Sabra Health Care Reit, Inc. · NASDAQ:SBRA
Sabra Health Care Reit — J.P. Morgan Healthcare Conference 2011
25 slides from Sabra Health Care Reit's conference presentation, Jan 13, 2011
Slide 1: J.P. Morgan Healthcare Conference
Exhibit 99.1 J.P. MORGAN HEALTHCARE CONFERENCE January 10-13, 2011
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS Statements made in this presentation that are not historical facts are “forward-looking” statements (as defined in the Private Securities Litigation Reform Act of 1995) that involve risks and uncertainties and are subject to change at any time. These forward-looking statem
Slide 3: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEASURES In this presentation, we refer to financial measures that are derived on the basis of methodologies other than in accordance with generally accepted accounting principles (“GAAP”). These non-GAAP financial measures are presented in this presentation on a pro forma basis a
Slide 4: Company Overview and Investment Highlights
Company Overview and Investment Highlights 4
Slide 5: Sabra Property Portfolio
SABRA PROPERTY PORTFOLIO Geographically diversified portfolio of skilled nursing and senior Key Portfolio Metrics housing assets Number of Facilities: 86 8 2 5 1 Property Type: 4 3 Skilled Nursing 67 (78%) 1 SNF/AL/IL 10 (12%) 1 AL 5 (6%) 1 2 Mental Health 2 (2%) IL 1 (1%) 8 8 1 CCRC 1 (1%) 1 2 1 3
Slide 6: Geographically Diverse Portfolio
GEOGRAPHICALLY DIVERSE PORTFOLIO Beds / Units by State 86 Properties and 9,603 Beds in 19 States (1) Number of Licensed Beds / Units New Total Hampshire Number of Skilled Assisted Independent Mental % of 17% State Centers Nursing Living Living Health Total Total Other States New Hampshire 15 1,131 4
Slide 7: Strong Operator Performance
STRONG OPERATOR PERFORMANCE Strong occupancy and skilled mix trends in the underlying REIT portfolio Bedford Hills in New Hampshire Historical Portfolio Occupancy 100% 89.6% 91.4% 90.9% 90.0% 88.2% 80% 60% 40% 20% 0% 2006 2007 2008 2009 YTD Q3 2010 Heartland Villa in Kentucky HistoricalPortfolioSNFS
Slide 8: Favorable Long-Term Lease Structure
FAVORABLE LONG-TERM LEASE STRUCTURE Strong structural protections to the REIT with operating flexibility to New Sun Triple net master leases with staggered maturities 10-15 year term, with 5 year renewal options Renewal options at time of renewal rates NorthriseCCRC in New Mexico Lesser of CPI or 2.
Slide 9: Business Model and Growth Opportunities
BUSINESS MODEL AND GROWTH OPPORTUNITIES SabraStrategy & Business Model Growth Opportunities Focused on acquiring and leasing skilled nursing Opportunistically pursue acquisitions and and senior housing facilities to strong national, diversification regional, and local operators Initial focus will be
Slide 10: Experienced Management Team
EXPERIENCED MANAGEMENT TEAM Dedicated leadership team with over 60 years of relevant experience Relevant Executive Experience Profile Rick Matros 20+ Years Former Sun Healthcare Chairman and CEO Chairman and ChiefExecutive Officer Executive of healthcare companies for over 20 years Harold Andrews, J
Slide 11: Industry Overview
Industry Overview ASABRA —
Slide 12: Aging Population Drives Demand
AGING POPULATION DRIVES DEMAND 65+ and 85+ population projected to increase 36% and 14%, respectively, by 2020 Number of SNF beds has steadily declined, creating favorable supply/demand dynamics Limits on new nursing home construction (CON states) Healthcare policy favors SNFs – payors focused on dr
Slide 13: Decreasing Bed Supply
DECREASING BED SUPPLY Sabrawill benefit from attractive supply / demand fundamentals within the skilled nursing and senior housing sectors Trend in Skilled Nursing Facilities Senior Housing Construction Starts in Top 31 Metros (Units) (figures in 000s) 5,000 17.0 4,335 16.8 4,184 16.8 16.7 4,000 16.
Slide 14: Shift of Patient Care to Lower Cost Alternatives
SHIFT OF PATIENT CARE TO LOWER COST ALTERNATIVES Sabrawill benefit from the increasing shift of patients toward SNF facilities SNFs deliver effective clinical Skilled nursing facilities are a lower cost setting outcomes at lower costs Increased Medicare funding for Comparison of Per Case Rates SNF I
Slide 15: Reimbursement Update
REIMBURSEMENT UPDATE Medicare: Implementednew ResourceUtilizationGroup(RUGsIV) systemeffectiveOctober1, 2010 13 new RUG categories focused on medically complex Elimination of lookbackperiod and change in concurrent therapy Should provide opportunity for greater skilled mix and rate growth 15
Slide 16: Sun Healthcare Overview
Sun Healthcare Overview ASABRA —
Slide 17: Sun Overview
SUN OVERVIEW Net Revenue by Business Inpatient SunDance SunBridge (Skilled Nursing) 6% 202 inpatient facilities CareerStaff 5% 19,500 patients/residents SolAmor (Hospice) Growing business operating in 8 states Inpatient 89% SunDance (Rehab) 476+ contracts / 344 non-affiliated 9/30/10 LTM Net Revenue
Slide 18: Inpatient Centers
INPATIENT CENTERS Sun operates 202 inpatient centers in 25 states Key Portfolio Metrics Number of Centers 202 5 Property Type: 5 Skilled Nursing 166 (82%) SNF/AL/IL 15 (7%) 11 15 18 AL 10 (5%) 2 Mental Health 8 (4%) 1 IL 2 (1%) 1 CCRC 1 (1%) 10 17 1 2 9 7 15 Beds: 20 3 Licensed 23,189 8 8 Available
Slide 19: Financially Secure Primary Tenant
FINANCIALLY SECURE PRIMARY TENANT Attractive Business Profile and Premium Assets 202 inpatient facilities across 25 states; 476+ SunDance rehab contracts 23,189 licensed beds 87.1% occupancy; 19.2% SNF skilled mix as of Sept 30, 2010 Strong Operating Performance $1.9 billion LTM 9/30/10 Pro Forma Re
Slide 20: Financial Overview
Financial Overview 20
Slide 21: Financial Summary
FINANCIAL SUMMARY SabraHealth Care REIT, Inc.Pro – Forma (Dollars in millions) Income Statement Items Balance Sheet Items Annualized(1) 9 Months As of 09/30/10 09/30/10 Revenue $70.2 Cash $65.0 G & A (2) 7.5 Real Estate, Net Book Value 486.2 Adjusted EBITDA (3) 65.1 Real Estate, Cap Rate (6) 720.0 F
Slide 22: Pro Forma Reconciliation Section
PRO FORMA RECONCILIATION SECTION Sabra Health Care REIT, Inc. Reconciliation to Pro Forma FFO, AFFO and Adjusted EBITDA (Dollars in millions) Proforma Proforma For the Nine For the Nine Months Ended Months Annualized September 30, 2010 September 30, 2010 Revenue $ 52.7 $ 70.2 Net income 12.2 16.2 Ad
Slide 23: Pro Forma Capitalization
PRO FORMA CAPITALIZATION ($ in millions) Capitalization Existing Sun As of September 30, 2010 Cash and Cash Equivalents $67.2 New Revolver ($100) $0.0 Mortgage Notes Payable (1) 162.2 Total Secured Debt $162.2 New Senior Unsecured Notes 225.0 - Total Debt $387.2 Common Stockholders' Equity 123.7 Tot
Slide 24: Responsible Financial Policy
RESPONSIBLE FINANCIAL POLICY Maintain a limited secured capital structure Maintain conservative capitalization Maintain significant liquidity Structure initial acquisitions with triple-net leases Initially pay dividends of 80% of adjusted funds from operations (AFFO)(1) each quarterly period (1) FFO
Slide 25: Investment Highlights Summary
INVESTMENT HIGHLIGHTS SUMMARY Geographically Diverse Portfolio Experienced Attractive Industry Management Team Fundamentals Growth Favorable Long-Term Opportunities Lease Structure Financially Secure Strong Lease Primary Tenant Coverage Strong Asset Coverage 25
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