Medical Properties Trust, Inc. · NYSE:MPT
Medical Properties Trust — Investor Presentation (April 2006)
28 slides from Medical Properties Trust's investor presentation, Apr 17, 2006
Slide 1: Investor Presentation April 2006
Investor Presentation April 2006
Slide 2: Safe Harbor
Certain statements made during this presentation are forward-looking and are subject to risks and uncertainties. The forward-looking statements made are based on our beliefs, assumptions and expectations of future performance, taking into account all information currently available to us. Actual res
Slide 3: Company Overview
Company Overview Unique Healthcare REIT Net Leased Medical Facilities (generally require physician order for admittance) A Focus on Higher Operating Margins in Target Facilities vs. Other Healthcare REIT's Inpatient and Outpatient Medical Facilities Mix of Existing and New Construction Local Communi
Slide 4: MPT's Portfolio is Uniquely Different From Other Healthcare REITs
MPT's Portfolio is Uniquely Different From Other Healthcare REITs Based on number of properties. Source: Other REITS represent current portfolios of 12 Health Care REITS listed in Stifel, Nicolaus and Incorporated Report, April 2005. MPT portfolio of existing properties and properties under construc
Slide 5: Healthcare Trends Are Favorable for MPT
Demand for health care services is increasing due to the aging of the population. Health care spending is growing relative to the general economy. Many facilities are aging and inefficient; being replaced to keep pace in the healthcare marketplace. An increasing emphasis on hospital and physician pa
Slide 6: MPT Positioned To Meet Growing Demand For Health Care Services
MPT Positioned To Meet Growing Demand For Health Care Services 65 and Over Pct of U.S. Population 1950 12256850 0.082 1960 16207237 0.09 1970 20065502 0.099 1980 25549427 0.113 1990 31078895 0.125 2000 34991753 0.124 2010 40243713 0.13 2020 54631891 0.163 2030 71453471 0.197 2040 80049634 0.204 2050
Slide 7: Hospital Usage is Heavily Influenced by the Composition Of The Population
Hospital Usage is Heavily Influenced by the Composition Of The Population Under 15 Years 40.8 15-44 Years 82.7 45-64 Years 116.9 65 Years and Over 370.4 Rate of Discharges Per 1,000 Population Age Group National Center Health Statistics Seniors use hospitals at a significantly higher rate than other
Slide 8: Health Care Spending Continues and Will Fuel MPT Growth
Health Care Spending Continues and Will Fuel MPT Growth In 2003, $1.7 trillion was spent on health care in the U.S. This is expected to increase to $3.6 trillion by 2014. Spending on health care currently accounts for about 15 percent of GDP. By 2014, health care will account for 18.7 percent of GDP
Slide 9: Medicare Spending Is Growing
Medicare Spending Is Growing Hospital Care Representing 40% GDP 1966 1.8 1975 16.3 1985 71.8 1991 120.9 1993 148.3 1995 182.7 1997 209.5 1999 213.5 2001 246.5 2003 280.9 2005 309.3 Total Medicare Spending, 1966-2005 ($ in billions; figures for 2003 and beyond are projections) No Slow Down in Medicar
Slide 10: MPT Portfolio
MPT Portfolio Based on investments for closed properties and loans 1st Qtr Rehab Hospitals 0.28 LTAC Hospitals 0.11 General Hospitals 0.57 MOBs 0.04 Percent Distribution by Invested Dollars
Slide 11: MPT Portfolio: Properties as of January 6, 2006
MPT Portfolio MPT Properties As of January 6, 2006 Thornton, CO North Valley Rehab Hospital 117-Beds 54-Bed LTACH, 32 SNF & 31 Psych Kentfield, CA Kentfield Rehab Hospital 60-Bed IRF Fresno, CA San Joaquin Valley Rehab 62-Bed IRF Victorville, CA Desert Valley Hospital 83-Bed Hospital Desert Valley M
Slide 12: MPT's Underwriting Philosophy
MPT's Underwriting Philosophy Demonstrated Market Need Physician Involvement and Partnerships Strong Experienced Operators Yield Decision Criteria
Slide 13: MPT's Management Team Expertise
MPT's Management Team Expertise Extensive Experience in . . . Hospital Acquisitions Hospital Development and Construction Hospital Operations Physician Practice Management Hospital Leases Real Estate Management
Slide 14: MPT's Valuation of Hospital Real Estate
MPT's Valuation of Hospital Real Estate Minimum Financial Requirements Not More Than Replace Cost Third Party Appraisals
Slide 15: Sum of the Parts is Worth More Than the Whole
Sum of the Parts is Worth More Than the Whole Real estate capital costs less than hospital capital Conversely, investors pay more for real estate income than they do for hospital operating income Hospital companies have substantial real estate assets But investors in hospital companies will only pay
Slide 16: REIT Financing Lowers a Hospital's Cost of Capital
REIT Financing Lowers a Hospital's Cost of Capital Transaction Assumptions Appraised value $ 50,000,000 Operating margin 22% Incremental tax rate of owners 40% Date of commencement January 1, 2006 Lease Assumptions Purchase price as percent of value 100% Purchase price $ 50,000,000 Initial lease rat
Slide 17: Hospital Cash Flow Financing Alternatives
Hospital Cash Flow Financing Alternatives Cash Flow Under Lease Structure Total Lease payments (99,323,652) Tax effect of lease payments 39,729,461 After tax lease payments (59,594,191) Sale proceeds 50,000,000 Operating earnings on sale proceeds 213,182,473 Net after-tax operating earnings 153,588,
Slide 18: REIT Financing Increases Valuation of Hospital Operations
REIT Financing Increases Valuation of Hospital Operations Real Estate Real Estate Owned Leased EBITDA (before lease payments) $18,000,000 $18,000,000 Lease payments - (5,125,000) EBITDA (after lease payments) 18,000,000 12,875,000 Market multiple 5 5 Value of Hospital cash flow 90,000,000 64,375,000
Slide 19: Financing Alternatives Lease vs. Mortgage Debt
Financing Alternatives Lease vs. Mortgage Debt Cash For Investment in Operating Business Cash available from lease financing $50,000,000 Cash available from debt financing 35,000,000 Excess cash from lease over debt financing $15,000,000 After Tax Value Of Financing Alternatives Net present value of
Slide 20: Key Measures Since April 2004
Key Measures Since April 2004 Net Proceeds Investments Significant Unleveraged Yields Substantial ROE & Dividend Growth
Slide 21: Steady Growth in Revenue
Total Revenue Qtr 3 '04 5039072 Qtr 4 '04 5854387 Qtr 1 '05 6480528 Qtr 2 '05 7241777 Qtr 3 '05 8204941 Qtr 4 '05 9621953 Qtr 1 '06 (Proj) Steady Growth in Revenue (In $1,000)
Slide 22: Steady Growth in Revenue and FFO
Total Revenue FFO Dividends Qtr 3 '04 5039072 3561702 2608286 Qtr 4 '04 5854387 4094009 2869115 Qtr 1 '05 6480528 4434664 2869115 Qtr 2 '05 7241777 5353807 4203338 Qtr 3 '05 8204941 6426478 6794741 Qtr 4 '05 9621953 7862082 7194432 Qtr 1 '06 (Proj) 9992266 8411000 Steady Growth in Revenue and FFO (I
Slide 23: 2006 Growth Expectations
2006 Growth Expectations First full quarter of operations of Town and Country Hospital in 1Q06 Expected 4Q05 acquisitions effective for all of 06 Commencement of operations for $137 million in projects currently under construction Escalations effective January 1, 2006 Expected $200 - $300 million in
Slide 24: Expected Future Operations
Expected Future Operations 1Q06 expected FFO................... $0.24 - $0.26 Projects to be completed in 2006... $137 million Expected 2006 acquisitions... $200 - $300 million Expected 2006 FFO.................. $1.16 - $1.20
Slide 25: Projected Percentage of Revenue by Operator
Projected Percentage of Revenue by Operator Based on investments for closed properties and loans as of March 31, 2006 For 2007, assuming no acquisitions in 2006 Vibra North Cypress Desert Valley Stealth DSI Bucks County Monroe Alliance Gulf States 0.41 0.12 0.12 0.11 0.08 0.07 0.06 0.03
Slide 26: Selected Pro Forma Balance Sheet Information
Selected Pro Forma Balance Sheet Information
Slide 27: MPT Market Data (as of April 11, 2006)
MPT Market Data (as of April 11, 2006) Market Cap $439.4 million Shares Outstanding 40.055 million Stock Price $10.97 Stock Price 52 Week Range $7.60-11.42 Annualized Quarterly Dividend $0.84 Average Daily Volume (YTD) 201,406
Slide 28: Investor Presentation April 2006
Investor Presentation April 2006
Medical Properties Trust — Investor Presentation (April 2006) on 6ix