Ventas’ Q2 Profits More Than Triple to $74 Million On Acquisition Strength

Growing revenues helped net profit for senior housing and healthcare real estate investment trust Ventas Inc. (NYSE:VTR) to nearly quadruple in the second quarter ended June 30, 2012 compared to the same period in the previous year, to $74 million, or $0.25 per share, versus $19.7 million or $0.11 per share.

“This increase in net income attributable to common stockholders is primarily the result of the [Ventas’] acquisitions, a net gain on real estate dispositions of $38.6 million and lower merger-related expenses and deal costs (including integration costs), partially offset by loss on extinguishment of debt,” says the REIT. 

Revenues rose 69.1% to $616.4 million from the second quarter in 2011, beating analyst estimates of $591.9 million. This marks the fifth quarter that Ventas has seen double digit year-over-year revenue growth, percentage wise, and the third quarter in which net income has increased. 


Normalized funds from operation (FFO) were up 19% from last year to $0.95 per diluted share, compared to $0.80 during the same period last year. 

Ventas attributed its substantial second-quarter growth to the acquisitions it has made, including the acquisition of 117 private pay senior living communities managed by Atria Senior Living in May of last year, and the acquisition of Nationwide Health Properties, Inc., last July. 

Additionally, the acquisition of Cogdell Spencer, which finalized earlier this year in April, and the May 2012 acquisition of 16 private pay senior living communities from affiliates of Sunrise Senior Living (NYSE:SRZ) contributed to the REIT’s growing revenues, along with “excellent” performance in the company’s senior housing operating communities managed by Sunrise and Atria and increases in Ventas’ triple-net lease portfolio and lower-weighted average interest rates. 


“We continue to see excellent opportunities to invest in performing healthcare and senior housing assets,” said CEO Debra Cafaro during the earnings call. 

Looking forward, Ventas raised its 2012 normalized FFO per diluted share guidance to range between $3.70 and $3.74, up from previously-announced guidance of between $3.63 and $3.69 per diluted share. 

Ventas expects its 2012 NOI for its Sunrise- and Atria-managed senior housing portfolios (including assets acquired this year) to range between $375 million and $381 million. 

View the earnings report.

Written by Alyssa Gerace

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