Sabra Health Care Reit, Inc. · NASDAQ:SBRA
Sabra Health Care Reit — Non-Deal Roadshow (May 2021)
40 slides from Sabra Health Care Reit's roadshow presentation, May 19, 2021
Slide 1: Strong. Resilient. Growing.
Non-Deal Roadshow hosted by BMO 1May 19, 2021 Strong. Resilient. Growing. Non-Deal Roadshow hosted by BMO May 19, 2021
Slide 2: Delivering Value
Our vast industry knowledge, experienced executive team and entrepreneurial spirit make Sabra uniquely positioned to succeed in our dynamic industry. We have the size, know-how, balance sheet and passion to deliver long-term value to shareholders. DELIVERING VALUE Non-Deal Roadshow hosted by BMOMay
Slide 3: Strategy
“WE’VE BUILT A STRONG AND RESILIENT FOUNDATION.” – Rick Matros, Chief Executive Officer STRATEGY Non-Deal Roadshow hosted by BMOMay 19, 2021 3
Slide 4: Sabra Today
4 33% 73 $6.3B1 SABRA TODAY STRATEGY Non-Deal Roadshow hosted by BMOMay 19, 2021 DEBT/ASSET VALUE OPERATOR RELATIONSHIPS ENTERPRISE VALUE $1B+ LIQUIDITY 9% MAX RELATIONSHIP CONCENTRATION 19.8% NOI CAGR SINCE 2011 (1) Includes Sabra’s 49% pro rata share of the debt of its unconsolidated joint venture
Slide 5: A Resilient and Agile REIT
A RESILIENT AND AGILE REIT Investment ▪ Invest in high-quality, strong-performing senior housing and SNF portfolios ▪ Relationship diversification ▪ Geographic diversification (investments in 43 states and Canada) ▪ Grow private-pay through investments in high-quality managed senior housing ▪ Develo
Slide 6: Strategy in Action
“BY OPPORTUNISTICALLY EXECUTING OUR STRATEGY, WE CONTINUE TO DELIVER LONG-TERM VALUE FOR OUR SHAREHOLDERS.” STRATEGY IN ACTION Non-Deal Roadshow hosted by BMOMay 19, 2021 6 – Talya Nevo-Hacohen, Chief Investment Officer
Slide 7: Strengthened Balance Sheet by Reducing Leverage
7 34 vs 72 STRENGTHENED BALANCE SHEET BY REDUCING LEVERAGE STRATEGY IN ACTION Non-Deal Roadshow hosted by BMOMay 19, 2021 Lowered cost of PERMANENT DEBT by 65 basis points to 3.63% Reduced NET DEBT TO ADJUSTED EBITDA1 ratio from 5.69x to 4.84x DECEMBER 31, 2018 vs MARCH 31, 2021 (1) Net Debt to Adju
Slide 8: Significantly Improved Credit Metrics
8 INTEREST COVERAGE + 1.09x to 5.23x FIXED CHARGE COVERAGE + 1.35x to 5.05x TOTAL DEBT/ASSET VALUE IMPROVED 1600 bps SIGNIFICANTLY IMPROVED CREDIT METRICS STRATEGY IN ACTION Non-Deal Roadshow hosted by BMOMay 19, 2021 DECEMBER 31, 2018 vs MARCH 31, 2021
Slide 9: Committed to Strong Corporate Governance & Ethical Business Practices
COMMITTED TO STRONG CORPORATE GOVERNANCE & ETHICAL BUSINESS PRACTICES Non-Deal Roadshow hosted by BMOMay 19, 2021 9 Our inaugural ESG report is in process. We believe that a diverse workforce is essential to our continued success. Our workforce reflects diverse gender, ethnicity, age and cultural ba
Slide 10: Diverse and Experienced Leadership
DIVERSE AND EXPERIENCED LEADERSHIP ENVIRONMENTAL, SOCIAL AND GOVERNANCE Non-Deal Roadshow hosted by BMOMay 19, 2021 10 We added two new board members, Ann Kono and Clifton Porter, during the fourth quarter and a third new board member, Katie Cusack, in January of 2021. These members add fresh skills
Slide 11: Investment Thesis
“WE CUSTOMIZE OUR FINANCIAL SOLUTIONS TO PROVIDE OPERATORS WITH CAPITAL TO INVEST IN THEIR BUSINESS AND SUPPORT THE DELIVERY OF QUALITY CARE.” – Talya Nevo-Hacohen, Chief Investment Officer INVESTMENT THESIS Non-Deal Roadshow hosted by BMOMay 19, 2021 11
Slide 12: Opportunistically Sourced, Creatively Structured and Prudently Financed
OPPORTUNISTICALLY SOURCED, CREATIVELY STRUCTURED AND PRUDENTLY FINANCED Unique, Accretive Investments Utilize our operational and asset management expertise to identify and capitalize on new opportunities where off-market price dislocation exists. Support Operator Expansion Be the capital partner of
Slide 13: Portfolio
“OUR PORTFOLIO AND TENANTS ARE POSITIONED TO DELIVER QUALITY CARE NOW AND IN THE FUTURE.” PORTFOLIO – Peter Nyland, Executive Vice President Asset Management Non-Deal Roadshow hosted by BMOMay 19, 2021 13
Slide 14: COVID-19 rent collections and liquidity
▪ From the beginning of the COVID-19 pandemic through April 2021, we have collected 99.9% of our forecasted rents, and through the first two weeks of May, collections are in line with what we normally receive through this point of the month. While we have agreed to temporary pandemic-related rent de
Slide 15: COVID-19 impact on operations and occupancy
The COVID-19 pandemic continues to have a significant impact on the operations of our facilities, although partially mitigated by government relief packages providing assistance to our Skilled Nursing/Transitional Care and Specialty Hospital and Other portfolios, and our Senior Housing - Leased and
Slide 16: Senior Housing – Managed Operations
SENIOR HOUSING – MANAGED OPERATIONS ▪ In March 2021, gross move-ins in the Enlivant Joint Venture were at the highest level in 18 months and close to the historical peak of 2.3 move-ins per facility per month. The number of leads and tours in March 2021 are 35% above March 2019 levels and this momen
Slide 17: COVID-19: Mitigation
▪ In response to the COVID-19 pandemic, the federal government approved several relief packages that initially extended to just our Skilled Nursing/Transitional Care facility operators. However, since September 1, 2020, eligible assisted living and memory care facility operators were also permitted
Slide 18: COVID-19 mitigation sources table
Mitigation Source Mitigates EBITDARM Reductions Description Estimated Available (All Sabra Relationships) PRF 2: Yes The CARES Act has, to date, appropriated $175 billion to the Provider Relief Fund (“PRF”) for hospitals and other health care providers nationwide to prevent, prepare for and respond
Slide 19: CARES Act Provider Relief Fund received
▪ Approximately $150 million received from the CARES Act Provider Relief Fund have been recognized in the operating results reported by our operators. We estimate that our operators have received approximately $230 million from the Provider Relief Fund but have only recognized $150 million in their
Slide 20: 2Q 2021 Guidance
2Q 2021 GUIDANCE PORTFOLIO Non-Deal Roadshow hosted by BMOMay 19, 2021 20 We expect the following amounts per diluted common share for the quarter ended June 30, 2021: o Net income: $0.13 - $0.14 o FFO: $0.38 - $0.39 o AFFO: $0.37 - $0.38 The above estimates are based on the following key assumption
Slide 21: Superior Returns Start with a Strong Portfolio
8 Years Wtd. Avg. Remaining Lease Term SUPERIOR RETURNS START WITH A STRONG PORTFOLIO 609 Investments1 PORTFOLIO 75% 81% 77% 77% Average Occupancy Percentage 2.25x 1.23x Rent Coverage3 73 Relationships 40% Skilled Mix SH - Leased SH - Managed 2 SNF/TC/Hosp/Oth. SH - Leased (1) Includes investment in
Slide 22: Proprietary Pipeline of Purpose-Built Assets
PROJECTS 25 CURRENT TOTAL INVESTMENT $390M EXPECTED REAL ESTATE VALUE 1 $490M COMPLETED AND PLANNED PROJECTS PROPRIETARY PIPELINE OF PURPOSE-BUILT ASSETS ENHANCES THE QUALITY OF OUR PORTFOLIO PORTFOLIO (1) Represents the value of completed projects at Sabra’s purchase price and the projected purchas
Slide 23: Effective Asset Management and Strong Operator Relationships
Specialty Hospitals and Other 11.2% Senior Housing - Managed 10.8% Senior Housing - Leased 10.4% Interest and Other Income 2.1% Skilled Nursing / Transitional Care 65.5% EFFECTIVE ASSET MANAGEMENT AND STRONG OPERATOR RELATIONSHIPS Crafted portfolio of high- quality and diverse facilities passionate
Slide 24: High Quality of Care, Strong Performance
HIGH QUALITY OF CARE STRONG PERFORMANCE Non-Deal Roadshow hosted by BMOMay 19, 2021 24
Slide 25: Our Operators Are Driven by Passion for Quality of Care
OUR OPERATORS ARE DRIVEN BY AN UNWAVERING PASSION: ADVANCING THE QUALITY OF CARE We Work With Operators Who Are: ▪ Highly engaged ▪ Nimble ▪ Regional experts ▪ In markets with favorable demographics ▪ Well positioned for the future of health care delivery OPERATORS Non-Deal Roadshow hosted by BMOMay
Slide 26: We Support Our Operators
WE SUPPORT OUR OPERATORS We Invest in Our Tenants’ Success: ▪ Redevelopment ▪ Expansion ▪ Strategic development ▪ Flexible equity and debt capital solutions OPERATORS Non-Deal Roadshow hosted by BMOMay 19, 2021 26
Slide 27: Strategy in Action: Operator and Executive Quotes
“WHEN IT COMES TO EXECUTING OUR STRATEGY, WE DO WHAT WE SAY WE ARE GOING TO DO.” – Talya Nevo-Hacohen, Chief Investment Officer STRATEGY IN ACTION – Rick Matros, Chief Executive Officer “WE’VE CONSISTENTLY DELIVERED VALUE TO OUR SHAREHOLDERS WHILE MAINTAINING A STRONG BALANCE SHEET.” Non-Deal Roadsh
Slide 28: Proprietary Information Technology System
PROPRIETARY INFORMATION TECHNOLOGY SYSTEM ▪ Supports the efficient and accurate collection of tenant, financial, asset management and acquisitions information. ▪ Furthers our ability to drive value to shareholders by enabling our team to remain lean, yet effective. CREATING OPERATING EFFICIENCIES OP
Slide 29: Free Access to Industry-Leading Business Intelligence Tools
DRIVING PERFORMANCE WITH FREE ACCESS TO INDUSTRY-LEADING BUSINESS INTELLIGENCE TOOLS Non-Deal Roadshow hosted by BMO OPERATORS May 19, 2021 29
Slide 30: Business intelligence tools for operators
Data Integrity Audit Real-time MDS verification analyzes the accuracy of the Minimum Data Set (MDS) assessment prior to CMS submission. Each MDS is checked for logical and clinical coding accuracy, with recommended actions when inaccurate, incomplete, or inconsistent information is identified. Helpf
Slide 31: Diverse Operator Base, Passionate About Care
Avamere 8.9% North American 7.8% Signature Healthcare 7.8% Cadia 7.4% Signature Behavioral 6.8% Enlivant 4.4%Holiday 4.1% Other 2.3% Other 50.5% Relationship Concentration 1 DIVERSE OPERATOR BASE, PASSIONATE ABOUT CARE By diversifying our tenant concentration, we’ve curated a portfolio equipped to p
Slide 32: Performance
“WE’VE DELIVERED ON OUR PROMISE TO STRENGTHEN OUR BALANCE SHEET AND ARE POISED TO CAPITALIZE ON FUTURE GROWTH OPPORTUNITIES.” – Harold Andrews, Jr., Chief Financial Officer PERFORMANCE Non-Deal Roadshow hosted by BMOMay 19, 2021 32
Slide 33: Balanced Capital Structure
Common Equity Value 58% Secured Debt 7% Unsecured Debt 35% Capital Structure 1 ENTERPRISE VALUE $6.3B BALANCED CAPITAL STRUCTURE Our diverse menu of capital options ensures that we have ready access to low- cost capital to fund our growth. PERFORMANCE (1) As of 3/31/2021. Includes Sabra’s 49% pro ra
Slide 34: Credit metrics versus investment grade peers
(1) Credit metrics (except net debt to adjusted EBITDA) are calculated in accordance with the credit agreement relating to our revolving credit facility and the indentures relating to our unsecured senior notes. (2) Investment Grade Peers consists of WELL, VTR, OHI and NHI, except with respect to th
Slide 35: Favorable Profile with Staggered Maturities
300 500 100 350 350 599 189 82 71 1,000 $22 $27 $359 $909 $192 $584 $173 $3 $353 $46 $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030+ Unsecured Bonds Term Loans Sabra's Share of Uncons. JV Debt Mortgage Debt / Secured Debt Line of Credit Available
Slide 36: Peer valuation and portfolio composition comparison
10.3x 10.4x 12.5x 14.7x 15.2x 20.9x 0.0x 4.0x 8.0x 12.0x 16.0x 20.0x 24.0x SBRA OHI NHI LTC CTRE Big 2 Average 7.0% 3.4% 4.4% 5.7% 6.5% 7.6% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% SBRA Big 2 Average CTRE LTC NHI OHI 7.4% 15.8% 20.2% 25.4% 27.1% 33.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% SBRA NHI LTC OHI Big 2
Slide 37: Well-Positioned Portfolio
SNF CONCENTRATION 1 SNF EBITDARM COVERAGE 1,3TOP FIVE RELATIONSHIP CONCENTRATION 1 (1) Represents latest available concentration and coverage for peers as of 5/13/2021. (2) Based on Annualized Cash NOI as of 3/31/2021 for real estate investments, investments in loans receivable and other investments
Slide 38: Appendix
APPENDIX Non-Deal Roadshow hosted by BMOMay 19, 2021 38
Slide 39: Non-GAAP definitions
Adjusted EBITDA.* Adjusted EBITDA is calculated as earnings before interest, taxes, depreciation and amortization (“EBITDA”) excluding the impact of merger-related costs, stock-based compensation expense under the Company’s long-term equity award program, and loan loss reserves. Adjusted EBITDA is a
Slide 40: Forward-looking statements
This presentation contains “forward-looking” statements that may be identified, without limitation, by the use of “expects,” “believes,” “intends,” “should” or comparable terms or the negative thereof. Forward-looking statements in this presentation include, but are not limited to, all statements re
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