UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): May 7, 2015

 

 

MEDICAL PROPERTIES TRUST, INC.

(Exact Name of Registrant as Specified in Charter)

 

 

Commission File Number 001-32559

 

Maryland		20-0191742
(State or other jurisdiction of incorporation or organization)		(I. R. S. Employer Identification No.)
1000 Urban Center Drive, Suite 501 Birmingham, AL		35242
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code

(205) 969-3755

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:

 

¨	Written communications pursuant to Rule425 under the Securities Act (17 CFR 230.425)

 

¨	Soliciting material pursuant to Rule14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨	Pre-commencement communications pursuant to Rule14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨	Pre-commencement communications pursuant to Rule13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

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Item 2.02. Results of Operations and Financial Condition.

On May 7, 2015, Medical Properties Trust, Inc. issued a press release announcing its financial results for the quarter ended March 31, 2015. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference. The information in this Current Report on Form 8-K, including the information set forth in Exhibit 99.1 and Exhibit 99.2 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended. In addition, this information shall not be deemed incorporated by reference in any filing of Medical Properties Trust, Inc. with the Securities and Exchange Commission, except as expressly set forth by specific reference in any such filing.

The Company disclosed three non-GAAP financial measures in the attached press release for the quarter ended March 31, 2015: Funds from operations, Normalized funds from operations and Adjusted funds from operations. The most directly comparable GAAP financial measure to each of these non-GAAP financial measures is net income, which was $35.9 million, or $0.17 per diluted share for the quarter ended March 31, 2015 compared to $7.2 million, or $0.04 per diluted share for the quarter ended March 31, 2014. In the attached press release, the Company disclosed Funds from operations of $50.4 million for the quarter ended March 31, 2015, and Normalized funds from operations of $56.9 million for quarter ended March 31, 2015. Adjusted funds from operations were disclosed in the press release as $54.2 million for the quarter ended March 31, 2015.

A reconciliation of the non-GAAP financial measures to net income as well as a statement disclosing the reasons why the Company’s management believes that presentation of these non-GAAP financial measures provides useful information to investors regarding the Company’s financial condition and results of operations are included in Exhibits 99.1 and 99.2.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

 

Exhibit Number		Description
99.1		Press release dated May 7, 2015 reporting financial results for the three months ended March 31, 2015
99.2		Medical Properties Trust, Inc. 1st Quarter 2015 Supplemental Information

 

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: May 7, 2015

 

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INDEX TO EXHIBITS

 

Exhibit Number		Description
99.1		Press release dated May 7, 2015 reporting financial results for the three months ended March 31, 2015
99.2		Medical Properties Trust, Inc. 1st Quarter 2015 Supplemental Information

 

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Exhibit 99.1

 

 

				Contact: Tim Berryman Director – Investor Relations Medical Properties Trust, Inc. (205) 397-8589 tberryman@medicalpropertiestrust.com

MEDICAL PROPERTIES TRUST, INC. ON PACE TO EXCEED ACQUISITION

TARGETS WITH $416 MILLION IN YEAR-TO-DATE COMMITMENTS FOR

NEW INVESTMENTS IN HOSPITAL REAL ESTATE

Continues Strong Growth in Per Share Normalized FFO of 8.0% (11.5% Before Non-cash Effect of Stronger Dollar) to $0.28

Birmingham, AL – May 7, 2015 – Medical Properties Trust, Inc. (the “Company” or “MPT”) (NYSE: MPW) today announced financial and operating results for the first quarter ended March 31, 2015.

FIRST QUARTER AND RECENT HIGHLIGHTS

 

•

Achieved Normalized Funds from Operations (“FFO”) per diluted share of $0.28 in the first quarter, up 8.0% compared with $0.26 per diluted share in the first quarter of 2014; FFO was negatively impacted from foreign currency translation (non-cash impact) of $0.01 per share due to the dollar strengthening, absence of which Normalized FFO would have increased by 11.5% to $0.29 per share;

 

•

Invested $150 million for the acquisition of the real estate assets of two general acute care hospitals in the Kansas City area, and approximately $16 million for the acquisition of the real estate assets of an inpatient rehabilitation hospital in Weslaco, Texas; both investments will pay rent at a GAAP rate exceeding 10.0% with initial year cash yields between 8.5% and 9.0%;

 

•

Executed new agreements to acquire or develop and lease back $250 million in acute hospitals and free-standing emergency facilities to Adeptus Health at a GAAP yield exceeding 10.0% and at an initial year cash yield of approximately 9.0%;

 

•

Completed construction and commenced collection of rent from two Adeptus First Choice ER facilities in the first quarter; MPT is now receiving rent from 20 Adeptus facilities with 11 more under or nearing construction and 11 undergoing pre-construction diligence reviews;

 

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•

Executed purchase agreements in April for 31 MEDIAN hospitals, commencing the period (generally 30 to 60 days) during which local governmental entities may elect (although not expected to do so) to acquire the purchase rights from MPT;

 

•

Issued 34.5 million shares of common stock at a public offering price of $14.50 for net proceeds of approximately $480 million to fund a portion of the acquisition of the previously announced MEDIAN sale-leaseback transactions;

Included in the financial tables accompanying this press release is information about the Company’s assets and liabilities, net income and reconciliations of net income to FFO and Adjusted Funds from Operations (“AFFO”), all on a basis comparable to 2014 periods.

“During the first quarter, MPT built on last year’s record performance, capitalizing on the increasingly strong dynamics in the hospital real estate market,” said Edward K. Aldag, Jr., Chairman, President and CEO of Medical Properties Trust. “A confluence of positive factors is contributing to MPT’s significant growth, including increased capital needs among hospital operators and the growing acceptance of our sale/leaseback model from hospital operators and their equity owners and not-for-profit hospital systems.

“We expect another year of highly accretive acquisitions both domestically and internationally as our pipeline remains exceedingly strong. Our highly successful equity offering in the first quarter signaled the broadening of our shareholder base and, along with recently announced entries by other healthcare REITs and sophisticated capital sources into the markets for hospital real estate, indicates increased investor confidence in hospital real estate as a source of long-term stable cash flows with outstanding rent coverage. Overall, conditions remain highly favorable for continuing to create shareholder value in 2015 and beyond.”

OPERATING RESULTS

Normalized FFO for the first quarter increased 33% to $56.9 million compared with $42.7 million in the first quarter of 2014. Per share Normalized FFO increased 8% to $0.28 per diluted share in the first quarter compared with $0.26 per diluted share in the first quarter of 2014. During the first quarter, the U.S. dollar strengthened against the Euro by 10% on average compared to the fourth quarter of 2014; this negatively affected Normalized FFO (from the translation of our international operating results) by approximately $0.01 per share. Because MPT has no intention in the foreseeable future to convert euro-denominated cash flow to dollars this accounting does not impact the amount of cash available to pay euro-denominated expenses including interest and operating expenses or to acquire additional assets whose purchase prices are denominated in euros.

First quarter 2015 total revenues increased 31% to $96.0 million compared with $73.1 million for the first quarter of 2014.

Net income for the first quarter of 2015 was $35.9 million (or $0.17 per diluted share) up from net income of $7.2 million (or $0.04 per diluted share) in the first quarter of 2014, which included a previously disclosed loan impairment charge.

 

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PORTFOLIO UPDATE AND OUTLOOK

Since the beginning of 2015, the Company has acquired two general acute care hospitals, St. Joseph Medical Center in Kansas City, Missouri and St. Mary’s Medical Center in Blue Springs, Missouri, for a total investment of $150 million and leased the facilities to Prime Healthcare. The leases are under a master lease agreement with Prime and have a 10-year initial term with two five-year extension options. The annual rent escalators are CPI-based with a floor.

In addition, the Company acquired an inpatient rehabilitation hospital in Weslaco, Texas for a total investment of approximately $16 million and leased the facility to Ernest Health. The lease falls under the master lease agreement with Ernest, which has a remaining 17-year fixed term and three five-year extension options. The annual rent escalators are CPI-based with a floor and a cap.

In April, the Company executed a new master lease agreement with Adeptus Health that provides for the acquisition and development of general acute care hospitals and free standing emergency facilities with an aggregate commitment of $250 million, bringing MPT’s expected investment in the preeminent leader in the rapidly growing emergency facility sector of acute treatment to $500 million. Much of the newly committed real estate funding will support Adeptus’ new strategy of creating localized ventures with leading hospital operators to build and operate clusters of facilities around jointly owned general acute hospitals. The new master lease includes provisions for double digit GAAP yields and uncapped annual inflation adjustments, along with a 15-year initial term and three five-year options to extend.

Early in the second quarter, the Company executed definitive agreements with affiliates of MEDIAN to purchase and lease back 31 hospitals and expects these properties to close during the next 30 to 60 days subject to expiration or waiver of previously described preemption rights; agreements for the acquisition of an additional four hospitals are expected to be executed during the second and third quarters. The Company has elected not to acquire five of the initially targeted 40 hospitals. The previously disclosed aggregate purchase price for the MEDIAN properties of €705 million remains unchanged.

As of March 31, 2015, the Company had total real estate and related investments of approximately $3.8 billion consisting of 141 properties in 27 states and in Germany and the United Kingdom. The properties are leased to or mortgaged by 27 hospital operating companies. Including completion of development commitments and the pending MEDIAN acquisitions, the Company projects total real estate and related investments of approximately $4.5 billion comprising more than 176 healthcare properties when achieved.

Based solely on the completed acquisitions, development projects currently ongoing, which does not include the new $250 million commitment to Adeptus, and the completion of the MEDIAN sale leaseback transactions, per share Normalized FFO is expected to range between approximately $1.22 and $1.28 on an annual run-rate basis. In addition, MPT expects to continue to invest in similarly accretive hospital real estate in 2015; however, any impact on FFO from such investments and the financing thereof is not included in the annual run rate provided herein.

 

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These estimates do not include the effects, if any, of real estate operating costs, litigation costs, debt refinancing costs, acquisition costs, currency exchange rate movements, interest rate hedging activities, write-offs of straight-line rent or other non-recurring or unplanned transactions. These estimates will change when the Company acquires or sells assets, market interest rates change, debt is refinanced, new shares are issued, additional debt is incurred, other operating expenses vary, income from investments in tenant operations vary from expectations, or existing leases do not perform in accordance with their terms.

CONFERENCE CALL AND WEBCAST

The Company has scheduled a conference call and webcast for Thursday, May 7, 2015 at 11:00 a.m. Eastern Time to present the Company’s financial and operating results for the quarter ended March 31, 2015. The dial-in numbers for the conference call are 877-546-5020 (U.S.) and 857-244-7552 (international); both numbers require passcode 33154467. The conference call will also be available via webcast in the Investor Relations’ section of the Company’s website, www.medicalpropertiestrust.com.

A telephone and webcast replay of the call will be available beginning shortly after the call’s completion through May 21, 2015. Dial-in numbers for the replay are 888-286-8010 and 617-801-6888 for U.S. and International callers, respectively. The replay passcode for both U.S. and international callers is 75057881.

The Company’s supplemental information package for the current period will also be available on the Company’s website under the “Investor Relations” section.

About Medical Properties Trust, Inc.

Medical Properties Trust, Inc. is a Birmingham, Alabama based self-advised real estate investment trust formed to capitalize on the changing trends in healthcare delivery by acquiring and developing net-leased healthcare facilities. MPT’s financing model allows hospitals and other healthcare facilities to unlock the value of their underlying real estate in order to fund facility improvements, technology upgrades, staff additions and new construction. Facilities include acute care hospitals, inpatient rehabilitation hospitals, long-term acute care hospitals, and other medical and surgical facilities. For more information, please visit the Company’s website at www.medicalpropertiestrust.com.

The statements in this press release that are forward looking are based on current expectations and actual results or future events may differ materially. Words such as “expects,” “believes,” “anticipates,” “intends,” “will,” “should” and variations of such words and similar expressions are intended to identify such forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results of the Company or future events to differ materially from those expressed in or underlying such forward-looking statements, including without limitation: the satisfaction of all conditions to, and the timely closing (if at all) of the MEDIAN sale-leaseback transactions; the Company financing of the transactions described herein; the capacity of MEDIAN and the Company’s other

 

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tenants to meet the terms of their agreements; Normalized FFO per share; expected payout ratio, the amount of acquisitions of healthcare real estate, if any; capital markets conditions, the repayment of debt arrangements; statements concerning the additional income to the Company as a result of ownership interests in certain hospital operations and the timing of such income; the payment of future dividends, if any; completion of additional debt arrangement, and additional investments; national and international economic, business, real estate and other market conditions; the competitive environment in which the Company operates; the execution of the Company’s business plan; financing risks; the Company’s ability to maintain its status as a REIT for federal income tax purposes; acquisition and development risks; potential environmental and other liabilities; and other factors affecting the real estate industry generally or healthcare real estate in particular. For further discussion of the factors that could affect outcomes, please refer to the “Risk factors” section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, and as updated by the Company’s subsequently filed Quarterly Reports on Form 10-Q and other SEC filings. Except as otherwise required by the federal securities laws, the Company undertakes no obligation to update the information in this press release.

# # #

 

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MEDICAL PROPERTIES TRUST, INC. AND SUBSIDIARIES

Consolidated Balance Sheets

 

(Amounts in thousands, except for per share data)		March 31, 2015				December 31, 2014
		(Unaudited)
Assets
Real estate assets
Land, buildings and improvements, and intangible lease assets		$	2,237,758			$	2,149,612
Construction in progress and other			49,266				23,163
Net investment in direct financing leases			453,423				439,516
Mortgage loans			437,591				397,594
Gross investment in real estate assets			3,178,038				3,009,885
Accumulated depreciation and amortization			(216,629	)			(202,627	)
Net investment in real estate assets			2,961,409				2,807,258
Cash and cash equivalents			33,548				144,541
Interest and rent receivables			40,464				41,137
Straight-line rent receivables			63,590				59,128
Other assets			724,038				695,272
Total Assets		$	3,823,049			$	3,747,336
Liabilities and Equity
Liabilities
Debt, net		$	1,882,319			$	2,201,654
Accounts payable and accrued expenses			111,187				112,623
Deferred revenue			25,362				27,207
Lease deposits and other obligations to tenants			8,480				23,805
Total Liabilities			2,027,348				2,365,289
Equity
Preferred stock, $0.001 par value. Authorized 10,000 shares; no shares outstanding			—				—
Common stock, $0.001 par value. Authorized 250,000 shares; issued and outstanding - 207,731 shares at March 31, 2015 and 172,743 shares at December 31, 2014			207				172
Additional paid in capital			2,248,137				1,765,381
Distributions in excess of net income			(371,459	)			(361,330	)
Accumulated other comprehensive loss			(80,922	)			(21,914	)
Treasury shares, at cost			(262	)			(262	)
Total Equity			1,795,701				1,382,047
Total Liabilities and Equity		$	3,823,049			$	3,747,336

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MEDICAL PROPERTIES TRUST, INC. AND SUBSIDIARIES

Consolidated Statements of Income

(Unaudited)

 

		For the Three Months Ended
		March 31, 2015				March 31, 2014
(Amounts in thousands, except for per share data)
Revenues
Rent billed		$	53,100			$	42,957
Straight-line rent			4,728				2,148
Income from direct financing leases			12,555				12,215
Interest and fee income			25,578				15,769
Total revenues			95,961				73,089
Expenses
Real estate depreciation and amortization			14,756				13,690
Impairment charges			—				20,496
Property-related			351				738
Acquisition expenses			6,239				512
General and administrative			10,905				8,959
Total operating expenses			32,251				44,395
Operating income			63,710				28,694
Interest and other income (expense)			(27,359	)			(21,442	)
Income tax (expense) benefit			(375	)			57
Income from continuing operations			35,976				7,309
Income (loss) from discontinued operations			—				(2	)
Net income			35,976				7,307
Net income attributable to non-controlling interests			(79	)			(66	)
Net income attributable to MPT common stockholders		$	35,897			$	7,241
Earnings per common share - basic:
Income from continuing operations		$	0.18			$	0.04
Income from discontinued operations			—				—
Net income attributable to MPT common stockholders		$	0.18			$	0.04
Earnings per common share - diluted:
Income from continuing operations		$	0.17			$	0.04
Income from discontinued operations			—				—
Net income attributable to MPT common stockholders		$	0.17			$	0.04
Dividends declared per common share		$	0.22			$	0.21
Weighted average shares outstanding - basic			202,958				163,973
Weighted average shares outstanding - diluted			203,615				164,549

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MEDICAL PROPERTIES TRUST, INC. AND SUBSIDIARIES

Reconciliation of Net Income to Funds From Operations

(Unaudited)

 

		For the Three Months Ended
		March 31, 2015				March 31, 2014
(Amounts in thousands, except per share data)
FFO information:
Net income attributable to MPT common stockholders		$	35,897			$	7,241
Participating securities’ share in earnings			(266	)			(209	)
Net income, less participating securities’ share in earnings		$	35,631			$	7,032
Depreciation and amortization			14,756				13,690
Funds from operations		$	50,387			$	20,722
Write-off of straight line rent			—				950
Impairment charges			—				20,496
Acquisition costs			6,239				512
Unutilized financing fees / debt refinancing costs			238				—
Normalized funds from operations		$	56,864			$	42,680
Share-based compensation			2,603				2,043
Debt costs amortization			1,377				1,049
Additional rent received in advance (A)			(300	)			(300	)
Straight-line rent revenue and other			(6,332	)			(4,703	)
Adjusted funds from operations		$	54,212			$	40,769
Per diluted share data:
Net income, less participating securities’ share in earnings		$	0.17			$	0.04
Depreciation and amortization			0.08				0.09
Funds from operations		$	0.25			$	0.13
Write-off of straight line rent			—				0.01
Impairment charges			—				0.12
Acquisition costs			0.03				—
Unutilized financing fees / debt refinancing costs			—				—
Normalized funds from operations		$	0.28			$	0.26
Share-based compensation			0.01				0.01
Debt costs amortization			0.01				0.01
Additional rent received in advance (A)			—				—
Straight-line rent revenue and other			(0.03	)			(0.03	)
Adjusted funds from operations		$	0.27			$	0.25

 

(A)	Represents additional rent from one tenant in advance of when we can recognize as revenue for accounting purposes. This additional rent is being recorded to revenue on a straight-line basis over the lease life.

Investors and analysts following the real estate industry utilize funds from operations, or FFO, as a supplemental performance measure. FFO, reflecting the assumption that real estate asset values rise or fall with market conditions, principally adjusts for the effects of GAAP depreciation and amortization of real estate assets, which assumes that the value of real estate diminishes predictably over time. We compute FFO in accordance with the definition provided by the National Association of Real Estate Investment Trusts, or NAREIT, which represents net income (loss) (computed in accordance with GAAP), excluding gains (losses) on sales of real estate and impairment charges on real estate assets, plus real estate depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures.

In addition to presenting FFO in accordance with the NAREIT definition, we also disclose normalized FFO,which adjusts FFO for items that relate to unanticipated or non-core events or activities or accounting changes that, if not noted, would make comparison to prior period results and market expectations less meaningful to investors and analysts. We believe that the use of FFO, combined with the required GAAP presentations, improves the understanding of our operating results among investors and the use of normalized FFO makes comparisons of our operating results with prior periods and other companies more meaningful. While FFO and normalized FFO are relevant and widely used supplemental measures of operating and financial performance of REITs, they should not be viewed as a substitute measure of our operating performance since the measures do not reflect either depreciation and amortization costs or the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties, which can be significant economic costs that could materially impact our results of operations. FFO and normalized FFO should not be considered an alternative to net income (loss) (computed in accordance with GAAP) as indicators of our financial performance or to cash flow from operating activities (computed in accordance with GAAP) as an indicator of our liquidity.

We calculate adjusted funds from operations, or AFFO, by subtracting from or adding to normalized FFO (i) unbilled rent revenue, (ii) non-cash share-based compensation expense, and (iii) amortization of deferred financing costs. AFFO is an operating measurement that we use to analyze our results of operations based on the receipt, rather than the accrual, of our rental revenue and on certain other adjustments. We believe that this is an important measurement because our leases generally have significant contractual escalations of base rents and therefore result in recognition of rental income that is not collected until future periods, and costs that are deferred or are non-cash charges. Our calculation of AFFO may not be comparable to AFFO or similarly titled measures reported by other REITs. AFFO should not be considered as an alternative to net income (calculated pursuant to GAAP) as an indicator of our results of operations or to cash flow from operating activities (calculated pursuant to GAAP) as an indicator of our liquidity.

Exhibit 99.2

 

Medical Properties Trust

FIRST QUARTER 2015

Supplemental Information

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MEDICALPROPERTIESTRUST.COM

TABLE OF CONTENTS

COMPANY OVERVIEW

Company Information 3

FINANCIAL INFORMATION

Reconciliation of Net Income to Funds from Operations 5

Debt Summary 6

Debt Maturity Schedule 7

PORTFOLIO INFORMATION

Lease Maturity Schedule 8

Investments and Revenue by Asset Type, Operator, State and Country 9

Acquisitions and Summary of Development Projects 12

FINANCIAL STATEMENTS

Consolidated Statements of Income 13

Consolidated Balance Sheets 14

Detail of Other Assets 15

FORWARD-LOOKING STATEMENT Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results of the Company or future events to differ materially from those expressed in or underlying such forward-looking statements, including without limitation: the satisfaction of all conditions to, and the timely closing (if at all) of the Median sale-leaseback transactions; the Company financing of the transactions described herein; the capacity of Median and the Company’s other tenants to meet the terms of their agreements; Normalized FFO per share; expected payout ratio, the amount of acquisitions of healthcare real estate, if any; capital markets conditions, the repayment of debt arrangements; statements concerning the additional income to the Company as a result of ownership interests in certain hospital operations and the timing of such income; the payment of future dividends, if any; completion of additional debt arrangement, and additional investments; national and international economic, business, real estate and other market conditions; the competitive environment in which the Company operates; the execution of the Company’s business plan; financing risks; the Company’s ability to maintain its status as a REIT for federal income tax purposes; acquisition and development risks; potential environmental and other liabilities; and other factors affecting the real estate industry generally or healthcare real estate in particular. For further discussion of the factors that could affect outcomes, please refer to the “Risk factors” section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, and as updated by the Company’s subsequently filed Quarterly Reports on Form 10-Q and other SEC filings. Except as otherwise required by the federal securities laws, the Company undertakes no obligation to update the information in this report.

Q1 2015 | SUPPLEMENTAL INFORMATION

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MEDICALPROPERTIESTRUST.COM

COMPANY OVERVIEW

Medical Properties Trust, Inc. is a Birmingham, Alabama based self-advised real estate investment trust formed to capitalize on the changing trends in healthcare delivery by acquiring and developing net-leased healthcare facilities. MPT’s financing model allows hospitals and other healthcare facilities to unlock the value of their underlying real estate in order to fund facility improvements, technology upgrades, staff additions and new construction. Facilities include acute care hospitals, inpatient rehabilitation hospitals, long-term acute care hospitals, and other medical and surgical facilities.

OFFICERS

Edward K. Aldag, Jr. Chairman, President and Chief Executive Officer R. Steven Hamner Executive Vice President and Chief Financial Officer

Emmett E. McLean Executive Vice President, Chief Operating Officer, Treasurer and Secretary Frank R. Williams, Jr. Senior Vice President, Senior Managing Director—Acquisitions

BOARD OF DIRECTORS

Edward K. Aldag, Jr. G. Steven Dawson R. Steven Hamner Robert. E. Holmes, Ph.D. Sherry A. Kellett William G. McKenzie L. Glenn Orr, Jr. D. Paul Sparks, Jr.

CORPORATE HEADQUARTERS

Medical Properties Trust, Inc.

1000 Urban Center Drive, Suite 501 Birmingham, AL 35242

(205) 969-3755 (205) 969-3756 (fax) www.medicalpropertiestrust.com

Q1 2015 | SUPPLEMENTAL INFORMATION

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MEDICALPROPERTIESTRUST.COM

COMPANY OVERVIEW (continued)

INVESTOR RELATIONS CAPITAL MARKETS

Tim Berryman | Director—Investor Relations Charles Lambert | Managing Director—Capital Markets

(205) 397-8589 (205) 397-8897

tberryman@medicalpropertiestrust.com clambert@medicalpropertiestrust.com

TRANSFER AGENT STOCK EXCHANGE SENIOR UNSECURED

American Stock Transfer LISTING AND DEBT RATINGS

and Trust Company TRADING SYMBOL Moody’s – Ba1

6201 15th Avenue New York Stock Exchange Standard & Poor’s – BBB-

Brooklyn, NY 11219 (NYSE): MPW

CONTINUUM OF CARER

E MEDICAL PROPERTIES TRUST FOCUSES ON THE MOST H

H I G CRITICAL COMPONENTS OF HEALTHCARE DELIVERY.

ACUTE HOSPITALS CARE

ACUTE CARE HOSPITALS & FREE STANDING EMERGENCY ROOMS LONG-TERM ACUTE CARE HOSPITALS

INPATIENT REHABILITATION FACILITIES NURSING HOMES

LONG-TERM

ACUTE CARE ASSISTED LIVING HOSPITALS HOME HEALTH CARE

MPT facility types shown in green.

HEALTH HOME REHABILITATION INPATIENT CARE

I FACILITIES

N T ASSISTED E N NURSING

S LIVING I T HOMES

Y

OF

C

AR

E

LOWER

Q1 2015 | SUPPLEMENTAL INFORMATION

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MEDICALPROPERTIESTRUST.COM

FINANCIAL INFORMATION

RECONCILIATION OF NET INCOME TO FUNDS FROM OPERATIONS

(Unaudited)

(Amounts in thousands except per share data)

For the Three Months Ended

March 31, 2015 March 31, 2014

FFO INFORMATION:

Net income attributable to MPT common stockholders $ 35,897 $ 7,241

Participating securities’ share in earnings (266) (209)

Net income, less participating securities’ share in earnings $ 35,631 $ 7,032

Depreciation and amortization 14,756 13,690

Funds from operations $ 50,387 $ 20,722

Write-off straight line rent — 950

Impairment charges — 20,496

Acquisition costs 6,239 512

Unutilized financing fees / debt refinancing costs 238 -

Normalized funds from operations $ 56,864 $ 42,680

Share-based compensation 2,603 2,043

Debt costs amortization 1,377 1,049

Additional rent received in advance(A) (300) (300)

Straight-line rent revenue and other (6,332) (4,703)

Adjusted funds from operations $ 54,212 $ 40,769

PER DILUTED SHARE DATA:

Net income, less participating securities’ share in earnings $ 0.17 $ 0.04

Depreciation and amortization 0.08 0.09

Funds from operations $ 0.25 $ 0.13

Write-off straight line rent — 0.01

Impairment charges — 0.12

Acquisition costs 0.03 -

Unutilized financing fees / debt refinancing costs — -

Normalized funds from operations $ 0.28 $ 0.26

Share-based compensation 0.01 0.01

Debt costs amortization 0.01 0.01

Additional rent received in advance(A) — -

Straight-line rent revenue and other (0.03) (0.03)

Adjusted funds from operations $ 0.27 $ 0.25

(A) Represents additional rent from one tenant in advance of when we can recognize as revenue for accounting purposes. This additional rent is being recorded to revenue on a straight-line basis over the lease life.

Investors and analysts following the real estate industry utilize funds from operations, or FFO, as a supplemental performance measure. FFO, reflecting the assumption that real estate asset values rise or fall with market conditions, principally adjusts for the effects of GAAP depreciation and amortization of real estate assets, which assumes that the value of real estate diminishes predictably over time. We compute FFO in accordance with the definition provided by the National Association of Real Estate Investment Trusts, or NAREIT, which represents net income (loss) (computed in accordance with GAAP), excluding gains (losses) on sales of real estate and impairment charges on real estate assets, plus real estate depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures.

In addition to presenting FFO in accordance with the NAREIT definition, we also disclose normalized FFO, which adjusts FFO for items that relate to unanticipated or non-core events or activities or accounting changes that, if not noted, would make comparison to prior period results and market expectations less meaningful to investors and analysts. We believe that the use of FFO, combined with the required GAAP presentations, improves the understanding of our operating results among investors and the use of normalized FFO makes comparisons of our operating results with prior periods and other companies more meaningful. While FFO and normalized FFO are relevant and widely used supplemental measures of operating and financial performance of REITs, they should not be viewed as a substitute measure of our operating performance since the measures do not reflect either depreciation and amortization costs or the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties, which can be significant economic costs that could materially impact our results of operations. FFO and normalized FFO should not be considered an alternative to net income (loss)

(computed in accordance with GAAP) as indicators of our financial performance or to cash flow from operating activities (computed in accordance with GAAP) as an indicator of our liquidity.

We calculate adjusted funds from operations, or AFFO, by subtracting from or adding to normalized FFO (i) unbilled rent revenue, (ii) non-cash share-based compensation expense, and (iii) amortization of deferred financing costs. AFFO is an operating measurement that we use to analyze our results of operations based on the receipt, rather than the accrual, of our rental revenue and on certain other adjustments. We believe that this is an important measurement because our leases generally have significant contractual escalations of base rents and therefore result in recognition of rental income that is not collected until future periods, and costs that are deferred or are non-cash charges. Our calculation of AFFO may not be comparable to AFFO or similarly titled measures reported by other REITs. AFFO should not be considered as an alternative to net income (calculated pursuant to GAAP) as an indicator of our results of operations or to cash flow from operating activities (calculated pursuant to GAAP) as an indicator of our liquidity.

Q1 2015 | SUPPLEMENTAL INFORMATION

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MEDICALPROPERTIESTRUST.COM

FINANCIAL INFORMATION

DEBT SUMMARY

(as of March 31, 2015)

($ amounts in thousands)

Debt Instrument Rate Type Rate Balance

2016 Unsecured Notes Fixed 5.59% (1) $ 125,000

Northland – Mortgage Capital Term Loan Fixed 6.20% 13,611

2018 Credit Facility Revolver Variable 1.40%–1.58% (2) 301,655

2019 Term Loan Variable 1.83% 125,000

5.75% Notes Due 2020 (Euro) Fixed 5.75% (3) 214,620

6.875% Notes Due 2021 Fixed 6.88% 450,000

6.375% Notes Due 2022 Fixed 6.38% 350,000

5.5% Notes Due 2024 Fixed 5.50% 300,000

$ 1,879,886

Debt Premium 2,433

Weighted average rate 5.16% $ 1,882,319

Rate Type as Percentage of Total Debt

Variable 22.7%

Fixed 77.3%

(1) Represents the weighted-average rate for four tranches of the Notes at March 31, 2015, factoring in interest rate swaps in effect at that time. The Company has entered into two swap agreements which began in July and October 2011. Effective July 31, 2011, the Company is paying 5.507% on $65 million of the Notes and effective October 31, 2011, the Company is paying 5.675% on $60 million of Notes.

(2) At March 31, 2015, this represents a $1.025 billion unsecured revolving credit facility with spreads over LIBOR ranging from 0.95% to 1.75%.

(3) Represents 200 million of bonds issued in EUR and converted to USD at March 31, 2015. Q1 2015 | SUPPLEMENTAL INFORMATION

6

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MEDICALPROPERTIESTRUST.COM

FINANCIAL INFORMATION

DEBT MATURITY SCHEDULE

(as of March 31, 2015)

($ amounts in thousands)

Debt Instrument 2015 2016 2017 2018 2019 Thereafter

2016 Unsecured Notes $ — $ 125,000 $ — $ — $ — $ -

Northland – Mortgage Capital Term Loan 211 299 320 12,781 — -

2018 Credit Facility Revolver — — — 301,655 — -

2019 Term Loan — — — — 125,000 -

5.75% Notes Due 2020 (Euro) — — — — — 214,620

6.875% Notes Due 2021 — — — — — 450,000

6.375% Notes Due 2022 — — — — — 350,000

5.5% Notes Due 2024 — — — — — 300,000

$ 211 $ 125,299 $ 320 $ 314,436 $ 125,000 $ 1,314,620

$1,500,000 $1,314,620 $1,200,000

$900,000

$600,000

$314,436 $300,000

$125,299 $125,000

$211 $320 $-

2015 2016 2017 2018 2019 Thereafter

2016 Unsecured Notes Northland – Mortgage Capital Term Loan

2018 Credit Facility Revolver 2019 Term Loan

5.75% Notes Due 2020 (Euro) 6.875% Notes Due 2021

6.375% Notes Due 2022 5.5% Notes Due 2024

Q1 2015 | SUPPLEMENTAL INFORMATION 7

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MEDICALPROPERTIESTRUST.COM

PORTFOLIO INFORMATION

LEASE MATURITY SCHEDULE

(as of March 31, 2015) ($ amounts in thousands)

Years of Lease Maturities (1) Total Leases Base Rent (2) Percent of Total

Base Rent

2015 — $ — -

2016 1 2,250 0.9%

2017 — — -

2018 1 2,020 0.8%

2019 8 6,547 2.5%

2020 1 1,061 0.4%

2021 3 14,244 5.5%

2022(3) 12 37,955 14.7%

2023 4 12,029 4.6%

2024 1 2,478 1.0%

Thereafter 87 179,887 69.6%

118 ## $ 258,471 100.0%

Percentageo f Total Base Rent

80%

69.6%

70% 60% 50% 40% 30%

20% 14.7%

10% 5.5% 4.6%

0.9% 2.5% 1.0%

— — 0.8% 0.4%

0%

(1) Excludes 13 of our properties that are under development. Also, lease expiration is based on the fixed term of the lease

and does not factor in potential renewal options provided for in our leases.

(2) Represents base rent on an annualized basis but does not include tenant recoveries, additional rents and other

lease-related adjustments to revenue (i.e., straight-line rents and deferred revenues).

(3) 95% of the 2022 maturities are under a Master Lease with Prime Healthcare; Master Lease renewal options

are for all properties or none of them.

Q1 2015 | SUPPLEMENTAL INFORMATION 8

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MEDICALPROPERTIESTRUST.COM

PORTFOLIO INFORMATION

INVESTMENTS AND REVENUE BY ASSET TYPE

(as of March 31, 2015)

($ amounts in thousands)

Asset Types Total Percentage of Total Percentage of

Assets Gross Assets Revenue Total Revenue

General Acute Care Hospitals (A) $ 2,128,144 52.7% $ 53,921 56.2%

Rehabilitation Hospitals 1,178,582 29.2% 28,466 29.7%

Long-Term Acute Care Hospitals 457,644 11.3% 13,442 14.0%

Wellness Centers 15,625 0.4% 132 0.1%

Other assets 259,683 6.4% — -

Total $ 4,039,678 100.0% $ 95,961 100.0%

Accumulated depreciation and amortization (216,629)

Total assets $ 3,823,049

Investments by Asset Type Revenue by Asset Type

0.1%

0.4%

General Acute Care

6.4% Hospitals 14.0% 11.3%

Rehabilitation Hospitals

52.7% Long-Term Acute Care

Hospitals 29.7% 56.2%

29.2% Wellness Centers

Other assets

(A) Includes three medical office buildings.

Q1 2015 | SUPPLEMENTAL INFORMATION 9

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MEDICALPROPERTIESTRUST.COM

PORTFOLIO INFORMATION

INVESTMENTS AND REVENUE BY OPERATOR

(as of March 31, 2015)

($ amounts in thousands)

Operators Total Percentage of Total Percentage of

Assets Gross Assets Revenue Total Revenue

Prime Healthcare $ 900,216 22.3% $ 24,021 25.0%

Ernest Health, Inc. 504,990 12.5% 14,700 15.3%

MEDIAN 422,409 10.4% 9,139 9.5%

IASIS Healthcare 347,612 8.6% 6,929 7.2%

RHM 252,782 6.3% 6,071 6.4%

22 operators 1,351,986 33.5% 35,101 36.6%

Other assets 259,683 6.4% — -

Total 4,039,678 100.0% $ 95,961 100.0%

Accumulated depreciation and amortization (216,629)

Total assets $ 3,823,049

Investments by Operator Revenue by Operator

Prime Healthcare

6.4%

22.3% 25.0%

Ernest Health, Inc.

36.6%

MEDIAN

33.5%

12.5% IASIS Healthcare

15.3%

RHM

6.4% 10.4%

6.3% 22 operators 7.2% 9.5%

8.6%

Other assets

Q1 2015 | SUPPLEMENTAL INFORMATION 10

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MEDICALPROPERTIESTRUST.COM

 

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PORTFOLIO INFORMATION

 

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INVESTMENTS AND REVENUE BY U.S. STATE AND COUNTRY

(as of March 31, 2015)

($ amounts in thousands)

U.S. States and Other Countries		Total Assets				Percentage of Gross Assets				Total Revenue				Percentage of Total  Revenue
Texas		$	818,980				20.3	%		$	21,016				21.9	%
California			547,095				13.6	%			16,539				17.3	%
New Jersey			237,388				5.9	%			3,841				4.0	%
Missouri			210,921				5.2	%			3,080				3.2	%
Arizona			206,391				5.1	%			5,024				5.2	%
22 Other States			1,022,168				25.3	%			30,169				31.4	%
United States			3,042,943				75.4	%			79,669				83.0	%
Germany			695,191				17.2	%			15,210				15.9	%
U.K.			41,861				1.0	%			1,082				1.1	%
International			737,052				18.2	%			16,292				17.0	%
Other assets			259,683				6.4	%
Total			4,039,678				100.0	%		$	95,961				100.0	%
Accumulated depreciation and amortization			(216,629	)
Total assets		$	3,823,049

 

Q1 2015 | SUPPLEMENTAL INFORMATION 11

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MEDICALPROPERTIESTRUST.COM

 

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PORTFOLIO INFORMATION

 

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ACQUISITIONS FOR THE THREE MONTHS ENDED MARCH 31, 2015

($ amounts in thousands)

Name		Location		Property Type		Acquisition / Development		Investment / Commitment
Weslaco Regional Rehabilitation Hospital		Weslaco, TX		Inpatient Rehabilitation Hospital		Acquisition		$	15,700
St. Joseph Medical Center		Kansas City, MO		Acute Care Hospital		Acquisition			80,000
St. Mary’s Medical Center		Blue Springs, MO		Acute Care Hospital		Acquisition			30,000
Total Investments / Commitments								$	125,700

SUMMARY OF DEVELOPMENT PROJECTS AS OF MARCH 31, 2015

($ amounts in thousands)

Property

Location

Property Type

Operator

Commitment

Costs Incurred as of 3/31/2015

Estimated Completion Date

UAB Medical West

Hoover, AL

Acute Care Hospital & MOB

Medical West, an affiliate of UAB

$

8,653

$

5,853

2Q 2015

First Choice ER - Chandler

Chandler, AZ

Acute Care Hospital

Adeptus Health

5,049

2,502

2Q 2015

First Choice ER - Converse

Converse, TX

Acute Care Hospital

Adeptus Health

5,754

4,311

2Q 2015

First Choice ER - Denver 48th

Denver, CO

Acute Care Hospital

Adeptus Health

5,123

1,174

2Q 2015

First Choice ER - Aurora

Aurora, CO

Acute Care Hospital

Adeptus Health

5,273

21

3Q 2015

First Choice ER - Carrollton

Carrollton, TX

Acute Care Hospital

Adeptus Health

35,820

23,458

3Q 2015

First Choice ER - Conroe

Houston, TX

Acute Care Hospital

Adeptus Health

6,110

1,668

3Q 2015

First Choice ER - Gilbert

Gilbert, AZ

Acute Care Hospital

Adeptus Health

6,500

2,481

3Q 2015

First Choice ER - Glendale

Glendale, AZ

Acute Care Hospital

Adeptus Health

4,824

564

3Q 2015

First Choice ER - McKinney

McKinney, TX

Acute Care Hospital

Adeptus Health

4,750

1,002

3Q 2015

First Choice ER - Victory Lakes

Houston, TX

Acute Care Hospital

Adeptus Health

4,939

554

3Q 2015

First Choice ER - Vintage Preserve

Houston, TX

Acute Care Hospital

Adeptus Health

45,961

5,678

3Q 2016

First Choice Emergency Rooms

Various

Acute Care Hospital

Adeptus Health

13,448

—

$

152,204

$

49,266

 

Q1 2015 | SUPPLEMENTAL INFORMATION 12

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MEDICALPROPERTIESTRUST.COM

FINANCIAL STATEMENTS

MEDICAL PROPERTIES TRUST, INC. AND SUBSIDIARIES

Consolidated Statements of Income

(Amounts in thousands except per share data)

(Unaudited)

For the Three Months Ended

March 31, 2015 March 31, 2014

Revenues

Rent billed $ 53,100 $ 42,957

Straight-line rent 4,728 2,148

Income from direct financing leases 12,555 12,215

Interest and fee income 25,578 15,769

Total revenues 95,961 73,089

Expenses

Real estate depreciation and amortization 14,756 13,690

Impairment charges — 20,496

Property-related 351 738

Acquisition expenses 6,239 512

General and administrative 10,905 8,959

Total operating expenses 32,251 44,395

Operating income 63,710 28,694

Interest and other income (expense) (27,359) (21,442)

Income tax (expense) benefit (375) 57

Income from continuing operations 35,976 7,309

Income (loss) from discontinued operations — (2)

Net income 35,976 7,307

Net income attributable to non-controlling interests (79) (66)

Net income attributable to MPT common stockholders $ 35,897 $ 7,241

Earnings per common share – basic:

Income from continuing operations $ 0.18 $ 0.04

Income from discontinued operations — -

Net income attributable to MPT common stockholders $ 0.18 $ 0.04

Earnings per common share – diluted:

Income from continuing operations $ 0.17 $ 0.04

Income from discontinued operations — -

Net income attributable to MPT common stockholders $ 0.17 $ 0.04

Dividends declared per common share $ 0.22 $ 0.21

Weighted average shares outstanding – basic 202,958 163,973

Weighted average shares outstanding – diluted 203,615 164,549

Q1 2015 | SUPPLEMENTAL INFORMATION 13

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MEDICALPROPERTIESTRUST.COM

FINANCIAL STATEMENTS

MEDICAL PROPERTIES TRUST, INC. AND SUBSIDIARIES

Consolidated Balance Sheets

(Amounts in thousands except per share data)

March 31, 2015 December 31, 2014

(unaudited)

ASSETS

Real estate assets

Land, buildings and improvements, and intangible lease assets $ 2,237,758 $ 2,149,612

Construction in progress and other 49,266 23,163

Net investment in direct financing leases 453,423 439,516

Mortgage loans 437,591 397,594

Gross investment in real estate assets 3,178,038 3,009,885

Accumulated depreciation and amortization (216,629) (202,627)

Net investment in real estate assets 2,961,409 2,807,258

Cash and cash equivalents 33,548 144,541

Interest and rent receivables 40,464 41,137

Straight-line rent receivables 63,590 59,128

Other assets 724,038 695,272

Total Assets $ 3,823,049 $ 3,747,336

LIABILITIES AND EQUITY

Liabilities

Debt, net $ 1,882,319 $ 2,201,654

Accounts payable and accrued expenses 111,187 112,623

Deferred revenue 25,362 27,207

Lease deposits and other obligations to tenants 8,480 23,805

Total liabilities 2,027,348 2,365,289

Equity

Preferred stock, $0.001 par value. Authorized 10,000 shares;

no shares outstanding — -

Common stock, $0.001 par value. Authorized 250,000 shares;

issued and outstanding—207,731 shares at March 31, 2015

and 172,743 shares at December 31, 2014 207 172

Additional paid in capital 2,248,137 1,765,381

Distributions in excess of net income (371,459) (361,330)

Accumulated other comprehensive income (loss) (80,922) (21,914)

Treasury shares, at cost (262) (262)

Total Equity 1,795,701 1,382,047

Total Liabilities and Equity $ 3,823,049 $ 3,747,336

Q1 2015 | SUPPLEMENTAL INFORMATION 14

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MEDICALPROPERTIESTRUST.COM

 

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FINANCIAL STATEMENTS

 

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DETAIL OF OTHER ASSETS AS OF MARCH 31, 2015

($ amounts in thousands)

Operator		Investment				Annual Interest Rate				YTD  Ridea Income(3)				Security / Credit Enhancements
Non-Operating Loans
Vibra Healthcare acquisition loan(1)		$	9,746				10.25	%						Secured and cross-defaulted with real estate, other agreements and guaranteed by Parent
Vibra Healthcare working capital			5,234				9.50	%						Secured and cross-defaulted with real estate, other agreements and guaranteed by Parent
Post Acute Medical working capital			5,619				11.36	%						Secured and cross-defaulted with real estate; certain loans are cross-defaulted with other loans and real estate
Alecto working capital			16,680				11.12	%						Secured and cross-defaulted with real estate and guaranteed by Parent
IKJG/HUMC working capital			11,037				10.40	%						Secured and cross-defaulted with real estate and guaranteed by Parent
Ernest Health			9,250				9.26	%						Secured and cross-defaulted with real estate and guaranteed by Parent
Other			5,432
			62,998
Operating Loans
Ernest Health, Inc.(2)			93,200				15.00	%		$	3,724			Secured and cross-defaulted with real estate and guaranteed by Parent
IKJG/HUMC convertible loan			3,352								54			Secured and cross-defaulted with real estate and guaranteed by Parent
			96,552								3,778
MEDIAN investments(4)			471,400
Equity investments			14,831								103
Deferred debt financing costs			33,383											Not applicable
Lease and cash collateral			3,313											Not applicable
Other assets(5)			41,561											Not applicable
Total		$	724,038							$	3,881

 

(1)

Original amortizing acquisition loan was $41 million; loan matures in 2019.

(2)

Cash rate is 10% effective March 1, 2014.

(3)

Income earned on operating loans is reflected in the interest income line of the income statement.

(4)

Includes loans and equity investment.

(5)

Includes prepaid expenses, office property and equipment and other.

 

Q1 2015 | SUPPLEMENTAL INFORMATION 15

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1000 Urban Center Drive, Suite 501 Birmingham, AL 35242 (205) 969-3755 NYSE: MPW www.medicalpropertiestrust.com

Contact:

Charles Lambert, Managing Director—Capital Markets

(205) 397-8897 or clambert@medicalpropertiestrust.com or Tim Berryman, Director—Investor Relations

(205) 397-8589 or tberryman@medicalpropertiestrust.com