NHI Reports First Quarter Income

MURFREESBORO, Tenn.--(BUSINESS WIRE)--National Health Investors, Inc. (NYSE:NHI) announced today its net income and funds from operations (“FFO”) for the three months ended March 31, 2009.

First Quarter Highlights:

• Net income increased from $13,399,000 to $15,049,000 or 12.3%
• Funds from operations (FFO) increased from $15,325,000 to $16,978,000 or 10.8%
• Recovery of a previous write-down, settlement of former tenant lease and other gains totaled $1,879,000

Net income for the three months ended March 31, 2009 was of $15,049,000 or $0.55 per basic and diluted common share compared to net income of $13,399,000 or $0.48 per basic and diluted common share for the same period in 2008. Net income was favorably impacted in 2009 by $1,879,000 or $0.07 per basic and diluted common share related to the settlement of a former tenant lease and prepayment of a mortgage loan receivable that resulted in the recovery of a previous write-down and other gains.

Funds from operations ("FFO") for the three months ended March 31, 2009 was $16,978,000 or $0.62 per basic and diluted common share compared to $15,325,000 or $0.55 per basic and diluted common share for the same period in 2008. FFO was favorably impacted in 2009 by $1,879,000 or $0.07 per basic and diluted common share related to the items described above.

National Health Investors, Inc. is a health care real estate investment trust that specializes in the financing of health care real estate by first mortgage and by purchase and leaseback transactions. The common stock of the company trades on the New York Stock Exchange with the symbol NHI. Additional information including NHI's most recent press releases may be obtained on NHI's web site at www.nhinvestors.com.

Statements in this press release that are not historical facts are forward-looking statements. NHI cautions investors that any forward-looking statements may involve risks and uncertainties and are not guarantees of future performance. All forward-looking statements represent NHI's judgment as of the date of this release.

Condensed Statements of Income
(in thousands, except share and per share amounts)
				Three Months Ended
				March 31,
				2009				2008
Revenues:
	Rental income			$	14,029			$	12,962
	Mortgage interest income				1,913				2,397
				$	15,942			$	15,359
Expenses:
	Interest expense			$	37			$	105
	Depreciation				1,951				2,007
	Amortization of loan costs				4				4
	Legal expense				450				134
	Franchise, excise and other taxes				275				223
	General and administrative				1,589				1,446
	Loan and realty losses (recoveries)				(640	)			-
				$	3,666			$	3,919
Income Before Non-Operating Income				$	12,276			$	11,440
	Non-operating income (investment interest and other)				2,814				1,978
Income From Continuing Operations				$	15,090			$	13,418
Discontinued Operations
	Income from operations - discontinued				(41	)			(19	)
Net income				$	15,049			$	13,399
Weighted average common shares outstanding:
	Basic				27,574,544				27,730,686
	Diluted				27,582,228				27,786,425
Earnings per share:
	Basic:
		Income from continuing operations		$	0.55			$	0.48
		Discontinued operations			-				-
		Net income available to common stockholders		$	0.55			$	0.48
	Diluted:
		Income from continuing operations		$	0.55			$	0.48
		Discontinued operations			-				-
		Net income available to common stockholders		$	0.55			$	0.48
Funds from operations
	Basic			$	16,978			$	15,325
	Diluted			$	16,978			$	15,325
Funds from operations per common share
	Basic			$	0.62			$	0.55
	Diluted			$	0.62			$	0.55
Quarterly dividend declared per common share				$	0.55			$	0.55
In accordance with Statement of Financial Accounting Standard No. 144, the results of operations for facilities sold, including the gain or loss on such sales, have been reported in the current and prior periods as discontinued operations.  The reclassifications to retroactively reflect the disposition of these facilities had no impact on previously reported net income.

Selected Balance Sheet Data
(in thousands)
		March 31,			December 31,
		2009			2008
Real estate properties, net		$	179,381		$	181,332
Mortgages receivable, net			102,694			108,640
Preferred stock investment			38,132			38,132
Cash and marketable securities			104,935			100,242
Bonds payable			2,762			3,987
Stockholders' equity			427,460			429,615

Reconciliation of Funds From Operations (1)(2)
The following table reconciles net income to funds from operations available to common stockholders:
	(in thousands, except share and per share amounts)
			Three Months Ended
			March 31,
			2009			2008
Net income				15,049			13,399
Elimination of non-cash items in net income:
	Real estate depreciation			1,929			1,908
	Real estate depreciation in discontinued operations			-			18
Basic funds from operations				16,978			15,325
Diluted funds from operations			$	16,978		$	15,325
Basic funds from operations per share			$	0.62		$	0.55
Diluted funds from operations per share			$	0.62		$	0.55
Shares for basic funds from operations per share				27,574,544			27,730,686
Shares for diluted funds from operations per share				27,582,228			27,786,425
	(1) Management believes that funds from operations (FFO) is an important supplemental measure of operating performance for a real estate investment trust. Because the historical cost accounting convention used for real estate assets requires straight-line depreciation (except on land), such accounting presentation implies that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen and fallen with market conditions, presentations of operating results for a real estate investment trust that uses historical cost accounting for depreciation could be less informative, and should be supplemented with a measure such as FFO. The term FFO was designed by the real estate investment trust industry to address this issue. Our measure may not be comparable to similarly titled measures used by other REITs. Consequently, our funds from operations may not provide a meaningful measure of our performance as compared to that of other REITs. Since other REI operations in and of itself does not represent cash generated from operating activities in accordance with GAAP (funds from operations does not include changes in operating assets and liabilities) and therefore should not be considered an alternative to net earnings as an indication of operating performance, or to net cash flow from operating activities as determined by GAAP in the United States, as a measure of liquidity and is not necessarily indicative of cash available to fund cash needs.
	(2) Our computations above are intended to comply with the SEC’s interpretation that recurring impairments taken on real property may not be added back to net income in the calculation of FFO. The SEC’s position is that recurring impairments on real property are not an appropriate adjustment.

National Health Investors, Inc.  Portfolio Summary (excluding corporate office)  March 31, 2009
Portfolio Statistics					Investment
			Properties		Percentage		Investment
	Real Estate Properties		72		63.6%		$	179,352,000
	Mortgages and Notes Receivables		49		36.4%			102,694,000
	Total Real Estate Portfolio		121		100.0%		$	282,046,000
Real Estate Properties			Properties		Beds		Investments
	Long Term Care Centers		49		6,788		$	100,962,000
	Assisted Living Facilities		14		1,141			55,693,000
	Medical Office Buildings		4		124,427 sq.ft.			9,038,000
	Independent Living Facilities		4		456			7,442,000
	Hospitals		1		55			6,217,000
	Total Real Estate Properties		72				$	179,352,000
Mortgage Notes Receivables			Properties		Beds		Investments
	Long Term Care Centers		32		3,581		$	98,999,000
	Developmentally Disabled		17		108			3,695,000
	Total Mortgage Notes Receivable		49		3,689			102,694,000
	Total Real Estate Portfolio		121				$	282,046,000
Summary of Facilities by Type:
					Percentage of		Total
			Properties		Total Dollars		Dollars
	Long Term Care Centers		81		71.0%		$	199,961,000
	Assisted Living Facilities		14		19.7%			55,693,000
	Medical Office Buildings		4		3.2%			9,038,000
	Independent Living Facilities		4		2.6%			7,442,000
	Hospitals		1		2.2%			6,217,000
	Developmentally Disabled		17		1.3%			3,695,000
	Total Real Estate Portfolio		121		100.0%		$	282,046,000
Portfolio by Operator Type
					Percentage of		Total
			Properties		Total Dollars		Dollars
	Regional		48		58.1%		$	163,856,000
	Public		65		32.5%			91,644,000
	Small Operator		8		9.4%			26,546,000
			121		100.0%		$	282,046,000

Public Operators							Percentage
				Dollar			Of Total
				Amount			Portfolio
	National HealthCare Corp.			$	56,223,000		20.0%
	Sunrise Senior Living Services				12,202,000		4.3%
	Community Health Systems, Inc.				11,650,000		4.1%
	Sun Healthcare				7,874,000		2.8%
	Res-Care, Inc.				3,695,000		1.3%
	Total Public Operators			$	91,644,000		32.5%

National Health Investors, Inc.   Summary of Facilities by State   March 31. 2009
																				Percent
					Acute				Dev.		Asst.		Retire-				Investment			Total
			LTC		Care		MOB		Disab.		Living		ment		Total		Amount			Portfolio
	Florida		11		-		1		14		4		-		30		$	70,919,000		25.1%
	Texas		8		-		2		-		-		-		10			47,025,000		16.7%
	Tennessee		20		-		-		3		3		2		28			25,662,000		9.1%
	Missouri		8		-		-		-		-		1		9			20,203,000		7.2%
	Arizona		1		-		-		-		4		-		5			16,771,000		5.9%
	Virginia		7		-		-		-		-		-		7			16,059,000		5.7%
	Massachusetts		4		-		-		-		-		-		4			14,268,000		5.1%
	Kansas		5		-		-		-		-		-		5			13,338,000		4.7%
	New Jersey		-		-		-		-		1		-		1			12,202,000		4.3%
	South Carolina		4		-		-		-		1		-		5			10,449,000		3.7%
	New Hampshire		3		-		-		-		-		-		3			8,663,000		3.1%
	Georgia		5		-		-		-		-		-		5			7,418,000		2.6%
	Kentucky		2		1		-		-		-		-		3			7,053,000		2.5%
	Idaho		1		-		-		-		-		1		2			4,785,000		1.7%
	Pennsylvania		-		-		-		-		1		-		1			4,044,000		1.4%
	Alabama		2		-		-		-		-		-		2			1,835,000		0.7%
	Illinois		-		-		1		-		-		-		1			1,352,000		0.5%
			81		1		4		17		14		4		121		$	282,046,000		100.0%