Invesque Inc. Reports Fourth Quarter and Full Year 2017 Results

TORONTO, ONTARIO, MARCH 14, 2018 – Invesque Inc. (TSX: IVQ.U) (the “Company”) today announced its results for the twelve months ended months ended December 31, 2017.

Fourth Quarter Highlights

  • Announcement of US$425 Million transformative acquisition of Care Investment Trust
     
  • Company rename and re-branding to Invesque
     
  • Announced US$54 Million raised in preferred equity private placement offering; closed on US$26.5 Million
     
  • Reported adjusted funds from operations (“AFFO”) of US$0.23 per common share
     
  • Closed US$68 Million in new acquisitions
     
  • Announced acquisition of US$21.5 Million memory care portfolio

“The fourth quarter was a very active quarter for Invesque. We successfully executed a preferred equity raise, re-branded our company, and announced over half a billion of accretive transactions, including our landmark acquisition of Care Investment Trust,” commented Scott White, chief executive officer for the company. “These accomplishments demonstrate the capabilities of our team, the scalability of our platform, and our ability to execute our strategy.”

Financial Highlights

Three months ended December 31, Years ended December 31,
(in thousands of U.S dollars, except per share values) 2017 2016 2017 2016
Revenue $17,806 $13,849 $68,066 $40,865
Net income $4,076 $5,139 $16,263 $4,877
Funds from operations (“FFO”) (1)= $6,007 $5,803 $28,188 $14,736
Funds from operations per share $0.19 $0.20 $0.87 $0.91
Adjusted funds from operations (“AFFO”) (1) $7,509 $7,149 $30,920 $19,571
Adjusted funds from operations per share $0.23 $0.24 $0.96 $1.21
(1) FFO and AFFO are measures used by management to evaluate operating performance. Please refer to the section “Non-IFRS Measures” in this press release for more information.

Balance Sheet and Portfolio Highlights

(in thousands of U.S. dollars, except number of properties) December 31, 2017 December 31, 2016
Total assets $785,005 $677,719
Number of owned properties 40 35
Debt $428,377 $356,220
Debt / Gross Book Value 54.6% 52.6%

“A key strength of our platform is our strong capital partnerships,” noted Scott Higgs, Chief Financial Officer for the Company. “We were able to creatively come to market by raising very attractive capital. The preferred equity private placement increased our liquidity and showcased our flexibility.”

Subsequent Events

In February 2018, the Company closed on the previously announced acquisition of Care Investment Trust (“CIT”). The acquisition was the largest to date for the Company, doubling the portfolio by property count. The acquisition of CIT continued the Company’s efforts to diversify the portfolio by adding eight operators, eight new states, 42 buildings, and more than 3,700 beds/suites. The transaction also increased the concentration of NOI from private pay assets to 52%.

Additionally, the Company announced the upsizing of the preferred equity private placement (“Preferred Equity”) by US$17.5 Million, increasing the total placement to US$71.5 Million.

In March 2018, the Company announced further diversification of the portfolio with the strategic acquisition of Mohawk Medical REIT (“Mohawk REIT”). The addition of Mohawk REIT portfolio adds 14 medical office buildings, including 11 in Canada and three in the United States. The acquisition of Mohawk REIT will provide a solid platform in the medical office building sector, delivering the Company continued avenues for growth.

In addition to the acquisition of Mohawk REIT, the Company closed on US$118 Million of acquisitions including four newly developed transitional care facilities, and a portfolio of free standing memory facilities, as listed below:

Location Operator Type Beds
Lincoln, Nebraska Hillcrest Healthcare System Transitional Care 72 Beds
Round Rock, Texas Rapid Recovery of Texas Transitional Care 70 Beds
Webster, Texas Rapid Recovery of Texas Transitional Care 70 Beds
San Antonio, Texas Rapid Recovery of Texas Transitional Care 105 Beds
Garland, Texas Constant Care Memory Care 38 Beds
Grapevine, Texas Constant Care Memory Care 38 Beds
McKinney, Texas Constant Care Memory Care 38 Beds

“Coming off of a remarkable fourth quarter, we’ve continued our momentum into 2018, by closing nearly US$543 Million of strategic acquisitions, and announcing an expansion into medical office buildings with the acquisition of Mohawk Medical REIT,” noted Adlai Chester, the Company’s Chief Investment Officer. “We continue to use our platform to implement our strategy, diversify our portfolio, and scale our operations.”

Upon closing the announced transactions, the Company’s portfolio will expand to 103 properties with more than 9,000 beds across 19 U.S. states and two Canadian provinces. The proposed acquisition of Mohawk REIT, remains subject to certain closing conditions, including satisfactory completion of due diligence. There can be no assurances that any such conditions will be satisfied or that the transaction will be consummated.

Investor Conference Call

A conference call hosted by the Company’s senior management team will be held Thursday, March 15, 2018 at 10:00 AM ET. The telephone numbers for the conference call are: Local: (647) 427-7450 or Toll Free: (888) 231-8191. The passcode for the conference call is: 27159359. The conference will also be available via webcast at http://www.invesque.com/investor-events-presentations/. Please log on at least 15 minutes before the call commences. The telephone numbers to listen to the call after it is completed (taped replay) are: Local: (416) 849-0833 or Toll Free: (855) 859-2056. The Passcode for the taped replay is 27159359.

About Invesque

Invesque Inc. is a North American healthcare real estate company with a growing portfolio of high quality properties located in the United States and Canada and operated by best-in-class healthcare, senior living and care operators primarily under long-term leases and joint ventures. Invesque partners with industry leaders to invest across the healthcare spectrum. Invesque’s mission is to create long-term shareholder value while providing an investment opportunity that matters. For more information, visit www.invesque.com.

Forward-Looking Information

This press release contains forward-looking information that reflects the current expectations of management about the future results and opportunities for the Company. Forward-looking statements generally can be identified by words such as “outlook”, “objective”, “may”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, “should”, “plans”, “project”, or “continue” or similar expressions suggesting future outcomes or events. Such forward-looking statements reflect the Company’s current beliefs and are based on information currently available to management. This forward-looking information represents our views as of the date of this press release and such information should not be relied upon as representing our views as of any date subsequent to the date of this document. We have attempted to identify important factors that could cause actual results or performance to vary from those current expectations or estimates expressed or implied by the forward-looking information. See risk factors highlighted in materials filed with the securities regulatory authorities in Canada from time to time, including, but not limited to, the Company’s annual information form available on SEDAR at www.sedar.com.

Non-IFRS Measures

The Company reports its financial results in accordance with International Financial Reporting Standard (“IFRS”). Included in this news release are certain non-IFRS financial measures as supplemental indicators used by management to track the Company’s performance. These non-IFRS measures are FFO and AFFO.

The Company believes that these non-IFRS financial measures provide useful information to both management and investors in measuring the financial performance and financial condition of the Company. These measures do not have a standardized meaning prescribed by IFRS and, therefore, may not be comparable to similar measures presented by other companies, nor should they be construed as an alternative to other financial measures determined in accordance with IFRS. For a full definition of these measures and a reconciliation to net profit for the three and twelve months ended December 31, 2017, please refer to the Financial Measures section of the 2017 MD&A available on the Company’s website and on SEDAR at www.sedar.com.

SOURCE Invesque Inc.

For further information: Investor Relations, 1-317-582-6971, ir@invesque.com