Omega Healthcare Investors (OHI) Financials

Omega Healthcare Investors (NYSE: OHI) has shown some consistent performance trends and notable financial movements over the last four years based on the quarterly financial statements analyzed from Q3 2022 through Q1 2025.

Key Positive Trends:

• Net income attributable to common shareholders has generally increased year-over-year, reaching $109 million in Q1 2025 from about $36 million in Q1 2023, indicating improved profitability.
• Total revenue steadily grew, reaching approximately $235 million in Q1 2025 from $190 million in Q1 2023, signaling growth in operations and business scale.
• The company maintained or increased cash dividends per common share consistently at $0.67 per quarter, suggesting stable returns to shareholders.
• Net cash flow from continuing operating activities showed solid strength, with $181.95 million in Q1 2025 compared to $111.36 million in Q1 2023, reflecting strong operational cash generation.
• Assets under management, particularly premises and equipment net, increased from around $6.44 billion in early 2023 to over $6.33 billion by Q1 2025, reflecting ongoing investments and growth in property portfolio.
• Issuance of common equity increased in recent quarters, e.g., $260.7 million in Q1 2025, supporting balance sheet strength and expansion initiatives.

Neutral Observations:

• Long-term debt fluctuated but remained significant, around $4.44 billion in Q1 2025 compared to roughly $5 billion in early 2023, indicating continued reliance on debt financing.
• Depreciation expense has remained high, reflecting ongoing investment in property and equipment but also sizable non-cash charges impacting earnings.
• Impairment charges and restructuring charges have been recorded consistently but at varying levels; these are signs of asset revaluation and strategic adjustments.
• Net interest expense continues to show a negative impact on income, with expenses exceeding interest income in recent quarters, typical for real estate investment trusts (REITs) with significant debt.

Areas of Concern / Negative Trends:

• Provision for credit losses fluctuated between positive and negative values, with $5.09 million provision in Q1 2025 but extreme spikes such as $64 million in late 2022, pointing to potential credit risk in their portfolio.
• Net interest income remains negative due to higher interest expense than income; Q1 2025 shows a net interest expense (loss) of approximately $9.16 million, which pressures profitability.
• Total non-interest expenses remain high, including significant depreciation, impairment, and restructuring charges cumulatively affecting operating margins.
• Cash flow from financing activities was negative $347.7 million in Q1 2025 due to substantial debt repayments and dividend payments, signaling heavy cash outflows that could limit liquidity if not managed.
• Balance sheet shows retained earnings as negative (around -$3.51 billion in Q1 2025), indicating accumulated losses or dividend payouts exceeding earnings historically.
• Trading account securities and restricted cash saw fluctuations, which may impact liquidity or investment income unpredictably.

Summary: Omega Healthcare Investors has demonstrated overall growth in revenue and net income over the recent years while maintaining consistent dividend payments, which may appeal to income-focused investors. The company shows strong operational cash flow but remains significantly leveraged, with persistent interest expense pressures and some credit loss volatility. Non-cash charges like depreciation and impairments are substantial but typical for its asset-heavy REIT model. Investors should watch the company's ability to manage debt levels and credit risks alongside its portfolio growth strategy.