AHR — American Healthcare REIT, Inc.

Summary of American Healthcare REIT (AHR) Q4 2025 Earnings Call

1. Key Financial Results and Metrics

• Normalized Funds from Operations (NFFO): $0.46 per diluted share for Q4 2025; $1.72 per diluted share for the full year, representing a 22% year-over-year growth.
• Same-Store Net Operating Income (NOI): 11.8% growth in Q4 and 14.2% for the full year 2025.
• Trilogy Segment Performance: Same-store NOI increased by 14% in Q4 and 18.4% for the year; occupancy reached 90.6%.
• SHOP Segment Performance: Same-store NOI increased by 24.6% in Q4 and 25.2% for the full year.
• Debt Metrics: Improved debt to EBITDA ratio, now at 3.4x.

2. Strategic Updates and Business Highlights

• Leadership Update: Jeff Hanson is serving as Interim CEO while Danny Prosky is on medical leave but remains engaged.
• Investment Activity: Closed over $950 million in new investments in 2025, with a focus on the Trilogy and SHOP segments.
• Acquisition Strategy: Emphasis on relationship-driven sourcing and disciplined underwriting, with a shift towards newer, higher-quality properties.
• Revenue Management Initiatives: Ongoing pilot programs to enhance revenue management across operators, leveraging Trilogy's proprietary platform.

3. Forward Guidance and Outlook

• 2026 NFFO Guidance: Projected between $1.99 and $2.05 per diluted share, indicating continued double-digit growth.
• Same-Store NOI Growth Guidance: Expected to be between 7% and 11% for 2026, with specific segment growth forecasts:
  • Trilogy: 8% to 12%
  • SHOP: 15% to 19%
  • Outpatient Medical: 0% to 2%
  • Triple-Net Leased Properties: 2% to 3%

4. Bad News, Challenges, or Points of Concern

• Occupancy Gains: While occupancy is strong, there are concerns about sustaining the same level of growth in 2026, particularly in the SHOP segment where growth rates are expected to decelerate.
• Competitive Pressures: Increased competition for acquisitions from other REITs and private equity firms, although AHR's off-market deals provide some insulation.
• Potential Risks: Uncertainty in government reimbursement rates and the impact of the flu season on occupancy levels, although early indicators for Q1 2026 are more favorable than the previous year.

5. Notable Q&A Insights

• Acquisition Environment: AHR is focusing on higher acuity SHOP assets, with a preference for established operators rather than less experienced ones.
• Revenue Management System: The rollout of revenue management tools is in early stages, aimed at smaller operators who may lack resources.
• Impact of Seasonality: Early 2026 occupancy levels are not significantly impacted by flu season compared to the previous year.
• Trilogy's Transition: The transition of a hospital from surgical to community services may lead to revenue volatility, but management remains confident in the tenant's commitment and financial stability.

Overall, AHR demonstrated strong financial performance in 2025, with a solid outlook for 2026 despite potential headwinds in occupancy growth and competitive pressures in the acquisition landscape.