National Health Investors, Inc.

Greetings and welcome to the National Health Investors First Quarter 2022 Conference Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question and answer session. At that time, if you have a question, please press the 1 followed by the 4 on your telephone. And if at any time during the conference you need to reach an operator, please press star 0. As a reminder, this conference is being recorded Tuesday, May 10, 2022. It is now my pleasure to turn the conference over to Dana Hambly. Please go ahead.

Thank you, and welcome to the National Health Investors Conference call to review the company's results for the first quarter of 2022. On the call today are Eric Mendelson, President and CEO, Kevin Pascoe, Chief Investment Officer, John Spade, Chief Financial Officer, and David Travis, Chief Accounting Officer. The results as well as notice of the accessibility of this conference call on a listen-only basis were released after the market closed yesterday in a press release that's been covered by the financial media. As a reminder, any statements in this conference call which are not historical facts are forward-looking statements. NHI cautions investors that any forward-looking statements may involve risks or uncertainties and are not guarantees of future performance. All forward-looking statements represent NHI's judgment as of the date of this conference call. Investors are urged to carefully review various disclosures made by NHI and its periodic reports filed with the Securities and Exchange Commission, including the risk factors and other information disclosed in NHI's Form 10-Q for the quarter ended March 31, 2022. Copies of these filings are available on the SEC's website at sec.gov or on NHI's website at nhireet.com. In addition, certain terms used in this call are non-GAAP financial measures, reconciliations of which are provided in NHI's earnings release and related tables and schedules, which have been filed on Form 8K with the SEC. Listeners are encouraged to review those reconciliations provided in the earnings release together with other information provided in that release. I'll now turn the call over to our CEO, Eric Mendelsohn.

Thank you, Dana. Hello, and thanks for joining us today. It has been one year since we communicated our initial plans to optimize our portfolio through $250 million to $400 million of asset dispositions, lease restructurings with operators where we have confidence in their ability to recover, and tenant transitions to new and existing partners, including shop joint ventures. We've accomplished a great deal in the past year. We have completed approximately 262 million in asset sales since that time, including 214 million in sales of underperforming senior housing properties. We expect to complete dispositions exceeding 100 million in net proceeds of several other underperforming properties in the first half of this year. These dispositions will have minimal impact on our cash NOI as the properties aren't contributing much rental income. We restructured the Bickford lease effective April 1st, which is consistent with the plan that we communicated in November. Bickford is a valued partner to NHI and we're confident that our new leases create a more sustainable relationship that improves our coverage, generates excess cash flow that can be used to repay NHI's deferral balance, and provides more capital for Bickford to reinvest and maintain our buildings. Recall that we have a fair market value reset after two years on the rent, so their success will be our success as well. We reached another great milestone for our company as we transitioned the remaining legacy holiday properties into two new shop ventures with Merrill Gardens and Discovery Senior Living in April. While it's still early stages, we've been pleased with the transition so far and look forward to providing much more detail on these ventures in our second quarter report. These types of ventures, coupled with our traditional triple net strategy, make NHI a formidable competitor for new business and senior housing. The balance sheet is in great shape as we reduced debt by over $275 million in the last 12 months and maintained leverage within our target of four to five times net debt to adjusted EBITDA despite significant deferrals and non-payment from Welltower for eight months. The pipeline is starting to rebuild, and we recently announced a 240 million share repurchase plan, so we see plenty of near-term opportunity to deploy capital without the need to issue equity. We included a new slide in our supplemental that outlines the activity undertaken in our portfolio optimization. I described the slide as busy, and this is intentional. We knew the process would introduce volatility to our cash flow and that there would be unforeseen obstacles that we'd have to navigate along the way. We've tried to communicate our plan through regular business updates, but understand that the many moving pieces made for difficult forecasting. Our operators continue to deal with operational challenges, however, We feel like we're in a better position now to forecast these challenges. We are now happy to report that we've largely completed portfolio optimization and reached an inflection point, which has greatly improved our visibility. As a result, we recently issued guidance, which John will discuss in more detail in his review of our quarter results. John.