Q2 2020 New Senior Investment Group Inc Earnings Call
Thursday
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Thursday
Good day and welcome to the new senior second quarter 2020 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please press conference specialist by pressing the star key followed by zero.
After today's presentation, there will be an opportunity to ask questions.
To ask a question. You may press star and then one on your touchtone phone to withdraw your question, please press * then two.
Please note this event is being recorded.
At this time, I'd like to turn the conference over to Jane Roe, please. Go ahead.
Good morning.
Okay, and welcome to New senior returning a call for the second quarter of 2020 with me today are squeezing Gibbons our CEO brought the Kel-Tec a Finance and Accounting and whatnot that all counsel before I have to call over to season. I'd like to highlight that this morning stress relief company update the application or quarterly supplement and the reconciliations the Gap non-gaap Financial measures can be found on our website at new seeing here is what we begin, please note that our discussion will exclusively focus on non-gaap measures unless otherwise indicated.
During this call will make forward-looking statements as defined in the private Securities litigation Reform Act of 1995. No, forward-looking statements can be guaranteed an actual results May differ materially from those projected. What we're looking statements made on. This call should be evaluated together with a risk and uncertainty that affect our business particularly those disclose the risk factors and other officers and our most recent annual and quarterly reports filed with the SEC including the form 10-q that we will be filing later today. We undertake no obligation to publicly update any forward-looking statements whether whether as a result of new information future events, or otherwise now, I'd like to turn the call over to our CEO Susan Givens great. Thanks Jane. Good morning, and thank you for joining new sr's earnings call for the second quarter of 2020.
Is our last earnings Calling May our Focus has been on the covid-19 pandemic and its impact on our hundred and three communities. I want to start by saying that we are deeply appreciative or all of our operators who have worked tirelessly to ensure the health safety and well-being of our residents and Associates throughout the past few months our operators and our team have shown their resiliency and their flexibility and they have continuously adapted to the changing circumstances in an effort to minimize as best as possible the impact to our communities operations into our overall Financial results.
Our Focus throughout all of this has been to control the things that we can control and be as transparent as we possibly can possibly be recognizing that the situation Still Remains very fluid is the onset of the pandemic. We have shared periodic updates with our stakeholders in order to provide as much information as we can on our earn our last earnings calling may only had the benefit of one full month of results since the start of the pandemic today here nearly five months in and we now have four full months of results that has given us better perspective and we have gained significant insights from the trends that we have observed, which I'd like to share with you today.
Well, the pandemic has clearly had a significant impact on our business. We are encouraged that we continue to see features specific to our independent living properties, which have resulted in lower. You can see Decline and have a louder operators to tightly control expenses as a result. Our financial performance has been much better than we had originally anticipated at the start of the pandemic up in Hawaii for the second quarter was down 3.1% year-over-year a significant Improvement relative to what we thought a quarter would look like just three months ago.
at the same time
Interest rates have declined substantially and have resulted in much lower interest expense. The interest expense savings combined with lower G&A from various cost-cutting initiatives have enabled us to offset the decline from covid-19 and Report strong a f f o results for the quarter.
And he looked at a second half of the year it remains difficult to predict how the pandemic will continue to evolve and how long it will impact our communities however with visibility into nearly seven months of a year we feel it is appropriate to provide our current expectations for the full year of 2020, which I'll discuss in a minute.
This morning. We posted a presentation on our website the presentation covers three areas, which all referenced throughout my, first it provides an update on the status of covid-19 with our community including some color on our properties have begun to list and a phased approach some of the restrictions that we've had in place at the properties since the start of the pandemic.
Second the presentation provides some observations on the trend that we've seen over the last several months and includes details on our financial results and third it provides. Our current expectations are full year twenty-twenty and o n a f f o
Let me begin with an update on the status of covid-19 within our communities in early March as it became clear that covid-19 was quickly spreading throughout the US are authors took steps to modify and enhance their existing infectious disease protocols things evolve rapidly and by mid-march, all of our operators had implemented significant measures Thursday. Now, please across the industry including restricting access to non-essential visitors securing additional PPE and supplies closing all communal Dining Services can be all group activities implementing quarantine for residents and Performing regular temperature checks for all residents and staff.
You getting an ID Nei our operators at certain of our properties and lifting some of the restrictions in a phased approach currently 78% of our communities are in some form of a recovery Faith. The recovery fees is allow for increased participation and group dining activities group dining in activities, non-essential Visitors by appointment and internal sales tours all in EM to start to bring communities out of the restrictions in a safe and measured way. However, you should know that while some of the restrictions have been lifted the communities are not fat to their pre covid-19 operation.
Our offer you have taken difficult, but we believe necessary steps to protect the residents and staff in our communities and we believe that these early and aggressive measures that were taken. Did I limit the introduction of the virus in many of our communities and it spread of the virus when it did appear in our communities as of yesterday. Our hours reported a total of 19 currently Active cases across ten properties, including thirteen residents and 6 Associates. The active resident cases represent only 0.1% of our total resident population.
additionally
56% of our properties have not reported any positive resident or associate cases and 72% of our properties have not reported a single resident case.
Of the 44% or 45 properties that have reported positive cases only twenty-nine had a positive resident case. So just 28% of our portfolio took over of the 45 properties that had a positive resident or associate case nearly seventy percent have had three positive cases or less.
It's a sort of a pandemic the weekly number of new cases within our community is has remained relatively low averaging about six new cases per week across our hundred and three communities.
Create a new case is slowed significantly in May and June. However over the past month as the rate of new cases across the country has gone up the rate of new cases in our portfolio has also increased thoughtfully. We believe that this is likely the result of restrictions being listed in local markets and within our properties as well as increased testing.
Importantly, we are seeing that effective operator Protocols are continuing to ensure that the virus does not spread within the properties. We do believe that there are components specific to the independent model which have helped to limit the spread of the virus particularly when combined with good protocols because our operators do not provide Health Care Services in our communities. There are fewer interaction between residents and Associates. So if you were touch points and therefore fewer opportunities for the virus to spread this will be something that needs to be carefully monitored as our communities continue to live life in and there are more interaction amongst residents and Associates.
I think it's important to note that due to the at-risk nature of the residents our community service. We expect that many of the protocols in place will continue for some time even as federal state and local or relaxed the services offered in our communities including communal dining group activities outside trips and visits are an essential part of the physical and mental well-being of residents in our communities and our operators faced a host of challenges including the wishes of the very seniors that they serve as they continue to balance the competing needs of health and safety and social organization.
Striking this balance is critically important as we work to bring new residents into our community and ensure residents satisfaction among our existing residents days.
Now let me turn to how cold it is a covid-19 has impacted our financial results.
With four months of financial results. We have observed a few key trends first while occupancy has declined declined have not been as severe as we had originally expected.
Second as an owner of independent living communities. We have benefited from a flexible expense structure that has enabled our operators to effectively manage expenses in light of lower occupancy came in third with 48% of our debt subject of loading rates. We have significantly benefitted from a sharp decline in interest rate.
as a result of
Those Trends and as I mentioned earlier are analyzed for the quarter was down 3.1% year-over-year a significant improvement over what we had originally expected at the onset of the pandemic and while I was down decline in interest costs combined with GNA reduction result in a ffo per share of $0.19 up from $0.17 in the first quarter.
Let me go through occupancy expenses and interest expense in a little more detail.
On the occupancy side while restrictions began to be lifted across our portfolio during the second quarter move-out activity continue to outpace move-in resulting in total portfolio took these a climbing two hundred and fifty basis points from 87.4% on March 31st to 84.9% on June 30th in total occupancy is down 630 basis points from February 29th, roughly the start of the pandemic through July 31st. The occupancy declines in March and April were the most severe an average one hundred twenty five basis points a month since May we have seen the trend steadily improved with lower rates of occupancy declined each month in July being the strongest was only fifty basis off the climb.
Monthly lease and monthly move-in remain below their historical averages, but they have continued to Trend positively since they're low points in April just to give you some context of how much of a rebound needs monthly leads 62% in July from a low point in April and monthly move-in threw up 119% in July also from the low Point April importance. July move-ins were almost to the level of pre covid-19 movement in January of this year.
While we are encouraged by these recent data points and the sequential Improvement in lead and move in the past with sustainable recovery remains uncertain and we have observed that each month is a little different than the trend vary by geography and community.
On the Move outside total move out volume remains below historical levels throughout the second quarter as we saw a voluntary move-outs come down that said move outside steadily increasing since April and we're up 28% in July 4th of April.
Moving to expenses. This is where we saw a significant change relative to what we had originally expected operating expenses were down four and half percent in the second quarter versus the first quarter down. There are really two things happening and it's worth breaking them into separate buckets first variable operating expenses and second covid-19 expenses.
On the variable expense side. We have benefited from a flexible cost structure as occupancy has gone down. Our operators have been able to successfully reduce expenses by flexing Staffing schedule and Supply costs something that is much harder to do in a setting with Healthcare. We believe that this is unique attribute of independent living and so While others in senior housing have experienced lost bikes and healthcare-related labor costs, including Hazard pay and overtime. We have not incurred those expenses as a result. Our margins has held steady at roughly 40% off on covid-19 expenses at the beginning of the pandemic. We started to incur additional expenses as a result of covid-19 and the enhanced safety protocol including the cost for that position of PPE additional supplies enhanced cleaning and the need for additional labor.
Well, we continue to encourage.
It was expensive. They have been significantly less than we originally anticipated mainly driven by lower Supply costs and lower labor costs as we have seen less of a need for temporary labor.
As we move forward we expect certain covid-19 related expenses will remain in place. As our operators continue to implement protective measures within the communities importantly the expenses incurred by community and there could be new expenses as a pandemic continues to evolve.
Now Teresa interest expense since the start of the pandemic we have seen significant interest rate volatility with average 1-month Libor declining from 173 basis points at the beginning of the year. Fifty basis points is 15 basis points this week with 48% of our debt floating rates. We made the decision not to swap more of our debt. And as a result, we have benefited from the Steep decline in our interest expense was down 18% and the second quarter versus the first quarter a significant saving as we move forward, we expect to continue to benefit from that cost.
And that brings me to our current expectations for 2020 while it's still difficult to estimate the complete impact of the endemic on our results. We now have seven months of actual results and four months of results, including the impact of covid-19. And we believe that we have enough information to provide our current expectations for 2020 and why and if fo
despite the disruption caused by the pandemic the interest rate interest savings resulting from our floating reset and then the initiatives that we have in place to reduce G&A are expected to offset or Thursday to find which we expect will result in full-year a ffo per share a $0.67 to $0.71 which is the same as the 20 20 range. We provided public in February prior to the onset of covid-19.
Corey told me to let me conclude by saying but as we all know this crisis has severely impacted at-risk population including the seniors that are Community served being disproportionately impacted. Our operators had taken several critical steps to protect the health and safety of the residents and employees within our communities while necessary. We know that these important measures have had and will continue to have an impact on our financial results. It's difficult to predict how long the pandemics will impact our communities and when a full recovery will start in what form it will pay off the less. We continue to believe in the value that our communities provide to the Middle Market demographic as well as the powerful long-term fundamentals of the overall Senior Housing Industry.
And lastly prior to the onset of the covid-19 pandemic, we implemented several initiatives to significantly improve the quality of our portfolio and the financial profile of the company.
Those initiative combines the decisions that we have made since the start of the crisis have put us in a good position as we continue to move through this pandemic with that. Let me turn it over to discuss the financial details.
and thanks everyone for joining us on the call this morning our portfolio remained unchanged versus the prior quarter and was comprised of 103 private-pay senior housing properties across 36-month
Susan mentioned earlier we had just begun to feel the impact of code towards the end of the first quarter during the second quarter. We felt the full impact of covid-19 across her entire portfolio off while we expected the quarter to be challenging. We were encouraged by the fact that the impact on our portfolio was not as extensive as previously anticipated.
In-store cash and the line for a total portfolio of 103 access to the second quarter of 2020 was down 3.1% compared to the second quarter of 2019.
Our total cash and why for the quarter includes approximately 1.5 million of code related costs and adjust.
Students such a Justice our total cash in oil is up 2.9% year-over-year. It's very early expense savings more than offset the revenue reduction from the decline in average occupancy for our managed portfolio the average occupancy for a managed properties. What's 84.9% a 220 basis-point decrease versus the second quarter of 2019 and RAV4 grew by 5.2% We were earlier as lower moving fees were upset by February both
River highlighting the flexibility of our cost structure of sequential cash in line was up 0.4% despite a decline of 250 basis points in any hockey can be compared to the prior quarter quarter of code related costs.
Expenses elsewhere we're down across the board including but not limited to labor direct marketing utilities food and supplies.
As a result our operating margin increase of 40.9% increase of 120 basis points compared to that for the first quarter of 2020.
No, this is our financial results balance sheet and provide a quick update on how we see the rest of the 40-20 shaping up.
Is it for the second quarter was 16.1 million or $0.19 per diluted share compared to $0.17 per diluted share for the first Ford vehicle include approximately 1.5 million of additional expense is another adjustment specifically related to the impact of code.
The cash and I applaud as reporter reporter the increase in and flow is primarily driven by interesting. We had a lower average that balance during the second quarter of the result of the retaining of debt and conditions of the sale of the assisted-living portfolio in q1. And you paid average Libor of fifty basis points not going rate that during the second quarter as a result of cash interest expense during the second floor by 3.3 million sequentially that approximately 50% or 750 million of our total debt subject reliable fluctuation.
As of June 30th labor was below twenty basis points would be single weighted average interest rate on a code that of 1.6 billion to 3.4%
Even the refinancing to be completed during the first quarter in conjunction with the sale. We are well-positioned from the maturity standpoint for the weighted average maturity of 5.8 years and no significant maturities until 2nd, June 24th.
We ended the quarter with gross after it's a 3.3 billion in cash and cash equivalents of just over a hundred million. And do you remember we had drawn down a hundred million on our revolving credit facility at the onset of depend em to safeguard our liquidity position.
Like it affect the action to support the early functioning of the financial markets better than anticipated operating results improved cash flow profile and improve visibility over the near-term. We take down for Thursday the total amount during the second quarter.
Finally, I wanted to provide some color latest expectation for 4 year twenty-twenty with the pandemic still evolving there remains a wide range of potential outcomes for the second half of the Year month. However, the first have actual results in recent Trends we wanted to frame what we believe to be a potential range of us at this time. We expect our full-year total cash and line for a hundred and three properties down four and a half percent to seven and a half percent at the intro the second half of occupancy four hundred basis points below where we were at the same point last year. However, if interest rates remain in current levels life savings on interest along with reductions in G&A to offset the decline in a lot
Even these assumptions we expect for range between $67.71 per share which is consistent with the initial range. We provided the beginning of the year with that. I will turn it off the operator to open the line for questions.
Thank you, and we will now begin the question-and-answer session to ask a question. You may press star and then one on your touchtone phone. If you are using a speaker phone, please pick up your handset before pressing the keys to withdraw your question, please press star then to our first question today will come from Daniel Bernstein of Capital One bank, please go ahead hi. Good morning. I can say is wow to an expense decrease. I actually do want to go into that just came wandering if the high-occupancy that you started out within the portfolio aided that expense flexibility. I mean when you look at Piers starting off at Aqueduct an 80 or the low-80s, are they going to like we have a tougher time flexing expenses than your portfolio that was in the high eighties?
That's what you think about it. I can't comment on exactly how others are.
Expensive but I can say is what we have always believed in known to be true is that there? There's more flexibility with independent living given the fact that we don't have health care. And so I think when you start off with, you know, a a a model that has Healthcare that always has some limitations around in a sense, you know, tightening and then when you layer on top of that a pandemic that is, you know, really, you know, a health-care, um, focus pandemic then then it means there's even, you know, more stress in terms of how to manage your health care expenses. So we've seen that. Um, we've been able to very quickly adjust adapt as occupancy has come down and I think that, you know, give a lot of credit to our operators for being very focused on you trying to be as Nimble as possible. Um, and
And that's what that's what that's what happened.
So how that you know where there's higher occupancy starting point or just really a function of our kind of model. I do probably a bit of both. Um, but I I think I probably, you know pleased with our ability to to manage the expense side of the equation. Were there any one-time expense games in the corridor such as like religious management fees or something that would come back. I mean obviously from your guidance. It sounds like first half first half results are going to flow into the second half, but I just wanted to make sure that it was anything one time like a reduced management fee. That might come back a little bit. Yeah. That's a great question know there were no one time fees like reduced management fees. I think the only thing to note is that obviously I'm in the kind of height of you know, the early days our operators did pull back on things like marketing and so that's that's part of what we factored into the second half of the year that has the birth
Start to push, you know, move-ins and really kind of, you know, try to get the restrictions lifted at the properties things like marketing are going to pick up a little bit. So no swings that were one time but there was a full back on some of the expenses, um that we expect will you know, kind of you know will go up as soon as we move forward, but we factor that into the numbers that we provided to the the full year twenty-twenty month-and-a-half ago. Okay, one more before I go back in the queue. Obviously, the the reduced interest expense on Libor has been a huge benefit to you walk in your earnings, you know at this point. Have you thought about maybe heading some more of that floating right that yeah, and that's a great question. So, you know, if if something we as a as a management team talk about a lot, you know daily and weekly and um, you know, we don't think we have a crystal ball as it relates to to kind of interest rate, but we did yep.
Make a very conscious choice not to swap additional debt when at the outside of the pandemic and I think that's helped us but I do think that as we sit here today with live or you know, fifteen basis points, that's something we're continuing to evaluate and you know, it's kind of an ongoing conversation. So to answer your question yes or considering it and thinking about it off unless you think it's going to go negative. I mean that's possibility, you know, I'll hop back up in the Outback in the queue. And if I have any more questions, I'll just come back on wage then.
Our next question today will come from VK Malhotra of Morgan Stanley, please go ahead.
Hi, this is Alina on for Vikram. Thanks for taking the question. Hi. Hi. I just wanted to go back to your comments on moving the levels Club near that sounds pretty positive. Just wanted to see if your operators were providing any rent concessions to get those move into those levels or how or has pricing held up. Well.
Yeah.
So obviously we're encouraged by the transmission on the Move inside. So as I said, you know starting from kind of a low point in April, we have seen a steady increase July is one month. So, um, I don't think we want to claim that, you know, we're kind of out of the woods. Um, but July was a very very strong month from a move in fact, and we just thought the context of kind of looking at it and comparing it to January of moving um was important and relevant. So, um, so again, I don't want to you know, necessarily say Thursday, we're back to kind of pre covid-19 in as as we move forward, but we do things, you know, July provide some interesting kind of data points. There were some discounts that our operators started to roll out just in July towards the end of the month. So it's hard to say whether those discounts actually, you know had a huge impact on July or if they'll start to have more of an impact as we move into kind of August. Yep.
On but it's something that you know, we talked to our operators about frequently and it's always a balance in terms of you know, kind of driving occupancy and discounting our operators wage or not, you know providing a huge number of concessions and they're managing that very effectively but there were some discounts that they started rolling at the end of July.
Great that's helpful. And then just from your your experience or talking to operator. What what are they saying about from wide band vs. So why bands just after their experience with the new I guess Research In some cases.
Sure, so it's it's kind of an ongoing conversation balancing, you know, the need is the desire to keep the residents in the associate same but also recognizing that you know, keeping residents in isolation for a prolonged period of time is not good. So it's not just physical or mental well-being of the month. And so there's a balance and you were working through that with them. I think what we've seen is that the protocols that they have in place or really, you know, effectively managing the spread of the virus. So, um, you know, we have had you know cases pop up in communities, but we haven't had widespread, you know positive case. This is in any, you know one community. So they've been able to manage, you know, kind of a safety of the residents in the associates while also use trying to live some of the Restrepo
And they haven't had to you know, really have widespread, you know lockdowns again with kind of the the surgeons that we seen around the country.
Okay, great. That's all my questions. Thank you.
Our next question today is from Michael Gorman of btig, please go ahead.
Thanks. Good morning. I was wondering Susan if you could just talk about I know it's still a relatively small sample set. But as we look over the past two months say June and July ninth performance of those properties where you were able to start lifting restrictions kind of phase one then into phase two and maybe when we talked about moving Trends and and life and things like that, maybe how that differs from the properties that are still under enhanced protocols.
Yeah, sure, you know so now for us we have you know, roughly 80% of our portfolio has moved into accountable. We we characterize as a recovery fee is dead. And I think it it, you know safe to say that across the board where the restrictions have been lifted. We're seeing more leads and higher move ends and it's obviously varies, um, by you know by community and by geography so there are some parts of the country where um, you know, people feel relatively comfortable and so we've seen you know higher moved in coming from those areas, but I think the the overarching you know, kind of comment is that yes where the restrictions have been lifted. We have seen more of a, you know, a return package to you know, hire Leeds and and move in. Um, and so that's you know, that's a big part of lifting the restrictions also part of the what goes along with lifting the restrictions and the ability to wage.
To allow, you know kind of physical tours inside of the the building. So yes, everyone's you know, looked to virtual tours and that has grown in usage and acceptance. But at the end of the day people want to know where they're living they want to see where they're living. And so what we have seen is getting people kind of back into the communities where they can lay their eyes on off their apartments and and the actual physical Community has been incredibly important.
Great, that's helpful. And then I'm sorry if I missed this but do you guys have the number what the year-over-year decline actual decline was in marketing expense and maybe how should we think about that expense line item not using as we get more properties kind of back into the normal swing of things.
Sure, you know our marketing was down on a year-over-year basis about 3% in the in the second quarter. So and that was you know done very intentionally. If you remember obviously, you know kind of going into April, um, you know there we didn't really know how this would kind of evolved and and all of our facilities at that point were in kind of locked down. We weren't allowing physical chores. So it didn't make a whole lot of sense to really be spending a lot of money on the marketing side as we moved, you know forward and has moved through the quarter. We have a restaurant as we moved through Q2. And then as we you know move into the second half of the year, we have increased that spend and so, um, you know, definitely factored into our our second half of the years. I don't think we're expecting that we get back to kind of the um, the completely kind of normal marketing spend, um anytime soon, but we're we're definitely not expecting marketing to be down three years.
the move forward
Great, and then maybe last one for me. I understand. There's still a lot of variability about what's going on and the the path of the virus. I appreciate the the reinstated guidance range as we think about it directionally. Should we think about third-quarter potentially being sort of the floor even if fourth quarter isn't a huge bounce back or is there a possibility that as we go into the fourth quarter, it'll still be kind of towards the midpoint or maybe even on the lower end.
Yeah, I mean, I think that we the second half of the Year what's important to note is that obviously the starting point from an occupancy standpoint is lower. So, while we seen some, you know kind of positive trend we're still looking at occupancy starting off in the third quarter roughly four hundred basis points lower than what it was last year starting in the third quarter. So, um, you know, I think that as we move through, you know, the third quarter in the fourth quarter, we had originally thought like most people that there might, you know be kind of a quiet place in the in the summer months and we wouldn't see it a surges and then we thought that you know, maybe in the fourth quarter as we moved into the fall, um, you know, we might see a spike. I think what we're we're now looking at is a little bit more kind of life study, you know, setting State and study sort of position on the occupancy side. So we don't have you know, kind of a significant variance between the third quarter in the fourth quarter dead.
You know, I think that that is something we're adjusting, you know kind of daily, but I think that you know, what's important is that while the first half of the year was, you know better off we had thought it also benefited from you know, the first quarter where we really, you know, only thought covid-19 come in and the second half of March and so, um, you know, as we move into the third and fourth grade, I expect him to be sort of um, you know sort of the same but I think that obviously is hard to predict right now. What we do feel comfortable with is kind of where we think we'll land suck a whole as it relates to kind of analyze and if fo
Great. Thanks to.
Thanks, Michael.
Our next question is a follow-up from Daniel Bernstein of Capital One, please go ahead. I actually got two on the move out. You know that I'm like maybe guess or some pent-up move out people needing higher levels of care or maybe people just wanted to move out of Il just I don't know. If you have any information to kind of drill down on Monday. What does move out involved, you know, where do people go to they move to higher levels of care or with something else that yeah. Sure. So I think you're exactly right. I mean as expected back in April and May and even June move out through or lower than historical levels. And so I think everyone had expected that that there was a less kind of movement when people were really kind of in lockdown and so we had anticipated that as people started to feel a little bit more comfortable we would see, you know a pickup and move out and by the way in our business, it's a natural part of our busy.
To have move-outs we're independent living and so we do have individuals that have to go to higher levels of care.
That's important that's necessary. And so we saw that in July our move out, you know picked up a bit. Um, but we've already seen is that in Lagos to move out numbers are coming down from the July levels. And so, um, you know, we can't completely, you know, determine what that's what that's going to look like going forward, but it tells us that um, but people felt a little bit more comfortable and as the needs of some residents increased they did move out in July, but we've seen that, you know, kind of pace down a little bit in August month overall to your question of where people are going higher levels of care. Like I said is always a big source of move out for us and that's just going to happen in our business and it's important that when they have higher needs we're not the right setting for those individuals and so they do need to pick a um, and we've seen that there have been some people that have moved back home. I say back home. Yep.
And with their adult children or it is to you know their own home. So that has um, you know that has increased a tiny bit in the last couple of months. Nothing that we think life is, you know to an alarming level, but I think it's understandable. There are people out there. Um, as we all know and expect that um, if they have the option to bring their parents home right now, they might want to do that. That's not a cross the board but we've seen that I think it is important to note though that we haven't had a spike in move out and it's been pretty consistent with what our historical move out levels of birth. We're pretty focused on it. And I think this is something you know, our operators in the whole industry has to be really focused on as we move forward. Um, it needs to be enjoyable Within These communities for the visual a live. It needs to be an active environment. It needs to, you know, provide some engagement for the residence and I think our operators have done a terrific job being creative and rebirth
You know providing that um resident experience, um, because we know that's critical and if we can't achieve that then you know, we could see hi remove ads.
Okay, and then the other question I know this is probably a little early but are you have you seen or are you looking at any investment opportunities? I know there's a lot of distress out there again. Obviously your portfolio did well but there's probably a lot of stress out there right now and seeing your house and going to be are you looking at or seeing any opportunities to to maybe invest money always paying attention if you know for no other reason then also just being informed about how are assets or you know kind of looking and feeling relative to others out there. So, um, you know, there's there's some thought I'd say that you know by and large. Um, there's been much less activity which is understandable. Of course, it's hard for people to get out and visit properties. It's hard for people to due diligence. Um, and so, you know, we're looking but I think that if also pretty early and I don't think I think people are talking a lot about you know distress, but I don't think there have been a lot of um, you know, yep.
For that feel distressed. And so, um, you know, I think that will continue to play out as we move forward.
Okay. All right. That's all I have. Thank you very much. Great. Thanks again.
Ladies and gentlemen, this will conclude our question-and-answer session at this time. I'd like to turn the conference back over to Susan Givens for any closing remarks.
Great. Thank you everyone for joining us. We look forward to keeping you updated as we move forward they say, thank you.
The conference is now concluded. We thank you for attending today's presentation. You may now disconnect your lines.