Ventas, Inc. · NYSE:VTR
Ventas — Investor Presentation (November 2005)
25 slides from Ventas's investor presentation, Nov 28, 2005
Slide 1: Ventas, Inc.
Ventas, Inc. AVENTAS”
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains “forward-looking statements” within the meaning of the federal securities laws. These forward-looking statements include, among others, statements of expectations, beliefs, future plans and strategies, anticipated results from operations and deve
Slide 3: Ventas Overview
Ventas Overview Largest owner of LTC and Senior Housing in the U.S. $5 billion Enterprise Value $366 million EBITDA – 2005 (Q3 2005 pro forma annualized) Owns 381 healthcare facilities in 42 states at 10/28/2005 Triple-net leases to providers of healthcare and senior housing Approximatel
Slide 4: Ventas Goals and Accomplishments
Ventas Goals and Accomplishments Strategic $1.2bn acquisition of Provident Diversification $336 million closed through 10/28/2005 $400+ million acquisitions closed 2004 Excellent FFO Normalized FFO/Share: Growth 2006 (E): $2.20 - $2.23 without acquisitions 2005 (E): $2.06 - $2.08 vs.
Slide 5: Ventas Goals and Accomplishments: Dividend Growth
Ventas Goals and Accomplishments Dividend Growth 2005: $1.44 11% year-over-year growth Low payout ratio → future growth Equity Out- 5-year ending 9/30/2005 > 56% TSR Performance 1 Best performing REIT over 5 years ending 9/30/2005 9th best performing U.S. public company Strong Bala
Slide 6: Ventas Goals and Accomplishments: Excellent Primary Tenants
Ventas Goals and Accomplishments Excellent Primary Kindred - $1+ billion equity market cap Tenants Brookdale/Alterra – IPO largest provider of senior/Alzheimer care “ Best Practices” Independent Board Corporate 99th percentile Institutional Governance Shareholder Services rating Sect
Slide 7: Ventas Outperformance
Ventas Outperformance VTR Total Shareholder Return 1 Ventas Morgan Stanley REIT Index (RMS) Healthcare REIT Sector S&P 500 Total Return Index 60.0% 56.3% 50.0% 42.0% 40.0% 31.3% 30.6% 30.0% 25.7% 25.9% 27.1% 19.2% 17.6% 20.0% 16.7% 12.2% 10.0% 0.0% (1.5%) (10.0%) 5-Year Ann. 3-Year Ann. 12-Month (09
Slide 8: Mergers & Acquisitions Achieve VTR Objectives
Mergers & Acquisitions Achieve VTR Provident AcquisitionObjectives – Closed Other 2005 Acquisitions Through 6/7/05 Provident Senior Living Trust - $1.2 10/28/05 $336 million in other acquisitions billion 27 facilities, 2,900 units 68 high end private pay facilities 23 ALFs/ILFs – 100% priv
Slide 9: Diversified Portfolio of Owned Properties
Diversified Portfolio of Owned Properties As of October 28, 2005 9 3 2 10 2 5 1 1 2 11 6 2 8 3 1 6 9 2 27 8 1 4 4 5 2 1 16 1 6 3 2 1 1 4 1 1 7 1 1 5 10 2 1 4 9 15 4 3 5 11 3 2 2 1 1 1 11 2 2 6 1 19 1 4 5 1 2 1 1 2 1 7 1 5 5 3 8 6 1 1 Nursing Facilities (Total: 200) 3 6 Hospitals (Total: 41) 13 Assis
Slide 10: Acquisition Improves Diversification
Acquisition Improves Diversification Tenant Mix (% of Revenues) – Asset Class Mix (% of Revenues) – 10/28/2005 1 10/28/2005 1 Prime. Other Summer. 1% MOBs/Personal Care 7% 4% 2% Bench. 1% Genesis 2% THI K indred SNF 2% 52% 37% ALF/ILF 42% Brookdale/Alterra 31% Hospitals 19% (1) Assumes full year eff
Slide 11: High Quality Assets
High Quality Assets Brookdale Properties Alterra Properties Independent Living Facility Assisted Living Facility 11
Slide 12: Growth and Diversification Strategy
Growth and Diversification Strategy Property types: Senior Housing and Healthcare related real estate Senior Housing and Skilled Nursing Hospitals and Specialty Care Facilities Medical Office and other NNN Healthcare related properties Possible strategic disposition of select Kindred asset
Slide 13: Positive Supply / Demand Fundamentals
Positive Supply / Demand Fundamentals – Limited Supply SNFs 16,000+ SNFs in US 106 average beds/facility 82% median occupancy Limits on new nursing home construction CON states High cost and long payback period limit new SNF construction Growing Demand 85+ population is fastest growing
Slide 14: Long Term Acute Care Industry Overview
Long Term Acute Care Industry Overview Overview $2.5 billion niche market 5.0% compounded secular growth rate Positive reimbursement trends Ventas is the largest owner of freestanding LTACs Total Ventas Market Ventas Owned Non-Ventas LTACs Owned LTACs 24% LTAC within Freestanding 76% Hospita
Slide 15: Strength in Private Pay Seniors Housing
Strength in Private Pay Seniors Housing 1 Overview Approximately $65 billion spent annually in U.S. on private pay seniors housing Since 1999, ALF development down 80% and ILF development down 50% Occupancy and average daily rates increasing Current occupancy approximately 90% Improved mar
Slide 16: Attractive Growth Profile
Attractive Growth Profile Overview Rental revenues increase $7+ million per year Includes all acquisitions through 10/28/2005 Excludes Reset Right and future acquisitions $389 $396 $400.0 ($ in millions) $350.0 $325 $300.0 $250.0 $233 $201 $200.0 $150.0 2003 2004 2005E 2006E 2007E Total Rental
Slide 17: Kindred Reset Right "In the Money"
Kindred Reset Right “In the Money” Ventas option to increase Kindred’s rent to “market” January 20, 2006 notice Ventas estimates at least $35mm rent increase per year Appraisal vs. Negotiated solution Ventas intends to maximize value / no downside Note: The value of the Reset Right is depe
Slide 18: Ventas Rent is Reliable
Ventas Rent is Reliable Performance Summary of Master Leases 1 Pooled multi-facility Master Leases: Best structure (1) Trailing Twelve Months EBITDARM and EBITDAR for the period ended September 30, 2005 (the latest available data provided by Kindred) to the Company’s Trailing Twelve Months cash re
Slide 19: Kindred Overview
Kindred Overview Principal Tenant is Financially Healthy (NYSE: KND) Excellent “Quality Mix” Higher Margin Hospital Business SNF Payor Mix 2 LTAC Payor Mix 2 Private and Other Private and 18% Medicare Other 32% 28% Medicaid Medicare 7% 65% Medicaid 50% (1) Includes nursing home, hospital, and pharma
Slide 20: Stable Reimbursement Outlook
Stable Reimbursement Outlook Medicare for SNFs Flat Medicare dollars for FY 2006 RUGs refinement effective 1/1/2006 Medicaid for SNFs Kindred Medicaid rates up YoY with provider taxes Operators predict no increase for 2H 2005; 2% -3% in 2006 $10 billion Medicaid reduction focus on drugs an
Slide 21: Ventas Accomplishments and Highlights
Ventas Accomplishments and Highlights Growth and Diversification strategy underway Provident acquisition 15% FFO/share growth estimated - 2005 vs. 2004 normalized 2006 (E) - 7% projected core growth without acquisitions Dividend growth Diversified portfolio of 381 high quality productive
Slide 22: SEC Reg. G Compliance
SEC Reg. G Compliance AVENTAS”
Slide 23: Non-GAAP Financial Measures
Non-GAAP Financial Measures Yearly Funds from Operations (FFO) per Share 2006E 2005E 2004 2003 2002 2001 Guidance Guidance Net Income per Diluted Share $1.11 - $1.14 $1.19 - $1.21 $1.43 $2.03 $0.93 $0.73 Excluding Depreciation on Real Estate Assets 1.09 - 1.09 0.87 - 0.87 0.58 0.52 0.60 0.60 Realize
Slide 24: Non-GAAP Financial Measures
Non-GAAP Financial Measures Quarterly EBITDA 1 ($ in ’000s) For the Quarter Ended 9/30/2005 Pro Forma Net Income $28,426 Add Back: Pro Forma Interest 34,051 Pro Forma Depreciation 28,573 Restricted Stock Amortization 471 Pro Forma EBITDA 91,521 Pro Forma Annualized EBITDA $366,084 Net Debt / EBITDA
Slide 25: Ventas, Inc.
Ventas, Inc. AVENTAS”