LTC PROPERTIES INC [LTC] Filings

10-Q 1 ltc-20230630x10q.htm 10-Q

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition period from ____ to ____

Commission file number 1-11314

LTC PROPERTIES, INC.

(Exact name of Registrant as specified in its charter)


Maryland				71-0720518
(State or other jurisdiction of				(I.R.S. Employer
incorporation or organization)				Identification No.)

2829 Townsgate Road, Suite 350

Westlake Village, California 91361

(Address of principal executive offices, including zip code)

(805) 981-8655

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common stock, $.01 par value	LTC	New York Stock Exchange

Indicate by check mark whether registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer ☑	Accelerated filer ☐	Non-accelerated filer ☐	Smaller reporting company ☐	Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☑

The number of shares of common stock outstanding on July 20, 2023 was 41,408,693.

Table of Contents

LTC PROPERTIES, INC.

FORM 10-Q

June 30, 2023

INDEX


PART I -- Financial Information		Page

Item 1.	Financial Statements
	Consolidated Balance Sheets	3
	Consolidated Statements of Income	4
	Consolidated Statements of Comprehensive Income	5
	Consolidated Statements of Equity	6
	Consolidated Statements of Cash Flows	7
	Notes to Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	49
Item 4.	Controls and Procedures	49
PART II -- Other Information

Item 1.	Legal Proceedings	50
Item 1A.	Risk Factors	50
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	50
Item 5.	Other Information	50
Item 6.	Exhibits	52

Table of Contents

LTC PROPERTIES, INC.

CONSOLIDATED BALANCE SHEETS

(amounts in thousands, except per share)



	June 30, 2023		December 31, 2022
	(unaudited)		(audited)
ASSETS
Investments:
Land	$	124,901	$	124,665
Buildings and improvements		1,286,615		1,273,025
Accumulated depreciation and amortization		(393,449)		(389,182)
Operating real estate property, net		1,018,067		1,008,508
Properties held-for-sale, net of accumulated depreciation: 2023—$3,691; 2022—$2,305		6,053		10,710
Real property investments, net		1,024,120		1,019,218
Financing receivables, net of credit loss reserve: 2023—$1,981; 2022—$768		196,075		75,999
Mortgage loans receivable, net of credit loss reserve: 2023—$4,761; 2022—$3,930		471,978		389,728
Real estate investments, net		1,692,173		1,484,945
Notes receivable, net of credit loss reserve: 2023—$463; 2022—$589		45,949		58,383
Investments in unconsolidated joint ventures		19,340		19,340
Investments, net		1,757,462		1,562,668

Other assets:
Cash and cash equivalents		7,026		10,379
Debt issue costs related to revolving line of credit		1,925		2,321
Interest receivable		50,593		46,000
Straight-line rent receivable		20,815		21,847
Lease incentives		1,360		1,789
Prepaid expenses and other assets		19,061		11,099
Total assets	$	1,858,242	$	1,656,103
LIABILITIES
Revolving line of credit	$	326,350	$	130,000
Term loans, net of debt issue costs: 2023—$417; 2022—$489		99,583		99,511
Senior unsecured notes, net of debt issue costs: 2023—$1,364; 2022—$1,477		527,456		538,343
Accrued interest		3,870		5,234
Accrued expenses and other liabilities		41,368		32,708
Total liabilities		998,627		805,796
EQUITY
Stockholders’ equity:
Common stock: $0.01 par value; 60,000 shares authorized; shares issued and outstanding: 2023—41,409; 2022—41,262		413		412
Capital in excess of par value		935,427		931,124
Cumulative net income		1,583,968		1,544,660
Accumulated other comprehensive income		8,568		8,719
Cumulative distributions		(1,703,710)		(1,656,548)
Total LTC Properties, Inc. stockholders’ equity		824,666		828,367
Non-controlling interests		34,949		21,940
Total equity		859,615		850,307
Total liabilities and equity	$	1,858,242	$	1,656,103

See accompanying notes.

Table of Contents

LTC PROPERTIES, INC.

CONSOLIDATED STATEMENTS OF INCOME

(amounts in thousands, except per share, unaudited)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022
Revenues:
Rental income	$	31,537	$	31,628	$	63,272	$	61,952
Interest income from financing receivables		3,830		—		7,581		—
Interest income from mortgage loans		11,926		10,097		23,170		19,733
Interest and other income		953		1,299		3,723		2,126
Total revenues		48,246		43,024		97,746		83,811
Expenses:
Interest expense		11,312		7,523		21,921		14,666
Depreciation and amortization		9,376		9,379		18,586		18,817
Impairment loss		12,076		—		12,510		—
Provision for credit losses		187		305		1,918		659
Transaction costs		91		67		208		99
Property tax expense		3,187		4,019		6,480		8,001
General and administrative expenses		6,091		5,711		12,385		11,519
Total expenses		42,320		27,004		74,008		53,761
Other operating income:
Gain on sale of real estate, net		302		38,094		15,675		38,196
Operating income		6,228		54,114		39,413		68,246
Income from unconsolidated joint ventures		376		376		752		751
Net income		6,604		54,490		40,165		68,997
Income allocated to non-controlling interests		(430)		(107)		(857)		(202)
Net income attributable to LTC Properties, Inc.		6,174		54,383		39,308		68,795
Income allocated to participating securities		(146)		(318)		(293)		(407)
Net income available to common stockholders	$	6,028	$	54,065	$	39,015	$	68,388

Earnings per common share:
Basic	$	0.15	$	1.37	$	0.95	$	1.74
Diluted	$	0.15	$	1.36	$	0.95	$	1.73

Weighted average shares used to calculate earnings per common share:
Basic		41,145		39,492		41,113		39,347
Diluted		41,232		39,665		41,200		39,520

Dividends declared and paid per common share	$	0.57	$	0.57	$	1.14	$	1.14

See accompanying notes.

Table of Contents

LTC PROPERTIES, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(amounts in thousands, unaudited)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022
Net income	$	6,604	$	54,490	$	40,165	$	68,997
Unrealized gain on cash flow hedges before reclassification		2,146		1,276		1,596		5,860
(Gains) losses reclassified from accumulated other comprehensive income to interest expense		(935)		159		(1,747)		451
Comprehensive income		7,815		55,925		40,014		75,308
Less: Comprehensive income allocated to non-controlling interests		(430)		(107)		(857)		(202)
Comprehensive income attributable to LTC Properties, Inc.	$	7,385	$	55,818	$	39,157	$	75,106

Table of Contents

LTC PROPERTIES, INC.

CONSOLIDATED STATEMENTS OF EQUITY

(In thousands)


					Capital in		Cumulative						Total		Non-
	Common Stock				Excess of		Net		Accumulated		Cumulative		Stockholder's		Controlling		Total
	Shares		Amount		Par Value		Income		OCI		Distributions		Equity		Interests		Equity
Balance—December 31, 2021	39,374	$	394	$	856,895	$	1,444,636	$	(172)	$	(1,565,039)	$	736,714	$	8,413	$	745,127
Common Stock cash distributions ($0.57 per share)	—		—		—		—		—		(22,480)		(22,480)		—		(22,480)
Stock-based compensation expense	—		—		1,925		—		—		—		1,925		—		1,925
Net income	—		—		—		14,412		—		—		14,412		95		14,507
Cash paid for taxes in lieu of common shares	(37)		—		(1,255)		—		—		—		(1,255)		—		(1,255)
Non-controlling interest distributions	—		—		—		—		—		—		—		(95)		(95)
Fair market valuation adjustment for interest rate swap	—		—		—		—		4,876		—		4,876		—		4,876
Other	123		1		(7)		—		—		—		(6)		—		(6)
Balance—March 31, 2022	39,460	$	395	$	857,558	$	1,459,048	$	4,704	$	(1,587,519)	$	734,186	$	8,413	$	742,599
Issuance of common stock	910		9		33,684		—		—		-		33,693		—		33,693
Common Stock cash distributions ($0.57 per share)	—		—		—		—		—		(22,635)		(22,635)		—		(22,635)
Stock-based compensation expense	—		—		2,012		—		—		—		2,012		—		2,012
Net income	—		—		—		54,383		—		—		54,383		107		54,490
Cash paid for taxes in lieu of common shares	(2)		—		(100)		—		—		—		(100)		—		(100)
Non-controlling interest distributions	—		—		—		—		—		—		—		(998)		(998)
Fair market valuation adjustment for interest rate swap	—		—		—		—		1,435		—		1,435		—		1,435
Other	12		—		—		—		—		—		—		—		—
Balance—June 30, 2022	40,380	$	404	$	893,154	$	1,513,431	$	6,139	$	(1,610,154)	$	802,974	$	7,522	$	810,496

Balance—December 31, 2022	41,262	$	412	$	931,124	$	1,544,660	$	8,719	$	(1,656,548)	$	828,367	$	21,940	$	850,307
Issuance of common stock	48		—		1,697		—		—		—		1,697		—		1,697
Issuance of restricted stock	128		1		(1)		—		—		—		—		—		—
Common Stock cash distributions ($0.57 per share)	—		—		—		—		—		(23,563)		(23,563)		—		(23,563)
Stock-based compensation expense	—		—		2,088		—		—		—		2,088		—		2,088
Net income	—		—		—		33,134		—		—		33,134		427		33,561
Cash paid for taxes in lieu of common shares	(41)		—		(1,538)		—		—		—		(1,538)		—		(1,538)
Non-controlling interest contributions	—		—		—		—		—		—		—		3,831		3,831
Non-controlling interest distributions	—		—		—		—		—		—		—		(406)		(406)
Fair market valuation adjustment for interest rate swap	—		—		—		—		(1,362)		—		(1,362)		—		(1,362)
Other	(1)		—		—		—		—		—		—		—		—
Balance—March 31, 2023	41,396	$	413	$	933,370	$	1,577,794	$	7,357	$	(1,680,111)	$	838,823	$	25,792	$	864,615
Issuance of restricted stock	15		—		—		—		—		—		—		—		—
Common Stock cash distributions ($0.57 per share)	—		—		—		—		—		(23,599)		(23,599)		—		(23,599)
Stock-based compensation expense	—		—		2,138		—

LTC PROPERTIES INC [LTC] Filings
10-Q	[2023-07-27]
10-Q	[2023-04-27]
10-K	[2023-02-16]
10-Q	[2022-10-27]
10-Q	[2022-07-28]
10-Q	[2022-04-28]
10-K	[2022-02-17]
10-Q	[2021-10-28]
10-Q	[2021-07-29]
10-Q	[2021-04-29]
10-K	[2021-02-18]
10-Q	[2020-10-29]
10-Q	[2020-07-30]
10-Q	[2020-05-04]
10-K	[2020-02-20]
10-Q	[2019-10-31]
10-Q	[2019-08-08]
10-Q	[2019-05-09]
10-K	[2019-02-28]
10-Q	[2018-11-05]
10-Q	[2018-08-08]
10-Q	[2018-05-09]
10-K	[2018-03-01]
10-Q	[2017-11-08]
10-Q	[2017-08-09]
10-Q	[2017-05-08]
10-K	[2017-02-22]
10-Q	[2016-11-02]
10-Q	[2016-08-01]
10-Q	[2016-05-02]
10-K	[2016-02-22]
10-Q	[2015-11-02]
10-Q	[2015-08-05]
10-Q	[2015-04-30]
10-K	[2015-02-26]
10-Q	[2014-11-03]
10-Q	[2014-08-06]
10-Q	[2014-05-06]
10-K	[2014-02-20]
10-Q	[2013-11-04]
10-Q	[2013-08-08]
10-Q	[2013-04-30]
10-K	[2013-02-21]
10-Q	[2012-11-08]
10-Q	[2012-08-07]
10-Q	[2012-05-07]
10-K	[2012-02-27]