Ventas Earnings Fall Due to Acquisition Costs, Revenue Up

Ventas (NYSE:VTR) reported that funds for operations came in at $121 million, up 15% from the same period last year.

Weighted average diluted shares outstanding in the first quarter of 2011 rose by 3.2% to 162.0 million, compared to 157.0 million in the comparable 2010 period.


“We delivered excellent results in the first quarter, with a 12 percent increase in normalized FFO per diluted share, and maintained an exceptional credit profile,” Ventas Chairman and Chief Executive Officer Debra A. Cafaro said.

Earlier this year, Ventas announced the acquisition of Nationwide Health Properties for $7.4 billion and it expects to close on the the $3.1 billion acquisition of 118 high-quality seniors housing assets managed by Atria Senior Living Group.

“With a strong balance sheet, a cohesive management team, and a large and growing investment opportunity set, we are executing on our strategy of building an enterprise that will provide strong returns to stakeholders from a diverse and productive portfolio of high-quality healthcare and seniors housing assets,” said Cafaro.

Ventas reported a profit of $49 million, or 30 cents a share, down from $52.6 million, or 34 cents a share, a year earlier.  The dip was mostly primarily the result of a $16.5 million loss on early extinguishment of debt recognized in the first quarter of 2011 and higher merger-related expenses and deal costs said Ventas.


The company’s senior living operating portfolio includes 79 senior housing communities in North America that are managed by Sunrise Senior Living, Inc. (NYSE: SRZ).

NOI for these 79 communities was $36.3 million for the quarter ended March 31, 2011, compared to $33.8 million for the comparable 2010 period.  This 7.3 percent improvement in NOI was due to a 140 basis point increase in average occupancy to 89.7 percent, the reduction in management fee expense to 3.75 percent of revenues and a 3.1 percent increase in average daily rate, partially offset by higher expenses.

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