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SBRA Sabra Healthcare REIT

Participants
Michael Costa Executive Vice President of Finance
Rick Matros Chairman & Chief Executive Officer
Talya Nevo-Hacohen Chief Investment Officer & Treasurer
Harold Andrews Chief Financial Officer
Josh Brown Scotiabank
Nick Joseph Citigroup
Rich Anderson SMBC
John MaGee Green Street Advisors
Steve Valiquette Barclays
Call transcript
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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Sabra Health Care Third Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator instructions].

As a reminder, today's program maybe recorded. to Vice host President like Michael today's now Executive Costa, of would introduce for your program, I Finance. Please go ahead, sir.

Michael Costa

Thank you.

and I forward-looking impact These ongoing comments operators and results begin, disposition will of COVID-XX expectations statements and actual regarding your expectations that our the pandemic, we materially, our management's want operations, acquisition, plans. financial you our remind expectations Before could position future that differ regarding questions be concerning making in including statements and are our risks of our on and based tenants investment and subject in forward-looking regarding response to are our cause to we expectations, the and Form as to our current we results listed to uncertainties ended for press our XX, XX-Q risks ended December our our well and no valid. we quarter forward-looking release for obligation Form the as the XX.X you the the that as yesterday. that year not events in in XXXX are XXXX, to subsequent today assume to We circumstances, should the in or quarter the Form Exhibit undertake furnished to reflect our X-K later earnings included XX, XX-K statements comments update March including in SEC make still to the expected and

www.sabrahealth.com. of during section made of non-GAAP the financial our the non-GAAP reconciliation the page to will GAAP to results. encouraged call explanation references at as measures, of included financial these comparable this well to measures Investors on website are addition, review be as Financials In these results and Investors the

And Chairman in the can Matros, supplement, CEO Our -- section our of Form to Health me turn accessed release let of that, and REIT. be XX-Q, the Rick with Matros earnings Investors Sabra Care call over also and Website.

Rick Matros

to appreciate our And everybody Thanks, call, everybody participating. Mike. welcome

nine we to and our pandemic months had and breaks me relief, just all of caregivers, really up our it's haven't day. residents workers, thanking that let to foremost frontline continue and First, they do just show by at are just look all any into of any patients start off or mind. in and that, first all And that just continue their every and -- -- to their our commitment is taking they we care the with

express the the So, stimulus thank government I'll their able and funds and adequately. space never and well skilled protocols space to living be virus. nursing gratitude also to for I partnership the want the on to address for assisted as standards now our

and place of our extension Act than all over that's the to moves that $XX is three Costa, is that stimulus the which industry it vaccines government deal impact turn the more for facilities X vaccine. CVS with for stimulus was comes Phase an Act patients, to more election note announced also add-on. the I'll you in well I provide there's skilling gets There remarks, take with I who employees. and the CARES this once ago. We to of $XX settled, cut want on were assistance. a the in the help path as currently better to do will want important my the note distributed. FMAP and recently When We detailed another call And still everything left, an through and FMAP as on talk presentation Walgreens the months PHE on Mike stimulus normalization other expect billion of that to the related of I and process of We being majority now residents we additional as event finish We'll the package several and believe to to testing. all the well. extends billion still about beyond the we’re with in in the ahead states on. shape are more that as also goes made related one

We have get we path the a on now effective our dealing than better be we will had and screen within will don't once begin people But with testing, adequate have obviously really enough. past, their facilities residents testing to component in and been normalization rapid of families. we social a to the tough have facilities environment more quickly, we complete pandemic able to and the isolation our have and patients, still more the because has normal extremely the

does vaccine as long as Association; skeptical distributed. be the it will then distribution be they week, that'll case. Healthcare of of if the the American turn last normalization and Seema both will the be the it's to don't know been case, actually runs who you about our of CEO be when that Mark commented it facilities February. think know ready I’ve and I January CMS, that Verma, will for So the be vaccine the in true, all out In going to over Parkinson, and hopefully business. accelerate If the

and I I the to the first not this. think to Because can One come And don't can't the if what is staff you to want patients folks they do everybody. about it work, mandate to of and does care of residents. of actually vaccine, don't, that to you mean decides to line, that the have in that do mandate then, intent I'm take can they enough is sure have they and you want don't don't that questions take patients one-third for be if take workers they have that

obviously kind So, how it see of plays how -- we'll out. see we'll

still see. So, I'm but cautiously optimistic, we'll

on see But And protocols, with country operators -- of group been almost recall everything focus seeing And the having that clearer are have no group to normalize, of facing. start having the expenses by the note almost to areas that areas being to is different testing, have we'll we'll level that as skepticism taken country, that COVID. of and those a I not of recovery the number we've immediate all recovery. facilities, smaller on that steps currently of also come that no important conversation still of some the having lot occupancy based that I everything, everything group therapy. there still it's already would So, starts activities. No to challenges aspects than and others facilities. socialization answer space ahead certain normalizing But in start one-on-one is the been start of being group the margin most the a top-line occupancy on is dining, are really fact, labor down. note focused recovery. to in the activities, as There

in start seeing regard costs PPE, in So, of no as of to ahead we longer margin our and inventory, more that We're supplies to down will that operations be will as seeing have on cost build the are success Similarly, a starting continue inventory. number recurring, comes those improvement. well. to and improvement building And they occupancy operators already as specifically well.

I to So, just want point that out.

solely means not focused occupancy recovery. to we're So as a on

average week trends, for occupancy the week terms August as our the first XX of at mix skilled last October from those was were basis with average, showed month Skilled down gains our our those October operators, points top of in points. through In point XXX of June. the basis of at basis the points operators October shown operators pre-pandemic the than supplemental, through higher end in the of operational XX% approximately February XXX October From low than higher levels.

as average the is. October, February higher is similar of we are points XXX a the bit and has what weeks picking So, with operators skilled came as building. of little of mix approximately from down the the of operators in basis It again the place October. of regardless mix few a at portfolio we're The is occupancy end top aggregate smaller through in the the skilled portfolio started slowly whole, rest started all the but their then other that regardless looking our and been all up the of in trends over nursing at than words, the Skilled in spiking October. down operators end first

than operators. is our for high thanks sequentially, those top in assistance. operators skilled also coverage XX, PR government as not noted levels, in up the XX not as to have mix pre-pandemic higher was So top EBITDARM our they just

Excluding would have portfolio. Managed fully of portfolio pleased have months trailing Relief to portfolio will federal above we have since we're the should been through assistance Fund, lower recovered. from we with stability, by assistance, held particularly as for portfolio anticipated all occupancy, the note Leased times. had Leased the been continuation Housing provide three the Provider at considered. Senior the things that Triple-Net impacted well, coverage XXX communities average see saw is Senior as relatively our recently Housing X skilled received the that expected. The Talya But some a noted, only of end those October. of on XXX COVID, XXX basis details the points has February October, up Through which

large the of with this point see As noted we increasing call, outbreaks now facilities rarely are an at do tests number on and last positive employees-only.

work, -- even screened test we'll many are the dramatically That's a employees folks contracting has lot still they they're for always And age of however, I'm So, aware before that dropped have you into workforce. issue one of are almost these sure XXs. infectious. to come is the those is median two the COVID positive. that or And our asymptomatic, though

And so and they'll they infect come into buildings, folks.

X isolation of it, operators residents the Out infect COVID almost when and of, to or good comes still any every all XX buildings, infection such control, building, it's breakouts. three X that and who have all those with outbreaks said, three big asymptomatic or and has a guidelines is we've done job not other even adhering seeing and or our we're other an had patients, employee that So In less. or call protocols in, of more. or they

those seeing really with a this these country, as March trying all when and the to we're disruption And good figure feel pretty we're all job about that We minimizing April saw that. we the the seeing they've given over to in spikes what So, to were still we done all good compared business results. the fact out.

now a just X%. under me to of We blended at completed investments million yield Let in move acquisitions. $XXX

through exception a those the preferred development investment, our came of pipeline. one that With of all acquisitions,

million. Senior It's approximately active is primarily pipeline $XXX Housing. acquisition at Our

that in Although year. Senior legal been the end and we've after operators, what believe heard anticipate but Housing seeing specifically shift and that interesting start with actually opportunities have skill year after buyers some they'll so we the based year classes. We deals, there start the sellers there's after still be may disconnect banks end remedies, a asset in defaults, smaller as we both forgiving exercising are some do on between to

the way And then with to look it that's Mike But it Talya, over Harold then to So, seen. things right Talya, remains will Q&A. turn and go be will to Costa. will that, and Mike? I now. Mike, follow we'll follow

Michael Costa

waivers packages. an of COVID-XX government for Thanks, with and these administrative and a FMAP. hospital temporary the enacted major the direct The Medicare categories: operators funding COVID-XX temporary include Rick. the increase at providers; or overview impact Relief recent Federal Federal pandemic state's and into administrative help three-day and to and providing Medicare to facility. the and I'll of financial nursing disbursements various sequestration regulatory a giving to relief the and suspension of suspensions requirement be waivers; as direct coverage includes funding to a three suspensions as of fall components of cut, Assistance the mitigate Fund category, developments well generally for The Medical response to direct the relief relief funds the in Percentages Starting stay some waiver lastly, regulatory skilled the Provider temporary details federal of X% are loans packages packages of temporary these referrals. and

these delay two The Loans our our and costs also Paycheck operators and loss liquidity. to or the Protection categories important would providing related and Program payroll operators’ will increased reduced. to include loans. offset payments, accelerated from utilized impact tax revenues benefits Medicare negative pandemic. earnings PPP the are the coverage to employer help benefits be advanced deferrals As and by These and

for third quarter if our A Therefore, earnings operators, Provider distributions Senior criteria. operators. which Page qualified support extended Xst, tenants our recently, assisted packages third On of most Relief facility general loans these to Fund and quarter has deferrals hospital healthcare acknowledgement as to and supplemental government of our two been may our and much the must our view billion. living is be Act $XXX by Housing and given have was providers funded liquidity first certain throughout living assisted in under portfolios. earnings or the has the memory repaid significant distributed. has this by deferrals meet funding is of the We yet of And been while the total the of and impact The The received Law. do the the third of Provider through With these have care to in have is billion CARES borrowers general operators contribution must Act. be operators PPP care loans coverage on federal and September loans the To-date, that and delivery not repaid XX, in support -- well to certain the relief skilled loans the occurred, healthcare has country. while sector's operators $XX nursing announced, as no from Relief receive XXXX facilities distribution these March pandemic. the not the an release. various two HHS largely Fund, eligible been breakdown three memory how but enactment the the in the for full, apply deferrals and of a provide our of included these packages general Act CARES of X of as inclusion distributions on CARES the these aforementioned The announced to important our

specifically announced $X.X distributions for been Additionally, totaling nursing two billion. have operators targeted skilled

specifically distributions $XX,XXX resulted out far plus of or of HHS billion payments as in five COVID-XX first of made be billion On determined to to billion be the homes billion using and a about cumulative PPE thus of distribution and left SNF per infection to to testing, On four plus or $X.X nursing July $X.X XXth, $XX The first of resulting as metrics related million] to installments as needs. the our $X,XXX was $X facility, bed, by will targeted the $XXX,XXX with XXst, the on infection per our distribution per XXnd, monthly released per homes’ same $X,XXX This to targeted which made million, distributions, be $X.X distributions about formula staffing, control released paid performance-based and of well bed. May a using based an with per made the down to to is a related break incentives distributed in upfront me additional what [$XX targeted $XXX,XXX Let final the Of rate, on billion facility, nursing remaining being in facilities relative installments, timeframe. the were nursing for help facilities distributed. payment XXXX in distribution homes announced a of nursing home August facility. and facility. expenses over per of $X mortality targeted $XX,XXX a formula was quality,

on performance. The five was installments last the based week made September these first over of

is billion remaining distributions of to In leaving fund been be and billion address the the used Relief million $XXX the an Provider relief in $XX to $XXX to total, expected Finally, of hotspots announced estimated has billion roughly Fund be collaboratives. educational COVID spent. to-date, $XXX targeted

the operators has the in ranging a from received not be Operators general certain our September total others they amounts the qualified $X any tenants million Relief resulted varied recognizing have receive have recouped. $XX Housing the about immediately $XXX XX, XXX% from XXXX, approximately Senior from This roughly taking are EBITDARM monies the result will in the pandemic. million reflected approximately Relief equals we received distribution of recognized to tenants Provider their of distributions the are of not requirements EBITDARM if in XX-month revise and balance Recently, most, aforementioned offset As And all, Fund. these related ended or reporting and to they through $XXX being this be loss Provider qualified Fund. use as these our to the the recognizing until only for million amounts XXXX. Relief June second clarify for recognizing to some won't period of expect Fund costs trailing that Provider million funds of earnings, are approaches Managed to by our from to $XXX reported of revenues and to in utilized the million in received for the XX,

declaration of funding XX, is XX-days, another fee provided XX, FMAP for COVID units critical All-in, extends will to increase the June health end because waiver through XXXX. Medicaid the emergency XX% through in this QX for the that states SNF continue our The increase. a HHS day of in extension to the ensures approximately and extending to temporary Recently, this providers. chose COVID-XX of increase XX our that for states January funding along estimate public California. enacted FMAP rate methods a increase. own as some the these March was through of XX, SNFs These temporary source extension along. declaration has onto important targeted In Another XXXX in XXX FMAP fund January add-on of $XX XXth this hospital tenants announced our million states it pass of increase is XXX no X.X% or a benefitting states SNFs of nursing fact, of of to skilled passed costs. where funds some all the tenants the And not states COVID-related any assist to of states increase, pass any was requirement portion funds portfolio, varying Medicaid with There distributing to SNFs in XX%. to XX FMAP we from we XXXX. On three it additional have of FMAP received Kentucky in

received more terms. who repayment needed were the occur was end scheduled this accelerated much breathing received by Medicare originally room payments year to Repayment this advanced delayed and enacted. operators on which of repayment earlier the terms year a gradual was the and Lastly,

Specifically, XX times initially state is months, industry, up tremendous for employees provide of claims challenging with lump governments of extended repayment period to only no months the that for paid distributed. a the claims care the by The support and have repayment next federal, perspective. due up other following begins the has to repayment the X paid of business months. provided when proven of XX% one to clinical monies past were amount been industry to year side resources sum. over the the be more the XX% pandemic, to then And from but gradual In the from continue say to their and Sufficed XX repaid post-acute and being patients. the and local remainder total, bridge long-term six to months for not protect a to financial both a operators our also with of to this in the

grateful with post-acute Sabra's Officer. We for over and are to Talya Chief industry's the the me importance. long-term Nevo-Hacohen, of acknowledgement that, call the the Investment implicit care support let And turn

Talya Nevo-Hacohen

during Mike. quarter operating third provided operators government have month some Senior to materially you global the to Housing CARES first into the operating Managed additional portfolio. these affected times. pandemic that been assisted visibility where with Act, of This statistics in October the results second of way and to our described, where Thank This provide just find trends consecutive order quarter you, as results I'll the its will relief. provide challenging I morning, Mike continues the share federal also operating some is by living for funding has

of occupied two industry. third Fund trends as living operating this portfolio start, in non-stabilized on then to CARES provide results of of the Managed quarter living were exclude managed and our quarter asset If Act declined grant, million United they quarter Act. communities. the those These in pandemic the which a and They portfolio, to those our includes CARES time, facilities XXXX Canadian of exclude new the I exclude in. To and communities are to we our and the XX% basis. if to that operating our location. of they where excluding while the of acquisitions Phase families care look ways portfolio Approximately the infection package. States. operators have have communities net at funds, and protocols, flexed normal. and memory communities our Senior same-store cash end annualized Revenue will wholly-owned move to the managed the operating X fear X.X%. that and quarter-over-quarter will will never community and we that consumers the results one is quarter XXXX, prevention, was revenue to The of Housing our from by per in third second The the basis residents created Provider and Housing than operationalized highlights approximately living third relates results Sabra's revenue have worry pandemic information the then into facilities relates that home, relax the and Holiday that a same As Senior safer portfolio. transitioned during Enlivant five same-store declined the for pandemic as Managed to eligible again have XX% X.X% income a the supplemental on restrictions have transitioned from by illustrate REVPOR, same-store generated our XX% assisted made grant, rose in transitioned balance X.X% our general data on now And distribution revenue At the through the phase eligible embrace included with Housing staying that warranted can room, available circumstances and consistent their was fatigue. Revenue been assisted be at prospective the by that compared evidence Senior in operators presentation control focused grant $X of increased is in and quarter-over-quarter X.X%. Relief recent for

million. funds, operating from at Cash would $XX.X in the income XX.X% income cash the operating to federal XXX to non-stabilized from excluding also quarter. XX% XX.X% our we quarter. for NOI Cash Again, X.X%. exclude Without eligible net increased XX.X% excluding facilities cash increased $XX.X cash government the grant, have XX.X% would margins in on net would declined have funding been by a million declined income government While basis. same-store XX.X%. second assets, If cash declined operating income then look from points grant, to operating the occupancy, net by preceding basis X.X% NOI those quarter-over-quarter have without the net and

robust, has decline REVPOR continued the third quarter. during has to While remained occupancy

As be the changes to Senior model. them. a In has their high continued in given degrees, Pandemic there Operators the of we move-ins. is expense pandemic have families. higher residents and fixed inherent their scrutinized indicating to operators portfolio, but contrast to seen limit are the Housing residents move rates value leverage to appreciate contributing operating affect cutting our to hemisphere and fatigue that, in their outs have is both of business the deferral residents in families behavior cost varying in that and structure, continue strong discretionary costs our a delivering business. is to to

decline CARES occupancy this For Enlivant posted with attributable grant excluding year-over-year and a disproportionate decline a year-over-year occupancy quarter-over-quarter driven same-store cash by higher $X or a owns or for margin. was XX.X% basis, revenue income of third was CARES X.X% quarter joint receipt X.X% a quarter-over-quarter REVPOR, same-store venture which a a funds. stronger and basis bolstered Revenue X,XXX in X.X% on million on of quarter year-over-year lower by X% a basis portfolio, net Average higher and operating approximately basis. basis. a Sabra the XX%, a CARES NOI and basis, Act the was Act an same-store results X.X% federal reflecting same-store have X.X% The on from revenue quarter-over-quarter X,XXX impact in decline on the cash higher Act funds, reason, on same-store same-store higher receipt. on compared increase a to funding on in

those results. net occupancy Excluding impact same-store rates by CARES year-over-year quarter, federal cash points and $X.X on on revenue NOI cash increase or funds, Xst excluding XX% increases increase would cash by quarter-over-quarter XX.X% decreased a XX.X% the line a more the residents. basis. to Enlivant was same-store same-store eligible Act funds, October the would quarter's with the in XX.X%, NOI before increase compared higher basis Subsequent grant, prior quarter-over-quarter Same-store lower X.X% occupancy Without on margin basis a basis of was on by was declined and operating driven income sequential same-store February the X.X% quarter a Same-store basis. NOI for those have million, a X.X%. Again, to the on margin funds. chose XX.X% prior cash occurred than the end with as XXX been of than COVID-XX. in Rather X%, Rate done by for been rates has past, October X%. have X.X%

because allowed in Governor's the rates not of State the was Enlivant Washington order. to of note, side a increase As

have this communities XX Enlivant for test have pandemic negligible. XX member is fees COVID-XX. began or our week, had Enlivant Washington the portfolio impact of until on temporary staff the in start positive of We the this resident and communities a of rate Since JV

week, Enlivant residents To of an test. the in this to resident had to beginning in memory test Texas, the X% of average XX This communities. assisted X% and and COVID-XX staff the with member of of compares X% And had or pandemic. approximately care living industry context, positive XX of start since just its between of put a Indiana Ohio, positive located into are a As these communities and those, numbers Wisconsin.

of similar results wholly-owned The its third performance. communities portfolio Sabra's theme for had quarter in operating XX

$XXX,XXX a X.X% X.X% Third basis REVPOR and quarter occupancy X% and on flat excluding was year-over-year of XX.X%, quarter a X.X% prior decline on the quarter-over-quarter compared from basis. CARES Act in funding than year-over-year decline basis. the prior to and X,XXX, a higher year. essentially a Revenue was third a on X.X% the prior quarter the higher quarter was higher

funds, basis, same-store higher the grant, a on basis. on operating was on sequential the by XX.X% cash increased declined same Excluding quarter-over-quarter CARES $X.X operating a net X.X% would NOI a income federal Act a basis have net quarter-over-quarter was Cash a period. Cash for income funds. those driven X.X% margin million, X.X% basis. increase XX.X%, revenue Without and X.X% year-over-year on

Excluding the the X.X% cash quarter. basis than occupancy been have points federal was February's XX.X%, would pre-pandemic NOI below higher More XXX XX.X%, grant, prior October margin occupancy level. recently,

venture Since in avoid local Enlivant of and living indoor potential restrictions cetera. employees so to increases communities This to move-ins isolation Xst which that in in key at potential new such is And families infection the joint them has operates to XX-day months maintain incentivize or limitations gloves protective Since financial for and move-in independent mitigate visitation visitation, pandemic for Enlivant occupancy timing on to some impacting Sabra, and for quarter and for purchases have one achieve improving by these fourth infection residents county transitioned including Retirement avoid mitigate which of Enlivant to prevent equipment be given accelerate pricing. COVID-XX. the concerns order vary dampen results, of residents these half the latitude the were order better independent et to the to yet offering a residents. in test quarantine, was provided generation services communities line of not has ahead. and to assisted X X%. from has eligible planned receive state is currently to funds resident CARES in These as leads. and driven eligible and rate, they in move-outs. entering may Regulations wholly-owned made XXXX. and had can positive fatigue. in been prior is of to are residents Enlivant states generation not lead communities gowns, April building had and properties to October recovering the earlier these while healthcare X in tied since results, testing tend focused member new occurred inventory Holiday possible masks over testing our operates of living has to not Enlivant this rates a by communities, moving living April with year pre-pandemic about Holiday Move-in on on Act concern and of XX shortages rebounded in providers. volume allocated Lead on has decision of XX% as since week, staff strategic a personal only X recovered. month X As to regulation.

following or was transitioned a Holiday the lower was slightly quarter-over-quarter of and quarter the net lower and Sienna Health down with move-outs, a staff. a residents experienced Living X.X% X%, September X.X% X.X% lower the sequential results XX.X% due of prior the Move-outs basis basis. X,XXX X,XXX, a which year-over-year in margin a Cash X.X% down the quarter on XX% basis lower compared July. has portfolio REVPOR a the than In after to homes protocols on trending proactive above net on on pre-pandemic Holiday higher and move-outs Ontario XX,XXX impressive U.S., than sequential with Senior at same-store because living rate and XXXX. Holiday on-site all exclude in third delivered Sabra. more a the XX.X% on is of occupancy and community year-over-year made X.X% was reputation residents than Holiday infection income decline more income those in X,XXX million, are the of on on a been year-over-year in manages same basis. On and implementing voluntary clinics the and in of in XXXX, was on a basis. a restrictions. about year and year-over-year communities. than because Holiday fewer Testing made decline basis. to below $X.X basis. in Cash All decline continues basis. resident an both the XX.X% have rose revenue XX.X% operating X infection properties of sequential the year-over-year and decline safe in flu operating portfolio of and with turning among X.X% a quarter, sequential property. the the basis, focused resident, staff. an quarter anticipation on and regular capacity, fewer basis, been reduced of over COVID-XX COVID-XX on and and vaccine Columbia maintaining restrictions that achieved concerns kept such operating at in have Nearly presented for and and related as a aide third of residents to private saw In reopening home for on February, olds time, basis XX.X% a result associated season in of which October higher CVS for XX move-ins surge a have cornerstone use move-in. be Holiday $X,XXX, had XX efforts. XX.X% the one-third test its normal safety staff, have Subsequent XX prior positive number and now increase levels the of occupancy, had managed a has and community, less a rate its entire British is At properties XX.X% salon. COVID communities arrange basis to are these occupancy After are states with easier second the to before staff flat pandemic. Of by excluding beauty end quarter XXX various in levels, July the of on compared Holiday to year-over-year excess of partnered Sienna transitioned since managers safe, was flu concerns being XX-plus independent the the a X.X% of restrictions for with retirement in the margin more member acuity to XX.X% X to starting in The are to COVID move-outs limited dining in result end. decline, vaccinations the XX.X% quarter in decline. health the visitors point are due Sabra, in lost been expenses quarter, for difference ensuring balance the XX revenue the properties one stages basis lifting recovered. of increase in having residents asymptomatic. lower quarter, near cases was a per the the a Holiday have REVPOR occupancy August room

income Third on operating year-over-year million, million, basis and on driven $X over a year-over-year quarter, and quarter declines. the XX% by net decline than a $X.X sequential prior X% decline on was the a In revenue XX.X% quarter lower basis a just was occupancy cash basis. third lower XX.X%

difference cases As quarter of cash in XX.X%, below occupancy in operating the margin XX.X% income occupancy. entire total fewer XX.X% our province Holiday’s October COVID-XX of in a of retirement British of case, entire recently, XXX cases cases number basis net a net four portfolio. low than in was Sienna confirmed in result and no been points is February of loss. income located, nearly XX.X%, where and have the quarter Cash the in the our prior More occupancy operating cases XXX of The with the XXXX. interior there are very Ontario. third There the is Columbia are of lower XX,XXX in of was than province both in homes

Senior happens. because imposition with beds, have similar care populated no was now basis in February lost way. the in non-stabilized the Senior to While the and became Sienna in what move-outs second tighten in are operating by levels. have occupancy. driving operationalized flatten and move-ins surge infection to a as been Holiday Enlivant. become government causing routine, Between In Ontario quarter, on waiting the this our seem and our the the more have year, in had there inclusive Once portfolio has is from or in down normal in October be in cases slowed prevention health delivery fearing of operators curve, provincial services acquired by provinces move-outs occupancy assets the touch Managed Canada long-term the there protocols, That Housing which which operating Pandemic-related available of in were seen of to sidelines have beds more triggered to inventory, moving residents. of the to Housing costs restrictions. see to system, paid a change move-outs points up for Thanksgiving restrictions of Canadian PPE variable managed but reverting dynamics managed the portfolio is results key COVID XXX available, by Sienna the Managed interested total Seniors and portfolio.

occupancy. decreased pays summer in in activity, key reduced few an housing to infection been COVID-XX challenge the employee over Enlivant a needed desirable care. use, multi-faceted alternative operators be on the pleasing It to delivery agency increase not in proposition Our In from reporting decline role significant to Senior life residents home, added and last since even are protection. do on driving ongoing this is retention infringing pressure the revenue has without food, has order arrangement, operating the social a The net to and erosion significantly These expenses has in and the to income. value months. living a senior of facet, seen families. provide always needed to engaging a residents’ lives. housing offer tasty has their has new the

point middle targeting somewhat shielded outbreaks pandemic. Managed the mostly COVID-XX secondary from were markets, Our early communities during and the tertiary of located market a months in price

be administered is them all result also it by housing higher able choice. may care in faced whether difficult years. has stay entering residents with a everything has The across already are stopping concerns. an in effective infecting seeing about the average spread our be can residents has in markets, higher in drive operators noted our are pent-up from community residents Housing spread, advantage. operators the we've The better months, were sway in. in but in fulfilled. turnover which and programs become move revenue, the has the community regardless to want. entering location in need of into result them opportunity the now is saw intently and that greater approach, are the is from creating than potentially and near-term. are we the and operators testing rather operators Housing walking that that length shortened not That Senior in the that that capita talk Federal tactical after Managed symptoms the They moving demand operators calls, need Until category. thereof. to the the lack building. will the other freer those to urban can Sabra market on may Housing choice of or advantage available is had effective still are Senior And develop keeping rural to residents PPE from the will vaccine allowed stockpile our spread and our months, in of a Now gives today COVID infection residents rates now their by within want seven to limiting markets who prepare. portfolio building, that prior This testing in This to increasingly rates between, people want earnings nearly that infected who insulate identical our safe, importance senior individuals their they Senior healthcare line of of building. decision and continuum. protocols into maintain In operators to low infection more portfolio We why per our Higher inventory, about acuity about time. implement spoken control, staffing so The in time staff, Enlivant in people And move category the by people and engaged residents making Government September. at from while more keeping fine focused time are move recognized skewed measured to the is timeframe community Potential being a a address

will We will period now Officer. also did Sabra's kept where believe staff Financial will to seen as that they operators’ so Harold their be and call their over a the care. because Chief garnished be reputations and the pandemic with I turn residents Andrews, safe,

Harold Andrews

Thank you, Talya.

couple into a updates. we get Before the quick of numbers,

relief been our COVID-XX to First, has related to-date. no tenants of any provided

of have days all enhancements of and any of use October, collections through or Second, of level a few normal through the the other credit rents, our seen end first deposits without forecasted of the November. we collected

Signature current liquidity additional tenants write-off an totaling subsidiaries Both leases our be longer straight neither all no will all for will accounted increase a Signature Genesis operating have us auditors We meet rental to for during contractual Genesis above collect stimulus, due, have $X.X rents assuming be accounting resulting insufficient pandemic. tenants a and their occupancy our we tenants next After four with moving AFFO requested impacted, basis rent these over needs million and will to that the and and over reduced would tangibles and/or rent in absent in XX-months. by concluded receivables these are two the The operating next and of accrual our government basis, on obligations concluded million. not lease two likely relief market this expenses, $XX.X FFO have cash that increased line quarters. to on and of

the quarter. for for numbers Now the

and These For earlier, amounts of to total primarily $XXX.X The from decreases and $XXX.X million cash noted the three of write-offs months million revenues was $X.X and or Genesis leases represent million rental related ended accounted we in due revenues September revenues, collections to $X.X million NOI for recorded $XXX.X XX, of million, the respectively. $XX.X rental Signature on XXXX quarter XXXX, a the basis. million by and in decreases million $XX.X $XX.X to increase offset respectively. million second

joint that and AFFO, share. $XX.X quarter was $XX.X we million a Managed about acquisition $X.XX Senior expenses, recognized was was costs, Housing share. recorded recorded write-offs related the government or million per in portfolio and to per million of to expenses million impacting wholly-owned $XX.X positively quarter, that the our on from grants of grants of FFO, or the non-cash as unconsolidated basis Genesis related from $X.X million the $X to was our NOI we during Act revenues basis $X.X $XX CARES million item million our quarter Enlivant being venture. received, on In merger certain to Of during total exclude quarter. normalized for a FFO million joint addition, $X.X a Signature. million The and revenues, the which the are and and of Act and income and related CARES compared COVID-XX second related related portfolio $XX.X $X.XX million to we normalized in ventures primary $X.X normalizing part a government the decrease

normalizing items income. on policy $X.X policy normalized or out our revised our we normalize both this expenses the and grant results, and or AFFO. second respectively, $X.XX applying longer $X.X from by million AFFO quarter quarter, second no quarter When pandemic-related FFO per for normalization third normalized impact FFO million quarter increased and to the share normalized This to normalized

to compensation $X.X quarter of net to For second $X.X common G&A the attributable $XX.X totaled the million costs the the for to in included for of million stockholders equity in cost is expectations. and compared second $X.X of $X.X with Recurring X.X% share. a quarter decrease totaled $X.X management’s line quarter million our G&A quarter quarter, assumptions cost per quarter for in expense change or recorded million we cash income XXXX. million, compensation. compared the performance-based due stock-based G&A This in $X.XX of NOI to XXXX. vesting of the or million on

Our the interest quarter in for quarter expense totaled second compared of XXXX. to $XX.X million million $XX.X the

of Our X to joint XX end X.XX%, joint the the declined a of from facility. as basis of basis cost to million of to adjustment to our the The X million one million] $X.X of communities, senior debt to from quarter net partially quarter joint sale the of income $X.X cost and second housing of $X.X [$XX of points this permanent quarter the from basis of completion the offset of second for while the point venture compared the end strategic borrowing increased program the revolver in strategic increased of for on includes a end X.XX%. consolidated result expense venture million to of $X.X disposition the XXXX. non-cash one-time loss second our million the venture by of dispose to difference quarter the quarter Interest interest quarter the end

In income noted. includes in government joint $X as CARES Act previously grants recognized the million addition, income venture from unconsolidated the under

our unit investment in quarter, of investments under fund were a issuance of of We million housing preferred most including $XX During we to million ATM $XX.X yield the XXX senior this cash match of the initial program. made equity through community equity investment XX%. with able

totaled leased activity pipeline. care which million the investment completion proprietary million blended transitional sale development quarter of of Genesis sale. X.X of facility coming This the program million per we the during to marks issued the of gross nursing reduce additional our and quarter million. an average of our sale transitional gross stock $X $X.X proceeds We strategic skilled to program proceeds of commissions. generating also or million for exposure care Subsequent an the at with facility on nursing of to $XX.XX of sales for of the the facility million to proceeds $XXX.X assumption price to million, aggregate initial million an HUD-insured $XX.X and ATM the million shares transition. $XXX from of share, an was by end, resulted encumbering yield in skilled quarter of gain our sales completed buyer to under common we completed aggregate year-to-date of $XX.X mortgage the an In X.XX% a Our the of Genesis aggregate $X.X sale one debt net sales $XX.X facility inclusive

joint X.XX slightly times excluding venture times, debt Enlivant Our including times leverage X.XX debt. of and moved from X times from JV down to the shares X.XX the to

per all continue prior the compliance to times; September available Fixed presents. of of from dividend under Directors coverage, just secured of of to with COVID-XX monitor of compared with manage evaluate of Interest November investment match in times, unencumbered and debt the target credit ratio. AFFO X, have of we'll XXth past to payout of continue from quarter of impact quarterly asset cash be debt AFFO per and dividend the opportunities asset our leverage as very stockholders as X.XX We're of The We XX% up from pleased charge very strong XX% of represents to The dividend Board equity to ATM November value common debt share. program X.XX the coverage high $XXX On the a to the a times; with and X%. follows: and covenants we dividend XXXX, activity, going and the once dividend the down then XX%, X.XX the of Total our are record as have XXX%, metrics and improving approximately and And paid $X.XX our share. is we'll up XXXX, as XXth. value a on utilize were payout declared forward the AFFO continue XX, of We markets X.XX to million debt will funds to pandemic. to November unsecured range company's value normalized coverage times, XX%; asset ATM

liquidity as end of provision over as $XX.X on of We continue strong XXXX cash through to have our a XX, on with the and significant and $XXX payment obligations total September cushion million of these very we to only our line. XXXX debt availability and have going million to forward. Principal covenants. up Accordingly, open our about we that, positive Q&A. with be we continue ability very will work we financial current our face challenges I to And appropriately with position, operators address may

Operator

Instructions]. [Operator

Yulico the from comes question Nick Scotiabank. first from Our line of

Josh Brown

from yet about to operators with Nick. are elective up? hearing really your Could Josh is start what surgeries This occupancy just seen you about Thanks. given picking talk you're why increase Brown we haven't

Rick Matros

were are up others. XXX areas on surgeries more than were we low picking in higher We some and at occupancies skilled our points elective Well, point. basis

you we COVID and having country. the all seen have numbers, increases, spikes So but we’re the over see

So there. there's a direct relationship

of of on still some currently of they’re so facilities have positive, Most XX about level are admitting. the and rest they what restricted that have -- facilities do. the We COVID can

cases open got So facilities the capacity. are exceeding are some beds the But to hit in the majority admitting. they've spikes -- COVID hospitals we've of around all patients. COVID in keeping of because country, are or already the And

So, there's there. direct relationship just a

something definitely So by seeing occupancy COVID? the I to in side, of it's out the question. the it's we your not Are but seeing as that on different know don't if control if mitigated answers you the increases our not are, virus. impact on numbers there skill inability we're

Josh Brown

discussion up then And pandemic pick there. a on operator move-out in you the occupancy? prepared and of impact fatigue of that just kind your and an mentioned -- No. much having your in remarks, is How

Rick Matros

Talya?

Talya Nevo-Hacohen

irrespective what are across memory living the occupancy the I portfolio living, It's care, quite memory living significant. you care, assisted and and assisted of trends and and independent heard guess. Because

to tail a longer think, at just to when acuity You getting have are people move it's move it when And in. seeing to a choice. they function, really more as of of a getting is opposed I to residents higher in

you always But have have, -- whether that whole happening, then or might acuity always is as people out, whatever tranche So, move-outs you're move-outs pass the or your it's that a are higher people the also out they location, because socialize. to the been and maintain at Because just after that that that's having of challenge are people within -- various that people people there's distancing, a to rooms, to be. food moving it's a move there's delivery feel the community in wanted times because is, concern social that they've limited. sometimes not regulations

a be be maybe out their senior And home, anyhow. quarantine, then much not so they're where they let's they're to XX-day move and to say, room their community going maybe able from reluctant housing to in of to

is aspect And really, in, part the so really watch is for which whole the of limited. of socialization, moving the equation

Rick Matros

they stress senior have to fatigue the of skilled are is everybody sound clarify, or very case referring the has -- in impacting Everybody me to that stressful in not side, yes, create impacting is clear the management that side, articulated at that, the in terms synchronous. some just our terms staff, reasons is and in been always housing that because sure just desire working that fatigue within you're But or on consistently, I that delays Talya of been it the Let articulated we’ve the but peers isn't facility, to admissions. to the was got think the those as folks And staying hard execution issues. seeing admit, whether been I want acuity, seeing it they or factors the pretty are home just on part that as other coming all staff of have, admit. it's you too, Talya make fatigue to facility longer,

Operator

Thank you.

comes the Citi. Joseph from Nick line of from question next Our

Your question, please.

Nick Joseph

Thanks.

growth the about talked external pipeline. You

think assumption mentioned What would that? good on a for I you $XXX million. hit be a rate

Rick Matros

most in. Well, of that’s already come

a coming XXXX got only million we've -- think in, XX and through I amount less small about then about in XXXX.

that exercise work left year and $XXX published, This we options million most declining. So, we've if been at you that those starts sort look schedules the and in. then last that, has the big always of of of the it

Nick Joseph

Okay. And ability then then? backfill about you that do the pipeline think to how

Rick Matros

It's to now. pretty want about that? you talk right Talya, tough

Talya Nevo-Hacohen

Sure.

because the it's So, a question actually in there's some interesting dynamics marketplace. obviously really

have fact, that's may unique or three in it's can having when pressure it. And new in there's the certainty and heard been for my a So, operators -- bit heard mode. have those not of they’re our are lease in are years pressure last you going been on in on and the you with occupancy, about up construction, on, may quite also guess that so I housing, properties their say senior occupancy underway is,

going So be opportunities segment. interesting some within there's that we that think to

their covenants. So they're But set, have not numbers not will their had will, track really to eventually getting their from earlier, had -- lenders. as on Rick under back you if if mentioned probably not hit on pressure asset

are odd during to market important. at -- really liquidity an is So time, where are to there there is out right, I going recapitalisation but or be that come a that think assets pandemic,

opportunity. So we think that's an interesting

Operator

you. Thank

Our SMBC next from Group. from question Anderson comes Rich

please. question, Your

Rich Anderson

normalize how not forward, income going it is be heard forward stimulus Then going you're still So, I will that out? of you're to kind I it think still of what going should do that not a stimulus out money to yet, mentioned numbers? an Harold, assume sort choppy right. the you going thing assumption about Or we normalize have in you

Harold Andrews

X%. in think we are are obviously, I the got and side, from that portfolio coming revenue the in numbers Well, Managed our the

as the on compared And down say revenues that, more have that just be to the become to would in happen. And seen I things So quarter impossible they are to up it's And it's to going in. that. predict we've there will of require incremental incremental operationalized. quarter be things stimulus But or timing hopeful last to come this built cost coming the operating coming scale for -- we're inventories. side,

predict start again, so to obviously And it's COVID difficult costs pandemic, as we as timing. the through the that labor impacted to we are But moving from normalize well. to expect see very

So for as less a see to then it and what should hard we of to while, I level it's the a in moderate closer it's I'm I that saw is and ongoing predict buildings. we -- vaccine, indicative quarter, of we're to but not cases as to we we'll kind the to of going going think cost think pandemic to see this the start see start because get

Rich Anderson

curious the does like Rick, -- model? between like triple-net. an you in maybe Okay. choice to go RIDEA some future happen want positively thinking environment may so of it shifts that is time want opportunity that I'm and all fundamental or more triple-net then it And inform sort about about it’d after operating vulnerability, this with the the just spend Is more you you might …. to expose COVID more an

Rick Matros

it. Thanks, Rich. Appreciate

it want So Part -- anymore. triple-net answer hardly that just it's of our the you doesn't to there do to do that anybody out is, affect really thinking. when practical. There's

space the you got want in that to consideration grow stay you've some and if practical of space. in So the

there's when complicit Housing You're learned. extremely deals. they're we living Senior coverage do facilities. I’ve this. not do independent we've on viewed on been really the And place we be in that before, going to think all are I pretty manage to And good, as acquisitions said The put lessons in because the side, side certainly healthcare good

on being that so we've to had of existing done, managed you times creating deals any led deals deals. hard triple-net or room equation really pre-pandemic to sort it of or coverage, And the which really breathing but conversion those the more as seen, amount -- issues folks demand just supply depresses not of headwinds hit when managed to

your to the operators, partner and at -- to operator to if that is determine goes with as level. downside, volume upside. we're that don't any as with analysis there because deal, so continue diligence deals good critical And think, transaction you're upside, managed the is all find as The to long buying initial we managed fine. you particular happy upside when know, we want So, we and and a peak a do are we do

hopefully as over making And might again. that's folks the that senior years occupancy Now, housing facilities, doing be if it's that possible way the in into of next of triple-nets couple the the interested starts demographic whether its learned a case, you're really underwriting versus living higher with happens it lesson. going it's independent level, X.X delivering point, their X.X go everybody in times has for Instead to so times, X be. of to there whatever

at always are cushion whatever headwinds point there you've that inevitable So some reason, for that and are got inevitable when headwinds there.

triple-net I come demographic but and occupancy, then that the demand. back really supply of state and interconnected. impacting it's dynamic can possible of the a And all So of function that think sort between that's the that’s

Operator

a Hartwich from Street. next Green question Our of line comes Lukas from

John MaGee

John and is MaGee this on your on you for congrats quarter. the Hi, time thank Lukas, for

as look to hoping look get there bid deal there of into, strong of you out was future? assets the for in for the to are Housing insight to quick a you advantage one me. you kind -- can areas you some the take to if Just advantage are deals your that selling that own up Senior recycle over look to of yourself the see take where into capital portfolio, just XXXX, I manifests

Rick Matros

you take do Talya, want to that?

Talya Nevo-Hacohen

Sure.

There's yes. about assets, the from it's the probably almost and asked from bottom barrel sell. you weekly It's living, specific buy something particularly they guys funny to because get a That's in it's just an Everyone looking buy asking an to that. always that even we really housing, to question, potentially, call buy, somebody us. buy at asset, -- who quite So can the inevitable. not Oftentimes but of does we're asset general. something multi-family want looking they're senior independent they is looking to wants

And home. frankly of makes measure, that about we'd the the sense And get that redeploy returns we that have well something can at a long-term whether because capital lot over think that then tested to the and at to long-term improvement to see have we we and X, to there's can we as haven't bought judgment sturdiness of there, how looking a how you the we time. make whether a capital it sell X.X. find So market to we

Operator

from Barclays. comes Valiquette Instructions] in Steve our [Operator And the next question line of

Steve Valiquette

to more was just of growing, this rent not says and Genesis do just scenarios to that from date. Signature, from might the about the flavor you or little and release I not I'm situation? requests still is press just opinion, if color September more I'm out a kind want if an for hoping either relief that sure of have guys this this, you likely more how the received any sure the even protocol, to XXth accounting today, get concern whole just from regarding as was case Sabra that be here, expect really get what it but you'd talk play operator

Rick Matros

me and Let it to then Harold. over make couple a turn of comments

make same you level I related -- the you're to of of for gotten a requests. include And think you you rent pandemic, may really expenses operator, you come and apply the assistance, to and no supply exclude one, have relief, and that, relatively any so forecasting high if kind analysis with that when not when to we any conclusion.

kick let it over we that, Harold. me But So, think was else. much it about to just as if anything

Harold Andrews

that more insights We into don't than from auditors. have any detailed the

to at this having Genesis us the And they issue for that with would come operators. see obviously them. and call got to be far not conversations, as a occupancies over they're And in to pressure. see to have problems, or here as problem told it this their be an will We obviously, for under they them got point continue clearly some but is improve They relief time, having quarter. imminent

and we've and with a So, wait Signature. in restructured Genesis while we're kind just that Signature a of lease mode see been back. one that has

was, show they've things been conclusion as given they and be occupancy provide the has their all to their Rick have very made could that position they've not forecast done. pleased said, is relief fine. able like given progress But cash we to We the what a with flow funded, increased levels in the been or occupancy Similarly, the today. relief, that are more feel short-term received by at Signature, absent being

we've whole other, mode. than that. One small a the such in to and I -- recurring more years. a see And and of rent of say quickly not and about think there's about percentage the next wait we So, it too, down Genesis lot for year a it's $XX have million to just $XX real a got gotten -- million basically I we're can couple

for fact impact negative happens, the is it move there, for that be I but is So, going us to something significant the really not whatever that case, -- be dramatically, the a to us. happens gotten so won't right obviously do. was it's think If that we've indication down hopefully this that, just --

Rick Matros

of one only who had we've And -- internal in relative we conversations came move region. that so also had those sort internal facilities, we conversations to we've to -- can it’s

be it’s really that and a would New we in Hampshire. So, a state difficult it move not like,

Operator

And you. Rick program question-and-answer the the Thank I'd to any back further for conclude Matros of like remarks. hand this session program. today's to does

Rick Matros

follow-up conversations. us additional have any available We're joining Thanks if you'll have or today. questions, for

a you to I the you talking so care. holidays. Take out stay in will to there. of And you environment we find while safe ways a please this For hope lot be for enjoy

Operator

conference. include Thank you, ladies today's in participation does program. your the This for gentlemen, and

may disconnect. Good now day. You