Profits jump for local firm

2/25/2009

Despite a turbulent environment that battered many sectors of the real estate market, Toledo's Health Care REIT Inc. reported higher revenues and profits for 2008 yesterday.

Revenues at the real estate investment trust, which is a landlord to nursing homes, assisted-living facilities, and other health-related businesses, soared 22 percent to $551 million from $454 million in 2007.

Profits declined in the fourth quarter, but for the year more than doubled to $288 million, or $2.81 a share, from $141 million, or $1.46 a share, in 2007.

Michael Crabtree, treasurer, was especially pleased with an increase in so-called funds from operations, which is a common way REITs measure performance.

"Even in a tough year, our funds from operation were up 8 percent year over year," Mr. Crabtree said. The figure increased to $3.38 a share from $3.12 a share in 2007. That performance was slightly better than forecasts by analysts, who expected $3.37 a share.

Health Care REIT is popular with investors seeking high dividend payouts. With shares closing up $2.34 to $33.45 on the New York Stock Exchange yesterday, the firm's current quarterly payment of 68 cents represents an 8 percent payout.

For the fourth quarter, profit slipped 41 percent to $29 million, or 22 cents a share, from $49 million, or 52 cents a share, in the prior-year period. That led to a 58 percent drop in net income available to stockholders per share to 22 cents from 52 cents in the final period of 2007.

The drop resulted mainly from a $33 million reduction in the value of medical office buildings Health Care REIT plans to sell and a $22 million loss connected to an abandoned debt offering, officials said.

Revenues in the fourth quarter increased 18 percent to $147 million from $125 million in 2007.