Health Care REIT Inc. (HCN) said Wednesday its second-quarter
profit slid 60% as the health-care real-estate investment trust
reported higher divestiture gains a year ago.
Nonetheless, the company again raised its per-share earnings
target, this time to $1.81 to $1.88 from $1.70 to $1.80, on
additional gains. It also narrowed its view on funds from
operations.
Although many retail and industrial REITs have struggled amid
the economic downturn and property woes, health-care REITs have
been less affected. While the industry isn't completely immune to
housing market challenges, Health Care REIT generates cash from
asset sales as it recycles assets to maintain a modern
portfolio.
Health Care, a REIT that invests in long-term care facilities,
reported earnings of $64.8 million, or 53 cents a share, down from
$161.3 million, or $1.73 a share. Property-sale gains were $10.7
million in the second quarter and $118.2 million in the
year-earlier quarter. Normalized funds from operations, a key
profitability measure for REITs, fell to 80 cents from 85
cents.
Gross revenue jumped 9.7% to $141.7 million.
Analysts polled by Thomson Reuters had expected FFO of 80 cents
on revenue of $140 million.
Shares were inactive in after-hours trading at $43.87. The
shares have rebounded recently and are up by about two-thirds from
the six-year low in March.
-By John Kell, Dow Jones Newswires; 212-416-2480; john.kell@dowjones.com