NHI — National Health Investors, Inc.

Summary of NHI Q3 2025 Earnings Call

1. Key Financial Results and Metrics:

• Net Income per Share: $0.69, up 6.2% year-over-year.
• NAREIT FFO per Share: $1.09, an increase of 5.8% compared to the prior year.
• Normalized FFO per Share: $1.32, up 28% year-over-year.
• Funds Available for Distribution (FAD): Increased 26% to $62.2 million.
• Total SHOP NOI: Increased by 62.6% to $4.9 million, driven by the transition of 7 properties to the SHOP portfolio.
• Same-store NOI: Declined by 2.2% year-over-year for the 15 legacy Holiday properties.
• Cash Lease Revenue: Increased approximately 12% year-over-year to $70.1 million.

2. Strategic Updates and Business Highlights:

• Transitioned 7 properties to the SHOP portfolio, resulting in significant NOI growth.
• Announced the first SHOP acquisition for $74.3 million, effective October 1, 2025.
• Total investments for 2025 reached $303.2 million, with an additional $195 million under signed Letters of Intent (LOIs).
• The company is focused on expanding its presence in private pay senior housing, anticipating SHOP NOI to double again in 2026 to at least 20% of total adjusted NOI.
• The balance sheet remains strong with a net debt to adjusted EBITDA ratio of 3.6x and over $1 billion in available liquidity.

3. Forward Guidance and Outlook:

• Updated full-year 2025 guidance includes:
  • NAREIT FFO per share at the midpoint of $4.64 (up 2%).
  • Normalized FFO per share at the midpoint of $4.90 (up 10.4%).
  • FAD at the midpoint of $232.6 million (up 13.9%).
  • Same-store SHOP NOI growth projected between 7% to 9% over 2024.
  • Anticipated SHOP NOI from conversions and new investments between $5.8 million and $6 million.

4. Challenges and Points of Concern:

• Same-store NOI for the legacy Holiday properties showed a decline, attributed to higher move-outs, personnel changes, and units taken offline for repairs.
• The company is currently assessing the legality of a lease renewal notice from NHC, which could have implications for future negotiations.
• Competitive pressures in the senior housing market are increasing, with more private equity entering the space, potentially impacting pricing and acquisition strategies.

5. Notable Q&A Insights:

• Management acknowledged challenges in the Holiday portfolio, emphasizing ongoing remediation efforts to improve occupancy and performance.
• The legality of the NHC lease renewal is under scrutiny, with management indicating that if found invalid, negotiations could open up significantly.
• The company is focused on ensuring strong operator relationships and is actively evaluating its portfolio to optimize performance.
• There is an ongoing effort to enhance asset management capabilities, with expectations of improved revenue per employee metrics as the SHOP portfolio expands.

Overall, NHI reported strong financial results and strategic growth in its SHOP portfolio, while also addressing challenges in its legacy properties and navigating competitive pressures in the senior housing market.