73,900        66,298        —             8,847          5,657
disposals
Proceeds from
loans             8,402         1,594         15,979        17,244         81,245
receivable
Funds held in
escrow for
future            (28,050   )   —             —             —              —
development
expenditures
Development
project           (23,883   )   (29,558   )   (29,287   )   (31,274  )     (24,358   )
expenditures
Capital           (27,160   )   (18,458   )   (13,793   )   (10,019  )     (21,815   )
expenditures
Other             115          40           (13       )   (2,137   )     (52       )
Net cash used
in investing      (955,783  )   (238,855  )   (934,739  )   (40,312  )     (154,515  )
activities
Cash flows from
financing
activities:
Net change in
borrowings
under revolving   (163,983  )   337,575       293,744       (382,398 )     103,452
credit
facilities
Proceeds from     1,142,023     299,067       601,985       667,330        385,887
debt
Repayment of      (90,023   )   (457,278  )   (346,921  )   (298,801 )     (493,919  )
debt
Payment of
deferred          (19,513   )   (1,277    )   (1,187    )   (1,793   )     (18,142   )
financing costs
Issuance of
common stock,     —             —             342,469       —              (79       )
net
Cash
distribution to   (183,306  )   (183,283  )   (182,704  )   (179,253 )     (166,114  )
common
stockholders
Cash
distribution to   (1,088    )   (1,117    )   (1,129    )   (1,112   )     1,679
redeemable OP
unitholders
Purchases of
redeemable OP     (2,841    )   (1,149    )   (378      )   (233     )     (185      )
units
Distributions
to                (1,180    )   (1,128    )   (1,315    )   (1,592   )     (559      )
noncontrolling
interest
Other             1,573        4,621        13,944       565           1,472     
Net cash
provided by
(used in)         681,662      (3,969    )   718,508      (197,287 )     (186,508  )
financing
activities
Net increase
(decrease) in     9,376         5,686         (383      )   7,362          (11,727   )
cash and cash
equivalents
Effect of
foreign
currency          2             40            (37       )   55             52
translation on
cash and cash
equivalents
Cash and cash
equivalents at    58,530       52,804       53,224       45,807        57,482    
beginning of
period
Cash and cash
equivalents at    $  67,908    $ 58,530     $ 52,804     $ 53,224      $ 45,807  
end of period
                                                                           
Supplemental
schedule of
non-cash
activities:
Assets and
liabilities
assumed from
acquisitions:
Real estate       $  84,939     $ 132,872     $ 310,002     $ 54,881       $ (61,527 )
investments
Utilization of
funds held for
an Internal       —             —             (96,204   )   (37,799  )     —
Revenue Code
Section 1031
exchange
Other assets      (22,159   )   18,380        86,635        (5,126   )     162,497
acquired
Debt assumed      44,923        117,539       232,629       17,734         142,863
Other             9,707         34,045        33,628        (6,989   )     (39,843   )
liabilities
Deferred income   —             (1,596    )   5,895         —              —
tax liability
Redeemable OP
unitholder        —             —             —             —              458
interests
Noncontrolling    8,150         1,264         28,281        (3,115   )     (2,510    )
interests
Equity issued     —             —             —             4,326          2
Debt
transferred on    —             —             —             14,535         —
the sale of
assets
                                                                                     

                                                                                                                                                             
Funds From Operations (FFO) Reconciliation Including Non-Cash Items^1
                                                                                                                                         
                                                                                                                                         Tentative Estimates
                                                                                                                        Year-Over-Year   Preliminary and                 Year-Over-Year
                                                                                                                                         Subject to Change
                  2011                         2012                                                                   Growth          FY2013 - Guidance              Growth^2
                  Q4            FY            Q1           Q2           Q3           Q4           FY             '11-'12         Low            High           '12-'13E
                                                                                                                                                                         
Net income
attributable to   $ 192,948      $ 364,493      $ 90,626      $ 74,025      $ 111,882     $ 86,267      $ 362,800                        $ 389,013       $ 466,182
common
stockholders
Net income
attributable to
common            $ 0.66         $ 1.58         $ 0.31        $ 0.25        $ 0.38        $ 0.29        $ 1.23                           $ 1.32          $ 1.59
stockholders
per share
                                                                                                                                                                         
Adjustments:
Depreciation
and
amortization on     160,805        445,237        159,926       186,782       188,364       186,486       721,558                          733,848         723,848
real estate
assets
Depreciation on
real estate
assets related      (1,744   )     (3,471   )     (1,511  )     (2,336  )     (2,221  )     (2,435  )     (8,503    )                      (8,768    )     (10,768   )
to
noncontrolling
interest
Depreciation on
real estate
assets related      2,339          6,552          2,175         2,131         1,700         1,510         7,516                            5,771           4,771
to
unconsolidated
entities
Gain on
re-measurement
of equity           -              -              -             -             (16,645 )     -             (16,645   )                      -               -
interest upon
acquisition,
net
Discontinued
operations:
Gain on real
estate              -              -              (40,233 )     (38,558 )     (357    )     (1,804  )     (80,952   )                      6,783           783
dispositions,
net
Depreciation
and
amortization on    4,724       12,040      3,808      13,986     7,006      13,993     38,793                      9,431        9,431     
real estate
assets
Subtotal: Funds
From Operations     166,124        460,358        124,165       162,005       177,847       197,750       661,767                          747,065         728,065
add-backs
Subtotal: Funds
From Operations  $ 0.57       $ 1.99       $ 0.43      $ 0.55      $ 0.60      $ 0.67      $ 2.25                       $ 2.54        $ 2.48        
add-backs per
share
Funds From        $ 359,072      $ 824,851      $ 214,791     $ 236,030     $ 289,729     $ 284,017     $ 1,024,567     24      %        $ 1,136,078     $ 1,194,247     14      %
Operations
Funds From
Operations per   $ 1.23       $ 3.57       $ 0.74      $ 0.81      $ 0.97      $ 0.96      $ 3.48        (3      )%      $ 3.87        $ 4.07        14      %
share
                                                                                                                                                                         
Adjustments:
Merger-related
expenses and        22,317         153,923        7,981         36,668        4,917         13,617        63,183                           20,675          -
deal costs
Income tax
(benefit)           (7,827   )     (31,137  )     11,305        (5,166  )     (8,870  )     (3,555  )     (6,286    )                      8,500           5,500
expense
Loss (gain) on
extinguishment      2,393          27,604         29,544        9,989         (1,194  )     (699    )     37,640                           5,000           (5,000    )
of debt, net
Litigation          (116,932 )     (202,259 )     -             -             -             -             -                                -               -
proceeds, net
Change in fair
value of            61             2,959          33            60            58            (52     )     99                               -               -
financial
instruments
Amortization of
other              255         1,022       256        255        256        255        1,022                       1,522        522       
intangibles
Subtotal:
Normalized
Funds From          (99,733  )     (47,888  )     49,119        41,806        (4,833  )     9,566         95,658                           35,697          1,022
Operations
add-backs
Subtotal:
Normalized
Funds From       $ (0.34    )  $ (0.21    )  $ 0.17      $ 0.14      $ (0.02   )  $ 0.03      $ 0.32                       $ 0.12        $ 0.00        
Operations
add-backs per
share
Normalized
Funds From        $ 259,339      $ 776,963      $ 263,910     $ 277,836     $ 284,896     $ 293,583     $ 1,120,225     44      %        $ 1,171,775     $ 1,195,270     6       %
Operations
Normalized
Funds From       $ 0.89       $ 3.37       $ 0.91      $ 0.95      $ 0.96      $ 0.99      $ 3.80        13      %       $ 3.99        $ 4.07        6       %
Operations per
share
                                                                                                                                                                         
Non-cash items
included in
Normalized FFO:
Amortization of
deferred
revenue and         (4,701   )     (12,159  )     (5,160  )     (3,669  )     (4,136  )     (4,153  )     (17,118   )                      (16,290   )     (16,290   )
lease
intangibles,
net
Other non-cash
amortization,
including fair      (7,734   )     (13,163  )     (10,108 )     (11,077 )     (10,141 )     (8,617  )     (39,943   )                      (19,055   )     (19,055   )
market value of
debt
Stock-based         5,750          19,346         4,834         6,252         5,443         4,255         20,784                           19,460          19,460
compensation
Straight-lining
of rental          (5,631   )   (14,885  )   (4,890  )   (5,580  )   (6,242  )   (7,330  )   (24,042   )                  (19,758   )   (19,758   )
income, net
Subtotal:
non-cash items      (12,316  )     (20,861  )     (15,324 )     (14,073 )     (15,076 )     (15,846 )     (60,318   )                      (35,642   )     (35,642   )
included in
Normalized FFO
Subtotal:
non-cash items
included in      $ (0.04    )  $ (0.09    )  $ (0.05   )  $ (0.05   )  $ (0.05   )  $ (0.05   )  $ (0.20     )                 $ (0.12     )  $ (0.12     )  
Normalized FFO
per share
Normalized FFO,
excluding         $ 247,023      $ 756,102      $ 248,586     $ 263,763     $ 269,820     $ 277,737     $ 1,059,907     40      %        $ 1,136,133     $ 1,159,627     8       %
non-cash items
Normalized FFO,
excluding        $ 0.85       $ 3.28       $ 0.85      $ 0.90      $ 0.91      $ 0.93      $ 3.60        10      %       $ 3.87        $ 3.95        9       %
non-cash items
per share
                                                                                                                                                                         
Weighted
average diluted     290,813        230,790        290,813       292,592       297,407       297,089       294,488                         293,678      293,678   
shares
                                                                                                                                                                         
^1 In thousands, except per share amounts. Totals and per share amounts may not add due to rounding. Per share quarterly amounts may not add to annual per share amounts due to
material changes in the Company's weighted average diluted share count, if any.
^2 2012-2013 growth assumes the midpoint of 2013 Guidance.

Historical cost accounting for real estate assets implicitly assumes that the
value of real estate assets diminishes predictably over time. Since real
estate values instead have historically risen or fallen with market
conditions, many industry investors have considered presentations of operating
results for real estate companies that use historical cost accounting to be
insufficient by themselves. To overcome this problem, the Company considers
FFO and normalized FFO appropriate measures of operating performance of an
equity REIT. Moreover, the Company believes that normalized FFO provides
useful information because it allows investors, analysts and Company
management to compare the Company's operating performance to the operating
performance of other real estate companies and between periods on a consistent
basis without having to account for differences caused by unanticipated items
such as transactions and litigation.

The Company uses the NAREIT definition of FFO. NAREIT defines FFO as net
income, computed in accordance with GAAP, excluding gains (or losses) from
sales of real estate property, including gain on re-measurement of equity
method investments, and impairment write-downs of depreciable real estate,
plus real estate depreciation and amortization and after adjustments for
unconsolidated partnerships and joint ventures. Adjustments for unconsolidated
partnerships and joint ventures will be calculated to reflect FFO on the same
basis. The Company defines normalized FFO as FFO excluding the following
income and expense items (which may be recurring in nature): (a) net gains on
real estate activity; (b) merger-related costs and expenses, including
amortization of intangibles and transition and integration expenses, and deal
costs and expenses, including expenses and recoveries relating to the
Company's lawsuit against HCP, Inc.; (c) the impact of any expenses related to
asset impairment and valuation allowances, the write-off of unamortized
deferred financing fees, or additional costs, expenses, discounts, make-whole
payments, penalties or premiums incurred as a result of early retirement or
payment of the Company's debt; (d) the non-cash effect of income tax benefits
or expenses; (e) the impact of future acquisitions or divestitures (including
pursuant to tenant options to purchase) and capital transactions; (f) the
financial impact of contingent consideration; (g) charitable donations made to
the Ventas Charitable Foundation; and (h) gains and losses for non-operational
foreign currency hedge agreements and changes in the fair value of financial
instruments.

FFO and normalized FFO presented herein may not be identical to FFO and
normalized FFO presented by other real estate companies due to the fact that
not all real estate companies use the same definitions. FFO and normalized FFO
should not be considered as alternatives to net income (determined in
accordance with GAAP) as indicators of the Company's financial performance or
as alternatives to cash flow from operating activities (determined in
accordance with GAAP) as measures of the Company's liquidity, nor are FFO and
normalized FFO necessarily indicative of sufficient cash flow to fund all of
the Company's needs. The Company believes that in order to facilitate a clear
understanding of the consolidated historical operating results of the Company,
FFO and normalized FFO should be examined in conjunction with net income as
presented elsewhere herein.

                  Non-GAAP Financial Measures Reconciliation
                    Net Debt to Adjusted Pro Forma EBITDA

The following information considers the pro forma effect on net income,
interest and depreciation of the Company's investments and other capital
transactions that were completed during the three months ended December 31,
2012, as if the transactions had been consummated as of the beginning of the
period. The following table illustrates net debt to pro forma earnings before
interest, taxes, depreciation and amortization (including non-cash stock-based
compensation expense), excluding gain on extinguishment of debt,
merger-related expenses and deal costs, net gains on real estate activity and
changes in the fair value of financial instruments (including amounts in
discontinued operations) (“Adjusted Pro Forma EBITDA”) (dollars in thousands):

                                                               
Net income attributable to common stockholders                   $ 86,267
Pro forma adjustments for current period investments, capital    (1,567      )
transactions and dispositions
Pro forma net income for the three months ended December 31,     84,700
2012
Add back:
Pro forma interest (including discontinued operations)           82,423
Pro forma depreciation and amortization (including               203,502
discontinued operations)
Stock-based compensation                                         4,255
Gain on extinguishment of debt, net                              (699        )
Gain on real estate dispositions, net                            (1,804      )
Income tax benefit (including discontinued operations)           (3,555      )
Change in fair value of financial instruments                    (52         )
Other taxes                                                      790
Merger-related expenses and deal costs                           13,617      
Adjusted Pro Forma EBITDA                                        $ 383,177   
Adjusted Pro Forma EBITDA annualized                             $ 1,532,708 
                                                                 
                                                                 
As of December 31, 2012:
Debt                                                             $ 8,413,646
Cash, including cash escrows pertaining to debt                  (111,635    )
Net debt                                                         $ 8,302,011 
                                                                 
Net debt to Adjusted Pro Forma EBITDA                            5.4x


Non-GAAP Financial Measures Reconciliation
NOI Reconciliation by Segment
(In thousands)
                2012 Quarters                                          2011
                                                                         Fourth
                 Fourth       Third        Second       First         Quarter
Revenues
                                                                         
Triple-Net
Triple-Net       $ 209,922     $ 209,666     $ 206,517     $ 205,116     $ 204,169
Rental Income
                                                                         
Medical Office
Buildings
Medical Office   100,027       92,458        80,335        56,251        53,826
- Stabilized
Medical Office   8,924        8,356        8,774        7,714        6,182
- Lease up
Total Medical
Office           108,951      100,814      89,109       63,965       60,008
Buildings -
Rental Income
Total Rental     318,873       310,480       295,626       269,081       264,177
Income
                                                                         
Medical Office
Building         2,840        3,434        5,529        4,499        9,313
Services
Revenue
Total Medical
Office           111,791       104,248       94,638        68,464        69,321
Buildings -
Revenue
                                                                         
Triple-Net
Services         1,110        1,110        1,110        1,109        1,108
Revenue
Total Medical
Office
Building and     3,950         4,544         6,639         5,608         10,421
Other Services
Revenue
                                                                         
Seniors
Housing
Operating
Seniors
Housing -        309,252       296,508       283,214       271,396       264,860
Stabilized
Seniors
Housing -        11,940        19,311        19,491        13,078        11,866
Lease up
Seniors
Housing -        1,341        1,312        1,315        1,321        1,266
Other
Total Resident
Fees and         322,533       317,131       304,020       285,795       277,992
Services
                                                                         
Non-Segment
Income from      14,690       9,035        8,152        8,036        9,867
Loans and
Investments
Total
Revenues,
excluding        660,046       641,190       614,437       568,520       562,457
Interest and
Other Income
                                                                         
Property-Level
Operating
Expenses
                                                                         
Medical Office
Buildings
Medical Office   36,360        32,981        26,401        17,845        17,649
- Stabilized
Medical Office   3,324        3,163        3,220        2,858        2,369
- Lease up
Total Medical
Office           39,684        36,144        29,621        20,703        20,018
Buildings
                                                                         
Seniors
Housing
Operating
Seniors
Housing -        212,781       202,045       192,640       184,748       177,890
Stabilized
Seniors
Housing -        9,191         13,631        13,786        9,795         9,803
Lease up
Seniors
Housing -        1,143        1,185        1,122        1,123        1,097
Other
Total Seniors    223,115      216,861      207,548      195,666      188,790
Housing
Total
Property-Level   262,799       253,005       237,169       216,369       208,808
Operating
Expenses
                                                                         
Medical Office
Building         1,569         1,487         3,839         2,988         7,245
Services Costs
                                                                         
Net Operating
Income
                                                                         
Triple-Net
Triple-Net       209,922       209,666       206,517       205,116       204,169
Properties
Triple-Net
Services         1,110        1,110        1,110        1,109        1,108
Revenue
Total            211,032       210,776       207,627       206,225       205,277
Triple-Net
                                                                         
Medical Office
Buildings
Medical Office   63,667        59,477        53,934        38,406        36,177
- Stabilized
Medical Office   5,600         5,193         5,554         4,856         3,813
- Lease up
Medical Office
Buildings        1,271        1,947        1,690        1,511        2,068
Services
Total Medical
Office           70,538        66,617        61,178        44,773        42,058
Buildings
                                                                         
Seniors
Housing
Operating
Seniors
Housing -        96,471        94,463        90,574        86,648        86,970
Stabilized
Seniors
Housing -        2,749         5,680         5,705         3,283         2,063
Lease up
Seniors
Housing -        198          127          193          198          169
Other
Total Seniors    99,418        100,270       96,472        90,129        89,202
Housing
Non-Segment      14,690       9,035        8,152        8,036        9,867
Net Operating    $ 395,678    $ 386,698    $ 373,429    $ 349,163    $ 346,404
Income
                                                                         
                                                                         
Note: Amounts above are adjusted to exclude discontinued operations for all
periods presented.

                  Non-GAAP Financial Measures Reconciliation
                                  Annual NOI

The Company believes that NOI and same-store NOI provide useful information
because those disclosures allow investors, analysts and Company management to
measure unlevered property-level operating results and to compare the
Company's operating results to the operating results of other real estate
companies and between periods on a consistent basis. Those terms are commonly
used in evaluating results of real estate companies. The Company defines NOI
as total revenues, excluding interest and other income, less property-level
operating expenses and medical office building services costs (including
amounts in discontinued operations). The following is a reconciliation of NOI
to net income (including amounts in discontinued operations) for the years
ended December31, 2012 and 2011 (in thousands):

                                                              
                                                 2012            2011
Net income                                       $ 361,775       $ 363,261
Adjustments:
Interest and other income (including amounts     (6,158      )   (1,217      )
in discontinued operations)
Interest (including amounts in discontinued      302,031         242,057
operations)
Depreciation and amortization (including         764,774         459,704
amounts in discontinued operations)
General, administrative and professional fees    98,813          74,537
(including amounts in discontinued operations)
Loss on extinguishment of debt, net              37,640          27,604
Litigation proceeds, net                         —               (202,259    )
Merger-related expenses and deal costs           63,183          153,923
Other (including amounts in discontinued         8,842           8,653
operations)
(Income) loss from unconsolidated entities       (18,154     )   52
Income tax benefit (including amounts in         (6,286      )   (31,137     )
discontinued operations)
Gain on real estate dispositions, net            (80,952     )   —           
NOI (including amounts in discontinued           1,525,508       1,095,178
operations)
Discontinued operations                          (20,540     )   (27,017     )
NOI (excluding amounts in discontinued           $ 1,504,968    $ 1,068,161 
operations)

Non-GAAP Financial Measure Reconciliation
Same-Store Total Portfolio NOI
(Dollars in thousands)
                                                             
                                                For the Years Ended
                                                December 31,
                                                2012            2011
                                                                
Net Operating Income                            $ 1,504,968     $ 1,068,161
                                                                
Less:
NOI Not Included in Same-Store                  771,165         364,831
Straight-Lining of Rental Income                24,042          14,885
Non-Cash Rental Income                          18,718         13,915      
                                                813,925        393,631     
                                                                
Same-Store Cash NOI                             $ 691,043       $ 674,530
Pro Forma NOI with Management Fee Adjustment    (31,187     )   (17,392     )
                                                                
Same-Store NOI with Management Fee Adjustment   $ 722,230      $ 691,922   
                                                                
Percentage Increase                                             4.4         %


Non-GAAP Financial Measure Reconciliation
Same-Store Seniors Housing Operating Portfolio NOI
(Dollars in thousands)
                                                           
                                                For the Years Ended
                                                December 31,
                                                2012          2011
                                                              
Net Operating Income                            $ 99,418      $ 89,202
                                                              
Less:
NOI Not Included in Same-Store                  8,793        428       
Same-Store NOI                                  $ 90,625      $ 88,774
Management Fee Adjustment                       (16,642   )   (12,246   )
                                                              
Same-Store NOI with Management Fee Adjustment   $ 107,267    $ 101,020 
                                                              
Percentage Increase                                           6.2       %

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Ventas, Inc.
Lori B. Wittman
(877) 4-VENTAS
 
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