LTC Reports Third Quarter 2013 Results, “Locks Rate” at 3.99% for $70 Million Senior Unsecured Notes and Announces

  LTC Reports Third Quarter 2013 Results, “Locks Rate” at 3.99% for $70
  Million Senior Unsecured Notes and Announces Completion and Opening of a
  Combination Assisted Living and Memory Care Property

Business Wire

WESTLAKE VILLAGE, Calif. -- November 4, 2013

LTC Properties, Inc. (NYSE: LTC) (“LTC” or the “Company”) announces today
operating results for the quarter ended September 30, 2013. The Company
reported an increase of 14.0% in Funds from Operations (“FFO”) to
$20.0million in the quarter ended September 30, 2013, from $17.5million in
the comparable 2012 period. FFO per diluted common share was $0.57 for the
quarters ended September 30, 2013 and 2012.

Normalized FFO was $20.0million in the third quarter of 2013 compared to
$17.6million in the third quarter of 2012. Normalized FFO per diluted common
share was $0.57 for the quarters ended September 30, 2013 and 2012. The
increase in FFO and normalized FFO was due to higher revenues resulting from
acquisitions and completed property developments and a decrease in interest
expense partially offset by higher weighted average shares outstanding.

Net income available to common stockholders for the quarter ended September
30, 2013 was $16.4million or $0.47 per diluted share. For the same period in
2012, net income available to common stockholders was $11.6million or $0.38
per diluted share. The increase in net income available to common stockholders
for the quarter ended September 30, 2013 was primarily due to the gain on sale
of six skilled nursing properties with a total of 230 beds and higher revenues
from acquisitions and completed property developments.

As previously announced on October 1, 2013, the Company increased its monthly
cash dividend on its common stock to $0.17 per share for the fourth quarter of
2013, approximately a 9.7% increase from the previous $0.155 per share. The
Company declared a monthly cash dividend of $0.17 per share per month for the
months of October, November and December 2013, payable on October 31, November
29 and December 31, 2013, respectively, to stockholders of record on October
23, November 21 and December 23, 2013, respectively.

The Company also announces that it locked rate on $70.0 million of senior
unsecured promissory notes under its shelf agreement with Prudential
Investment Management, Inc. The notes, when issued, would bear interest at an
annual fixed rate of 3.99% and mature in 8 years with interest-only payments
in the first two years and annual principal amortization thereafter. The
Company expects the sale of the notes to occur on or around November 20, 2013
and to use the proceeds to pay down its unsecured revolving line of credit.

Additionally, the Company announces the completion and opening of a 77-unit
combination assisted living and memory care property in Wichita, Kansas in
October 2013. The total project cost for the property was approximately $10.6
million. The property is leased to an affiliate of Oxford Senior Living
(“Oxford”) under a 10-year lease with two 5-year renewal options. Cash rent
began on November 1, 2013 at an initial cash yield of 9.25% and will increase
2.5% annually.

Wendy Simpson, LTC’s Chairman, CEO and President, commented, “LTC is pleased
to announce the successful completion and opening of its third development
project this year. We are excited about the addition of another new private
pay seniors housing community to our portfolio and look forward to expanding
our relationship with Oxford.”

Conference Call Information

The Company will conduct a conference call on Tuesday, November 5, 2013, at
8:00 a.m. Pacific Time, in order to comment on the Company’s performance and
operating results for the quarter ended September 30, 2013. The conference
call is accessible by dialing 888-317-6016. The international number is
412-317-6016. An audio replay of the conference call will be available from
November 5 through November 20, 2013. Callers can access the replay by dialing
877-344-7529 or 412-317-0088 and entering conference number 10035985. The
earnings release will be available on our website. The Company’s supplemental
information package for the current period will also be available on the
Company’s website at www.LTCProperties.com in the “Presentations” section of
the “Investor Information” tab.

About LTC

At September 30, 2013, LTC had investments in 84 skilled nursing properties,
105 assisted living properties, 9range of care properties, two schools and
six parcels of land under development. These properties are located in 29
states. Assisted living properties, independent living properties, memory care
properties and combinations thereof are included in the assisted living
property type. Range of care properties consist of properties providing
skilled nursing and any combination of assisted living, independent living
and/or memory care services. The Company is a self-administered real estate
investment trust that primarily invests in senior housing and long-term care
facilities through facility lease transactions, mortgage loans and other
investments. For more information on LTC Properties, Inc., visit the Company’s
website at www.LTCProperties.com.

Forward Looking Statements

This press release includes statements that are not purely historical and are
“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, including statements regarding the Company’s
expectations, beliefs, intentions or strategies regarding the future. All
statements other than historical facts contained in this press release are
forward looking statements. These forward looking statements involve a number
of risks and uncertainties. Please see our most recent Annual Report on Form
10-K, our subsequent Quarterly Reports on Form 10-Q, and in our other publicly
available filings with the Securities and Exchange Commission for a discussion
of these and other risks and uncertainties. All forward looking statements
included in this press release are based on information available to the
Company on the date hereof, and the Company assumes no obligation to update
such forward looking statements. Although the Company’s management believes
that the assumptions and expectations reflected in such forward looking
statements are reasonable, no assurance can be given that such expectations
will prove to have been correct. The actual results achieved by the Company
may differ materially from any forward looking statements due to the risks and
uncertainties of such statements.

                                               
                                                     
LTC PROPERTIES, INC.

CONSOLIDATED STATEMENTS OF INCOME

(amounts in thousands, except per share amounts, unaudited)
                                                     
                                                     
                       Three Months Ended            Nine Months Ended
                       September 30,                 September 30,
                       2013         2012           2013         2012
Revenues:
Rental income          $ 24,645       $ 21,908       $ 72,907       $ 63,182
Interest income
from mortgage            1,086          1,398          3,195          4,361
loans
Interest and            94           96           279          818    
other income
Total revenues          25,825       23,402       76,381       68,361 
                                                                    
Expenses:
Interest expense         2,581          2,988          8,512          7,025
Depreciation and         6,139          5,793          18,152         16,053
amortization
General and
administrative          2,676        2,370        8,962        7,498  
expenses
Total expenses          11,396       11,151       35,626       30,576 
                                                                    
Income from
continuing               14,429         12,251         40,755         37,785
operations
                                                                    
Discontinued
operations:
Net income from
discontinued             238            253            805            748
operations
Gain on real
estate assets,          2,619        —            1,605        16     
net
Net income from
discontinued            2,857        253          2,410        764    
operations
                                                                             
Net income               17,286         12,504         43,165         38,549
Income allocated
to                      —            (9     )      —            (30    )
non-controlling
interests
Net income
attributable to         17,286       12,495       43,165       38,519 
LTC Properties,
Inc.
                                                                    
Income allocated
to participating         (95    )       (94    )       (284   )       (279   )
securities
Income allocated
to preferred            (818   )      (818   )      (2,454 )      (2,454 )
stockholders
Net income
available to           $ 16,373      $ 11,583      $ 40,427      $ 35,786 
common
stockholders
                                                                    
Basic earnings
per common
share:
Continuing             $ 0.39         $ 0.37         $ 1.17         $ 1.16
operations
Discontinued           $ 0.08        $ 0.01        $ 0.07        $ 0.03   
operations
Net income
available to           $ 0.47        $ 0.38        $ 1.24        $ 1.18   
common
stockholders
                                                                    
Diluted earnings
per common
share:
Continuing             $ 0.39         $ 0.37         $ 1.16         $ 1.16
operations
Discontinued           $ 0.08        $ 0.01        $ 0.07        $ 0.03   
operations
Net income
available to           $ 0.47        $ 0.38        $ 1.24        $ 1.18   
common
stockholders
                                                                    
Weighted average
shares used to
calculate
earnings per
common share:
Basic                   34,553       30,253       32,625       30,219 
Diluted                 36,580       30,293       34,657       30,263 

NOTE: Computations of per share amounts from continuing operations,
discontinued operations and net income are made independently. Therefore, the
sum of per share amounts from continuing operations and discontinued
operations may not agree with the per share amounts from net income allocable
to common stockholders.


Supplemental Reporting Measures

FFO, adjusted FFO (“AFFO”), and Funds Available for Distribution (“FAD”) are
supplemental measures of a real estate investment trust’s (“REIT”) financial
performance that are not defined by U.S. generally accepted accounting
principles (“GAAP”). Investors, analysts and the Company use FFO, AFFO and FAD
as supplemental measures of operating performance and we believe they are
helpful in evaluating the operating performance of a REIT. Real estate values
historically rise and fall with market conditions, but cost accounting for
real estate assets in accordance with U.S. GAAP assumes that the value of real
estate assets diminishes predictably over time. We believe that by excluding
the effect of historical cost depreciation, which may be of limited relevance
in evaluating current performance, FFO, AFFO and FAD facilitate comparisons of
operating performance between periods. Additionally the Company believes that
normalized FFO, normalized AFFO and normalized FAD provide useful information
because they allow investors, analysts and our management to compare the
Company’s operating performance on a consistent basis without having to
account for differences caused by unanticipated items.

FFO, as defined by the National Association of Real Estate Investment Trusts
(“NAREIT”), means net income available to common stockholders (computed in
accordance with U.S. GAAP) excluding gains or losses on the sale of real
estate and impairment write-downs of depreciable real estate plus real estate
depreciation and amortization, and after adjustments for unconsolidated
partnerships and joint ventures. Normalized FFO represents FFO adjusted for
certain items detailed in the reconciliations. The Company’s computation of
FFO may not be comparable to FFO reported by other REITs that do not define
the term in accordance with the current NAREIT definition or that have a
different interpretation of the current NAREIT definition from the Company;
therefore, caution should be exercised when comparing our company’s FFO to
that of other REITs.

We define AFFO as FFO excluding the effects of straight-line rent and
amortization of lease inducement. U.S. GAAP requires rental revenues related
to non-contingent leases that contain specified rental increases over the life
of the lease to be recognized evenly over the life of the lease. This method
results in rental income in the early years of a lease that is higher than
actual cash received, creating a straight-line rent receivable asset included
in our consolidated balance sheet. At some point during the lease, depending
on its terms, cash rent payments exceed the straight-line rent which results
in the straight-line rent receivable asset decreasing to zero over the
remainder of the lease term. By excluding the non-cash portion of
straight-line rental revenue and amortization of lease inducement, investors,
analysts and our management can compare AFFO between periods. Normalized AFFO
represents AFFO adjusted for certain items detailed in the reconciliations.

We define FAD as AFFO excluding the effects of non-cash compensation charges.
FAD is useful in analyzing the portion of cash flow that is available for
distribution to stockholders. Investors, analysts and the Company utilize FAD
as an indicator of common dividend potential. The FAD payout ratio, which
represents annual distributions to common shareholders expressed as a
percentage of FAD, facilitates the comparison of dividend coverage between
REITs. Normalized FAD represents FAD adjusted for certain items detailed in
the reconciliations.

The Company uses FFO, normalized FFO, normalized AFFO and normalized FAD as
supplemental performance measures of our cash flow generated by operations and
cash available for distribution to stockholders. FFO, normalized FFO,
normalized AFFO and normalized FAD do not represent cash generated from
operating activities in accordance with U.S. GAAP, and are not necessarily
indicative of cash available to fund cash needs and should not be considered
an alternative to net income available to common stockholders.

Reconciliation of FFO, Normalized FFO, Normalized AFFO and Normalized FAD

The following table reconciles net income available to common stockholders to
FFO available to common stockholders, normalized FFO available to common
stockholders, normalized AFFO and normalized FAD (unaudited, amounts in
thousands, except per share amounts):

                                        
                  Three Months Ended        Nine Months Ended
                  September 30,             September 30,
                  2013        2012         2013               2012
                                                                           
Net income
available to      $ 16,373     $ 11,583     $ 40,427            $ 35,786
common
stockholders
Add:
Depreciation
and
amortization        6,202        5,925        18,469              16,461
(continuing
and
discontinued
operations)
Less: Gain on
sale of real       (2,619 )    —          (1,605 )           (16    )
estate, net
FFO available
to common           19,956       17,508       57,291              52,231
stockholders
Add: Non-cash
interest
related to          36           110          256                 330
earn-out
liabilities
Less:
Non-recurring      —          —          707     ^(1 ^)   (347   ) ^(2 ^)
one time
items
Normalized
FFO available       19,992       17,618       58,254              52,214
to common
stockholders
Add (less):
Non-cash           (975   )    (701   )    (2,505 )           (1,704 )
rental income
Normalized
adjusted FFO        19,017       16,917       55,749              50,510
(AFFO)
Add: Non-cash
compensation       542        445        1,593             1,355  
charges
Normalized
funds
available for     $ 19,559    $ 17,362    $ 57,342           $ 51,865 
distribution
(FAD)
_____________________________________

(1) Represents the one-time severance and accelerated
restricted stock vesting charges related to the
retirement of the Company’s former Senior Vice
President, Marketing and Strategic Planning.

(2) Represents revenue from the Sunwest bankruptcy
settlement distribution.
                                                      
Basic FFO
available to
common            $ 0.58      $ 0.58      $ 1.76             $ 1.73   
stockholders
per share
Diluted FFO
available to
common            $ 0.57      $ 0.57      $ 1.72             $ 1.69   
stockholders
per share
                                                                           
Diluted FFO
available to      $ 20,869    $ 18,429    $ 60,029           $ 54,994 
common
stockholders
Weighted
average
shares used
to calculate
diluted FFO        36,779     32,521     34,858            32,494 
per share
available to
common
stockholders
                                                      
Basic
normalized
FFO available     $ 0.58      $ 0.58      $ 1.79             $ 1.73   
to common
stockholders
per share
Diluted
normalized
FFO available     $ 0.57      $ 0.57      $ 1.75             $ 1.69   
to common
stockholders
per share
                                                                           
Diluted
normalized
FFO available     $ 20,905    $ 18,539    $ 60,992           $ 54,977 
to common
stockholders
Weighted
average
shares used
to calculate
diluted            36,779     32,521     34,858            32,494 
normalized
FFO per share
available to
common
stockholders
                                                      
Basic
normalized        $ 0.55      $ 0.56      $ 1.71             $ 1.67   
AFFO per
share
Diluted
normalized        $ 0.54      $ 0.55      $ 1.68             $ 1.64   
AFFO per
share
                                                                           
Diluted
normalized        $ 19,930    $ 17,838    $ 58,487           $ 53,273 
AFFO
Weighted
average
shares used
to calculate       36,779     32,521     34,858            32,494 
diluted
normalized
AFFO per
share
                                                      
Basic
normalized        $ 0.57      $ 0.57      $ 1.76             $ 1.72   
FAD per share
Diluted
normalized        $ 0.56      $ 0.56      $ 1.72             $ 1.68   
FAD per share
                                                                           
Diluted
normalized        $ 20,472    $ 18,283    $ 60,080           $ 54,628 
FAD
Weighted
average
shares used
to calculate       36,779     32,521     34,858            32,494 
diluted
normalized
FAD per share
                                                                           
                                                                           

                                                       
                                                             
LTC PROPERTIES, INC.

CONSOLIDATED BALANCE SHEETS

(amounts in thousands)
                                                             
                                                             
                                      September 30, 2013     December 31, 2012
                                      (unaudited)            (audited)
ASSETS
Real estate investments:
Land                                  $   76,751             $   74,702
Buildings and improvements                834,345                811,867
Accumulated depreciation and             (212,495   )          (194,448   )
amortization
Net real estate property                  698,601                692,121
Properties held-for-sale, net
of accumulated depreciation and          —                    9,426      
amortization: 2013 — $0; 2012 —
$4,100
Net real estate property                  698,601                701,547
Mortgage loans receivable, net
of allowance for doubtful                40,668               39,299     
accounts: 2013 — $411; 2012 —
$782
Real estate investments, net              739,269                740,846
Other assets:
Cash and cash equivalents                 60,338                 7,191
Debt issue costs, net                     2,514                  3,040
Interest receivable                       726                    789
Straight-line rent receivable,
net of allowance for doubtful             29,684                 26,766
accounts: 2013 — $1,541; 2012 —
$1,513
Prepaid expenses and other                7,453                  7,542
assets
Notes receivable                          1,259                  3,180
Straight-line rent receivable
and other assets related to
properties held-for-sale, net            —                    238        
of allowance for doubtful
accounts: 2013 — $0; 2012 — $44
Total assets                          $   841,243           $   789,592    
                                                             
LIABILITIES
Bank borrowings                       $   —                  $   115,500
Senior unsecured notes                    185,800                185,800
Bonds payable                             2,035                  2,635
Accrued interest                          2,076                  3,279
Earn-out liabilities                      —                      6,744
Accrued expenses and other                15,275                 12,165
liabilities
Accrued expenses and other
liabilities related to                   33                   361        
properties held-for-sale
Total liabilities                         205,219                326,484
                                                             
EQUITY
Stockholders' equity:
Preferred stock $0.01 par
value; 15,000 shares
authorized; shares issued and             38,500                 38,500
outstanding: 2013 — 2,000; 2012
— 2,000
Common stock: $0.01 par value;
60,000 shares authorized;                 348                    305
shares issued and outstanding:
2013 — 34,752; 2012 — 30,544
Capital in excess of par value            688,341                510,236
Cumulative net income                     767,198                724,033
Accumulated other comprehensive           125                    152
income
Cumulative distributions                 (858,488   )          (810,125   )
Total LTC Properties, Inc.                636,024                463,101
stockholders' equity
                                                             
Non-controlling interests                —                    7          
Total equity                             636,024              463,108    
Total liabilities and equity          $   841,243           $   789,592    
                                                                            

Contact:

LTC Properties, Inc.
Wendy L. Simpson
Pam Kessler
(805) 981-8655
 
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