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Section 1: 8-K (FORM 8-K)

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20459

 

 

 

FORM 8-K

 

CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D)

OF THE SECURITIES EXCHANGE ACT OF 1934

 

Date of report:  February 20, 2020

(Date of earliest event reported)

 

LTC PROPERTIES, INC.

(Exact name of Registrant as specified in its charter)

 

Maryland   1-11314   71-0720518
(State or other jurisdiction of   (Commission file number)   (I.R.S. Employer
incorporation or organization)       Identification No)

 

2829 Townsgate Road, Suite 350

Westlake Village, CA 91361

(Address of principal executive offices)

 

(805) 981-8655

(Registrant’s telephone number, including area code)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

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 the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

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.  ¨

 

 

 

 

 

 

Item 2.02. — Results of Operations and Financial Condition

 

On February 20, 2020, LTC Properties, Inc. announced the operating results for the three months ended December 31, 2019. The text of the press release and the supplemental information package are furnished herewith as Exhibits 99.1 and 99.2, respectively, and are specifically incorporated by reference herein.

 

The information in this Form 8-K and the related information in the exhibits attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section and shall not be incorporated by reference into any filing of LTC under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing, except as shall be expressly set forth by specific reference in any such filing.

 

Item 9.01. — Financial Statements and Exhibits

 

99.1Press Release issued February 20, 2020.
99.2LTC Properties, Inc. Supplemental Information Package for the period ending December 31, 2019.
104Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

SIGNATURE

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

 

  LTC PROPERTIES, INC.
   
   
Dated: February 20, 2020 By: /s/ WENDY L. SIMPSON
    Wendy L. Simpson
    Chairman, CEO & President

 

 

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Section 2: EX-99.1 (EXHIBIT 99.1)

Exhibit 99.1

 

 FOR IMMEDIATE RELEASE

 

For more information contact:

Wendy L. Simpson

Pam Kessler

(805) 981-8655

 

 

 

LTC REPORTS 2019 FOURTH QUARTER RESULTS

AND DISCUSSES RECENT ACTIVITIES 

 

WESTLAKE VILLAGE, CALIFORNIA, February 20, 2020 -- LTC Properties, Inc. (NYSE: LTC), a real estate investment trust that primarily invests in seniors housing and health care properties, today announced operating results for its fourth quarter ended December 31, 2019.

 

Net income available to common stockholders was $12.4 million, or $0.31 per diluted share, for the 2019 fourth quarter, compared with $30.6 million, or $0.77 per diluted share, for the same period in 2018. The decrease in net income available to common stockholders was primarily due to a net loss on sale during the 2019 fourth quarter, compared with a net gain on sale during the same period in 2018, an impairment loss from investment in unconsolidated joint ventures during the 2019 fourth quarter, and one-time non-recurring other income related to the write-off of a contingent lease incentive and related earn-out liability in the prior year, partially offset by higher rental income from acquisitions and completed developments.

 

Funds from Operations (“FFO”) was $32.4 million for the 2019 fourth quarter, compared with $32.1 million for the comparable 2018 period. FFO per diluted common share was $0.81 for the quarters ended December 31, 2019 and 2018. Excluding non-recurring items, FFO per diluted common share was $0.76 and $0.73 for the quarters ended December 31, 2019 and 2018, respectively. The improvement in FFO per diluted common share excluding non-recurring items, was primarily due to higher rental income during the 2019 fourth quarter as discussed above.

 

LTC completed the following transactions during the fourth quarter of 2019:

 

·Acquired a 76-unit assisted living/memory care community in Auburn Hills, Michigan and an 80-unit memory care community in Sterling Heights, Michigan for an aggregate purchase price of $19.0 million, and entered into a 10-year master lease with an operator new to LTC’s portfolio at an initial cash yield of 7.4%, escalating 2% annually with four, five-year renewal options;

 

·Sold a hurricane damaged property in Texas and recognized a $2.1 million net gain on property insurance proceeds. Additionally, as a result of this transaction, LTC recognized a net loss on sale of $0.8 million, resulting in a net gain of $1.3 million when combined with insurance proceeds;

 

·Sold two non-revenue producing properties, a 160-bed skilled nursing center in Arizona and a 140-unit independent living community in Texas, for an aggregate sales price of $7.3 million, recognizing a cumulative loss of $3.8 million; and

 

·Issued senior unsecured notes in the aggregate amount of $100.0 million to affiliates and managed accounts of PGIM, Inc. The notes bear interest at 3.85%, have scheduled principal payments and mature on October 20, 2031.The proceeds were used to paydown the Company’s unsecured line of credit.

 

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Subsequent to December 31, 2019, LTC completed the following:

 

·Acquired a 140-bed skilled nursing center in Texas for approximately $13.5 million, and entered into a 10-year master lease with an operator new to LTC’s portfolio with an initial cash yield of 8.5%, escalating 2% annually with two, five-year renewal options.

 

Conference Call Information

 

LTC will conduct a conference call on Friday, February 21, 2020, at 8:00 a.m. Pacific Time (11:00 a.m. Eastern Time) to provide commentary on its performance and operating results for the quarter ended December 31, 2019. The conference call is accessible by telephone and the internet. Telephone access will be available by dialing 877-510-2862 (domestically) or 412-902-4134 (internationally). To participate in the webcast, go to LTC’s website at www.LTCreit.com 15 minutes before the call to download any necessary software.

 

An audio replay of the conference call will be available from February 21 through March 6, 2020, and may be accessed by dialing 877-344-7529 (domestically) or 412-317-0088 (internationally) and entering conference number 10138686. Additionally, an audio archive will be available on LTC’s website on the “Presentations” page of the “Investor Information” section, which is under the “Investors” tab. LTC’s earnings release and supplemental information package for the current period will be available on its website on the “Press Releases” and “Presentations” pages, respectively, of the “Investor Information” section which is under the “Investors” tab.

 

About LTC

 

LTC is a real estate investment trust (REIT) investing in seniors housing and health care properties primarily through sale-leasebacks, mortgage financing, joint-ventures and structured finance solutions including preferred equity and mezzanine lending. LTC holds more than 200 investments in 28 states with 30 operating partners. The portfolio is comprised of approximately 50% seniors housing and 50% skilled nursing properties. Learn more at www.LTCreit.com.

 

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Forward Looking Statements

 

This press release includes statements that are not purely historical and are “forward looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding the Company’s expectations, beliefs, intentions or strategies regarding the future. All statements other than historical facts contained in this press release are forward looking statements. These forward-looking statements involve a number of risks and uncertainties. Please see LTC’s most recent Annual Report on Form 10-K, its subsequent Quarterly Reports on Form 10-Q, and its other publicly available filings with the Securities and Exchange Commission for a discussion of these and other risks and uncertainties. All forward-looking statements included in this press release are based on information available to the Company on the date hereof, and LTC assumes no obligation to update such forward looking statements. Although the Company’s management believes that the assumptions and expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. The actual results achieved by the Company may differ materially from any forward-looking statements due to the risks and uncertainties of such statements.

 

(financial tables follow)

 

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LTC PROPERTIES, INC.

CONSOLIDATED STATEMENTS OF INCOME

(amounts in thousands, except per share amounts)

 

   Three Months Ended   Twelve Months Ended 
   December 31,   December 31, 
   2019   2018   2019   2018 
   (unaudited)   (audited) 
Revenues:                
Rental income  $38,189   $32,759   $152,755   $135,405 
Interest income from mortgage loans   7,683    7,290    29,991    28,200 
Interest and other income   591    3,538    2,558    5,040 
Total revenues   46,463    43,587    185,304    168,645 
                     
Expenses:                    
Interest expense   7,578    7,215    30,582    30,196 
Depreciation and amortization   9,817    9,396    39,216    37,555 
Provision for doubtful accounts   13    11    166    87 
Transaction costs   90    65    365    84 
Property tax expense   4,189(1)       16,755     
General and administrative expenses   4,541    4,801    18,453    19,193 
Total expenses   26,228    21,488    105,537    87,115 
                     
Other operating income:                    
(Loss) gain on sale of real estate, net   (4,630)   7,984    2,106    70,682 
Operating income   15,605    30,083    81,873    152,212 
Gain from property insurance proceeds   2,111(2)       2,111(2)    
Impairment loss from investments in unconsolidated joint ventures   (5,500)       (5,500)    
Income from unconsolidated joint ventures   415    761    2,388    2,864 
Net income   12,631    30,844    80,872    155,076 
Income allocated to non-controlling interests   (89)   (78)   (346)   (95)
Net income attributable to LTC Properties, Inc.   12,542    30,766    80,526    154,981 
Income allocated to participating securities   (93)   (121)   (391)   (625)
Net income available to common stockholders  $12,449   $30,645   $80,135   $154,356 
                     
Earnings per common share:                    
Basic  $0.31   $0.78   $2.03   $3.91 
Diluted  $0.31   $0.77   $2.02   $3.89 
                     
Weighted average shares used to calculate earnings per                    
common share:                    
Basic   39,588    39,501    39,571    39,477 
Diluted   39,775    39,864    39,759    39,839 
                     
Dividends declared and paid per common share  $0.57   $0.57   $2.28   $2.28 

 

 

(1)The new income statement line item “property tax expense” is due to the impact of newly adopted Accounting Standard Codification 842, Leases (“ASC 842”). See Item 8. FINANCIAL STATEMENTS—Note 2. Summary of Significant Accounting Policies. in our Annual Report on Form 10-K for the year ended December 31, 2019 for further discussion.

 

(2)Represents a net gain from property insurance proceeds related to a property that was sold during the fourth quarter of 2019.

 

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Supplemental Reporting Measures

 

FFO and Funds Available for Distribution (“FAD”) are supplemental measures of a real estate investment trust’s (“REIT”) financial performance that are not defined by U.S. generally accepted accounting principles (“GAAP”). Investors, analysts and the Company use FFO and FAD as supplemental measures of operating performance. The Company believes FFO and FAD are helpful in evaluating the operating performance of a REIT. Real estate values historically rise and fall with market conditions, but cost accounting for real estate assets in accordance with GAAP assumes that the value of real estate assets diminishes predictably over time. We believe that by excluding the effect of historical cost depreciation, which may be of limited relevance in evaluating current performance, FFO and FAD facilitate like comparisons of operating performance between periods. Occasionally, the Company may exclude non-recurring items from FFO and FAD in order to allow investors, analysts and our management to compare the Company’s operating performance on a consistent basis without having to account for differences caused by unanticipated items.

 

FFO, as defined by the National Association of Real Estate Investment Trusts (“NAREIT”), means net income available to common stockholders (computed in accordance with GAAP) excluding gains or losses on the sale of real estate and impairment write-downs of depreciable real estate, plus real estate depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. The Company’s computation of FFO may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition or have a different interpretation of the current NAREIT definition from that of the Company; therefore, caution should be exercised when comparing our Company’s FFO to that of other REITs.

 

We define FAD as FFO excluding the effects of straight-line rent, amortization of lease inducement, effective interest income, deferred income from unconsolidated joint ventures, non-cash compensation charges, capitalized interest and non-cash interest charges. GAAP requires rental revenues related to non-contingent leases that contain specified rental increases over the life of the lease to be recognized evenly over the life of the lease. This method results in rental income in the early years of a lease that is higher than actual cash received, creating a straight-line rent receivable asset included in our consolidated balance sheet. At some point during the lease, depending on its terms, cash rent payments exceed the straight-line rent which results in the straight-line rent receivable asset decreasing to zero over the remainder of the lease term. Effective interest method, as required by GAAP, is a technique for calculating the actual interest rate for the term of a mortgage loan based on the initial origination value. Similar to the accounting methodology of straight-line rent, the actual interest rate is higher than the stated interest rate in the early years of the mortgage loan thus creating an effective interest receivable asset included in the interest receivable line item in our consolidated balance sheet and reduces down to zero when, at some point during the mortgage loan, the stated interest rate is higher than the actual interest rate. FAD is useful in analyzing the portion of cash flow that is available for distribution to stockholders. Investors, analysts and the Company utilize FAD as an indicator of common dividend potential. The FAD payout ratio, which represents annual distributions to common shareholders expressed as a percentage of FAD, facilitates the comparison of dividend coverage between REITs.

 

While the Company uses FFO and FAD as supplemental performance measures of our cash flow generated by operations and cash available for distribution to stockholders, such measures are not representative of cash generated from operating activities in accordance with GAAP, and are not necessarily indicative of cash available to fund cash needs and should not be considered an alternative to net income available to common stockholders.

 

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Reconciliation of FFO and FAD

 

The following table reconciles GAAP net income available to common stockholders to each of NAREIT FFO attributable to common stockholders and FAD (unaudited, amounts in thousands, except per share amounts):

 

   Three Months Ended   Twelve Months Ended 
   December 31,   December 31, 
   2019   2018   2019   2018 
GAAP net income available to common stockholders  $12,449   $30,645   $80,135   $154,356 
Add: Depreciation and amortization   9,817    9,396    39,216    37,555 
Add: Impairment loss from investments in unconsolidated joint ventures   5,500        5,500     
Less: Gain on sale of real estate, net   4,630    (7,984)   (2,106)   (70,682)
NAREIT FFO attributable to common stockholders   32,396    32,057    122,745    121,229 
                     
Add: Non-recurring items   (2,111)(1)   (3,074)(2)   (1,535)(5)   (3,074)
FFO attributable to common stockholders, excluding non-recurring items  $30,285   $28,983   $121,210   $118,155 
                     
NAREIT FFO attributable to common stockholders  $32,396   $32,057   $122,745   $121,229 
Non-cash income:                    
Less: straight-line rental income   (889)   (921)   (4,487)   (9,550)
Add: amortization of lease costs   104    441    385    2,092 
(Less)/Add: Other non-cash (income)/expense       (3,074)(2)   1,926(3)   (3,074)(2)
Less: Effective interest income from mortgage loans   (1,481)   (1,438)   (5,842)   (5,703)
Less: Deferred income from unconsolidated joint ventures       (15)   (18)   (108)
Net non-cash income   (2,266)   (5,007)   (8,036)   (16,343)
                     
Non-cash expense:                    
Add: Non-cash compensation charges   1,627    1,486    6,565    5,870 
Add: Non-cash interest related to earn-out liabilities               377 
Less:  Capitalized interest   (167)   (398)   (608)   (1,248)
Net non-cash expense   1,460    1,088    5,957    4,999 
                     
Funds available for distribution (FAD)   31,590    28,138   $120,666   $109,885 
                     
Less: Non-recurring income   (2,111)(1)       (3,461)(4)    
Funds available for distribution (FAD), excluding non-recurring items  $29,479   $28,138   $117,205   $109,885 

 

(1)   Represents a net gain from property insurance proceeds related to a property that was sold during the fourth quarter of 2019.

(2)   Represents net write-off of a contingent lease incentive and related earn-out liability.

(3)   Represents the write-off of straight-line rent due to a lease termination and transition of two senior housing communities to a new operator.

(4)   Represents deferred rent repayment from an operator and (1) above.

(5)   Represents (3) and (4) above.

 

NAREIT Basic FFO attributable to common stockholders per share  $0.82   $0.81   $3.10   $3.07 
NAREIT Diluted FFO attributable to common stockholders per share  $0.81   $0.81   $3.08   $3.06 
                     
NAREIT Diluted FFO attributable to common stockholders  $32,489   $32,178   $123,136   $121,854 
Weighted average shares used to calculate NAREIT diluted FFO per share attributable to common stockholders   39,939    39,864    39,921    39,839 
                     
Diluted FFO attributable to common stockholders, excluding non-recurring items  $30,378   $29,104   $121,601   $118,780 
Weighted average shares used to calculate diluted FFO, excluding non-recurring items, per share attributable to common stockholders   39,939    39,864    39,921    39,839 
                     
Diluted FAD, excluding non-recurring items  $29,572   $28,259   $117,596   $110,510 
Weighted average shares used to calculate diluted FAD, excluding non-recurring items, per share   39,939    39,864    39,921    39,839 

 

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LTC PROPERTIES, INC.

CONSOLIDATED BALANCE SHEETS

(amounts in thousands, except per share)

 

   December 31, 2019   December 31, 2018 
   (audited)   (audited) 
ASSETS          
Investments:          
Land  $126,703   $125,358 
Buildings and improvements   1,295,899    1,290,352 
Accumulated depreciation and amortization   (312,642)   (312,959)
Operating real estate property, net   1,109,960    1,102,751 
Properties held-for-sale, net of accumulated depreciation: 2019—$35,113; 2018—$1,916   26,856    3,830 
Real property investments, net   1,136,816    1,106,581 
Mortgage loans receivable, net of loan loss reserve: 2019—$2,560; 2018—$2,447   254,099    242,939 
Real estate investments, net   1,390,915    1,349,520 
Notes receivable, net of loan loss reserve: 2019—$181; 2018—$128   17,927    12,715 
Investments in unconsolidated joint ventures   19,003    30,615 
Investments, net   1,427,845    1,392,850 
           
Other assets:          
Cash and cash equivalents   4,244    2,656 
Restricted cash       2,108 
Debt issue costs related to bank borrowings   2,164    2,989 
Interest receivable   26,586    20,732 
Straight-line rent receivable, net of allowance for doubtful accounts: 2019—$0; 2018—$746   45,703(1)   73,857 
Lease incentives   2,552(1)   14,443 
Prepaid expenses and other assets   5,115(2)   3,985 
Total assets  $1,514,209   $1,513,620 
           
LIABILITIES          
Bank borrowings  $93,900   $112,000 
Senior unsecured notes, net of debt issue costs: 2019—$812; 2018—$938   599,488    533,029 
Accrued interest   4,983    4,180 
Accrued expenses and other liabilities   30,412(2)   31,440 
Total liabilities   728,783    680,649 
           
EQUITY          
Stockholders’ equity:          
Common stock: $0.01 par value; 60,000 shares authorized; shares issued and outstanding:  2019—39,752; 2018—39,657   398    397 
Capital in excess of par value   867,346    862,712 
Cumulative net income   1,293,482    1,255,764 
Cumulative distributions   (1,384,283)   (1,293,383)
Total LTC Properties, Inc. stockholders’ equity   776,943    825,490 
Non-controlling interests   8,483    7,481 
Total equity   785,426    832,971 
Total liabilities and equity  $1,514,209   $1,513,620 

 

 

(1)Decrease due to impact of newly adopted ASC 842. See Item 8. FINANCIAL STATEMENTS—Note 2. Summary of Significant Accounting Policies. in our Annual Report on Form 10-K for the year ended December 31, 2019 for further discussion.

 

(2)Includes $1,287 right of use asset/lease liability due to the impact of newly adopted ASC 842. See Item 8. FINANCIAL STATEMENTS—Note 2. Summary of Significant Accounting Policies. in our Annual Report on Form 10-K for the year ended December 31, 2019 for further discussion.

 

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Section 3: EX-99.2 (EXHIBIT 99.2)

Exhibit 99.2

 

Supplemental Operating & Financial Data December 2019 Boonespring Healthcare Center & Rehabilitation Union, KY

 

SUPPLEMENTAL INFORMATION 4Q 2019 COMPANY Company Information & Leadership 3 INVESTMENTS Execution of Growth Strategy 4 Real Estate Activities Acquisitions and Loan Originations 5 Joint Ventures 6 De Novo Development 7 Expansions and Renovations 8 Lease-Up and Lease-Up History 9-10 Capital Recycling 11 PORTFOLIO Portfolio Overview 12 Portfolio Metrics 13 Portfolio Diversification Geography, MSA, Age of Portfolio 14-15 Operators 16 Maturity 17 FINANCIAL Enterprise Value 18 Debt Metrics 19 Debt Maturity 20 Financial Data Summary 21-22 Income Statement Data 23 Consolidated Balance Sheets 24 Funds from Operations 25-26 GLOSSARY Glossary 27-28 TABLE OF CONTENTS 2 FORWARD - LOOKING STATEMENTS This supplemental information contains forward - looking statements within the meaning of Section 27 A of the Securities Act of 1933 , as amended, and Section 21 E of the Securities Exchange Act of 1934 , as amended, adopted pursuant to the Private Securities Litigation Reform Act of 1995 . Statements that are not purely historical may be forward - looking . You can identify some of the forward - looking statements by their use of forward - looking words, such as ‘‘believes,’’ ‘‘expects,’’ ‘‘may,’’ ‘‘will,’’ ‘‘should,’’ ‘‘seeks,’’ ‘‘approximately,’’ ‘‘intends,’’ ‘‘plans,’’ ‘‘estimates’’ or ‘‘anticipates,’’ or the negative of those words or similar words . Forward - looking statements involve inherent risks and uncertainties regarding events, conditions and financial trends that may affect our future plans of operation, business strategy, results of operations and financial position . A number of important factors could cause actual results to differ materially from those included within or contemplated by such forward - looking statements, including, but not limited to, the status of the economy, the status of capital markets (including prevailing interest rates), and our access to capital ; the income and returns available from investments in health care related real estate, the ability of our borrowers and lessees to meet their obligations to us, our reliance on a few major operators ; competition faced by our borrowers and lessees within the health care industry, regulation of the health care industry by federal, state and local governments, changes in Medicare and Medicaid reimbursement amounts (including due to federal and state budget constraints), compliance with and changes to regulations and payment policies within the health care industry, debt that we may incur and changes in financing terms, our ability to continue to qualify as a real estate investment trust, the relative illiquidity of our real estate investments, potential limitations on our remedies when mortgage loans default, and risks and liabilities in connection with properties owned through limited liability companies and partnerships . For a discussion of these and other factors that could cause actual results to differ from those contemplated in the forward - looking statements, please see the discussion under ‘‘Risk Factors’’ and other information contained in our Annual Report on Form 10 - K for the fiscal year ended December 31 , 2019 and in our publicly available filings with the Securities and Exchange Commission . We do not undertake any responsibility to update or revise any of these factors or to announce publicly any revisions to forward - looking statements, whether as a result of new information, future events or otherwise . NON - GAAP INFORMATION This supplemental information contains certain non - GAAP information including EBITDA re , adjusted EBITDA re , FFO, FFO excluding non - recurring items, FAD, FAD excluding non - recurring items, adjusted interest coverage ratio, and adjusted fixed charges coverage ratio . A reconciliation of this non - GAAP information is provided on pages 22 , 25 and 26 of this supplemental information, and additional information is available under the “Non - GAAP Financial Measures” subsection under the “Selected Financial Data” section of our website at www . LTCreit . com .

 

SUPPLEMENTAL INFORMATION 4Q 2019 Wendy Simpson Chairman, Chief Executive Officer and President Pam Kessler Executive Vice President, CFO and Secretary Clint Malin Executive Vice President, Chief Investment Officer Cece Chikhale Senior Vice President, Controller and Treasurer Doug Korey Senior Vice President, Managing Director of Business Development Peter Lyew Vice President, Director of Taxes LEADERSHIP Gibson Satterwhite Vice President, Asset Management Mandi Hogan Vice President, Marketing 3 Founded in 1992 , LTC Properties, Inc . (NYSE : LTC) is a self - administered real estate investment trust (REIT) investing in seniors housing and health care properties primarily through sale - leaseback transactions, mortgage financing and structured finance solutions including preferred equity and mezzanine lending . LTC’s portfolio encompasses Skilled Nursing Facilities (SNF), Assisted Living Communities (ALF), Independent Living Communities (ILF), Memory Care Communities (MC) and combinations thereof . Our main objective is to build and grow a diversified portfolio that creates and sustains shareholder value while providing our stockholders current distribution income . To meet this objective, we seek properties operated by regional operators, ideally offering upside and portfolio diversification (geographic, operator, property type and investment vehicle) . For more information, visit www . LTCreit . com . LTC PROPERTIES, INC. 2829 Townsgate Road Suite 350 Westlake Village, CA 91361 805 - 981 - 8655 www.LTCreit.com TRANSFER AGENT American Stock Transfer and Trust Company 6201 15 th Avenue Brooklyn, NY 11219 866 - 708 - 5586 BOARD OF DIRECTORS Any opinions, estimates, or forecasts regarding LTC’s performance made by the analysts listed above do not represent the opinions, estimates, and forecasts of LTC or its management. ANALYSTS 3 Wendy Simpson Chairman Boyd Hendrickson Lead Independent Director James Pieczynski Nominating & Corporate Governance Committee Chairman Devra Shapiro Audit Committee Chairman Timothy Triche, MD Compensation Committee Chairman Mike Bowden Vice President, Investments Connor Siversky Berenberg Capital Markets John Kim BMO Capital Markets Corp. Daniel Bernstein CapitalOne Jordan Sadler KeyBanc Capital Markets, Inc. Omotayo Okusanya Mizuho Securities USA LLC Mike Carroll RBC Capital Markets Corporation Rich Anderson SMBC Nikko Securities Chad Vanacore Stifel, Nicolaus & Company, Inc. Todd Stender Wells Fargo Securities, LLC

 

SUPPLEMENTAL INFORMATION 4Q 2019 $9 $68 $44 $12 $112 $39 $22 $28 $17 $94 $109 $245 $185 $25 $414 $142 $103 $80 $81 $14 $0 $75 $150 $225 $300 $375 $450 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 YTD 2020 Development/Expansions/Renovations Total LTC Investment $1.5 Billion in Total Investments Underwritten EXECUTION OF GROWTH STRATEGY 4 INVESTMENTS (excludes non - controlling partners’ contributions)

 

SUPPLEMENTAL INFORMATION 4Q 2019 (1) Commitments may include capital improvement or development allowances for approved projects but excludes incentive payments a nd contingent payments. For a comprehensive list of our commitments, see our Annual Report on Form 10 - K. (2) See page 7 for development activities. (3) We entered into a joint venture (“JV”) to develop, purchase and own seniors housing communities. During 2018, the JV purchase d l and for the development of a 78 - unit ALF/MC community for a total anticipated project cost of $18,108. Additionally during 2018, in a sale - leaseback transaction, the JV purchased an existing operational 89 - unit IL F community adjacent to the ALF/MC community we are developing for $14,400. Upon completion of the development project, LTC’s economic interest in the real estate JV will be approximately 88%. We account fo r t he JV on a consolidated basis. See page 6 for joint venture contributions. (4) We entered into a JV to purchase an existing operational 74 - unit ALF/MC community. The non - controlling partner contributed $919 of equity and we contributed $15,976 in cash. LTC’s economic interest in the real estate JV is approximately 95%. We account for the JV on a consolidated basis. See page 6 for joint venture contributions. (5) We acquired a 90 - bed post - acute skilled nursing center in Kansas City, MO. We also acquired a parcel of land and committed to d evelop a 90 - bed post - acute skilled nursing center in Independence, MO. (6) Escalated by 2% in December 2019 and annually thereafter. (7) Capital improvement commitment is available to both properties for a total of $1,900. CONTRACTUAL # OF PROPERTY # BEDS/ DATE OF INITIAL PURCHASE PROPERTIES TYPE UNITS LOCATION OPERATOR CONSTRUCTION CASH YIELD PRICE 2018 5/11 1 UDP (2) 78 units Medford, OR Fields Senior Living 2018-2020 7.65% 600$ (3) 17,508$ (3) 6/28 2 MC 88 units Fort Worth & Frisco, TX Koelsch Communities 2014/2015 7.25% 25,200 — 8/30 1 ILF 89 units Medford, OR Fields Senior Living 1984/2005 6.75% 14,400 (3) — (3) 4 255 units 40,200$ 17,508$ 2019 1/31 1 ALF/MC 74 units Abingdon, VA English Meadows Senior Living 2015 7.40% 16,719$ (4) —$ 8/15 1 SNF (5) 90 beds Kansas City, MO Ignite Medical Resorts 2018 8.25% (6) 19,500 — 8/23 1 UDP (2)(5) 90 beds Independence, MO Ignite Medical Resorts 2019-2020 9.25% 2,622 14,752 12/31 1 ALF/MC 76 units Auburn Hills, MI Randall Residence 1995 7.40% 6,486 1,900 (7) 12/31 1 MC 80 units Sterling Heights, MI Randall Residence 1997 7.40% 12,514 — (7) 5 230 units / 180 beds 57,841$ 16,652$ 2020 1/10 1 SNF 140 beds Longview, TX HMG Healthcare 2014 8.50% 13,500$ —$ ADDITIONAL DATE COMMITMENT (1) LOAN ORIGINATIONS ACQUISITIONS (1) We funded additional loan proceeds of $7,400 and $7,125 and committed to fund $1,700 and $3,000 in capital improvements, res pec tively, under an existing mortgage loan. The loan is secured by four SNF properties in Michigan. See page 8 for the detail of remaining commitments for expansions and renovations. (2) Represents a mezzanine loan with a rate of 12.00% annually (8% paid in cash and 4% deferred during the first 46 months) which wa s originated in 4Q18 but funded in 1Q19. (3) We funded additional loan proceeds of $7,500 under an existing mortgage loan. The incremental funding bears interest at 9.41% , f ixed for two years, and escalating by 2.25% thereafter. REAL ESTATE ACTIVITIES – ACQUISITIONS AND LOAN ORIGINATIONS (DOLLAR AMOUNTS IN THOUSANDS) 5 STATED # OF PROPERTY # BEDS/ LOAN MATURITY FUNDED AT INTEREST PROPERTIES TYPE UNITS LOCATION TYPE DATE OPERATOR ORIGINATION ORIGINATION RATE 2018 3/1 1 SNF 112 beds Sterling Heights, MI (1) Mortgage Oct-2045 Prestige Healthcare 9,100$ 7,400$ 8.66% 8/31 1 SNF 126 beds Grand Haven, MI (1) Mortgage Oct-2045 Prestige Healthcare 10,125 7,125 9.41% 10/16 1 UDP-ALF/MC/ILF 204 units Atlanta, GA Mezzanine Dec-2023 Village Park Senior Living 6,828 — 12.00% (2) 3 238 beds/204 units 26,053$ 14,525$ 2019 6/20 2 SNF 205 beds East Lansing, MI (3) Mortgage Jan-2045 Prestige Healthcare 7,500$ 7,500$ 9.41% DATE INVESTMENTS

 

SUPPLEMENTAL INFORMATION 4Q 2019 REAL ESTATE ACTIVITIES – JOINT VENTURES (DOLLAR AMOUNTS IN THOUSANDS) 6 CONSOLIDATED JOINT VENTURES LTC LTC INVESTMENT PROPERTY # BEDS/ LTC FUNDED REMAINING YEAR LOCATION OPERATOR TYPE INVESTMENT PURPOSE UNITS LTC COMMITMENT TO DATE COMMITMENT (1) 2017 Cedarburg, WI Tealwood Senior Living ALF/MC/ILF Owned Real Estate & Development 110 units 22,517$ 2,318$ 20,199$ 19,133$ (2) —$ 2017 Spartanburg, SC Affinity Living Group ALF Owned Real Estate 87 units 11,660 1,241 10,419 10,419 — 197 units 34,177 3,559 30,618 29,552 — 2018 Medford, OR Fields Senior Living (3) UDP Owned Real Estate & Development 78 units 18,108 1,081 17,027 12,308 4,719 2018 Medford, OR Fields Senior Living (3) ILF Owned Real Estate 89 units 14,400 2,857 11,543 11,543 — 167 units 32,508 3,938 28,570 23,851 4,719 2019 Abingdon, VA English Meadows Senior Living ALF/MC Owned Real Estate 74 units 16,895 919 15,976 15,976 — 438 units 83,580$ 8,416$ 75,164$ 69,379$ 4,719$ JOINT VENTURES INTEREST TOTAL NON-CONTROLLING CONTRIBUTIONCOMMITMENT INVESTMENTS UNCONSOLIDATED JOINT VENTURES PROPERTY MATURITY # BEDS/ CARRYING LOCATION PROPERTIES OPERATOR TYPE DATE UNITS IMPAIRMENT VALUE 2015 Peoria & Yuma, AZ 4 Senior Lifestyle ALF/MC/ILF Preferred Equity N/A 15.00% (1) 585 units 24,503$ (5,500)$ (1) 19,003$ INVESTMENT INVESTMENTCOMMITMENT YEAR TYPE COMMITMENTRETURN (1) See page 7 for the development activities on a consolidated basis. (2) In 4Q19, the construction of the senior living community in Cedarburg, WI was completed under budget. (3) Represents a single joint venture with ownership in two properties. (1) Effective second quarter of 2019, this JV was placed on cash basis due to delinquency of our preferred return. In November 20 19, the JV signed a contract for the sale of the four properties comprising the JV. The contract was subject to standard due diligence and other contingencies to close, all of which were met in January 2020. Accordingly, b ase d on the information available to us, we recorded an impairment loss from investment in unconsolidated joint ventures of $5,500 and wrote our preferred equity investment down to its estimated fair value.

 

SUPPLEMENTAL INFORMATION 4Q 2019 ESTIMATED CASH RENT CONTRACTUAL TOTAL TOTAL INCEPTION COMMITMENT # OF PROPERTY INITIAL CASH # BEDS/ INVESTMENT 4Q19 CAPITALIZED PROJECT BASIS REMAINING DATE YEAR LOCATION OPERATOR PROJECTS TYPE YIELD UNITS COMMITMENT (1) FUNDING (2) 2Q21 2018 Medford, OR Fields 1 ALF/MC 7.65% 78 units 18,108$ 3,716$ 442$ 13,831$ 4,719$ 4Q20 (4) 2019 Independence, MO Ignite 1 SNF 9.25% 90 beds 17,374 1,172 52 4,158 13,268 2 78 units / 90 beds 35,482$ 4,888$ 494$ 17,989$ 17,987$ COMMITMENT (3) TO DATE INTEREST/OTHER REAL ESTATE ACTIVITIES – DE NOVO DEVELOPMENT (DOLLAR AMOUNTS IN THOUSANDS) (1) Includes purchase of land and initial improvement funding, if applicable, and development commitment. (2) In addition to the 4Q19 funding detailed here, we funded $479 on a property in Union, KY that was completed in 1Q19 and funde d $ 106 on a property in Cedarburg, WI that was completed in 2Q19. See Lease - Up and Lease - Up History on pages 9 and 10, respectively. (3) Remaining Commitment is calculated as follows: “Investment Commitment” less “Total Project Basis” plus “Total Capitalized In ter est/Other.” (4) In August 2019, we acquired a parcel of land for $2,622 and committed to develop a 90 - bed post - acute skilled nursing center in I ndependence, MO. Completion is scheduled for the fall of 2020. 7 INVESTMENTS Ignite Medical Resort Blue Springs Independence, MO

 

SUPPLEMENTAL INFORMATION 4Q 2019 (1) Commitment is secured by two properties in Michigan operated by Prestige Healthcare. Interest payment increases upon each fun din g. (2) Commitment is part of the total loan commitment secured by four properties in Michigan operated by Prestige Healthcare. Inte res t payment increases upon each funding. REAL ESTATE ACTIVITIES – EXPANSIONS & RENOVATIONS (DOLLAR AMOUNTS IN THOUSANDS) MORTGAGE LOANS 8 CONTRACTUAL TOTAL COMMITMENT PROJECT # OF PROPERTY INITIAL INVESTMENT 4Q19 FUNDED REMAINING YEAR TYPE LOCATION OPERATOR PROJECTS TYPE CASH YIELD TO DATE COMMITMENT — (1) 2016 Renovation East Lansing, MI Prestige Healthcare 2 SNF 9.41% 4,500$ 122$ 4,263$ 237$ — (2) 2018 Renovation Sterling Heights, MI Prestige Healthcare 1 SNF 8.66% 1,700 41 971 729 — (2) 2018 Renovation Grand Haven, MI Prestige Healthcare 1 SNF 9.41% 3,000 221 711 2,289 4 9,200$ 384$ 5,945$ 3,255$ INCEPTION DATE COMMITMENT FUNDING INTEREST ESTIMATED INVESTMENTS Medilodge of East Lansing East Lansing, MI Medilodge of Richmond Richmond, MI

 

SUPPLEMENTAL INFORMATION 4Q 2019 REAL ESTATE ACTIVITIES – LEASE - UP (DOLLAR AMOUNTS IN THOUSANDS) (1) Represents date of Certificate of Occupancy. (2) Total Investment for acquisitions includes closing costs and total development costs and excludes capitalized interest. (3) As a result of Anthem’s default under its master lease in 2017, Anthem is paying annual cash rent of $9.9 million through 202 0. We receive regular financial performance updates from Anthem and continue to monitor Anthem’s performance obligations under the master lease agreement. (4) Certificate of occupancy was received in February 2019, however licensure was not received until April 2019. 9 DEVELOPMENT CONTRACTUAL DATE DATE OCCUPANCY AT COMMITMENT PROJECT # OF PROPERTY # BEDS/ INITIAL TOTAL ACQUIRED OPENED (1) 12/31/2019 YEAR TYPE LOCATION OPERATOR PROJECTS TYPE UNITS CASH YIELD INVESTMENT (2) Oct-2016 Jun-2018 71% 2016 Development Oak Lawn, IL Anthem (3) 1 MC 66 units — (3) 14,997$ Dec-2017 Feb-2019 (4) 23% 2017 Development Cedarburg, WI Tealwood 1 ALF/MC/ILF 110 units 7.50% 21,527 2 176 units 36,524$ INVESTMENTS Boonespring Healthcare Center & Rehabilitation Union, KY

 

SUPPLEMENTAL INFORMATION 4Q 2019 # OF MONTHS PROPERTY PROJECT # BEDS/ DATE DATE DATE TO PROPERTY LOCATION OPERATOR TYPE TYPE UNITS ACQUIRED OPENED (1) STABILIZED STABILIZATION Highline Place Littleton, CO Anthem MC Development 60 units May-2012 Jul-2013 Sep-2013 2 Willowbrook Place - Kipling Littleton, CO Anthem MC Development 60 units Sep-2013 Aug-2014 Dec-2015 16 Chelsea Place Aurora, CO Anthem MC Development 48 units Sep-2013 Dec-2014 Mar-2016 15 Greenridge Place Westminster, CO Anthem MC Development 60 units Dec-2013 Feb-2015 Feb-2017 24 Harvester Place Burr Ridge, IL Anthem MC Development 66 units Oct-2014 Feb-2016 Feb-2018 24 Vineyard Place Murrieta, CA Anthem MC Development 66 units Sep-2015 Aug-2016 Aug-2018 24 Porter Place Tinley Park, IL Anthem MC Development 66 units May-2015 Jul-2016 Jul-2018 24 Emerald Place (2) Glenview, IL Anthem MC Development 66 units Oct-2015 Dec-2017 Dec-2019 24 Coldspring Transitional Care Center Cold Spring, KY Carespring SNF Development 143 beds Dec-2012 Nov-2014 Jun-2016 19 Boonespring Healthcare Center (3) Union, KY Carespring SNF Development 143 beds Sep-2016 Feb-2019 Dec-2019 10 Hillside Heights Rehabilitation Suites Amarillo, TX Fundamental SNF Redevelopment 120 beds Oct-2011 Jul-2013 Aug-2013 1 Pavilion at Glacier Valley Slinger, WI Fundamental SNF Redevelopment 106 beds Feb-2015 Feb-2014 Feb-2016 24 Pavilion at Creekwood Mansfield, TX Fundamental SNF Acquisition 126 beds Feb-2016 Jul-2015 Feb-2017 12 Carmel Village Memory Care Clovis, CA Generations MC/ILF Acquisition 73 units Jun-2017 Sep-2016 Jun-2018 12 Carmel Village at Clovis Clovis, CA Generations ALF Acquisition 107 units Jun-2017 Nov-2014 Jun-2018 12 Mustang Creek Estates Frisco, TX Mustang Creek Mgmt ALF/MC Development 80 units Dec-2012 Oct-2014 Dec-2015 14 The Oxford Grand Wichita, KS Oxford Senior Living ALF/MC Development 77 units Oct-2012 Oct-2013 Sep-2014 11 Oxford Villa Wichita, KS Oxford Senior Living ILF Development 108 units May-2015 Nov-2016 Nov-2018 24 Oxford Kansas City Kansas City, MO Oxford Senior Living ALF/MC Acquisition 73 units Oct-2017 Aug-2017 Jun-2019 22 REAL ESTATE ACTIVITIES – LEASE - UP HISTORY (1) Represents date of Certificate of Occupancy. (2) Property meets the definition of stabilized by being open for 24 months but has not yet achieved the occupancy threshold requ ire ment of 90% for ALF. The occupancy for Glenview, IL property at December 31, 2019 was 77%. (3) Property meets the definition of stabilized and has achieved the occupancy threshold requirement of 80% for SNF. The occupan cy for Union, KY property at December 31, 2019 was 85%. 10 INVESTMENTS

 

SUPPLEMENTAL INFORMATION 4Q 2019 (2) ($5) $15 $35 $55 $75 $95 $115 2000 2003 2006 2009 2012 2015 2019 Sales Gain/(Loss) (1) Reflects total sales price. (2) During 4Q19, we entered into multiple contracts to sell a majority of the properties operated by Preferred Care. The contract s a re subject to standard due diligence and contingencies to close. As a result, the certainty of completing the sales of the properties is unknown. If tho se transactions are completed successfully, some closings could occur in 1Q20 and the remainder in 2Q20. Preferred Care is currently paying monthly rent of $5 5 which we are accounting for on a cash basis. 11 Millions • Total Sales Price of $359.4 million • Total Gain of $139.5 million Since 2000: REAL ESTATE ACTIVITIES – CAPITAL RECYCLING On average, LTC has sold approximately $18 million (1) annually INVESTMENTS

 

SUPPLEMENTAL INFORMATION 4Q 2019 (1) Includes “cash rent,” “straight - line rent” and “amortization of lease incentives” and excludes real estate taxes reimbursement, straight - line rent write - off and rental income from properties sold during the twelve months ended December 31 , 2019 . (2) Includes “interest income from mortgage loans” and excludes interest income from mortgage loans that paid off during the twelve months ended December 31 , 2019 . (3) Includes two development projects consisting of a 78 - unit ALF/MC community in Oregon and a 90 - bed SNF center in Missouri . (4) Includes three parcels of land held - for use and one behavioral health care hospital . PORTFOLIO OVERVIEW (DOLLAR AMOUNTS IN THOUSANDS) 12 30 Operators 28 States 199 Properties 2 Development projects 3 Land parcels PORTFOLIO Gross Real Property 85.3% $1.4B Loans Receivable 14.7% $0.3B # OF % OF % OF PROPERTY TYPE PROPERTIES INVESTMENT REVENUES Skilled Nursing 92 853,029$ 49.0% 69,087$ 29,991$ 58.7% Assisted Living 106 858,852 49.3% 68,641 — 40.7% Under Development (3) — 17,989 1.0% — — — Other (4) 1 11,360 0.7% 955 — 0.6% Total 199 1,741,230$ 100.0% 138,683$ 29,991$ 100.0% GROSS INCOME (1) RENTAL INVESTMENT TWELVE MONTHS ENDED DECEMBER 31, 2019 INCOME (2) INTEREST

 

SUPPLEMENTAL INFORMATION 4Q 2019 PORTFOLIO METRICS (1) Information is from property level operator financial statements which are unaudited and have not been independently verified by LTC. SAME PROPERTY PORTFOLIO STATISTICS (1) STABILIZED PROPERTY PORTFOLIO (1) 13 ASSISTED LIVING TOTAL PORTFOLIO PAYOR SOURCE SNF PORTFOLIO PAYOR SOURCE SKILLED NURSING 58.4% 58.2% 12.5% 12.7% 29.1% 29.1% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 2Q19 3Q19 Private Pay Medicare Medicaid 33.1% 32.4% 21.2% 21.2% 45.7% 46.4% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 2Q19 3Q19 Private Pay Medicare Medicaid 1.38 1.31 1.83 1.75 78.6% 78.7% 60.0% 70.0% 80.0% 90.0% 100.0% 0.00 0.50 1.00 1.50 2.00 2Q19 3Q19 Occupancy % Normalized EBITDAR Normalized EBITDARM Occupancy (TRAILING TWELVE MONTHS THROUGH SEPTEMBER 30, 2019 AND JUNE 30, 2019) PORTFOLIO 1.22 1.21 1.44 1.43 86.9% 87.0% 75.0% 80.0% 85.0% 90.0% 95.0% 100.0% 0.00 0.50 1.00 1.50 2.00 2Q19 3Q19 Occupancy % Normalized EBITDAR Normalized EBITDARM Occupancy

 

SUPPLEMENTAL INFORMATION 4Q 2019 PORTFOLIO DIVERSIFICATION – GEOGRAPHY (AS OF DECEMBER 31, 2019) States in which we have the highest concentration of properties are those states with the highest projected increases in the 80+ population cohort over the next decade. Represents 10 states with the highest projected increases in the 80+ population cohort from year 2020 to year 2030 Source: The American Senior Housing Association, Winter 2018, Population Growth Forecast by State 14 PORTFOLIO * Behavioral health care hospital Skilled Nursing (92) Assisted Living (106) Other * (1) Under Development (2) Land (3) CA WA ME NV WY MI IL AR LA WV ND NY OR AZ NM TX UT ID MT SD NE KS OK MS MN WI FL AL GA SC TN MO IA IN OH PA NJ NC VA CO KY 4 23 1 1 2 3 4 1 2 4 2 1 5 6 17 5 2 7 7 4 8 7 4 3 13 7 5 1 22 2 5 10 1 1 1 1 2 1 1 1 1 1 2

 

SUPPLEMENTAL INFORMATION 4Q 2019 50.0% 19.2% 20.5% 7.3% 3.0% 0.0% 20.0% 40.0% 60.0% MSAs 1-31 MSAs 32-100 MSAs > 100 Cities in Micro- SA Cities not in MSA or Micro- SA 24 years 12 years 0 10 20 30 40 Skilled Nursing Assisted Living Years GROSS PORTFOLIO BY MSA (1) PORTFOLIO DIVERSIFICATION – GEOGRAPHY (AS OF DECEMBER 31, 2019, DOLLAR AMOUNTS IN THOUSANDS) (1) The MSA rank by population as of July 1, 2018, as estimated by the United States Census Bureau. Approximately 69% of our properties are in the top 100 MSAs. (1) Due to master leases with properties in multiple states, revenue by state is not available. (2) Includes one behavioral health care hospital and three parcels of land. 15 AVERAGE PORTFOLIO AGE (1) (1) As calculated from construction date or major renovation/expansion date . Includes owned portfolio and mortgage loans secured by 22 SNF properties in Michigan . # OF STATE (1) PROPS % SNF % ALF % UDP % % Texas 40 284,697$ 16.4% 214,227$ 25.1% 70,470$ 8.2% —$ — —$ — Michigan 24 276,742 15.9% 256,660 30.1% 19,139 2.2% — — 943 8.3% Wisconsin 11 149,290 8.6% 13,946 1.6% 135,344 15.8% — — — — Colorado 16 114,923 6.6% 8,044 0.9% 106,879 12.4% — — — — California 7 103,240 5.9% 22,262 2.6% 80,978 9.4% — — — — Illinois 5 87,604 5.0% — — 87,604 10.2% — — — — Ohio 9 86,474 5.0% 54,000 6.3% 32,474 3.8% — — — — Florida 11 72,169 4.1% 32,865 3.9% 39,304 4.6% — — — — Kansas 11 71,505 4.1% 14,111 1.7% 57,394 6.7% — — — — Kentucky 3 62,715 3.6% 48,520 5.7% 14,195 1.7% — — — — All Others 62 431,871 24.8% 188,394 22.1% 215,071 25.0% 17,989 100.0% 10,417 91.7% Total 199 1,741,230$ 100.0% 853,029$ 100.0% 858,852$ 100.0% 17,989$ 100.0% 11,360$ 100.0% OTH (2) INVESTMENT GROSS PORTFOLIO

 

SUPPLEMENTAL INFORMATION 4Q 2019 PORTFOLIO DIVERSIFICATION – OPERATORS (AS OF DECEMBER 31, 2019, DOLLAR AMOUNTS IN THOUSANDS) 16 Privately Held SNF/ALF/ILF Transitional Care 13 Properties 2 States Privately Held SNF/MC Hospitals & Other Rehab 86 Properties 10 States Privately Held SNF/ALF/ILF 25 Properties 5 States NYSE: GEN SNF/ALF Senior Living Nearly 400 Properties 26 States Privately Held ALF/ILF/MC/SNF 21 Properties 3 States (1) Represents annualized income for the month of December 2019 for leased properties, except for Senior Care, Anthem and Preferred Care as noted below, and annualized interest income from mortgage loans outstanding as of December 31 , 2019 . (2) In December 2018 , Senior Care Centers and numerous of its affiliates and subsidiaries (“Senior Care”) filed for Chapter 11 bankruptcy resulting from lease terminations from certain landlords and on - going operational challenges . During 4 Q 19 , the judge allowed Senior Care to assume LTC’s master lease and Senior Care paid LTC the December 2018 unpaid rent, late fees and legal fees totaling approximately $ 1 , 600 . Due to the uncertainty regarding Senior Care’s emergence from bankruptcy, the amount reflects contractual annual cash rent . (3) Anthem is currently being accounted for on a cash basis . See page 9 for Anthem disclosure . (4) During 4Q19, we entered into multiple contracts to sell a majority of the properties operated by Preferred Care. The contract s a re subject to standard due diligence and contingencies to close. As a result, the certainty of completing the sales of the properties is unknown. If those transactions are completed successfully, so me closings could occur in 1Q20 and the remainder in 2Q20. Preferred Care is currently paying monthly rent of $55 which we are accounting for on a cash basis. Privately Held SNF/ALF/ILF Other Rehab 78 Properties 5 States Privately Held ALF/ILF/MC/SNF Short Term Stays 174 Properties 27 States Privately Held SNF/ALF 22 Properties 1 State Privately Held Exclusively MC 12 Properties 4 States NYSE: BKD ILF/ALF/MC Continuing Care 794 Properties 45 States PORTFOLIO # OF GROSS OPERATORS PROPS GAAP (1) % CASH % INVESTMENT % Prestige Healthcare 24 32,094$ 19.4% 26,345$ 16.8% 269,792$ 15.5% Senior Lifestyle Corporation 23 20,217 12.2% 18,215 11.6% 191,283 11.0% Senior Care Centers 11 14,603 (2) 8.8% 14,603 (2) 9.3% 138,109 7.9% Anthem Memory Care 11 9,900 (3) 6.0% 9,900 (3) 6.3% 136,484 7.8% Brookdale Senior Living 35 13,648 8.3% 13,722 8.8% 98,921 5.7% Carespring Health Care Management 4 11,194 6.8% 9,748 6.2% 102,520 5.9% Fundamental 7 8,409 5.1% 8,464 5.4% 75,795 4.4% Traditions Senior Management 7 8,276 5.0% 8,535 5.4% 71,742 4.1% Genesis Healthcare 6 8,154 4.9% 8,111 5.2% 50,004 2.9% Juniper Communities 5 6,663 4.0% 6,480 4.1% 81,988 4.7% All Others 66 32,073 19.5% 32,608 20.9% 524,592 (4) 30.1% 199 165,231$ 100.0% 156,731$ 100.0% 1,741,230$ 100.0% ANNUALIZED INCOME

 

SUPPLEMENTAL INFORMATION 4Q 2019 8.3% 2.4% 0.5% 2.0% 3.1% 5.5% 9.9% 49.6% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 18.7% 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 2020 2021 2022 2023 2024 2025 2026 Thereafter Leases Loans (As a % of Total Annual Income) (1) PORTFOLIO MATURITY (AS OF DECEMBER 31, 2019, DOLLAR AMOUNTS IN THOUSANDS) 17 Near Term Lease Maturities: • Four in 2020 with an annualized GAAP rent totaling $13.6 million (3) • Three in 2021 with an annualized GAAP rent totaling $4.0 million • One in 2022 with an annualized GAAP rent totaling $0.8 million As of December 31, 2019, approximately 94% of owned properties are covered under master leases and approximately 94% of rental revenues come from master leases or cross - default leases. (1) Includes annualized GAAP rent for leased properties, except for Anthem, Senior Care and Preferred Care, and annualized interest income from mortgage loans outstanding as of December 31 , 2019 . (2) Represents Brookdale maturing on 12 / 31 / 20 , with two 10 - year renewal options . PORTFOLIO % OF % OF % OF YEAR TOTAL TOTAL TOTAL 2020 13,648$ (2) 10.2% —$ — 13,648$ 8.3% 2021 3,958 2.9% — — 3,958 2.4% 2022 771 0.6% — — 771 0.5% 2023 3,332 2.5% — — 3,332 2.0% 2024 5,140 3.8% — — 5,140 3.1% 2025 9,087 6.8% — — 9,087 5.5% 2026 16,430 12.2% — — 16,430 9.9% Thereafter 82,005 61.0% 30,860 100.0% 112,865 68.3% Total 134,371$ 100.0% 30,860$ 100.0% 165,231$ 100.0% INCOME (1) INCOME (1) INCOME (1) RENTAL INTEREST ANNUAL

 

SUPPLEMENTAL INFORMATION 4Q 2019 Common Stock 72.0% Total Debt 28.0% ENTERPRISE VALUE (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS AND NUMBER OF SH ARES) CAPITALIZATION (1) Subsequent to December 31, 2019, we borrowed $18,000 under our unsecured revolving line of credit. Accordingly, we have $111 ,90 0 outstanding with $488,100 available for borrowing. (2) Represents outstanding balance of $600,300, net of debt issue costs of $812. (3) Closing price of our common stock as reported by the NYSE on December 31, 2019. (4) See page 22 for reconciliation of annualized adjusted EBITDA re . 18 FINANCIAL Bank borrowings - weighted average rate 3.1% (1) 93,900$ Senior unsecured notes, net of debt issue costs - weighted average rate 4.4% (2) 599,488 Total debt - weighted average rate 4.2% 693,388 28.0% No. of shares Common stock 39,751,704 44.77$ 1,779,684 72.0% 2,473,072$ 100.0% Add: Non-controlling interest 8,483 Less: Cash and cash equivalents (4,244) 2,477,311$ Debt to Enterprise Value 28.0% Debt to Annualized Adjusted EBITDAre (4) 4.6x DECEMBER 31, 2019 (3) CAPITALIZATION ENTERPRISE VALUE 12/31/19 DEBT EQUITY Closing Price TOTAL MARKET VALUE

 

SUPPLEMENTAL INFORMATION 4Q 2019 DEBT METRICS (DOLLAR AMOUNTS IN THOUSANDS) 19 LEVERAGE RATIOS COVERAGE RATIOS 4.6x 4.9x 4.5x 4.9x 4.3x 4.7x 4.4x 4.9x 0.0 2.0 4.0 6.0 8.0 Debt to Adjusted EBITDAre Adjusted EBITDAre/ Fixed Charges 4Q19 Annualized 2019 2018 2017 LINE OF CREDIT LIQUIDITY $93,900 $112,000 $96,500 $506,100 $488,000 $503,500 $- $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 2019 2018 2017 Balance Available 37.2% 28.0% 35.2% 28.0% 37.6% 28.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% Debt to Gross Asset Value Debt to Total Enterprise Value 2019 2018 2017 FINANCIAL (1) Subsequent to December 31, 2019, we borrowed $18,000 under our unsecured revolving line of credit. Accordingly, we have $111 ,90 0 outstanding with $488,100 available for borrowing. ( 1 )

 

SUPPLEMENTAL INFORMATION 4Q 2019 Senior Unsecured Notes 86.5% Unsecured Line of Credit 13.5% $0 $0 $93,900 $0 $0 $0 $0 $0 $40,160 $47,160 $48,160 $49,160 $49,160 $49,500 $51,500 $265,500 $- $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 2020 2021 2022 2023 2024 2025 2026 Thereafter Unsecured Line Senior Unsecured Notes DEBT MATURITY (AS OF DECEMBER 31, 2019, DOLLAR AMOUNTS IN THOUSANDS) DEBT STRUCTURE (1) Subsequent to December 31, 2019, we borrowed $18,000 under our unsecured revolving line of credit. Accordingly, we have $111 ,90 0 outstanding with $488,100 available for borrowing. (2) Reflects scheduled principal payments. (3) Includes debt issue costs which are excluded in the senior unsecured notes balance on our Consolidated Balance Sheets shown o n p age 24. 20 FINANCIAL UNSECURED SENIOR LINE OF UNSECURED % OF YEAR CREDIT (1) NOTES (2) TOTAL TOTAL 2020 —$ 40,160$ 40,160$ 5.8% 2021 — 47,160 47,160 6.8% 2022 93,900 48,160 142,060 20.5% 2023 — 49,160 49,160 7.1% 2024 — 49,160 49,160 7.1% 2025 — 49,500 49,500 7.1% 2026 51,500 51,500 7.4% Thereafter — 265,500 265,500 38.2% Total 93,900$ 600,300$ (3) 694,200$ (3) 100.0%

 

SUPPLEMENTAL INFORMATION 4Q 2019 12/31/19 12/31/18 12/31/17 Gross real estate assets $ 1,741,230 $ 1,666,842 $ 1,618,284 Net real estate investments $ 1,390,915 $ 1,349,520 $ 1,309,996 Gross asset value $ 1,864,705 $ 1,831,070 $ 1,774,024 Total debt (1) $ 693,388 $ 645,029 $ 667,502 Total liabilities (1) $ 728,783 $ 680,649 $ 706,922 Total equity $ 785,426 $ 832,971 $ 758,648 FINANCIAL DATA SUMMARY (DOLLAR AMOUNTS IN THOUSANDS) (1) Includes outstanding balance of gross bank borrowings and senior unsecured notes, net of debt issue costs. 21 NON - CASH REVENUE COMPONENTS (1) For leases and loans in place at December 31, 2019, assuming no renewals, modifications or replacements, and no new investments are added to our portfolio except for the subsequent acquisitions, lease extensions, completed development in 2020 and the leases on cash basis. COMPONENTS OF RENTAL INCOME (1) Increased due to acquisitions, developments and capital improvement projects partially offset by decreased rent from properti es sold in 2018 and 2019 lease transitions. (2) Per the provisions of the new GAAP lease standard, any lessor cost, paid by the lessor and reimbursed by the lessee, must be inc luded as lease revenue. We have adopted the new lease standard using a modified retrospective approach as of January 1, 2019. Accordingly, we are not re quired to report this revenue stream for periods prior to January 1, 2019. (3) Decrease is due to the adoption of the new GAAP lease standard, under which we wrote off straight - line rent and lease incentives related to certain operators. (4) Represents the write - off of straight - line rent due to a lease termination and transition of two seniors housing communities to a new operator. FINANCIAL 2019 2018 2019 2018 Cash rent 33,500$ (1) 32,279$ 134,581$ (1) 127,947$ Revenue related to real estate taxes reimbursed by the operator (2) 3,904 — 15,998 — Straight-line rent 889 (3) 921 4,487 (3) 9,550 Straight-line rent write-off — — (1,926) (4) — Amortization of lease incentives (104) (3) (441) (385) (3) (2,092) Total rental income 38,189$ 32,759$ 152,755$ 135,405$ THREE MONTHS ENDED DECEMBER 31,  YEAR ENDED DECEMBER 31,  4Q19 1Q20 (1) 2Q20 (1) 3Q20 (1) 4Q20 (1) 889$ 831$ 727$ 593$ 380$ (104) (101) (108) (108) (108) 1,481 1,523 1,555 1,549 1,477 2,266$ 2,253$ 2,174$ 2,034$ 1,749$ Straight-line rent Amortization of lease incentives Effective interest Net

 

SUPPLEMENTAL INFORMATION 4Q 2019 FINANCIAL DATA SUMMARY (DOLLAR AMOUNTS IN THOUSANDS) RECONCILIATION OF ANNUALIZED ADJUSTED EBITDA re AND FIXED CHARGES (1) Impairment charge on investments in unconsolidated joint ventures . (2) Represents net write - off of $ 1 , 880 of straight - line rent and other receivables related to two properties in Overland Park and Wichita, KS . (3) Gain from property insurance proceeds related to a property in Texas . (4) Represents ( 3 ) above and $ 1 , 350 deferred rent repayment from an operator offset by $ 1 , 926 write - off of straight - line rent due to a lease termination and transition of two seniors housing communities to a new operator . (5) Represents net write - off of earn - out liabilities and the related lease incentives . (6) Given we do not have preferred stock, our fixed - charge coverage ratio and interest coverage ratio are the same . 22 FINANCIAL Net income 12,631$ 80,872$ 155,076$ 87,340$ Add/Less: Loss (gain) on sale of real estate, net 4,630 (2,106) (70,682) (3,814) Add: Impairment charges 5,500 (1) 5,500 (1) — 1,880 (2) Add: Interest expense 7,578 30,582 30,196 29,949 Add: Depreciation and amortization 9,817 39,216 37,555 37,610 EBITDAre 40,156 154,064 152,145 152,965 Less: Non-recurring one-time items (2,111) (3) (1,535) (4) (3,074) (5) (842) (5) Adjusted EBITDAre 38,045$ 152,529$ 149,071$ 152,123$ Interest expense 7,578$ 30,582$ 30,196$ 29,949$ Add: Capitalized interest 167 608 1,248 908 Fixed charges (6) 7,745$ 31,190$ 31,444$ 30,857$ Annualized Adjusted EBITDAre 152,180$ Annualized Fixed Charges 30,980$ Debt (net of debt issue costs) 693,388$ 693,388$ 645,029$ 667,502$ Debt to Adjusted EBITDAre 4.6x * 4.5x 4.3x 4.4x Adjusted EBITDAreto Fixed Charges 4.9x * 4.9x 4.7x 4.9x * Represents annualized 4Q19 results. Loss (gains) on sale of real estate and non-recurring one-time items were not annualized. 12/31/2018 12/31/2017 12/31/2019 12/31/19 THREE MONTHS ENDED FOR THE YEAR ENDED

 

SUPPLEMENTAL INFORMATION 4Q 2019 INCOME STATEMENT DATA (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) 23 FINANCIAL 2019 2018 2019 2018 Revenues Rental income (see page 21) 38,189$ 32,759$ 152,755$ 135,405$ Interest income from mortgage loans 7,683 7,290 29,991 28,200 Interest and other income 591 3,538 2,558 5,040 Total revenues 46,463 43,587 185,304 168,645 Expenses Interest expense 7,578 7,215 30,582 30,196 Depreciation and amortization 9,817 9,396 39,216 37,555 Provision for doubtful accounts 13 11 166 87 Transaction costs 90 65 365 84 Property tax expense 4,189 — 16,755 — General and administrative expenses 4,541 4,801 18,453 19,193 Total expenses 26,228 21,488 105,537 87,115 Other Operating Income (Loss) gain on sale of real estate, net (4,630) 7,984 2,106 70,682 Operating Income 15,605 30,083 81,873 152,212 Gain from property insurance proceeds 2,111 — 2,111 — Impairment loss from investments in unconsolidated joint ventures (5,500) — (5,500) — Income from unconsolidated joint ventures 415 761 2,388 2,864 Net Income 12,631 30,844 80,872 155,076 Income allocated to non-controlling interests (89) (78) (346) (95) Net income attributable to LTC Properties, Inc. 12,542 30,766 80,526 154,981 Income allocated to participating securities (93) (121) (391) (625) Net income available to common stockholders 12,449$ 30,645$ 80,135$ 154,356$ Earnings per common share: Basic $0.31 $0.78 $2.03 $3.91 Diluted $0.31 $0.77 $2.02 $3.89 Weighted average shares used to calculate earnings per common share: Basic 39,588 39,501 39,571 39,477 Diluted 39,775 39,864 39,759 39,839 Dividends declared and paid per common share $0.57 $0.57 $2.28 $2.28 (unaudited) (audited) THREE MONTHS ENDED DECEMBER 31, DECEMBER 31, TWELVE MONTHS ENDED

 

SUPPLEMENTAL INFORMATION 4Q 2019 CONSOLIDATED BALANCE SHEETS (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS, AUDITED) 24 FINANCIAL ASSETS Investments: Land $ 126,703 $ 125,358 Buildings and improvements   1,295,899   1,290,352 Accumulated depreciation and amortization   (312,642)   (312,959) Operating real estate property, net   1,109,960   1,102,751 Properties held-for-sale, net of accumulated depreciation: 2019—$35,113; 2018—$1,916   26,856   3,830 Real property investments, net   1,136,816   1,106,581 Mortgage loans receivable, net of loan loss reserve: 2019—$2,560; 2018—$2,447   254,099   242,939 Real estate investments, net   1,390,915   1,349,520 Notes receivable, net of loan loss reserve: 2019—$181; 2018—$128   17,927   12,715 Investments in unconsolidated joint ventures 19,003 30,615 Investments, net   1,427,845   1,392,850 Other assets: Cash and cash equivalents   4,244   2,656 Restricted cash — 2,108 Debt issue costs related to bank borrowings   2,164   2,989 Interest receivable   26,586   20,732 Straight-line rent receivable, net of allowance for doubtful accounts: 2019—$0; 2018—$746   45,703   73,857 Lease incentives 2,552 14,443 Prepaid expenses and other assets   5,115   3,985 Total assets $ 1,514,209 $ 1,513,620 LIABILITIES Bank borrowings $ 93,900 $ 112,000 Senior unsecured notes, net of debt issue costs: 2019—$812; 2018—$938   599,488   533,029 Accrued interest   4,983   4,180 Accrued expenses and other liabilities   30,412   31,440 Total liabilities   728,783   680,649 EQUITY Stockholders’ equity: Common stock: $0.01 par value; 60,000 shares authorized; shares issued and outstanding: 2019—39,752; 2018—39,657   398   397 Capital in excess of par value   867,346   862,712 Cumulative net income   1,293,482   1,255,764 Cumulative distributions   (1,384,283)   (1,293,383) Total LTC Properties, Inc. stockholders’ equity   776,943   825,490 Non-controlling interests   8,483   7,481 Total equity   785,426   832,971 Total liabilities and equity $ 1,514,209 $ 1,513,620 DECEMBER 31, 2018DECEMBER 31, 2019

 

SUPPLEMENTAL INFORMATION 4Q 2019 FUNDS FROM OPERATIONS (UNAUDITED, AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) RECONCILIATION OF FFO AND FAD 25 (1) Gain from property insurance proceeds related to a property in Texas . (2) Represents net write - off of earn - out liabilities and the related lease incentives . (3) Represents ( 1 ) above and $ 1 , 350 net of deferred rent repayment from an operator offset by ( 4 ) below . (4) Represents $ 1 , 926 write - off of straight - line rent due to a lease termination and transition of two seniors housing communities to a new operator . (5) Represents ( 1 ) above and $ 1 , 350 net of deferred rent repayment from an operator . FINANCIAL 2019 2018 2019 2018 GAAP net income available to common stockholders 12,449$ 30,645$ 80,135$ 154,356$ Add: Depreciation and amortization 9,817 9,396 39,216 37,555 Add: Impairment charges 5,500 — 5,500 — Less: Gain on sale of real estate, net 4,630 (7,984) (2,106) (70,682) NAREIT FFO attributable to common stockholders 32,396 32,057 122,745 121,229 Add: Non-recurring items (1)(2) (2,111) (1) (3,074) (2) (1,535) (3) (3,074) (2) 30,285$ 28,983$ 121,210$ 118,155$ NAREIT FFO attributable to common stockholders 32,396$ 32,057$ 122,745$ 121,229$ Non-cash income: Less: Straight-line rental income (889) (921) (4,487) (9,550) Add: Amortization of lease costs 104 441 385 2,092 (Less)/Add: Other non-cash (income)/expense (1) — (3,074) (2) 1,926 (4) (3,074) (2) Less: Effective interest income from mortgage loans (1,481) (1,438) (5,842) (5,703) Less: Deferred income from unconsolidated joint ventures — (15) (18) (108) Net non-cash income (2,266) (5,007) (8,036) (16,343) Non-cash expense: Add: Non-cash compensation charges 1,627 1,486 6,565 5,870 Add: Non-cash interest related to earn-out liabilities — — — 377 Less: Capitalized interest (167) (398) (608) (1,248) Net non-cash expense 1,460 1,088 5,957 4,999 Funds available for distribution (FAD) 31,590 28,138 120,666 109,885 Less: Non-recurring income (2) (2,111) (1) — (3,461) (5) — Funds available for distribution (FAD) excluding non-recurring income 29,479$ 28,138$ 117,205$ 109,885$ $0.81 $0.81 $3.08 $3.06NAREIT Diluted FFO attributable to common stockholders per share FFO attributable to common stockholders excluding non-recurring income THREE MONTHS ENDED TWELVE MONTHS ENDED DECEMBER 31, DECEMBER 31,

 

SUPPLEMENTAL INFORMATION 4Q 2019 FOR THE THREE MONTHS ENDED DECEMBER 31, FFO/FAD attributable to common stockholders 32,396$ 32,057$ 31,590$ 28,138$ Non-recurring one-time items (2,111) (1) (3,074) (2) (2,111) (1) — FFO/FAD attributable to common stockholders excluding non-recurring income 30,285 28,983 29,479 28,138 Effect of dilutive securities: Participating securities 93 121 93 121 Diluted FFO/FAD assuming conversion 30,378$ 29,104$ 29,572$ 28,259$ 39,588 39,501 39,588 39,501 Effect of dilutive securities: Stock options 3 4 3 4 Performance based stock units (MSU) 184 203 184 203 Participating securities 164 156 164 156 Shares for diluted FFO/FAD per share 39,939 39,864 39,939 39,864 FOR THE TWELVE MONTHS ENDED DECEMBER 31, FFO/FAD attributable to common stockholders 122,745$ 121,229$ 120,666$ 109,885$ Non-recurring one-time items (1,535) (3) (3,074) (2) (3,461) (4) — FFO/FAD attributable to common stockholders excluding non-recurring income 121,210 118,155 117,205 109,885 Effect of dilutive securities: Participating securities 391 625 391 625 Diluted FFO/FAD assuming conversion 121,601$ 118,780$ 117,596$ 110,510$ 39,571 39,477 39,571 39,477 Effect of dilutive securities: Stock options 4 3 4 3 Performance based stock units (MSU) 184 203 184 203 Participating securities 162 156 162 156 Shares for diluted FFO/FAD per share 39,921 39,839 39,921 39,839 Shares for basic FFO/FAD per share 2019 2018 2018 Shares for basic FFO/FAD per share FFO FAD 2019 FFO FAD 2019 2018 2019 2018 FUNDS FROM OPERATIONS (UNAUDITED, AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) RECONCILIATION OF FFO PER SHARE 26 (1) Gain from property insurance proceeds related to a property in Texas . (2) Represents net write - off of earn - out liabilities and the related lease incentives . (3) Represents ( 1 ) above and $ 1 , 350 net of deferred rent repayment from an operator offset by $ 1 , 926 write - off of straight - line rent due to a lease termination and transition of two seniors housing communities to a new operator . (4) Represents ( 1 ) above and $ 1 , 350 net of deferred rent repayment from an operator . FINANCIAL

 

SUPPLEMENTAL INFORMATION 4Q 2019 Assisted Living Communities (“ALF”) : The ALF portfolio consists of assisted living, independent living, and/or memory care properties . (See Independent Living and Memory Care) Assisted living properties are seniors housing properties serving elderly persons who require assistance with activities of daily living, but do not require the constant supervision skilled nursing properties provide . Services are usually available 24 hours a day and include personal supervision and assistance with eating, bathing, grooming and administering medication . The facilities provide a combination of housing, supportive services, personalized assistance and health care designed to respond to individual needs . Contractual Lease Rent : Rental revenue as defined by the lease agreement between us and the operator for the lease year . Earnings Before Interest, Tax, Depreciation and Amortization for Real Estate (“EBITDA re”) : As defined by the National Association of Real Estate Investment Trusts (“ NAREIT”), EBITDA re is calculated as net income (computed in accordance with GAAP) excluding (i) interest expense, (ii) income tax expense, (iii) real estate depreciation and amortization, (iv) impairment write - downs of depreciable real estate, (v) gains or losses on the sale of depreciable real estate, and (vi) adjustments for unconsolidated partnerships and joint ventures . Funds Available for Distribution (“FAD”) : FFO excluding the effects of straight - line rent, amortization of lease costs, effective interest income, deferred income from unconsolidated joint ventures, non - cash compensation charges, capitalized interest and non - cash interest charges . Funds From Operations (“FFO”) : A s defined by NAREIT, net income available to common stockholders (computed in accordance with U . S . GAAP) excluding gains or losses on the sale of real estate and impairment write - downs of depreciable real estate plus real estate depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures . GAAP Lease Yield : GAAP rent divided by the sum of the purchase price and transaction costs . GAAP Rent : Total rent we will receive as a fixed amount over the initial term of the lease and recognized evenly over that term . GAAP rent recorded in the early years of a lease is higher than the cash rent received and during the later years of the lease, the cash rent received is higher than GAAP rent recognized . GAAP rent is commonly referred to as straight - line rental income . Gross Asset Value : The carrying amount of total assets after adding back accumulated depreciation and loan loss reserves, as reported in the company’s consolidated financial statements . Gross Investment : Original price paid for an asset plus capital improvements funded by LTC, without any depreciation deductions . Gross Investment is commonly referred to as undepreciated book value . Independent Living Communities (“ILF”) : Seniors housing properties offering a sense of community and numerous levels of service, such as laundry, housekeeping, dining options/meal plans, exercise and wellness programs, transportation, social, cultural and recreational activities, on - site security and emergency response programs . Many offer on - site conveniences like beauty/barber shops, fitness facilities, game rooms, libraries and activity centers . ILFs are also known as retirement communities or seniors apartments . Interest Income : Represents interest income from mortgage loans and other notes . Licensed Beds/Units : The number of beds and/or units that an operator is authorized to operate at seniors housing and long - term care properties . Licensed beds and/or units may differ from the number of beds and/or units in service at any given time . Memory Care Communities (“MC”) : Seniors housing properties offering specialized options for seniors with Alzheimer’s disease and other forms of dementia . These facilities offer dedicated care and specialized programming for various conditions relating to memory loss in a secured environment that is typically smaller in scale and more residential in nature than traditional assisted living facilities . These facilities have staff available 24 hours a day to respond to the unique needs of their residents . Metropolitan Statistical Areas (“MSA”) : Based on the U . S . Census Bureau, MSA is a geographic entity defined by the Office of Management and Budget (OMB) for use by Federal statistical agencies in collecting, tabulating, and publishing Federal statistics . A metro area contains a core urban area of 50 , 000 or more population . MSAs 1 to 31 have a population of 20 . 3 M – 2 . 1 M . MSAs 32 to 100 have a population of 2 . 1 M – 0 . 6 M . MSAs less than 100 have a population of 0 . 5 M – 55 K . Cities in a Micro - SA have a population of 216 K – 13 K . Cities not in a MSA has population of less than 100 K . Mezzanine : In certain circumstances, the Company strategically allocates a portion of its capital deployment toward mezzanine loans to grow relationships with operating companies that have not typically utilized sale leaseback financing as a component of their capital structure . Mezzanine financing sits between senior debt and common equity in the capital structure, and typically is used to finance development projects or value - add opportunities on existing operational properties . We seek market - based, risk - adjusted rates of return typically between 12 - 18 % with the loan term typically between four to eight years . Security for mezzanine loans can include all or a portion of the following credit enhancements ; secured second mortgage, pledge of equity interests and personal/corporate guarantees . Mezzanine loans can be recorded for GAAP purposes as either a loan or joint venture depending upon specifics of the loan terms and related credit enhancements . 27 GLOSSARY GLOSSARY

 

SUPPLEMENTAL INFORMATION 4Q 2019 Micropolitan Statistical Areas (“Micro - SA”) : Based on the U . S . Census Bureau, Micro - SA is a geographic entity defined by the Office of Management and Budget (OMB) for use by Federal statistical agencies in collecting, tabulating, and publishing Federal statistics . A micro area contains an urban core of at least 10 , 000 population . Mortgage Loan : Mortgage financing is provided on properties based on our established investment underwriting criteria and secured by a first mortgage . Subject to underwriting, additional credit enhancements may be required including, but not limited to, personal/corporate guarantees and debt service reserves . When possible, LTC attempts to negotiate a purchase option to acquire the property at a future time and lease the property back to the borrower . Net Real Estate Assets : Gross real estate investment less accumulated depreciation . Net Real Estate Asset is commonly referred to as Net Book Value (“NBV”) . Non - cash Rental Income : Straight - line rental income and amortization of lease inducement . Non - cash Compensation Charges : Vesting expense relating to stock options and restricted stock . Normalized EBITDAR Coverage : The trailing twelve month’s earnings from the operator financial statements adjusted for non - recurring, infrequent, or unusual items and before interest, taxes, depreciation, amortization, and rent divided by the operator’s contractual lease rent . Management fees are imputed at 5 % of revenues . Normalized EBITDARM Coverage : The trailing twelve month’s earnings from the operator financial statements adjusted for non - recurring, infrequent, or unusual items and before interest, taxes, depreciation, amortization, rent, and management fees divided by the operator’s contractual lease rent . Occupancy : The weighted average percentage of all beds and/or units that are occupied at a given time . The calculation uses the trailing twelve months and is based on licensed beds and/or units which may differ from the number of beds and/or units in service at any given time . Operator Financial Statements : Property level operator financial statements which are unaudited and have not been independently verified by us . Payor Source : LTC revenue by operator underlying payor source for the period presented . LTC is not a Medicaid or a Medicare recipient . Statistics represent LTC's rental revenues times operators' underlying payor source revenue percentage . Underlying payor source revenue percentage is calculated from property level operator financial statements which are unaudited and have not been independently verified by us . Private Pay : Private pay includes private insurance, HMO, VA, and other payors . Purchase Price : Represents the fair value price of an asset that is exchanged in an orderly transaction between market participants at the measurement date . An orderly transaction is a transaction that assumes exposure to the market for a period prior to the measurement date to allow for marketing activities that are usual and customary for transactions involving such assets ; it is not a forced transaction (for example, a forced liquidation or distress sale) . Rental Income : Represents GAAP rent net of amortized lease inducement cost . Same Property Portfolio (“SPP”) : Same property statistics allow for the comparative evaluation of performance across a consistent population of LTC’s leased property portfolio and the Prestige Healthcare mortgage loan portfolio . Our SPP is comprised of stabilized properties occupied and operated throughout the duration of the quarter - over - quarter comparison periods presented (excluding assets sold and assets held - for - sale) . Accordingly, a property must be occupied and stabilized for a minimum of 15 months to be included in our SPP . Skilled Nursing Properties (“SNF”) : Seniors housing properties providing restorative, rehabilitative and nursing care for people not requiring the more extensive and sophisticated treatment available at acute care hospitals . Many SNFs provide ancillary services that include occupational, speech, physical, respiratory and IV therapies, as well as sub - acute care services which are paid either by the patient, the patient’s family, private health insurance, or through the federal Medicare or state Medicaid programs . Stabilized : Properties are generally considered stabilized upon the earlier of achieving certain occupancy thresholds (e . g . 80 % for SNFs and 90 % for ALFs) and, as applicable, 12 months from the date of acquisition/lease transition or, in the event of a de novo development, redevelopment, major renovations or addition, 24 months from the date the property is first placed in or returned to service, or issuance of certificate of occupancy for properties acquired in lease - up . Under Development Properties (“UDP”) : Development projects to construct seniors housing properties . 28 GLOSSARY GLOSSARY

 

 

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