Healthpeak Properties, Inc.

Good morning and welcome to the Omega Healthcare Investors Second Quarter 2022 Earnings Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Michelle Reber, Please go ahead.

Thank you and good morning. With me today are Omega's CEO, Taylor Pickett, COO, Dan Booth, CFO, Bob Stevenson, and Megan Krull, Senior Vice President of Operations. Comments made during this conference call that are not historical facts may be forward-looking statements, such as statements regarding our financial projections, dividend policy, portfolio restructurings, rent payments, financial condition or prospects of our operators, contemplated acquisitions, dispositions or transitions, and our business and portfolio outlook generally. These forward-looking statements involve risks and uncertainties which may cause actual results to differ materially. Please see our press releases and our filings with the Securities and Exchange Commission, including, without limitation, our most recent report on Form 10-K, which identifies specific factors that may cause actual results or events to differ materially from those described in forward-looking statements. During the call today, We will refer to some non-GAAP financial measures such as NAREIT FFO, Adjusted FFO, FAD, and EBITDA. Reconciliations of these non-GAAP measures to the most comparable measure under generally accepted accounting principles, as well as an explanation of the usefulness of the non-GAAP measures, are available under the Financial Information section of our website at www.omegahealthcare.com and, in the case of NAREIT FFO and Adjusted FFO, in our recently issued press release. In addition, certain operator coverage and financial information that we discuss is based on data provided by our operators that has not been independently verified by Omega. I will now turn the call over to Taylor.

Thanks, Michelle. Good morning, and thank you for joining our second quarter 2022 earnings conference call. Today, I will discuss our second quarter financial results, skilled nursing facility industry trends, and operator restructurings. Our first quarter adjusted FFO is $0.76 per share, and funds available for distribution are $0.71 per share. We have maintained our quarterly dividend of $0.67 per share. The dividend payout ratio is 88% of adjusted FFO and 94% of funds available for distribution. As we discussed last quarter, the ability to put restructuring portfolios back to work improved the FAT payout ratio by 7%. We expect over time to put additional portfolios back to work, further improving our fat payout ratio and liquidity. Turning to skilled nursing facility industry trends. Occupancy continues to trend upward while staffing availability is slowly improving. Wages for full-time staff are significantly higher than pre-COVID wages. We believe this is a permanent shift in cost structure for our facilities. Fortunately, a number of states have announced significant increases in Medicaid rates, reflecting the need to fund these higher costs. Turning to operator restructurings. The strength of our portfolio assets generally allows us to work through operator restructurings with limited long-term cash flow downside. We've completed all of the restructuring work related to Gulf Coast. We are well down the restructuring pathway with the Aegemo portfolio, which represents approximately 6% of contractual rent, none of which was recognized in the second quarter. And the other portfolios with liquidity issues have generally committed to pay contractual rent obligations while we work through various asset sales or transitions to new operators. Finally, I again thank our operating partners, and in particular, the frontline caregivers and staff who have cared for the tens of thousands of residents within our facilities. I will now turn the call over to Bob.