Medical Properties Trust, Inc. common stock

Hello everyone, thank you for joining us and welcome to the Medical Properties Trust third quarter 2026 earnings conference call. All lines have been placed on mute to prevent any background noise during this call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star 1 again. I will now hand the conference call over to Charles Lambert, Senior Vice President. Charles, please go ahead.

Good morning. Welcome to the NPT conference call to discuss our third quarter 2026 financial results. With me today are Edward K. Aldag, Jr., Chairman, President, and Chief Executive Officer of the company. Steven Hamner, Executive Vice President and Chief Financial Officer, Kevin Hanna, Senior Vice President, Controller and Chief Accounting Officer, Rosa Williams, Senior Vice President of Operations and Secretary, and Jason Fry, Managing Director, Asset Management and Underwriting. Our press release was distributed this morning and furnished on Form 8K with the Securities and Exchange Commission. If you did not receive a copy, It is available on our website at mpt.com in the investor relations section. Additionally, we're hosting a live webcast of today's call, which you can access in that same section. During the course of this call, we will make projections and certain other statements that may be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to known and unknown risks, uncertainties, and other factors that may cause our financial results and future events to differ materially from those expressed in or underlying such forward-looking statements. We refer you to the company's reports filed with the Securities and Exchange Commission for a discussion of the factors that could cause the company's actual results or future events to differ materially from those expressed in this call. The information being provided today is as of this date only and except as required by the federal securities laws, the company does not undertake a duty to update any such information. In addition, during the course of the conference call, we will describe certain non-GAAP financial measures which should be considered in addition to and not in lieu of comparable GAAP financial measures. Please note that in our press release, NPT has reconciled all non-GAAP financial measures to the most directly comparable GAAP measures in accordance with Reg G requirements. You can also refer to our website at NPT.com for the most directly comparable financial measures and related reconciliations. I will now turn the call over to our Chief Executive Officer, Ed Aldag.

Thank you, Charles, and thank all of you for joining us this morning. Earlier this year, we projected MPT would reach annualized cash rental revenue of at least $1 billion by the end of this year. Year to date, we have already collected more than $750 million of cash revenue, which annualizes to more than the $1 billion we projected earlier. This reflects the strength of our diverse portfolio of operators around the world. During the year, we've sold nine properties for cash proceeds of approximately $600 million, and we still hit our target. For 2027, despite these sales, we continue to expect portfolio cash rents above $1 billion. Now I'd like to address some recent changes at HSA. Many of you are aware that the two principals leading HSA, have been engaged in a legal dispute that has served as an unfortunate distraction from core hospital operations. With the resolution of this matter and the exit of one of those principles, we now have a new tenant in place that goes by the name of Ardonis. At this time, the hospitals will continue to operate under the HSA name. As we have discussed in the past few quarters, HSA's core challenges remain revenue cycle management. Simply put, these hospitals have not done a good enough job of billing and collecting. To address these continued challenges, HSA has engaged Ovation Healthcare based in Nashville, Tennessee to provide management services. Ovation manages over 500 hospitals across the U.S. and will immediately take over all aspects of operations across the portfolio, including revenue cycle, IT, staffing, Supply Chain and other areas. Ovation's immediate focus will be on improving RCM. We are optimistic that Ovation can help HSA to unlock the significant potential of these hospitals. Turning to the UK, where we have been discussing budget constraints that have adversely impacted the NHS for several quarters now. As a result of these challenges, the NHS has not been able to fully fund the robust demand the country continues to see for behavioral health services. Recognizing these ongoing dynamics, MPT and Priory have reached an agreement to reduce the annual rental obligations by approximately 18% with the ability for rents to increase as patient volumes recover. As part of this agreement, we added an extension option at MPT's election that effectively extends Priory's lease by 10 years. Following our recent asset sales and attractive valuations and the comprehensive steps we have taken to refinance our debt that Steve will discuss in more detail shortly, we have meaningfully strengthened our balance sheet this year. Additionally, as Rosa will cover, our portfolio consists of more than 50 operators around the world that are well positioned to continue servicing increased global demand for healthcare services. Thank you, Ed.