EPR Properties Provides Company Update and Announces Earnings Conference Call

EPR Properties (NYSE:EPR) today provided an update on the impact of COVID-19 on its operations and financial condition and announced that it will hold its earnings call for first quarter 2020 on Thursday, May 7, 2020 at 8:30 a.m. EDT.

Customer Update

Since the Company last issued an update on the impact of COVID-19 to its operations on March 24, 2020, the impact of the pandemic has increased significantly with the temporary closing of substantially all of its customers’ operations. As discussed in the prior update, the Company is committed to working with its customers for our long-term mutual benefit. Since the prior update, tenants and borrowers have paid approximately 15% of April 2020 contractual base rent and mortgage payments. The Company has agreed to defer the rent and mortgage payments on a month-to-month basis for substantially all of the customers that have not paid rent for the month of April 2020. While deferments for this period delay rent or mortgage payments, these deferments generally do not release tenants from the obligation to pay the deferred amounts in the future.

Several larger tenants of the Company have recently announced additional sources of liquidity including the Company’s largest tenant, American Multi-Cinema, Inc. or “AMC,” representing approximately 18% of the Company’s total revenue for the year ended December 31, 2019. On April 17, 2020, AMC’s parent announced the pricing of a private offering of $500.0 million of first lien notes and has indicated that these additional proceeds would provide it with sufficient liquidity to withstand a global suspension of operations until a partial reopening ahead of Thanksgiving. Despite this increase in short term liquidity, the Company believes it is prudent to begin recognizing revenue for AMC on a cash basis. Accordingly, the Company will record a non-cash write-off of straight-line rent receivable of approximately $12.5 million for the quarter ended March 31, 2020 related to AMC as well as two small tenants where a similar assessment has been made that cash accounting is appropriate.

Liquidity

Below is a liquidity analysis indicating the number of months the Company currently expects that it could cover its Monthly Cash Burn Rate without requiring additional sources of cash, after the Company’s completion of its previously announced $150.0 million share repurchase program and its remaining capital expenditure commitments which extend through 2021, assuming various potential levels of monthly cash revenues and either 100% of the current common share dividend level or no such common share dividends. The “Monthly Cash Burn Rate” includes the Company’s current estimates of average monthly cash for general and administrative expense, interest expense, property operating expense paid directly by the Company, ground leases whether or not paid directly by the Company, losses on the Company’s operating properties, preferred dividends and maintenance capital expenditures.