REGIONAL HEALTH PROPERTIES, INC
For the period ended Mar 31, 2026. Filed May 15, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 15, 2026
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What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-14.
0001193125-25-283236
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-15.
0001193125-26-226575
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 94 previous paragraphs and 99 current paragraphs.
30 unchanged; 20 reworded; 47 added; 44 removed; 0 previous and 2 current paragraphs rearranged.
Tables are not compared: 9 previous and 8 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (47)
Current report
Regional Health Properties, Inc. is a healthcare company that owns, operates and invests in healthcare real estate and operating businesses focused on long-term care, senior housing and pharmacy services. Historically, the Company operated primarily as a healthcare real estate platform that leased skilled nursing and senior housing facilities to third-party operators under long-term triple-net lease arrangements. Over time, and particularly following recent strategic initiatives and acquisitions, the Company has evolved toward a more integrated owner-operator model that combines healthcare real estate ownership with the direct operation of healthcare facilities and related healthcare services.
Current report
As of March 31, 2026 the Company had investments of approximately $60.0 million in healthcare real estate, operated or leased a portfolio consisting primarily of skilled nursing facilities and senior housing communities located in five states, and operates a pharmacy business located in Louisiana, which was acquired following the SunLink merger completed on August 14, 2025.
Current report
The Company operates through three reportable segments: Healthcare Services, Pharmacy Services and Real Estate. The Healthcare Services segment includes the direct operation of skilled nursing and senior housing communities that provide a range of healthcare and residential services, including sub-acute and post-acute skilled nursing care, intermediate nursing care, rehabilitative therapy, memory care, Alzheimer’s and dementia care, and senior living services. The Pharmacy Services segment includes retail pharmacy products and services, institutional pharmacy services and durable medical equipment. The Real Estate segment consists of investments in skilled nursing and senior housing properties that are leased or subleased to third-party operators under triple-net lease arrangements. These segments reflect the Company’s evolution from a healthcare landlord into a more diversified healthcare company with both real estate and operating capabilities.
Current report
The comparability of the Company’s results for the three months ended March 31, 2026 and 2025 is affected by the SunLink merger, which added the Pharmacy Services segment beginning on August 14, 2025. In addition, one facility that was included in the Real Estate segment in 2025 transitioned to the Healthcare Services segment on February 1, 2026. As a result, year-over-year comparisons reflect not only changes in operating performance, but also a meaningful change in segment composition. These changes resulted in increased patient care revenues and patient care expenses in Healthcare Services, the addition of pharmacy revenues and related cost of goods sold in Pharmacy Services, and lower rental revenues in Real Estate because one property is no longer operated under a lease structure. Accordingly, the Company’s consolidated and segment results for the three months ended March 31, 2026 are not directly comparable to the prior-year period.
Current report
The Company funds its business and its three reportable segments primarily through operating cash flow, collections of patient, pharmacy and rent receivables, mortgage and other debt financing, asset sales and, when available, proceeds from the sale of securities.
Current report
Key Segment Operating Metrics
Current report
Management evaluates the performance of the Company’s business using selected operating and financial metrics that management believes are most relevant to each of the Company's three reportable segments.
Current report
Healthcare Services
Current report
The most important operating metrics for the Healthcare Services segment are occupancy/census, payor mix, labor costs, and accounts receivable collections. Management believes these measures are the primary drivers of patient care revenue, operating margins and cash flow for the facilities the Company operates directly.
Current report
Occupancy and census are key indicators of demand and facility utilization. Management also monitors payor mix, including the relative percentage of Medicare, Medicaid, managed care and private-pay residents, because reimbursement rates and margins vary significantly by payor source. In addition, labor costs, including wage rates, agency staffing usage and employee benefit costs, are critical measures of operating performance given the labor-intensive nature of skilled nursing and senior housing operations. Management also closely monitors patient accounts receivable and collection trends, as increases in patient receivables can materially affect the segment’s working capital and liquidity.
Current report
The most important operating metrics for the Pharmacy Services segment are script count, reimbursement collections, gross margin, and customer retention. Management believes these measures are the best indicators of the scale, profitability and cash-generation profile of the pharmacy business.
Current report
Script count is a key measure of pharmacy volume and operating activity. Management also monitors reimbursement collections and the timing of payment from government and commercial payors, because reimbursement levels and collection timing directly affect revenue realization and working capital. Gross margin is an important measure of the relationship between pharmacy revenues and the cost of pharmaceutical products sold or medical equipment rented. Customer retention is also a significant operating measure because the stability of institutional and retail customer relationships affects recurring revenue and the long-term growth of the segment.
Current report
Real Estate
Current report
The most important operating metrics for the Real Estate segment are rent collections, tenant credit quality, lease performance, and portfolio optimization opportunities. Management believes these measures are the most relevant indicators of the segment’s recurring cash flow and asset value. Rent collections are a primary measure of current segment performance because rental income remains the principal source of revenue within the Real Estate segment. Management also monitors tenant credit quality and the financial performance of operators, as tenant distress or weak facility performance can affect rent collections, lease renewals and the recoverability of receivables. In addition, management evaluates lease restructurings, lease terminations and transition opportunities to determine whether a property is best held as a leased asset, transferred to another operator, or operated directly within the Healthcare Services segment. These evaluations are an important part of the Company’s broader portfolio optimization and owner-operator strategy.
Current report
Recent Activities
Current report
On February 27, 2026, the Company and Erin Property Holdings, LLC (the “Borrower”) entered into two Forbearance Agreements with effective dates of February 1, 2026 (the “Forbearance Agreements”) with Cadence Bank, N.A. (the “Lender”) relating to certain defaults by the Company and the Borrower under the loan agreements in the principal amount of $5,000,000 due on July 27, 2036 (the “USDA Note”) and the principal amount of $800,000 due on July 27, 2036 (the “SBA Note” and, together with the USDA Note, the “Notes”) that were issued by the Borrower to the Company to reflect payment obligations pursuant to the Security Agreement, dated as of July 27, 2011 (the “Security Agreement”), between the Borrower and the Lender.
Current report
Pursuant to the Forbearance Agreements, (a) the Borrower agreed to make payments of $21,047.76 as a one-time forbearance payment and $6,764.21 for the 2026 USDA annual renewal fee toward the SBA Note no later than February 27, 2026, and (b) the Company and the Lender agreed, subject to the terms and conditions set forth in the Forbearance Agreements, to forbear from exercising its rights and remedies on account of the failure by the Company and the Borrower to pay the amounts due under the USDA Note and SBA Note by the expiration of the period (“Forbearance Period”) of February 1, 2027.
Current report
During the Forbearance Period, the Company and the Borrower shall make monthly payments of principal and interest in accordance with the terms of the USDA Note and the SBA Note with interest continuing to accrue in accordance with the terms of the Notes which amounts shall remain the obligation of the Company and the Borrower.
Current report
Segment Reporting
Current report
Management believes the most meaningful way to understand 2026 results is by reference to the Company’s three reportable segments together with the consolidated statement of operations and comprehensive earnings. Healthcare Services results reflect the direct operation of facilities, including the impact of taking back operations at certain properties during 2025. Pharmacy Services results reflect the partial-year contribution from the pharmacy business acquired in the SunLink merger. Real Estate results reflect rental income, credit loss expense and lease-related activity associated with facilities that remained leased or subleased to third-party operators.
Current report
At the consolidated level, patient care revenues, pharmacy revenues and patient care expense increased significantly in 2026 due primarily to the expanded Healthcare Services segment and the addition of Pharmacy Services, while rental revenues declined as certain facilities were transitioned out of the Real Estate segment and into operated status. Accordingly, line-item changes in the consolidated statement of operations and comprehensive earnings should be evaluated in light of these changes in segment composition.
Current report
As of March 31, 2026, we had investments of approximately $60.0 million in a portfolio of twelve healthcare facilities, consisting of eleven owned properties and one leased facility. Our owned properties consisted of nine skilled nursing facilities and two senior housing communities. Of the twelve facilities, five were leased or subleased to third-party operators under triple-net lease arrangements, and seven were managed on the Company’s behalf by two external managers. The Company’s leased facility is subleased to a third-party operator under a triple-net lease arrangement.
Current report
Independent Living Communities
Current report
Independent living communities are age-restricted residential communities designed for seniors who are able to live independently but prefer the security, convenience and social setting of community living. These communities typically offer lifestyle services and limited support services for residents who do not require a high level of daily care.
Current report
Assisted Living Facilities
Current report
Assisted living facilities provide assistance with activities of daily living while allowing residents to maintain a degree of independence. Services commonly include meals, housekeeping, medication reminders, personal care support and other services that help residents live in a supportive residential setting.
Current report
Memory Care Communities
Current report
Memory care communities provide specialized care for individuals suffering from Alzheimer’s disease and other forms of dementia. These communities typically operate in a more secure setting and offer staff, programming and care plans specifically designed to address cognitive impairment and memory loss.
Current report
For the three months ended March 31, 2026, total revenues increased to $21.2 million from $7.2 million for the prior-year period, primarily due to the addition of Pharmacy Services revenues following the SunLink merger and increased Healthcare Services revenues from facilities transitioned to operated status. Total expenses also increased as the Company incurred the related cost of goods sold, patient care expenses and general and administrative expenses associated with the expanded operating platform. Net loss was $1.2 million for both periods, as the increase in loss from operations was partially offset by lower interest expense and lower other expense.
Current report
Patient care revenues—Patient care revenues were $12.7 million for the three months ended March 31, 2026, compared to $5.6 million for the same period in 2025. The 125.4% increase is due to the transition of the Autumn Breeze, Georgetown, and Sumter facilities to the Healthcare Services segment and to a lesser extent an increase in census at our Glenvue facility.
Current report
Pharmacy revenue— Pharmacy revenues were $7.6 million for the three months ended March 31, 2026. These revenues reflect the Pharmacy Services segment added in connection with the SunLink merger. There was no comparable Pharmacy Services revenue for the three months ended March 31, 2025.
Current report
Cost of goods sold—Cost of goods sold was $4.5 million for the three months ended March 31, 2026 and relates to the cost of pharmacy products sold or rented by the Pharmacy Services segment. There was no comparable cost of goods sold for the three months ended March 31, 2025.
Current report
Patient care expense—Patient care expense was $9.7 million for the three months ended March 31, 2026 compared with $4.4 million for the same period in 2025. The current period expense increase of $5.3 million was primarily due to the transition of the Autumn Breeze, Georgetown, and Sumter facilities to the Healthcare Services segment and to a lesser extent an increase in census at our Glenvue facility.
Current report
General and administrative expenses—General and administrative expenses were $6.5 million for the three months ended March 31, 2026 compared with $2.2 million for the same period in 2025. The increase was primarily due to the transition of the Autumn Breeze, Georgetown, Southland and Sumter facilities to the Healthcare Services segment and addition of the Sunlink merger.
Current report
Loss on Lease Termination—There were no expenses related to lease terminations for the three months ended March 31, 2026. Expenses related to the termination of the two leases to Oak Hollow Healthcare Management were $0.3 million for the three months ended March 31, 2025. The losses consist of the write-offs of straight-line rent.
Current report
Gain on operations transfer—The gain on operations transfer was $0.1 million for the three months ended March 31, 2025 and there was no such gain or loss for the three months ended March 31, 2026. In March 2025, The Company took patient accounts receivable in lieu of the outstanding Rent Receivable owed by Oak Hollow Healthcare Management as part of the lease termination.
Current report
The Company’s liquidity profile is determined by the operating performance and working capital needs of the Healthcare Services and Pharmacy Services segments, as well as rent collections, tenant performance and refinancing activity within the Real Estate segment.
Current report
The Company’s primary sources of cash include revenues from its healthcare operations, pharmacy operations, rental income, collections of patient, pharmacy and rent receivables, refinancing transactions, debt borrowings and proceeds from asset sales. The Company’s primary uses of cash include salaries, wages and other operating costs of its Healthcare Services and Pharmacy Services segments, facility and rent expenses, debt service, capital expenditures and other working capital needs. Management monitors cash collections, facility-level operating performance, pharmacy reimbursement collections, tenant rent collections, refinancing activity, access to debt markets and access to equity capital as key liquidity drivers. Trading on the OTCQB may limit the Company’s ability to raise equity capital, which could affect future refinancing efforts, growth initiatives and overall financial flexibility.
Current report
Short-term Liquidity
Current report
Management expects the Company’s short-term liquidity requirements over the twelve months following the filing of this Quarterly Report to be funded primarily through collections of patient accounts receivable, rent receivable and other receivables, mortgage refinancing activity, including the potential refinancing of the Southland facility, additional debt borrowings and proceeds from the sale of assets classified as held for sale. The Company’s short-term liquidity continues to be affected by the transition of the Autumn Breeze facility from leased to operated status, which has increased working capital requirements, including payroll, supplies, patient care costs and patient accounts receivable.
Showing the first 40 of 47 passages. Open the source sections for the rest.
Removed paragraphs (44)
Previous report
Regional Health Properties, Inc., a Georgia corporation, operates businesses in Real Estate, Healthcare Services and Pharmacy Services. Our Real Estate segment consists of real estate investments in skilled nursing and senior housing facilities. We fund our real estate investments primarily through: (1) operational cash flow, (2) mortgages, and (3) sale of equity securities. Our Healthcare Services segment is comprised of entities set up to operate our facilities. Our Pharmacy Services segment consists of four operational areas, retail pharmacy products and services, institutional pharmacy services, which consists of specialty and non-specialty pharmaceutical and products to institutional clients or to patients in institutional settings, non-institutional pharmacy services consisting of the provision specialty and non-specialty pharmacy and biological products to clients or patients in non-institutional settings including private residential homes and durable medical equipment, consisting primarily of the sale and rental products for institutional clients or to patients and institutional settings and patient-administered home care. While the Company is a self-managed real estate investment company, the Company, when business conditions require, may undertake initiatives to take back facilities in order operate the facilities ourselves or using a third manager.
Previous report
As of September 30, 2025, we had investments of approximately $67.9 million in eleven health care real estate properties and one leased property. We currently own eleven properties, consisting of nine skilled nursing facilities and two multi-service facilities (of which one multi-service campus contains two co-located properties). Seven facilities are pursuant to triple-net leases and six facilities are managed by two external managers. The Company has one leased facility that is subleased pursuant to a triple-net lease.
Previous report
Multi-Service Campuses. Multi-service campuses generally include some combination of co-located skilled nursing, independent living, assisted living and/or memory care units all housed at a single location and operated as a continuum of care. We also refer to continuing care retirement communities as multi-service campuses. These facilities are often marketed as an
Previous report
opportunity for residents to “age in place,” and tend to attract couples where the individuals may require or benefit from differing levels of care.
Previous report
Meadowood's current and historical calculations have been changed from 161 licensed beds to 90 beds. This change reflects the actual total beds available by the business.
Previous report
See Note 6 -Leases to the consolidated financial statements included in Part I, Item 1 herein for a discussion of lease terminations.
Previous report
The pharmacy business is composed of four operational areas conducted in three locations in southwest Louisiana:
Previous report
Retail pharmacy products and services, consisting of retail pharmacy sales.
Previous report
Institutional pharmacy services consisting of the provision of specialty and non-specialty pharmaceutical and biological products to institutional clients or to patients in institutional settings, such as extended care and rehabilitation centers, nursing homes, assisted living facilities, behavioral and specialty hospitals, hospice, and correctional facilities.
Previous report
Non-institutional pharmacy services consisting of the provision of specialty and non-specialty pharmaceutical and biological products to clients or patients in non-institutional settings including private residential homes.
Previous report
Durable medical equipment products and services (“DME”), consisting primarily of the sale and rental of products for institutional clients or to patients in institutional settings and patient-administered home care.
Previous report
Patient care revenues—Patient care revenues for the Healthcare Services segment, as a result of the Company operating the Georgetown, Glenvue, Meadowood, Mountain Trace, Southland, and Sumter facilities, were $9.8 million for the three months ended September 30, 2025, compared to $2.6 million for the same period in 2024. The 280.3% increase is primarily due to the Company taking over the operations of four previously leased facilities since October 1, 2024.
Previous report
Rental revenues—Rental revenue for our Real Estate Services segment decreased by approximately $0.3 million to $1.3 million for the three months ended September 30, 2025, compared with $1.6 million for the same period in 2024. The decrease in rental revenue this year results from the reduction of the four leased facilities that the Company now operates.
Previous report
Pharmacy revenues—Pharmacy revenues of $4.0 million for the three months ended September 30, 2025 is the revenue generated during the post SunLink merger period.
Previous report
Costs of goods sold— Costs of goods sold is the cost of Pharmacy products sold or rented during the post SunLink merger period.
Previous report
Patient care expense—Patient care expense increased to $8.6 million for the three months ended September 30, 2025 compared to $2.2 million for the three months ended September 30, 2024. The increase results from the increase in the number of facilities operated by the Company this year.
Previous report
Depreciation and amortization—Depreciation and amortization remained consistent totaling $0.5 million for the three months ended September 30, 2025 and 2024.
Previous report
General and administrative expenses—General and administrative expenses were $3.7 million for the three months ended September 30, 2025 compared with $1.2 million for the same period in 2024. The increased expense this year resulted from the increased cost of the four facilities being operated this year that were rented last year.
Previous report
Other expense—Other expense of $0.6 million for the three months ending September 30, 2025 was legal and other expenses incurred for the SunLink merger.
Previous report
Gain on bargain purchase -The gain on bargain purchase of $5.3 million for the three months ended September 30, 2025 resulted from the SunLink merger completed on August 14, 2025.
Previous report
Nine Months Ended September 30, 2025 and 2024
Previous report
Patient care revenues—Patient care revenues for the Healthcare Services segment, as a result of the Company operating the Georgetown, Glenvue, Meadowood, Mountain Trace, Southland, and Sumter facilities, totaled $24.2 million for the nine months ended September 30, 2025, compared to $7.4 million for the same period in 2024. The increase is due to the increased number of facilities operated in the current year nine months.
Previous report
Pharmacy revenues—Pharmacy revenues of $4.0 million for the nine months ended September 30, 2025 is the revenue generated during the post SunLink merger period.
Previous report
Costs of goods sold— Costs of goods sold is the cost of Pharmacy products sold or rented during the post SunLink merger period.
Previous report
Patient care expense—Patient care expense was $20.2 million for the nine months ended September 30, 2025 compared to $6.5 million for the nine months ended September 30. 2024. The increase this year resulted from the increased number of facilities operated this year
Previous report
Facility rent expense—Facility rent expense increased to $0.6 million for the nine months ended September 30, 2025 compared to $0.4 million for the nine months ended September 30, 2024.
Previous report
General and administrative expenses—General and administrative expenses were $8.4 million for the nine months ended September 30, 2025, compared with $4.1 million for the same period in 2024. The increased expense this year resulted from the increased cost of the four facilities being operated this year that were rented last year.
Previous report
Credit loss expense—Credit loss expense was $0.6 million for nine months ended September 30, 2025, compared to $0.6 million for the same period in 2024. Credit loss expense represents reserves taken against patient accounts receivable at the Glenvue facility, reserves taken against rental accounts receivable at the Southland facility and a write off of approximately $0.4 million of notes receivable at Lumber City.
Previous report
Other expense, net—Other expense, net was 1.2 million for nine months ended September 30, 2025, compared to $0.2 million for the same period in 2024. The expenses were predominantly legal and other expenses incurred for the SunLink merger.
Previous report
Gain on bargain purchase -The gain on bargain purchase of $5.3 million for the nine months ended September 30, 2025 resulted from the SunLink merger completed on August 14, 2025.
Previous report
The Company intends to pursue measures to grow its operations, streamline its cost infrastructure and otherwise increase liquidity, including: (i) refinancing or repaying debt to reduce interest costs and mandatory principal repayments, with such repayment to be funded through potentially expanding borrowing arrangements with certain lenders; (ii) increasing future lease revenue through acquisitions and investments in existing properties; (iii) modifying the terms of existing leases; (iv) replacing certain tenants who default on their lease payment terms;(v) reducing other and general and administrative expenses and (vi) integrating the SunLink businesses to reduce duplicative expenses.
Previous report
On July 30, 2025, the Company, Coosa, and the Purchaser entered into a binding asset purchase agreement, or APA, whereby Coosa would sell the Coosa Facility to the Purchaser, subject to a 45-day due diligence window in favor of the Purchaser. Under the terms contemplated by the APA, the Purchaser would acquire the Coosa Facility for a purchase price of $10.6 million. The sale of the Coosa Facility was completed on November 6, 2025.For further information see Note 6 -Assets Held for Saleand Note 15 -Subsequent Events to the consolidated financial statements included in Part I, Item 1 herein.
Previous report
Effective August 14, 2025, the Company closed on the merger with SunLink; whereas, SunLink merged with and into the Company, and the Company continuing as the surviving corporation. The Company issued 1,592,438 shares of the Company's common stock and 1,405,609 shares of the Company's Series D preferred stock as the purchase price consideration for the merger. Unrestricted cash acquired from SunLink was $6.0 million. For further information see Note 3 -Business Combination. to the consolidated financial statements included in Part I, Item 1 herein.
Previous report
Separately, the Company experienced changes in its listing status. Until February 5, 2025, Regional’s common stock and Series A Preferred Stock were listed on the NYSE American under the ticker symbols “RHE” and “RHE-PA,” respectively. Trading was suspended on that date due to noncompliance with listing standards. On June 11, 2025, the NYSE American formally delisted both securities. They now trade on the OTC Markets under the symbols “RHEP” (common stock) and “RHEPA”
Previous report
(Series A Preferred Stock).
Previous report
Trading on the OTC Markets presents challenges, including reduced liquidity, wider bid-ask spreads, and limited analyst coverage. In addition, broker-dealers face greater regulatory burdens, which may further discourage trading activity. These limitations could depress trading prices and negatively impact the Company’s ability to raise capital through equity or debt offerings. Such constraints may impair the Company’s ability to invest in future growth or refinance upcoming debt maturities.
Previous report
During the nine months ended September 30, 2025, the Company's net cash used by operating activities was $1.0 million primarily due to fluctuations in working capital. Management anticipates collecting a portion of the past due rent after the filing date and is currently negotiating various methods to collect the remaining unpaid rent.
Previous report
Management anticipates access to several sources of liquidity, including cash on hand, cash flows from operations, cash flows from investing and debt refinancing during the twelve months following the date of this filing.
Previous report
Nine Months Ended September 30, 2025
Previous report
Net cash provided by investing activities—was approximately $5.3 million. This includes $6.0 million of cash acquired in the SunLink merger.
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Reworded paragraphs (20)
Previous wording
This Quarterly Report and certain information incorporated herein by reference contain forward-looking statements and information within the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). This information includes assumptions made by, and information currently available to management, including statements regarding future economic performance and financial condition, liquidity and capital resources, and management's plans and objectives. In addition, certain statements included in this Quarterly Report, in the Company's future filings with the SEC, in press releases, and in oral and written statements made by us or with our approval, which are not statements of historical fact, are forward-looking statements. Words such as "may," "could," "should," "would," "believe," "expect," "anticipate," "estimate," "intend," "seek," "plan," "project," "continue," "predict," "will," and other words or expressions of similar meaning are intended by us to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Forward-looking statements are based on the Company's current expectations about future events or results and information that is currently available to us, involve assumptions, risks, and uncertainties, and speak only as of the date on which such statements are made.
Current wording
This Quarterly Report and certain information incorporated herein by reference contain forward-looking statements and information within the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). This information includes assumptions made by, and information currently available to management, including statements regarding future economic performance and financial condition, liquidity and capital resources, and management's plans and objectives. In addition, certain statements included in this Quarterly Report, in the Company's future filings with the SEC, in press releases, and in oral and written statements made by us or with our approval, which are not statements of historical fact, are forward-looking statements.
Previous wording
(1) Meadowood Retirement Village offers assisted living, memory care, and independent living and is therefore considered a multi-service campus.
Current wording
(a) Meadowood Retirement Village offers assisted living, memory care, and independent living.
Previous wording
(2) Eaglewood Village offers assisted living and Eaglewood Care Center offers skilled nursing. Both properties are co-located and are therefore considered a multi-service campus.
Current wording
(b) Eaglewood Village offers assisted living and Eaglewood Care Center offers skilled nursing.
Previous wording
The following table provides summary information regarding the number of facilities and related licensed beds/units by operator affiliation as of September 30, 2025:
Current wording
The following table provides summary information regarding the number of facilities and related licensed beds/units by operator/manager affiliation as of March 31, 2026:
Previous wording
Represents the number of facilities leased or subleased to separate tenants, of which each tenant is an affiliate of the entity named in the table above.
Current wording
Represents the number of owned facilities leased or subleased to separate tenants, of which each tenant is an affiliate of the entity named in the table above.
Previous wording
For a more detailed discussion of the above information, see Note 7 -Leasesto the consolidated financial statements included in Part I, Item 1 herein. Additionally, see "Portfolio of Healthcare Investments" included in Part I, Item 1 "Business" in the Annual Report.
Current wording
For a more discussion of the above information, see Note 7– Leasesto the consolidated financial statements included in Part I, Item 1 herein. Additionally, see "Portfolio of Healthcare Investments" included in Part I, Item 1 "Business" in the Annual Report.
Previous wording
The following table sets forth, for the periods indicated, an unaudited statement of operations items and the amounts and percentages of change of these items. The results of operations for any particular period are not necessarily indicative of results for any future period. The following data should be read in conjunction with our consolidated financial statements and the notes thereto, which are included herein.
Current wording
The following table sets forth, for the periods indicated, an unaudited statement of operations and comprehensive earnings items and the amounts and percentages of change of these items. The results of operations for any particular period are not necessarily indicative of results for any future period. The following data should be read in conjunction with our consolidated financial statements and the notes thereto, which are included herein.
Previous wording
Rental revenues—Rental revenue for our Real Estate Services segment decreased by approximately $1.2 million to $4.1 million for the nine months ended September 30, 2025, compared with $5.3 million for the same period in 2024. The (21.4)% decrease is primarily due to the reduction in rental facilities resulting from the transition to operating facilities this year.
Current wording
Rental revenues—Rental revenue decreased by approximately $0.6 million to $0.9 million for the three months ended March 31, 2026, compared with $1.5 million for the same period in 2025. The 44.4% decrease is primarily due to transition of the Autumn Breeze, Georgetown and Sumter facilities to our Healthcare Services segment.
Previous wording
Facility rent expense—Facility rent remained consisted totaling $0.2 million for the three months ended September 30, 2025 and 2024.
Current wording
Facility rent expense—Facility rent was $0.2 million for the three months ended March 31, 2026, which was generally consistent for the three months ended March 31, 2025.
Previous wording
Depreciation and amortization—Depreciation and amortization was $1.4 million for the nine months ended September 30, 2025, compared to $1.5 million for the same period in 2024.
Current wording
Depreciation and amortization—Depreciation and amortization was $0.7 million for the three months ended March 31, 2026, compared to $0.4 million for the same period in 2025. The increase was primarily was primarily due to depreciation on assets acquired in the SunLink acquisition.
Previous wording
Credit loss expense—Credit loss expense was $0.2 million for the three months ended September 30, 2025 compared to $0.5 million for the same period in 2024. Credit loss expense represents reserves taken against patient accounts receivable at the Glenvue facility, reserves taken against rental accounts receivable at the Southland facility and a write off of approximately $0.4 million of notes receivable at Lumber City.
Current wording
Credit loss expenses—Credit loss expense was $0.2 million for the three months ended March 31, 2026 and $0.1 million for the same period in 2025. The loss primarily represents reserves taken against patient accounts receivable in the period.
Previous wording
The following table summarizes the Company's non-GAAP financial measure of results based on EBITDA for the three and nine months ended September 30, 2025 and 2024. EBITDA attributable to the Company's financial measure represents net income (loss) before interest expense (including amortization of deferred financing costs), amortization of stock-based compensation, and depreciation and amortization. Adjusted EBITDA represents EBITDA further adjusted to eliminate the impact of certain items that the Company does not consider indicative of core operating performance, such as recovery of previously reversed rent, lease termination revenue, property operating expenses, gains or losses from dispositions of real estate, real estate impairment charges, provision for loan losses, non-routine transaction costs, loss on extinguishment of debt, unrealized loss on other real estate related investments and provision for credit losses and lease restructuring, as applicable.
Current wording
The following table summarizes the Company's non-GAAP financial measure of results based on EBITDA for the quarters ending March 31, 2026 and 2025. EBITDA attributable to the Company's financial measure represents net income (loss) before interest expense (including amortization of deferred financing costs), provision for income tax, and depreciation and amortization. Adjusted EBITDA represents EBITDA further adjusted to eliminate the impact of certain items that the Company does not consider indicative of core operating performance, such as recovery of previously reversed rent, amortization of stock-based compensation, lease termination revenue, gains or losses from dispositions of real estate, real estate impairment charges, provision for loan losses, non-routine transaction costs, loss on extinguishment of debt, unrealized loss on other real estate related investments and provision for credit losses and lease restructuring, as applicable.
Previous wording
As of September 30, 2025, the Company had $1.0 million in unrestricted cash and $7.7 million of net accounts receivable, mainly consisting of patient and rent receivables. Net accounts receivable consist of gross accounts receivable of $8.6 million offset by a recorded estimated allowance of $0.9 million
Current wording
At March 31, 2026, the Company had $1.1 million in unrestricted cash and 10.1 million of net accounts receivable, mainly consisting of patient accounts receivable and rent receivables.
Previous wording
As of September 30, 2025, the Company had $48.6 million in indebtedness, net of $0.9 million deferred financing costs and unamortized discounts. The Company anticipates net principal repayments of approximately $3.0 million during the next twelve-month period, approximately $2.2 million of routine debt service amortization, $0.6 million of insurance financing amortization, and $0.2 million payment of bond debt.
Current wording
As of March 31, 2026, the Company had $42.6 million in indebtedness, net of $0.8 million of deferred financing costs, and unamortized discounts. The Company anticipates net principal repayments of approximately $8.1 million during the next twelve-month period, consisting of approximately $4.1 million of routine debt service amortization, $0.2 million of bond debt payments, and $3.8 million of Southland's maturing debt.
Previous wording
As of September 30, 2025, the Company was in compliance with the various financial and administrative covenants under the Company's outstanding credit related instruments.
Current wording
As of March 31, 2026, the Company was in compliance with the various financial and administrative covenants under all the Company's outstanding credit related instruments, except with respect to the Southland-related USDA and SBA notes that are subject to the forbearance arrangements.
Previous wording
Net cash used in operating activities—was approximately $1.0 million. The negative cash flow from operating activities was mainly due to the timing of working capital accounts.
Current wording
Net cash used by operating activities—was approximately $0.9 million. The negative cash flow from operating activities was mainly due to the timing of working capital accounts.
Previous wording
Net cash used in financing activities—was approximately $3.8 million. Cash of $2.7 million was used to repurchase Series B Preferred shares and make routine payments totaling 1.3 million for our senior debt obligations.
Current wording
Net cash used in financing activities—was approximately $0.7 million. The cash was used to make routine payments totaling $0.4 million for our Senior debt obligations and $0.2 million for other debt; and cash used for the repurchase of our Series B Preferred Stock was $0.2 million.
Previous wording
Net cash provided by operating activities—was approximately $1.0 million. The positive cash flow from operating activities was mainly due to the timing of working capital accounts.
Current wording
Net cash provided by operating activities—was approximately $0.2 million. The positive cash flow from operating activities was mainly due to the timing of working capital accounts.
Previous wording
Net cash used in financing activities—was approximately $1.2 million. The cash was used to make routine payments totaling 1.0 million for our senior debt obligations, and $0.2 million for other debt.
Current wording
Net cash used in financing activities—was approximately $0.6 million. The cash was used to make routine payments totaling $0.4 million for our Senior debt obligations and $0.2 million for other debt.
Previous wording
For a discussion of our critical accounting policies, see Note 1 – Organization and Significant Accounting Policiesto the consolidated financial statements included in Part I, Item 1 herein.
Current wording
For a discussion of our critical accounting policies, see Note 1 – Organization and Significant Accounting Policiesto the consolidated financial statements included in Part I, Item 1 herein and also Note 1 – Summary of Significant Accounting Policies included in Part II, Item 8 of the Annual Report.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
Words such as "may," "could," "should," "would," "believe," "expect," "anticipate," "estimate," "intend," "seek," "plan," "project," "continue," "predict," "will," and other words or expressions of similar meaning are intended by us to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Forward-looking statements are based on the Company's current expectations about future events or results and information that is currently available to us, involve assumptions, risks, and uncertainties, and speak only as of the date on which such statements are made.
Current report — wording carried from elsewhere
Net cash used in investing activities—was approximately $65.0 thousand. This capital expenditure was primarily for leasehold improvements.