Care Investment Trust announces Q2 2009 financials

Aug 10 2009

Care Investment Trust Inc. (NYSE: CRE) ("Care" or the "Company"), a real estate investment and finance company formed to invest in healthcare-related real estate and commercial mortgage debt, today reported financial results for the second quarter ended June 30, 2009.

The Company reported a net loss as calculated in accordance with GAAP of $0.5 million, or $0.03 per basic and diluted share. Net income was impacted by a non-cash depreciation charge from the Company's real estate investments of $3.3 million.

Funds From Operations (FFO) for the second quarter of 2009 were $2.7 million, or $0.14 per basic and diluted share. Adjusted Funds From Operations (AFFO) amounted to $0.8 million, or $0.04 per basic and diluted share. FFO is the result of adding back to net income the Company's share of depreciation and amortization of real estate related to Care's investment in the Cambridge properties and its acquisition of the Bickford properties. AFFO reflects additional adjustments for other non-cash income and expense items including stock-based compensation, straight-lining of lease revenue, the unrealized gain or loss on the revaluation of partnership units in relation to the Company's investment in the Cambridge properties and the unrealized gain or loss recognized on loans carried at the lower of cost or market. These adjustments are detailed on the Reconciliation of Non-GAAP Financial Measures attached hereto.

Portfolio Activity

Wholly-owned and Partially-owned Real Estate

Wholly-owned real estate totaled $103.1 million at June 30, 2009, consisting of investments in 14 assisted and independent living and alzheimers' facilities, all of which were net leased. In addition, Care had real estate investments in partially-owned entities of $60.8 million at the end of the second quarter 2009, consisting of investments in equity interests in limited liability entities owning nine medical office buildings as well as a joint venture acquisition of four assisted and independent living facilities.

Loan Portfolio

Net investments in loans were $101.2 million as of June 30, 2009, all of which were floating rate. The weighted average spread on the portfolio at June 30, 2009 was 5.64 percent over one-month LIBOR and the average maturity of the portfolio was approximately two years. The effective yield on the portfolio was 5.95 percent for the quarter ended June 30, 2009.

Operating Activities

Care generated total revenue of $5.1 million during the 2009 second quarter which included interest income from investments in loans of $1.8 million, rental revenue of $3.2 million and other income of $0.1 million. Other income included interest earned on cash balances and extension and other fee income.

The Company incurred $3.1 million in operating expenses during the three months ended June 30, 2009, including $0.5 million in management fees and $3.0 million in marketing, general and administrative expenses. Care also incurred $0.9 million of depreciation and amortization expense relating to its investment in the Bickford properties as well as a favorable adjustment of $1.2 million recognized on its loans carried at the lower of cost or market.

Care's net loss from investments in partially-owned entities amounted to $1.3 million for the three months ended June 30, 2009 and consisted of a $1.6 million loss, after depreciation charges of $2.4 million, related to the Company's investment in the Cambridge properties as well as equity income of $0.3 million from Care's investment in the Senior Management Concepts properties.

Interest expense totaled $1.5 million for the three months ended June 30, 2009, which related primarily to the mortgage debt incurred to finance the acquisition of the Bickford properties. The effective interest rate for the quarter on the Company's mortgage debt borrowings incurred to finance the acquisition of the Bickford properties was 6.88 percent.

Liquidity and Funding

At June 30, 2009, Care had $53.8 million in cash and cash equivalents. During the second quarter 2009 Care received $29.3 million from the prepayment of a mortgage investment in April 2009 at par and $8.2 million from the prepayment of a mortgage investment in June 2009 at par.

F. Scott Kellman, Chief Executive Officer, stated, "Balance sheet strength improved significantly during the second quarter as we received $37.5 million from the prepayment of two mortgage investments. Care now holds approximately $53 million in cash and cash equivalents and has no debt maturities prior to 2015."

Conference Call Details

The Company will host a conference call on Monday, August 10, 2009, at 11:00 a.m. Eastern Time to discuss the second quarter results. The call may be accessed live by dialing (888) 549-7880 or by visiting the Company's website at www.carereit.com .

Investors may access a replay by dialing (800) 406-7325, passcode 4133239, which will be available through August 17, 2009. The webcast replay will also be archived in the "Investor Relations" section of the Company's website.

www.carereit.com