Community Healthcare Trust Announces Results for the Three Months Ended June 30, 2016

COMMUNITY HEALTHCARE TRUST INCORPORATED

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(Dollars in thousands, except per share amounts)

June 30, 2016

December 31, 2015

ASSETS

Real estate properties:

Land and land improvements

$

22,601

$

13,216

Buildings, improvements, and lease intangibles

171,407

119,716

Personal property

81

35

Total real estate properties

194,089

132,967

Less accumulated depreciation

(11,350)

(5,203)

Total real estate properties, net

182,739

127,764

Cash and cash equivalents

10,920

2,018

Mortgage note receivable, net

10,872

10,897

Other assets, net

3,082

2,124

Total assets

$

207,613

$

142,803

LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities

Revolving credit facility

$

—

$

17,000

Accounts payable and accrued liabilities

2,521

812

Other liabilities

3,625

2,721

Total liabilities

6,146

20,533

Commitments and contingencies

Stockholders' Equity

Preferred stock, $0.01 par value; 50,000,000 shares authorized; none issued and outstanding

—

—

Common stock, $0.01 par value; 450,000,000 shares authorized; 12,911,078 and 7,596,940 shares issued and outstanding at June 30, 2016 and December 31, 2015, respectively

129

76

Additional paid-in capital

213,912

127,578

Cumulative net loss

(832)

(1,456)

Cumulative dividends

(11,742)

(3,928)

Total stockholders' equity

201,467

122,270

Total liabilities and stockholders' equity

$

207,613

$

142,803

(1)

The Condensed Consolidated Balance Sheets do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.

COMMUNITY HEALTHCARE TRUST INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2016 AND 2015

(Unaudited)

(Dollars in thousands, except per share amounts)

Three Months Ended June 30,

Six Months Ended June 30,

2016

2015

2016

2015

REVENUES

Rental income

$

4,530

$

729

$

8,203

$

729

Tenant reimbursements

1,105

107

2,062

107

Mortgage interest

561

—

1,097

—

6,196

836

11,362

836

EXPENSES

Property operating

1,228

138

2,277

138

General and administrative

895

1,603

1,701

1,603

Depreciation and amortization

3,332

577

6,147

577

Bad debts

30

—

30

—

5,485

2,318

10,155

2,318

OTHER INCOME (EXPENSE)

Interest expense

(222)

(41)

(602)

(41)

Interest and other income, net

19

14

19

14

(203)

(27)

(583)

(27)

NET INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS)

$

508

$

(1,509)

$

624

$

(1,509)

INCOME (LOSS) PER COMMON SHARE:

Net income (loss) per common share – Basic

$

0.04

$

(0.42)

$

0.06

$

(0.80)

Net income (loss) per common share – Diluted

$

0.04

$

(0.42)

$

0.06

$

(0.80)

WEIGHTED AVERAGE COMMON SHARE OUTSTANDING-BASIC

12,038,381

3,574,392

9,774,782

1,896,518

WEIGHTED AVERAGE COMMON SHARE OUTSTANDING-DILUTED

12,064,839

3,574,392

9,834,050

1,896,518

(1)

The Condensed Consolidated Statements of Comprehensive Income (loss) do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.

COMMUNITY HEALTHCARE TRUST INCORPORATED

RECONCILIATION OF FFO AND NORMALIZED FFO ⁽¹⁾

(Dollars in thousands, except per share amounts)

(Unaudited)

Three Months Ended June 30,

2016

2015

Net income (loss)

$

508

$

(1,509)

   Real estate depreciation and amortization

3,330

577

   Total adjustments

3,330

577

Funds From Operations

$

3,838

$

(932)

   Transaction costs

204

1,546

   Straight line rent

(138)

(14)

   Deferred compensation

140

26

Normalized Funds From Operations

$

4,044

$

626

   Funds from Operations per Common Share-Diluted

$

0.32

$

(0.26)

   Normalized Funds From Operations Per Common Share-Diluted

$

0.34

$

0.18

FFO Weighted Average Common Shares Outstanding

12,064,839

3,574,392

Normalized FFO Weighted Average Common Shares Outstanding (2)

12,064,839

3,563,389

(1)

Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time.  However, since real estate values have historically risen or fallen with market conditions, many industry investors deem presentations of operating results for real estate companies that use historical cost accounting to be insufficient by themselves.  For that reason, the Company considers funds from operations ("FFO") and normalized FFO to be appropriate measures of operating performance of an equity real estate investment trust ("REIT").  In particular, the Company believes that normalized FFO is useful because it allows investors, analysts and Company management to compare the Company's operating performance to the operating performance of other real estate companies and between periods on a consistent basis without having to account for differences caused by unanticipated items and other events.

The Company uses the National Association of Real Estate Investment Trusts, Inc. ("NAREIT") definition of FFO.  FFO and FFO per share are operating performance measures adopted by NAREIT. NAREIT defines FFO as the most commonly accepted and reported measure of a REIT's operating performance equal to "net income (computed in accordance with GAAP), excluding gains (or losses) from sales of property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures." The Company has included normalized FFO above which it has defined as FFO excluding certain expenses related to equity offerings, closing costs of properties acquired and mortgages funded, straight-line rent, deferred compensation and other non-cash items.  Normalized FFO presented herein may not be comparable to similar measures presented by other real estate companies due to the fact that not all real estate companies use the same definition.

FFO and normalized FFO should not be considered as alternatives to net income (determined in accordance with GAAP) as indicators of the Company's financial performance or as alternatives to cash flow from operating activities (determined in accordance with GAAP) as measures of the Company's liquidity, nor are they necessarily indicative of sufficient cash flow to fund all of the Company's needs.  The Company believes that in order to facilitate a clear understanding of the consolidated historical operating results of the Company, FFO and normalized FFO should be examined in conjunction with net income as presented elsewhere herein.

(2)

Weighted average common shares outstanding used in calculating Normalized FFO for the three months ended June 30, 2015 includes the dilutive effect of 11,003 shares of restricted common stock that were excluded in calculating the weighted average common shares outstanding for FFO because the effect was anti-dilutive due to the net loss incurred in the period.