Medical Properties Trust Q4 Earnings Call Highlights
by Mitch Edgeman · The Markets DailyMedical Properties Trust (NYSE:MPW) executives highlighted improving operating trends across much of the company’s hospital portfolio while providing updates on leasing activity, acquisitions and dispositions, and the status of the Prospect bankruptcy during the company’s fourth-quarter 2025 earnings call.
Portfolio performance and coverage trends
Chairman, President and CEO Edward Aldag said total portfolio EBITDARM coverage increased year-over-year to 2.6x. He pointed to particularly strong results in general acute care, where operators delivered a more than $130 million increase in EBITDARM versus the same quarter last year.
Aldag also said post-acute care operators posted a $50 million year-over-year EBITDARM increase for a second consecutive quarter, led by improvements at Ernest Health (15%), Vibra (28%), and MEDIAN (8%). Behavioral health results were “down slightly” year-over-year, which management attributed to volume headwinds in the U.K. market and labor cost pressure in the U.S.
International and U.S. operating updates
SVP of Operations Rosa Hooper Williams said the company’s international portfolio represents 50% of investments and remains an anchor of stability. In Germany, MEDIAN recorded its strongest quarter since joining the portfolio, with quarterly EBITDARM increasing more than 20% year-over-year and occupancy at 90%. Williams cited improving reimbursement levels and growing orthopedics demand as contributors.
In the U.K., Williams said general acute operators such as Circle Health continued to perform well. She added that Priory is adjusting to shifts in referral patterns in the behavioral health market amid NHS budget constraints and is modifying service lines at certain facilities.
Across continental Europe, Williams said Swiss Medical Network reported solid year-over-year growth in hospital EBITDARM and noted its new clinical collaboration with the Mayo Clinic. She also cited steady performance trends from other operators including HM Hospitales, IMED, and ATOS.
In the U.S., Williams said Ernest Health delivered double-digit EBITDARM growth year-over-year and successfully refinanced its 2026 term loan and revolver in the fourth quarter, extending maturities to 2030 and reducing its rate. She said Lifepoint Behavioral’s new leadership is implementing program enhancements aimed at modernizing the segment, controlling labor costs, and supporting a stronger revenue mix in 2026.
Williams added that rent from recently transitioned tenants continues to ramp and that management expects those tenants to reach 100% contractual rent by the end of 2026.
Leasing, acquisitions, and property sales
Aldag said the company entered into a new 20-year master lease with Vibra following strong post-acute performance. During the quarter, the REIT acquired a high-performing post-acute facility in California for approximately $32 million and later acquired a post-acute facility in Europe for EUR 23 million. The company also sold six smaller properties during the quarter.
In the Q&A, management described the sold properties as smaller and underperforming relative to the rest of the portfolio, and said it would continue to evaluate similar opportunities. Aldag said the company is now “more likely to be in an acquisition mode than a disposition mode,” while still pursuing dispositions where appropriate.
Asked about the two acquisitions, management did not provide individual cap rates or property-level details, citing policy, but said coverage and cap rates were “very strong” and “very attractive.” CFO Steven Hamner said the quarter’s acquisition activity totaled about $60 million across two transactions and emphasized the company is being selective as it watches its cost of capital improve.
On deal sourcing, Aldag said the pipeline is driven roughly half by existing or former tenant relationships, with most of the remainder coming through marketed transactions.
Financial results, Prospect bankruptcy, and balance sheet items
Controller and Chief Accounting Officer Kevin Hanna reported normalized FFO of $0.18 per share for the fourth quarter and $0.58 per share for full-year 2025. He said normalized FFO benefited from cash receipts tied to Vibra and HSA, estimating the quarter’s normalized FFO was approximately $0.03 to $0.04 higher than it otherwise would have been due to those receipts.
- Hanna said a restructuring transaction with Vibra resulted in a new master lease agreement and the collection of approximately $18 million as a one-time rent payment for past obligations.
- He also noted the company received a $4 million payment in October for September rent from HSA.
Hanna said the company entered into a new 15-year lease with Noor Health Systems for six California properties previously leased to Prospect. Noor is scheduled to begin paying partial rent in June 2026 and ramp to 100% contractual rent in December 2026. The company plans to account for Noor’s revenue on a cash basis.
Hanna reported approximately $34 million of impairment charges in the quarter, “the majority of which related to Prospect.” He also said the company received approximately $70 million of net proceeds from the Prospect bankruptcy during the quarter, with a remaining investment of $60 million expected to be collected in 2026 as the process nears completion.
In Q&A, management said the remaining Prospect-related transaction pending is the bonding contract to acquire the Waterbury facility in Connecticut, which it expects to close in the current quarter. Management said proceeds from that sale, along with collections of receivables expected over the next 60 to 90 days, should fully pay the company’s DIP financing. The team also reiterated confidence that “super secured” DIP financing would be repaid from proceeds of litigation pursued by the litigation trust, on which the company said it has first claim.
Hamner reviewed upcoming maturities, including a EUR 500 million unsecured notes issue due in October 2026 bearing a 0.99% rate, and said the company intends to maximize the benefit of that low rate. He also cited a bank revolver and $200 million term loan expected to mature in June 2027 (after a presumed extension), and $1.4 billion of unsecured notes maturing in October 2027. He said the company has multiple options to address maturities, including secured debt refinancing, asset sales, and other transactions, and pointed to prior secured issuances and financing activity as evidence of flexibility and covenant headroom.
Hamner also noted that the company’s $150 million share repurchase plan announced the prior quarter resulted in repurchases of “a little less than 1%” of market capitalization through year-end, and said the company will continue evaluating buybacks alongside balance sheet needs.
Tenant-specific items: Vibra and transitioned properties
Management provided additional context on the Vibra restructuring in response to analyst questions, while declining to provide a breakdown of prior versus new cash rent. Executives said Vibra had been discussed as the “1% tenant” undergoing restructuring and noted that Vibra had been on a cash basis, meaning prior rental revenue was not being recognized on an accrual basis. Management clarified that Vibra was paying rent during the quarter and that the $18 million represented additional rent owed for past obligations.
Management also said the $32 million California acquisition was purchased from Vibra and that Vibra used proceeds to pay off debt. Aldag added that Vibra refinanced its debt and is in a stronger position, and management noted that a couple of properties are now leased to Select Medical rather than Vibra.
Regarding HSA, executives said collections are still below desired levels but described progress versus the starting point when HSA took over former Steward properties. Management said it expects the implementation of the MEDITECH EMR system in the second quarter to support revenue cycle management and cost savings, and reiterated that HSA is currently at about 1x coverage on full rent. Management said it has not provided additional working capital loans to HSA or Noor, though it did provide HSA funding to help acquire the MEDITECH license and said Noor-related funding was tied to remaining Prospect bills.
About Medical Properties Trust (NYSE:MPW)
Medical Properties Trust, Inc is a real estate investment trust (REIT) focused on acquiring, financing, and owning net-leased hospital facilities. Through sale-leaseback transactions, direct acquisitions and recapitalizations, the company provides capital to healthcare operators while maintaining long-term, triple-net lease agreements. Its portfolio encompasses general acute care hospitals, rehabilitation facilities and other healthcare-related real estate assets and is structured to deliver stable, long-duration rental income streams.
Founded in 2003 and based in Birmingham, Alabama, Medical Properties Trust completed its initial public offering in 2004.