On February 26, 2025, Universal Health Realty Income Trust (UHT, Financial) released its 8-K filing detailing the financial results for the fourth quarter and full year of 2024. As a healthcare real estate investment trust (REIT), UHT focuses on investing in and leasing healthcare and human service facilities across the United States.
Quarterly and Annual Financial Highlights
For the fourth quarter of 2024, UHT reported a net income of $4.7 million, or $0.34 per diluted share, compared to $3.6 million, or $0.26 per diluted share, in the same period of 2023. This improvement was primarily driven by an increase in income generated from various properties, partially offset by higher interest expenses due to increased borrowing rates.
On an annual basis, UHT's net income for 2024 was $19.2 million, or $1.39 per diluted share, up from $15.4 million, or $1.11 per diluted share, in 2023. The increase was attributed to higher property income and reduced expenses related to a property in Chicago, Illinois.
Funds from Operations and Dividends
Funds from operations (FFO), a key performance metric for REITs, were $11.8 million, or $0.85 per diluted share, in Q4 2024, compared to $11.4 million, or $0.82 per diluted share, in Q4 2023. For the full year, FFO increased to $47.9 million, or $3.46 per diluted share, from $44.6 million, or $3.23 per diluted share, in 2023. The increase in FFO reflects the overall improvement in net income.
UHT declared a fourth-quarter dividend of $0.735 per share, totaling $10.1 million, which was paid on December 31, 2024.
Strategic Developments and Challenges
In 2024, UHT expanded its credit agreement, increasing borrowing capacity to $425 million and extending the maturity date to 2028. Additionally, the company entered into a new interest rate swap agreement to hedge against interest rate fluctuations.
Despite these positive developments, UHT faces challenges such as increased interest expenses due to rising rates, which could impact future profitability. The company also continues to manage vacant properties in Chicago and Evansville, which incur ongoing expenses until leased or sold.
Income Statement Overview
| Metric | Q4 2024 | Q4 2023 | 2024 | 2023 |
|---|---|---|---|---|
| Net Income | $4.7 million | $3.6 million | $19.2 million | $15.4 million |
| Diluted EPS | $0.34 | $0.26 | $1.39 | $1.11 |
| FFO | $11.8 million | $11.4 million | $47.9 million | $44.6 million |
Analysis and Outlook
Universal Health Realty Income Trust's financial performance in 2024 demonstrates resilience and strategic growth, with significant improvements in net income and FFO. The company's ability to manage interest rate risks and expand its credit facilities positions it well for future opportunities. However, ongoing challenges such as interest rate volatility and property vacancies require careful management to sustain growth and profitability.
Explore the complete 8-K earnings release (here) from Universal Health Realty Income Trust for further details.
