Medical Properties Trust, Inc.

Medical Properties Trust reported normalized FFO of $0.15 per share for Q2 2026, versus $0.14 last quarter. General acute operators reported aggregate EBITDARM coverage of 2.8x, post-acute coverage was 2.4x, and behavioral coverage was 1.4x. Management said post-acute EBITDARM increased more than $70 million year over year, led by Median up 24% and Ernest Health up 13%. The company impaired approximately $17 million in working capital loans, primarily tied to two Steward replacement tenants in the Midwest. Forward guidance and outlook: management said the refinancing extends $2.4 billion of debt maturities to 2032 and, after step 2, MPT will have no debt maturing in 2026 or 2027 and only about $600 million due in June 2028. Management expects about $1.1 billion of liquidity from recent and near-term asset sales and said it remains on track to reach over $1 billion of annualized cash rent by year-end. HSA is paying 75% of contractual rent and rises to 100% in mid-September; NOR is paying 50% and rises to 100% in mid-December.

Ed Aldag framed the quarter around balance-sheet repair and asset-value validation. He emphasized that the refinancing removes near-term maturity pressure and gives the company room to pursue a more balanced capital allocation strategy while continuing to reduce leverage. Operationally, he pointed to robust demand in rehabilitation services, stronger post-acute trends, and continued confidence in Switzerland, while acknowledging behavioral health and UK funding pressures.

Kevin Hanna said Q2 normalized FFO of $0.15 per share was in line with expectations, helped by rent step-ups at HSA and NOR. He also noted higher year-over-year G&A driven by stock compensation tied to cash-settled awards and depreciation from the headquarters building placed in service in Q1, plus about $17 million of working capital loan impairments tied mainly to the two Steward replacement tenants. Steve Hamner detailed the financing: $2.4 billion of secured notes at a 9.25% coupon and 5.5-year term, repayment/exchange of 2026 and 2027 maturities, roughly $123 million of gross debt reduction from exchanging longer-dated notes, and covenant headroom improving from around 1.55x-1.60x to as much as 200% after step 1 and up to 300% after step 2.

Analysts focused on how step 2 would be funded, whether the balance of the 2027 notes would be handled via a new credit line, and how much additional secured debt capacity remained. Management said step 2 would not rely only on the credit line and could use asset sales, existing liquidity, and additional secured debt opportunities; it also said the secured-debt ratio would move from about 25% toward the 40% area, with asset sales creating more headroom. Questions also centered on HSA cash collections and Florida supplemental funding; Aldag said collections are still in the eighties, Florida has already sent about half of the DPP money, and the rest could come within a week, enabling repayment of working capital advances. On NOR, management confirmed rent has started and said Prospect is doing well.