Investment Growth Propels Health Care REIT’s 2Q Earnings up 68.8%

Health Care REIT, Inc. (NYSE:HCN) experienced a 68.8% jump in net income in the second quarter, compared to the previous year, due to earnings from substantial investment growth.

The REIT’s net income rose to $86.2 million in the quarter ending on June 30, 2011, up from last year’s $51.1 million. Net income attributable to common shareholders was lower, at $69.8 million, and $0.39 per diluted share, compared to last year’s $0.37 per diluted share.

Gross revenues for the quarter were reported at $381.1 million, nearly 150% greater than 2Q 2010 revenues of $153.7 million. Much of this revenue came from rental income, which is 69% higher than last year. HCN also saw growth in revenue for resident fees and service and interest income.


During the second quarter, HCN closed acquisition on all of Genesis HealthCare’s real estate assets for $2.4 billion, and also completed a transaction on four combination senior housing facilities located in New York and Chicago for an investment of $141.5 million. Year-to-date, the REIT has closed acquisitions and joint investment ventures of $4.0 billion, an increase from the previously announced $3.8 billion, and has 868 properties in 45 states.

Second quarter funds from operation (FFO) rose 13% to $0.90 per share, and the company’s 2011 earnings forecast expects FFO to range between $3.34 and $3.40 per diluted share. Net income attributable to shareholders is expected to range between $1.04 to $1.10 per diluted share, an increase from May 2011’s outlook.

Written by Alyssa Gerace