CareTrust REIT, Inc.

Ladies and gentlemen, thank you for standing by and welcome to the CareTrust REITs second quarter 2020 earnings conference call. At this time, all participants are on listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question at that time, please press star then one on your touch-tone telephone. I will now return the conference to your host, Ms. Lauren Beal, CareTrust controller. Ma'am, you may begin.

Thank you, and welcome to CareTrust REITs second quarter 2020 earnings call. Participants should be aware that this call is being recorded. and listeners are advised that any forward-looking statements made on today's call are based on management's current expectations, assumptions, and beliefs about Care Trust business and the environment in which it operates. These statements may include projections regarding future financial performance, dividends, acquisitions, investments, returns, financings, and other matters, and may or may not reference other matters affecting the company's business or the businesses of its tenants, including factors that are beyond their control, such as natural disasters, pandemics, such as COVID-19, and governmental actions. The company's statements today and its business generally are subject to risks and uncertainties that could cause actual results to materially differ from those expressed or implied herein. Listeners should not place undue reliance on forward-looking statements and are encouraged to review Care Trust SEC filings for a more complete discussion of factors that could impact results, as well as any financial or other statistical information required by SEC Regulation G. Except as required by law, Care Trust REIT and its affiliates do not undertake to publicly update or revise any forward-looking statements where changes arise as a result of new information, future events, changing circumstances, or for any other reason. During the call, the company will reference non-GAAP metrics such as EBITDA, FFO, and FAD, or FAD, and normalized EBITDA, FFO, and FAD. When viewed together with GAAP results, the company believes these measures can provide a more complete understanding of its business, but cautions that they should not be relied upon to the exclusion of GAAP reports. Care Trust yesterday filed its Form 10-Q, an accompanying press release, and its quarterly financial supplement, each of which can be accessed on the investor relations section of Care Trust's website at www.caretrustreit.com. A replay of this call will also be available on the website for a limited period. Management on the call this morning include Bill Wagner, Chief Financial Officer, Dave Sedgwick, Chief Operating Officer, Mark Lamb, Chief Investment Officer, and Eric Gillis, Vice President of Portfolio Management and Investment. I will now turn the call over to Greg Stapley, Care Trust REITs Chairman and CEO.

Thanks, Lauren, and good morning, everyone. You know, while the resurgence of COVID-19 has been difficult on multiple fronts, there are some bright spots out there that we're talking about. First and foremost, we are grateful to be able to report that our tenants and their staffs are working through it, and thanks in part to the government relief measures provided to date, our skilled nursing tenants are earnestly caring for their patients and otherwise holding up well. We are also encouraged by the recently commenced federal rollout of point-of-care rapid results testing to nursing homes nationwide. The government is reportedly delivering 600 to 700 testing platforms a week with an eye to getting them into all of the nation's 15,000 nursing facilities as quickly as possible. Several of our facilities are near the top of the distribution list. This has been a giant missing piece in the infection control puzzle at the nation's inpatient care facilities. Short of having an effective vaccine, point-of-care rapid results testing will likely be the biggest advance in the ongoing war against COVID-19. Real-time testing in places where so many of our most susceptible citizens reside should begin saving lots of lives immediately. We hope that seniors' housing facilities will be next in line for these testing capabilities as well. We also hope that the government will move to protect even more of our vulnerable elderly by including seniors' housing providers in the next round of stimulus support. As for care trust tenants, you'll recall that about 85% of our rental revenue comes from our skilled nursing assets. Our SNF operators and their care staffs are working hard daily to keep their heads above water while protecting our vulnerable seniors. And they're getting better at it every day as more is learned about COVID-19 and more resources come available to aid them in the fight. In addition to the state and federal relief dollars, the accompanying regulatory relief has been immensely helpful Suspension of the three-day qualifying stay for Medicare eligibility is the most prominent example. Hopefully, this highlights the fact that the, quote, stroke of the pen risk that some of the credit community and elsewhere are wringing their hands over actually goes both ways. Yes, the lion's share of SNF revenues coming from government sources, changes in policy or reimbursement rates can hurt providers, at least until the provider is adjusted, and which usually happens pretty quickly. But if the government's response to this pandemic proves anything about that dynamic, it is that both state and federal officials understand and are fully committed to the long-term health and economic survival of post-acute care as a truly essential industry. That is an undeniable plus in difficult times like these, not to mention the fact that the government is the most financially capable customer any business could have, especially when economic conditions are most challenging. While we don't necessarily want to project an everything's fine message, everybody knows everything's not fine, we also don't want to convey doom and gloom either. Having been in the operating trenches ourselves and seen the hard work and significant resources being devoted to the fight, we believe our providers are well positioned to continue weathering the storm for the near term. As for Care Trust itself, I'm pleased to report that we remain in great shape. We collected 99.3% of rents from April through July, and August rent collections are on track and continuing to come in as expected. We have the lowest leverage in company history today at 3.1 times net debt to EBITDA at this moment. Interest costs on the little bit of floating rate debt we do have are at historic lows, and we have no debt maturities on the horizon before 2024. And our $600 million revolving credit line is undrawn, plus we have around $20 million in cash on hand, plus our conservative payout ratio leaves us each year with a sizable chunk of very cheap capital that we can invest at solid returns. All of these funds are fully available to support our opportunistic growth strategy without raising a nickel in new debt or equity unless we want to. And speaking of investments, although the pandemic has put a crimp in M&A activity over the past few months, we expect to start announcing new investments again very soon. With that, I'd like the team to briefly talk about our results for the last quarter, as well as our thoughts on the next couple, and then we'll open it up for Q&A. Dave?