LTC Properties, Inc. (NYSE:LTC) Q3 2023 Earnings Conference Call October 27, 2023 11:00 AM ET

Company Participants

Wendy Simpson - Chairman and Chief Executive Officer

Pam Kessler - Co-President and Chief Financial Officer

Clint Malin - Co-President and Chief Investment Officer

Conference Call Participants

Juan Sanabria - BMO

Connor Siversky - Wells Fargo

Michael Carroll - RBC Capital Markets

Operator

Greetings. Welcome to the LTC Properties, Inc. Third Quarter 2023 Earnings Conference Call. [Operator Instructions] Before management begins its presentation, please note that today’s comments, including the question-and-answer session, may include forward-looking statements subject to risks and uncertainties that may cause actual results and events to differ materially. These risks and uncertainties are detailed in LTC Properties’ filings with the Securities and Exchange Commission from time to time, including the company’s most recent 10-K dated December 31, 2022. LTC undertakes no obligation to revise or update these forward-looking statements to reflect events or circumstances after the date of this presentation. Please note, this event is being recorded.

I would now like to turn the conference over to Wendy Simpson.

Wendy Simpson

Thank you, operator and welcome everyone to LTC’s 2023 third quarter conference call. I am joined today by Pam Kessler, Co-President and Chief Financial Officer and Clint Malin, Co-President and Chief Investment Officer.

On our last call, I spoke about LTC’s primary mission of focus for the remainder of 2023. And as a result of that strategy, we have made progress towards those identified goals, including very positive results regarding the Brookdale and Prestige porfolios. We also closed the remaining transactions in the pipeline with funding of that transaction expected early next year. Pam and Clint will talk more about this later.

To recap, since the beginning of the year, we have originated nearly $270 million in transactions and generated over $51 million in sales proceeds resulting in net gains totaling approximately $21 million. Of the $51 million in sales proceeds to-date, $14 million was received in the third quarter. We expect to receive additional sales proceeds in the $27 million to $28 million range throughout the remainder of 2023, primarily related to the expected sales of the portion of the Brookdale portfolio. Additionally, so far in 2023, we have received almost $12 million in mezzanine loan payoffs generating $1.6 million of exit IRR income at a weighted average rate of 12%. LTC’s long-term mandate remains focused.

First, focus on the portfolio, where we have been working to further reduce its average age while creating additional operator diversity and maintaining a balanced portfolio of private pay and skilled nursing. Second, focus on reducing leverage to more historical levels by using sales proceeds to pay-down a portion of our debt. And third, focus on positioning LTC for future growth.