HEALTHCARE REALTY TRUST INC - FORM 8-K - EX-99.1

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8-K - FORM 8-K - HEALTHCARE REALTY TRUST INC	g26100e8vk.htm
EX-99.2 - EX-99.2 - HEALTHCARE REALTY TRUST INC	g26100exv99w2.htm

Exhibit 99.1

HEALTHCARE REALTY
Gabrielle M. Andrés
Corporate Communications
P 615.269.8175
www.healthcarerealty.com

NEWS RELEASE

HEALTHCARE REALTY TRUST ANNOUNCES FOURTH QUARTER RESULTS

NASHVILLE, Tennessee, February 22, 2011 — Healthcare Realty Trust Incorporated (NYSE:HR) today announced results for the fourth quarter ended December 31, 2010. FFO per diluted common share for the three months ended December 31, 2010 totaled $0.30. FFO per diluted common share for the twelve months ended December 31, 2010 totaled $1.14, which includes the effect of non-cash impairment charges totaling $7.5 million, or $0.12 per diluted common share. FAD for the three months ended December 31, 2010 totaled $0.29 per diluted common share.

Revenues for the three and twelve months ended December 31, 2010 totaled $67.0 million and $258.4 million, respectively. Income (loss) from continuing operations for the three and twelve months ended December 31, 2010 totaled ($0.2) million and $4.0 million, respectively. Net income attributable to common stockholders for the three months ended December 31, 2010 totaled $0.4 million, or $0.01 per diluted common share. Net income attributable to common stockholders for the twelve months ended December 31, 2010 totaled $8.2 million, or $0.13 per diluted common share. Along with FFO, net income attributable to common stockholders for the twelve months ended December 31, 2010 was also affected by impairment charges.

Healthcare Realty Trust is a real estate investment trust that integrates owning, managing, financing and developing income-producing real estate properties associated primarily with the delivery of outpatient healthcare services throughout the United States. The Company had investments of approximately $2.6 billion in 209 real estate properties and mortgages as of December 31, 2010, excluding assets classified as held for sale and including an investment in one unconsolidated joint venture. The Company’s 201 owned real estate properties, excluding assets classified as held for sale, are comprised of six facility types, located in 28 states, totaling approximately 13.3 million square feet. The Company provides property management services to approximately 9.2 million square feet nationwide.

The Company directs interested parties to its Internet site, www.healthcarerealty.com, where information is posted regarding this quarter’s operations. Please contact the Company at 615.269.8175 to request a printed copy of this information.

In addition to the historical information contained within, the matters discussed in this press release may contain forward-looking statements that involve risks and uncertainties. These risks are discussed in filings with the Securities and Exchange Commission by Healthcare Realty Trust, including its Annual Report on Form 10-K for the year ended December 31, 2010 under the heading “Risk Factors,” and as updated in its Quarterly Reports on Form 10-Q filed thereafter. Forward-looking statements represent the Company’s judgment as of the date of this release. The Company disclaims any obligation to update forward-looking statements.

HEALTHCARE REALTY TRUST INCORPORATED
Consolidated Statements of Operations (1)
(Dollars in thousands, except per share data)
(Unaudited)


	Three Months Ended						Twelve Months Ended
	December 31,						December 31,
	2010			2009			2010			2009

REVENUES
Master lease rent	$	13,326		$	13,655		$	54,659		$	53,340
Property operating		50,206			45,024			190,205			177,849
Straight-line rent		557			599			2,509			2,052
Mortgage interest		669			520			2,377			2,646
Other operating		2,244			2,328			8,644			10,951

		67,002			62,126			258,394			246,838

EXPENSES
General and administrative		4,380			5,081			16,894			22,478
Property operating		26,273			23,733			101,355			93,249
Bad debt, net		9			110			(429	)		535
Depreciation		17,824			15,675			67,440			60,847
Amortization		1,473			1,196			5,342			5,259

		49,959			45,795			190,602			182,368

OTHER INCOME (EXPENSE)
Loss on extinguishment of debt		—			—			(480	)		—
Re-measurement gain of equity interest upon acquisition		—			—			—			2,701
Interest expense		(17,908	)		(13,549	)		(65,710	)		(43,080	)
Interest and other income, net		620			425			2,419			1,099

		(17,288	)		(13,124	)		(63,771	)		(39,280	)


INCOME (LOSS) FROM CONTINUING OPERATIONS		(245	)		3,207			4,021			25,190

DISCONTINUED OPERATIONS
Income from discontinued operations		737			1,208			3,385			5,844
Impairments		(150	)		—			(7,511	)		(22	)
Gain on sales of real estate properties		40			—			8,352			20,136

INCOME FROM DISCONTINUED OPERATIONS		627			1,208			4,226			25,958


NET INCOME		382			4,415			8,247			51,148

Less: Net income attributable to noncontrolling interests		(2	)		(45	)		(47	)		(57	)


NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS	$	380		$	4,370		$	8,200		$	51,091


BASIC EARNINGS PER COMMON SHARE
Income from continuing operations	$	0.00		$	0.05		$	0.06		$	0.43

Discontinued operations		0.01			0.02			0.07			0.45


Net income attributable to common stockholders	$	0.01		$	0.07		$	0.13		$	0.88


DILUTED EARNINGS PER COMMON SHARE
Income from continuing operations	$	0.00		$	0.05		$	0.06		$	0.43

Discontinued operations		0.01			0.02			0.07			0.44


Net income attributable to common stockholders	$	0.01		$	0.07		$	0.13		$	0.87


WEIGHTED AVERAGE COMMON SHARES OUTSTANDING — BASIC		63,176,732			58,357,290			61,722,786			58,199,592


WEIGHTED AVERAGE COMMON SHARES OUTSTANDING — DILUTED		64,241,164			59,311,720			62,770,826			59,047,314


(1)		The Consolidated Statements of Operations do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.

HEALTHCARE REALTY TRUST INCORPORATED
Consolidated Statements of Cash Flows (1)
(Dollars in thousands)
(Unaudited)


	Three Months Ended						Twelve Months Ended
	December 31,						December 31,
	2010			2009			2010			2009

Cash flows from operating activities:
Net income	$	382		$	4,415		$	8,247		$	51,148
Non-cash items:
Depreciation and amortization — real estate		19,011			16,539			72,213			66,914
Depreciation and amortization — other		1,399			1,493			5,681			4,007
Provision for bad debt, net		9			108			(409	)		517
Impairments		150			—			7,511			22
Straight-line rent receivable		(549	)		(577	)		(2,472	)		(1,925	)
Straight-line rent liability		(217	)		108			92			444
Equity in losses from unconsolidated joint ventures		—			—			—			2
Stock-based compensation		566			425			2,411			3,711
Provision for deferred post-retirement benefits		223			417			1,390			2,860
Re-measurement gain of equity interest upon acquisition		—			—			—			(2,701	)
Other non-cash items		—			(38	)		(542	)		723

Total non-cash items		20,592			18,475			85,875			74,574

Other items:
Accounts payable and accrued liabilities		(3,494	)		(6,857	)		6,367			5,127
Other liabilities		(1,098	)		4,864			470			(3,508	)
Other assets		(2,212	)		(65	)		(9,137	)		(1,017	)
Gain on sales of real estate properties		(40	)		—			(8,352	)		(20,136	)
Loss on extinguishment of debt		—			—			480			—
Payment of partial pension settlement		(2,240	)		—			(2,582	)		(2,300	)
State income taxes paid, net of refunds		(30	)		(12	)		(533	)		(674	)

Total other items		(9,114	)		(2,070	)		(13,287	)		(22,508	)

Net cash provided by operating activities		11,860			20,820			80,835			103,214

Cash flows from investing activities:
Acquisition and development of real estate properties		(185,381	)		(71,254	)		(369,034	)		(170,520	)
Funding of mortgages and notes receivable		(11,188	)		(10,208	)		(25,109	)		(23,391	)
Investment in unconsolidated joint venture		—			—			—			(184	)
Proceeds from sales of real estate		1,191			—			34,512			83,441
Proceeds from mortgages and notes receivable repayments		1,816			12,688			9,201			12,893

Net cash used in investing activities		(193,562	)		(68,774	)		(350,430	)		(97,761	)

Cash flows from financing activities:
Net repayments on unsecured credit facilities		(131,000	)		(323,000	)		(50,000	)		(279,000	)
Borrowings on notes and bonds payable		396,800			377,969			396,800			377,969
Repayments on notes and bonds payable		(757	)		(5,793	)		(2,516	)		(28,433	)
Repurchase of notes payable		—			—			(8,556	)		—
Quarterly dividends paid		(19,340	)		(22,855	)		(75,821	)		(91,385	)
Proceeds from issuance of common stock		38,768			25,933			118,235			26,467
Equity issuance costs		(7	)		(3	)		(30	)		(3	)
Common stock redemption		—			—			—			(8	)
Debt issuance and assumption costs		(483	)		(3,900	)		(1,199	)		(11,293	)
Capital contributions received from noncontrolling interest holders		(53	)		457			633			2,228
Distributions to noncontrolling interests		(82	)		(91	)		(481	)		(282	)

Net cash provided by (used in) financing activities		283,846			48,717			377,065			(3,740	)


Increase in cash and cash equivalents		102,144			763			107,470			1,713
Cash and cash equivalents, beginning of period		11,177			5,088			5,851			4,138

Cash and cash equivalents, end of period	$	113,321		$	5,851		$	113,321		$	5,851


(1)		The Consolidated Statements of Cash Flows do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.

RECONCILIATION OF FUNDS FROM OPERATIONS (1) (2):
(Dollars in thousands, except per share data)
(Unaudited)


	Three Months Ended					Twelve Months Ended
	December 31,					December 31,
	2010			2009		2010			2009

Net Income Attributable to Common Stockholders	$	380		$	4,370	$	8,200		$	51,091

Gain on sales of real estate properties		(40	)		—		(8,352	)		(20,136	)
Real estate depreciation and amortization		18,883			16,539		71,725			66,927

Total adjustments		18,843			16,539		63,373			46,791


Funds From Operations	$	19,223		$	20,909	$	71,573		$	97,882


Funds From Operations Per Common Share — Basic	$	0.30		$	0.36	$	1.16		$	1.68


Funds From Operations Per Common Share — Diluted	$	0.30		$	0.35	$	1.14		$	1.66


Weighted Average Common Shares Outstanding — Basic		63,176,732			58,357,290		61,722,786			58,199,592


Weighted Average Common Shares Outstanding — Diluted		64,241,164			59,311,720		62,770,826			59,047,314

RECONCILIATION OF FUNDS AVAILABLE FOR DISTRIBUTION (2):
(Dollars in thousands, except per share data)
(Unaudited)


	Three Months Ended
	December 31, 2010
Net Income Attributable to Common Stockholders	$	380

Gain on sales of real estate properties		(40	)
Partial pension settlement		(2,240	)
Total non-cash items included in cash flows from operating activities (3)		20,592


Funds Available For Distribution	$	18,692


Funds Available For Distribution Per Common Share — Diluted	$	0.29


Weighted Average Common Shares Outstanding — Diluted		64,241,164


(1)		Funds from operations (“FFO”) is calculated according to the definition of the National Association of Real Estate Investment Trusts and is comprised primarily of net income (loss) attributable to common stockholders and depreciation from real estate, but is not adjusted for certain non-cash income and expense items. Gains on the sale of real estate properties are excluded from FFO and FFO per share, while impairments are included in FFO and FFO per share.

(2)		FFO and Funds Available For Distribution (“FAD”) do not represent cash generated from operating activities determined in accordance with accounting principles generally accepted in the United States of America and are not necessarily indicative of cash available to fund cash needs. FFO and FAD should not be considered alternatives to net income attributable to common stockholders as indicators of the Company’s operating performance or as alternatives to cash flow as measures of liquidity.

(3)		See the Consolidated Statements of Cash Flows that are included in this earnings release.

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