Sabra Health Care Reit, Inc. · NASDAQ:SBRA
Sabra Health Care Reit — Nareit's REITweek Virtual Investor Conference 2021
40 slides from Sabra Health Care Reit's conference presentation, Jun 9, 2021
Slide 1: Nareit's REITweek Virtual Investor Conference: Strong. Resilient. Growing.
Nareit's REITweek Virtual Investor Conference 1June 8-10, 2021 Strong. Resilient. Growing. Nareit’s REITweek Virtual Investor Conference June 8-10, 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 Nareit's REITweek Virtual Investor
Slide 3: Strategy
“WE’VE BUILT A STRONG AND RESILIENT FOUNDATION.” – Rick Matros (he), Chief Executive Officer STRATEGY Nareit's REITweek Virtual Investor ConferenceJune 8-10, 2021 3
Slide 4: Sabra Today
4 33% 73 $6.4B1 SABRA TODAY STRATEGY Nareit's REITweek Virtual Investor ConferenceJune 8-10, 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 unconsolida
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 Nareit's REITweek Virtual Investor ConferenceJune 8-10, 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 Nareit's REITweek Virtual Investor ConferenceJune 8-10, 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)
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 Nareit's REITweek Virtual Investor ConferenceJune 8-10, 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 Nareit's REITweek Virtual Investor ConferenceJune 8-10, 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, ag
Slide 10: Diverse and Experienced Leadership
DIVERSE AND EXPERIENCED LEADERSHIP ENVIRONMENTAL, SOCIAL AND GOVERNANCE Nareit's REITweek Virtual Investor ConferenceJune 8-10, 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
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 Nareit's REITweek Virtual Investor ConferenceJune 8-10, 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 Nareit's REITweek Virtual Investor ConferenceJune 8-10, 2021 13
Slide 14: COVID-19 Rent Collections and Liquidity
▪ From the beginning of the COVID-19 pandemic through May 2021, we have collected 99.8% of our forecasted rents. While we have agreed to temporary pandemic-related rent deferrals for four tenants of one to six months of rent, we have not granted any permanent pandemic-related rent concessions. Total
Slide 15: COVID-19 Impact: Skilled Nursing 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 ▪ Average occupancy for our Senior Housing - Managed portfolio bottomed out during the first half of March 2021 and has increased 136 basis points through May 15, 2021. ▪ In March 2021, gross move-ins in the Enlivant Joint Venture were at the highest level in 18 m
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 Summary
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: Provider Relief Fund Received and Recognized
▪ 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 Nareit's REITweek Virtual Investor ConferenceJune 8-10, 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 followi
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 Nareit's REITweek Virtual Investor ConferenceJune 8-10, 2021 24
Slide 25: Operators 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 Nareit's REITweek Virtual Investor
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 Nareit's REITweek Virtual Investor ConferenceJune 8-10, 2021 26
Slide 27: Strategy in Action: Operators
“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.” Nareit's REITwe
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 Nareit's REITweek Virtual Investor Conference OPERATORS June 8-10, 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 Nareit's REITweek Virtual Investor ConferenceJune 8-10, 2021 32
Slide 33: Balanced Capital Structure
Common Equity Value 59% Secured Debt 7% Unsecured Debt 34% Capital Structure 1 ENTERPRISE VALUE $6.4B 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 vs. 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 Comparison
10.6x 11.0x 12.8x 14.1x 15.2x 22.1x 0.0x 4.0x 8.0x 12.0x 16.0x 20.0x 24.0x SBRA OHI NHI LTC CTRE Big 2 Average 6.8% 3.2% 4.3% 5.9% 6.6% 7.2% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% SBRA Big 2 Average CTRE LTC NHI OHI 11.5% 14.7% 24.6% 31.8% 33.0% 33.3% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% SBRA NHI LTC OHI Big
Slide 37: Well-Positioned Portfolio vs. Peers
SNF CONCENTRATION 1 SNF EBITDARM COVERAGE 1,3TOP FIVE RELATIONSHIP CONCENTRATION 1 (1) Represents latest available concentration and coverage for peers as of 6/4/2021. (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 Nareit's REITweek Virtual Investor ConferenceJune 8-10, 2021 38
Slide 39: Definitions of Non-GAAP Measures
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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