Executive Summary

Q2 2025 delivered double-digit growth and a clean beat on revenue vs consensus, driven by the Care REIT UK acquisition and continued U.S. deployment; total revenues rose 63.3% year over year to $112.47M, and normalized FFO/FAD per share were $0.43 .
Revenue beat Street by ~10% ($112.47M actual vs $102.02M consensus) while GAAP diluted EPS printed $0.35 vs $0.34 consensus; normalized EPS screens below some EPS frameworks due to REIT reporting emphasis on FFO *. Values retrieved from S&P Global.
Management raised FY 2025 guidance for normalized FFO/FAD to $1.77–$1.79 and net income per share to $1.43–$1.45; component assumptions include ~$338M cash rental revenues and ~$44M interest expense, underpinned by low leverage (net debt/annualized normalized EBITDA ~2.0x) and strong liquidity .
Strategic catalysts: successful integration of Care REIT (entry into UK care homes), reloaded ~$600M pipeline, and term loan swap fixing SOFR at 3.5% (4.63% all-in), supporting visible runway for external growth .

What Went Well and What Went Wrong

What Went Well
- UK Care REIT acquisition closed, adding ~133 care homes with inflation-linked leases and strengthening diversification; management is “chuffed” with operator relationships and sees ample UK growth opportunities .
- Revenue up 63.3% YoY and normalized FFO per share up ~19% YoY; dividend increased 15.5% YoY to $0.335 with ~78% payout, keeping a comfortable coverage .
- Balance sheet strength: net debt/annualized normalized EBITDA ~2.0x, fixed charge coverage 8.2x, and ample revolver capacity; ATM activity bolstered equity and term loan fixed rate enhances interest visibility .
What Went Wrong
- G&A rose with integration and team buildout (including UK manager acquisition), implying near-term opex headwind before synergy realization .
- EPS optics still governed by non-GAAP-to-GAAP reconciliation and FX items (e.g., $4.41M FX gain), which can complicate comparability vs Street EPS frameworks .
- Competitive dynamics in seniors housing show wider cap rate ranges; at lower cap rates CareTrust may be less competitive, highlighting need for careful operator selection (SHOP entry remains deliberate) .

Financial Results

Metric	Q2 2024	Q1 2025	Q2 2025
Total Revenues ($USD Millions)	$68.89	$96.62	$112.47
Rental Income ($USD Millions)	$55.41	$71.65	$86.03
Interest Income – Financing Receivable ($USD Millions)	$0.00	$2.81	$2.89
Interest & Other Income ($USD Millions)	$13.48	$22.17	$23.55
Net Income ($USD Millions)	$10.76	$65.80	$68.55
Diluted EPS ($USD)	$0.07	$0.35	$0.35
Normalized FFO ($USD Millions)	$52.54	$77.85	$83.09
Normalized FFO per share ($USD)	$0.36	$0.42	$0.43
Normalized FAD ($USD Millions)	$53.99	$80.80	$83.07
Normalized FAD per share ($USD)	$0.37	$0.43	$0.43
Dividend per share ($USD)	$0.29	$0.335	$0.335

Estimates vs Actuals

Metric	Q1 2025 Estimate	Q1 2025 Actual	Q2 2025 Estimate	Q2 2025 Actual
Revenue ($USD)	$98.85M*	$96.62M	$102.02M*	$112.47M
EPS (Primary) ($USD)	$0.348*	$0.35	$0.341*	$0.35

Values retrieved from S&P Global.*

Segment/Source Breakdown (Q2 2025)

Revenue Component	Q2 2025 ($USD Millions)
Rental Income	$86.03
Interest Income – Financing Receivable	$2.89
Interest Income & Other	$23.55
Total Revenues	$112.47

Key KPIs and Balance Sheet

KPI	Q2 2025	Notes
Rent & Interest Collection	99.7%	High collection supports cash flow predictability
Net Debt / Annualized Normalized Run-Rate EBITDA	2.0x	Low leverage post acquisitions
Fixed Charge Coverage Ratio	8.2x	Strong coverage
Cash on Hand	~$65M	Post quarter-end
Revolver Availability	~$1.14B	Liquidity headroom
Dividend Payout Ratio (Normalized FAD)	~78%	At $0.335/sh

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Income per share	FY 2025	$1.36–$1.40	$1.43–$1.45	Raised
Normalized FFO per share	FY 2025	$1.69–$1.73	$1.77–$1.79	Raised
Normalized FAD per share	FY 2025	$1.73–$1.77	$1.77–$1.79	Raised
Diluted Weighted Avg Shares	FY 2025	190.6M	195.3M	Raised (share count)
Quarterly Dividend	Current rate	$0.335	$0.335	Maintained
Cash Rental Revenues	FY 2025	—	~$338M	New disclosure
Straight-line Rent	FY 2025	—	~$8M	New disclosure
Amortization of Lease Intangibles	FY 2025	—	~$2M	New disclosure
Interest Income (Financing Receivables)	FY 2025	—	~$12M	New disclosure
Interest Income (Loans + Cash)	FY 2025	—	~$87M	New disclosure
Interest Expense	FY 2025	—	~$44M (incl. ~$5M deferred fees)	New disclosure
G&A Expense	FY 2025	—	~$48–$52M (incl. ~$12M SBC)	New disclosure

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4 2024, Q1 2025)	Current Period (Q2 2025)	Trend
External growth pipeline	Record $1.5B invested in 2024; pipeline reloading to ~$500M as of Q1 2025	~YTD $1.2B deployed; pipeline reloaded to ~$600M	Accelerating
UK Care Homes strategy	Announced/closed Care REIT; ~132 homes, inflation-linked leases	Integration strong; building UK team; active pipeline with operators	Scaling
Financing & credit	Upsize plan for $500M term loan; investment grade by Fitch in Q2	Term loan closed; swaps fixed SOFR at 3.5%, 4.63% all-in; low leverage	De-risked
SHOP/RIDEA entry	Evaluating entries; disciplined operator-first approach	Expect SHOP transaction within 12 months; focused on new relationships (not conversions)	Building
Regulatory/macro	Monitoring staffing/minimums; Medicaid support emphasized	Bipartisan support for Medicaid observed; caution on budget pressures	Balanced watch
Operator bench/diversification	Continued diversification across U.S. SNFs & campuses	Broadened operator and geographic mix (UK + U.S. SNF portfolio JV)	Positive mix shift

Management Commentary

“Total revenues are up 63.3% in the second quarter over the prior year quarter. Normalized FFO per share is up about 19%, and normalized FAD per share is up about 16%” .
On UK integration: “We are chuffed with the operator relationships... and have already game plan with many of them how to grow together in the near future” .
Investments and pipeline: “In a JV… we closed on an approximately $146 million portfolio of 10 skilled nursing assets… pipeline remains strong sitting at approximately $600 million” .
Guidance raise & capital: “We raised guidance… to $1.77 to $1.79 for both normalized FFO and normalized FAD per share… liquidity remains strong… fixed rate debt 93%” .
SHOP approach: “We’ll be opportunistic… it’s all about the operator… I’d be really surprised if we didn’t get something done with respect to SHOP within the next twelve months” .

Q&A Highlights

Pipeline composition: Majority U.S. skilled nursing; remainder U.S. seniors and UK care homes; some SHOP deals under evaluation .
Seniors housing competitiveness: Wider cap-rate ranges; CareTrust competitive where operator fit is strongest; grit to compete in select opportunities .
SHOP strategy: Preference for de novo growth versus converting existing triple-net relationships; casting wider net for operator partners .
Synergies: UK manager integration progressing; expected synergy run-rate ~50% of prior ~$10M run-rate, ramping largely in Q1 next year .
Regulatory backdrop: Medicaid support appears bipartisan; monitoring potential budget pressures/sequestration risk next year .

Estimates Context

Revenue beat: $112.47M actual vs $102.02M consensus (~10% upside) for Q2 2025; sequentially also ahead vs Q1 consensus *. Values retrieved from S&P Global.
EPS: GAAP diluted EPS $0.35 vs $0.34 consensus (small beat); note REITs emphasize FFO/FAD, and CTRE reported normalized FFO $83.09M ($0.43/sh), up YoY *. Values retrieved from S&P Global.
FY 2025 consensus frames: Revenue $416.07M and EPS $1.43, broadly aligned with raised company guidance for net income per share ($1.43–$1.45), with FFO/FAD guidance lifted beyond prior ranges *. Values retrieved from S&P Global.

Key Takeaways for Investors

The print was clean with a material revenue beat and raised FY guidance; external growth and UK integration are tracking well, underpinning visible FFO/FAD per-share compounding .
Liquidity and leverage create capacity: net debt/EBITDA ~2.0x, large revolver, and fixed-rate term loan reduce financing risk into continued deployment .
Pipeline breadth (U.S. SNF heavy, select seniors housing, UK opportunities) provides diversified growth vectors; watch SHOP execution over next 12 months .
Dividend sustainability strengthened: payout ~78% of normalized FAD and rising FFO trajectory suggest room to maintain or grow distributions aligned with cash flows .
Near-term watch items: G&A normalization and synergy ramp, FX impacts from UK portfolio, and competitive dynamics in seniors housing cap rates .
Strategic narrative: UK entry and operator-first discipline differentiate sourcing, while interest-rate hedging and investment-grade dynamics support a lower cost of capital .
Trading lens: Raised guidance and strong beat on revenue are supportive; catalysts include UK pipeline adds, prospective SHOP entry, and further investment closures from the ~$600M pipeline .

Additional Q2 2025 Press Releases and Prior Quarters

Q2: Closed Care REIT acquisition (UK entry) ; Fitch investment grade rating upgrade ; $500M term loan upsizing ; Pacific Northwest SNF portfolio (~$146M JV) .
Q1 2025 results & guidance: Normalized FFO $77.85M ($0.42/sh), FAD $80.80M ($0.43/sh); guidance initially $1.69–$1.73 normalized FFO .

Notes: All non-GAAP metrics reconcile in company exhibits; FX gains and impairments are excluded in normalized presentations (see reconciliations) .

CareTrust REIT, Inc. (CTRE)·Q2 2025 Earnings Summary