Invesque (IVQ) Q2 2024 earnings summary

Executive summary

• Completed sale of Symcare portfolio for $121 million, reducing skilled nursing exposure to nine properties.

• Sold MetroWest Medical Center for $6.4 million and Glendale, Wisconsin skilled nursing facility for $5.1 million, continuing exit from medical office and skilled nursing assets.

• Added Chapters Living as a new operator for three memory care communities, showing positive operational progress.

• SHOP portfolios (Commonwealth and Heritage) achieved and maintained pre-pandemic occupancy levels, with continued growth into Q3.

• Refinanced or extended $209.5 million of debt in Q2, reducing KeyBank credit facility by $33 million.

Financial highlights

• FFO and AFFO were each $0.10 per share for the quarter ended June 30, 2023; for Q2 2024, FFO was $0.03 per share and AFFO was $0.02 per share.

• Paid down over $122 million on the corporate credit facility between March 31 and June 30, with an additional $19.4 million paid after quarter-end, totaling over $141 million.

• NOI for the SHOP portfolio increased 5.5% sequentially, driven by occupancy and rate growth.

• Q2 2024 revenue was $43.1 million, down from $50.3 million in Q2 2023; net loss for Q2 2024 was $15.8 million, compared to $45.9 million in Q2 2023.

Outlook and guidance

• Expect continued asset sales, especially remaining medical office buildings, within 12 months, and further refinancings to reduce leverage in the second half of 2024.

• Anticipate further portfolio pruning and operator consolidation to focus on private-pay senior housing.

• Projected occupancy growth in senior housing to level off after recent strong recovery.