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Tag: trust

  • New Senior Investment Group Inc. (SNR) Stock Surges Following Announcement of Acquisition by Ventas

    New Senior Investment Group Inc. (SNR) Stock Surges Following Announcement of Acquisition by Ventas

    New Senior Investment Group Inc. (SNR) stock prices were up by a significant 29.15% shortly after market trading commenced on June 28th, 2021, bringing the price up to USD$8.95 early on in the trading day.

    Buyout Transaction

    June 28th, 2021 saw Ventas Inc. announce its intentions to buy New Senior Investment Group in an all-stock transaction that is valued at roughly USD$2.3 billion. The move will see the healthcare-focused real estate investment trust expand its footprint into the senior housing market. As per the transaction, existing shareholders of SNR will receive 0.1561 shares of newly issued Ventas shares for every share of SNR. The resulting price of each SNR comes out to USD$9.10, representing a significant 31.7% premium.

    Details of the Transaction

    With the deal including USD$1.5 billion in debt, a closing date is expected for the second half of 2021. Ventas has cited the eventual recovery of the senior housing industry in a post-pandemic economy as a major reason for their decision to purchase SNR. The transaction is expected to result in the realizing of between USD$16 million to USD$18 million in annualized corporate synergies.

    Operating Expense Reports

    Operating expenses for the first quarter of 2021 were reported to be 3.2% lower than numbers reported for the same time period of the prior year. This year-over-year difference is largely attributable to reduced spending on occupancy-related expenses and other controllable costs, such as supplies and maintenance. Utilities and insurance expenses were up because of the winter storms earlier in February of 2021 affecting businesses across the United States. Operating expenses stemming from the impact of the pandemic came out to USD$0.3 million, down 46% from the prior year and 45% from the prior quarter.

    NOI Margins

    The first quarter of fiscal 2021 reported an NOI margin of 36.1%, down from the 39.1 reported in the fourth quarter of 2020. The quarter-over-quarter reduction was largely driven by the occupancy declines that have been persistent since the onset of the pandemic, with the February storms further exacerbating the situation. As operators push for occupancy growth, short-term margins are expected to suffer before picking up in the longer run.

    Future Outlook for SNR

    With the company set to be acquired, SNR is poised for the expanded facilities that will be made available to it to drive further growth. Current and potential investors are hopeful that management will continue to leverage the resources at their disposal to facilitate significant and sustained increases in shareholder value.

  • San Juan Basin Royalty Trust (SJT) Stock Dips Significantly Ahead of June 2021 Cash Distribution

    San Juan Basin Royalty Trust (SJT) stock prices were down by a concerning 15.38% shortly after market trading commenced on June 18th, 2021, bringing the price per share up to USD$4.72 early on in the trading day.

    June 2021 Cash Distribution

    The company announced on June 18th, 2021 that it had declared a monthly cash distribution of a total of USD$821,024.63 to holders of its units of beneficial interest. This comes out to USD$0.017615 per unit, derived mainly from estimated production during April 2021, subject to various adjustments by the owner of the Trust’s subject interests for prior months. The distribution will be applicable to unit holders of record as of June 30th, 2021, with the payout scheduled for July 15th, 2021.

    Comparative Reports

    As per information provided to the company by Hilcorp, April 2021 saw gas production for the subject interests coming out to a total of 2,498,553 Mcf, up from the 2,617,042 Mcf reported for the month of March in 2021. Average gas prices for April 2021 were calculated by dividing revenues by production volume, with a final figure of USD$1.67 per Mcf. This is comparable to an average gas price of USD$2.07 per Mcf for March 2021.

    April 2021 Breakdown

    Because of the company’s transition to a new accounting system, Hilcorp informed SJT that April 2021 would have a monthly report based on estimated production, estimated prices, and estimated costs. Revenue for the reporting month of April 2021 included an estimated USD$100,000 for non-operated revenue. Capital costs for the month of April 2021 came out to USD$11,623 as per Hilcorp reports to the trust. Lease operating expenses and property taxes were reported at USD$2,459,029, while severance taxes came in at USD$780,743.

    Capital Project Plan

    The company announced near the end of February that Hilcorp had provided the company with a capital project plan for the fiscal year 2021, which expected capital expenditures amounting to USD$0.3 million. The principal asset of the Trust is comprised of a 75% et overriding royalty interest that is derived from certain oil and gas leasehold and royalty interests in properties owned by Hilcorp. These interests stem from properties owned by Hilcorp in the San Juan Basin.

    Future Outlook for SJT

    Armed with a new accounting system, SJT is poised to capitalize on the opportunities afforded to it. The company is keen to bounce back from the dip in equity value following the cash distribution for June 2021. Current and potential investors are hopeful that management will continue to leverage the resources at their disposal to facilitate significant and sustained increases in shareholder value.