Medical Properties Trust, Inc., Q4 2008 Earnings Call Transcript

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2009-01-29 11:39:16.0

Tags: Call Transcript, Earnings, RBC Capital Markets, Medical Properties Trust Inc., G&A, Litigation, Personal Finance, Business Operations, Seeking Alpha

Question-and-Answer Session

Operator

(Operator Instructions). And your first question comes from the line of Kevin Ellich with RBC Capital Markets. You may proceed.

Kevin Ellich - RBC Capital Markets

Good morning guys, thanks for taking my question.

Ed Aldag

Good morning.

Kevin Ellich - RBC Capital Markets

I guess I'd like to start off with the guidance and the G&A expenses Steve you did nice job of breaking off all of the components. But I was just wondering and I missed the Houston Litigation it seems. Could you walk through that once again and then what should we expect going forward?

Steve Hamner

The Houston litigation in the fourth quarter amounted to about a $1.4 million in, in defense cost. And I am not sure what your question was Kevin.

Kevin Ellich - RBC Capital Markets

The question is, the G&A expense I guess is the $10 million a good number to use?

Steve Hamner

Oh no the $10 million is not a good number to use. If you look at the $10 million roughly, $10,020,000 in G&A for the fourth quarter. That includes over $4 million of unusual one time, non-recurring, similarly phrased charges that include for example, we discussed the, the Bucks County write off. Bucks County, was a $4.7 million write off, of which $3 million of that went to straight line rent and $1.8 million of that is included in that $10 million of G&A as a bad debt expense.

Kevin Ellich - RBC Capital Markets

Okay. (inaudible)

Steve Hamner

Pardon.

Kevin Ellich - RBC Capital Markets

Sorry, that bad debt that is just a one time expense then.

Steve Hamner

Yes, that's right as is of course the roughly $1.3 million in retention cost that we had on the River Oaks hurricane damage. We are still negotiating with insurers and contractors that we believe we may have had as much as $6 million or $7 million in damage to the two buildings all of which is insured of course except for our retention which was $1.3 million. So we charged off that $1.3 million to G&A as a property expense in the fourth quarter.

So that also is included $10,020,000. Also there is another I think I mentioned roughly $1.1 million in HPA related cost that we believe may be recoverable but given the status of the bankruptcy proceedings we've elected basically to reserve those costs until we get more clarity on the bankruptcy and our rise to the collateral. So those three items themselves amount to over $4 million and again as you described it one time charges that are included in the roughly $10 million of G&A.

 

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