Universal Health Realty Income Trust reported net income of $4.5 million, or $0.32 per diluted share, for the second quarter of 2025, a decrease from $5.3 million, or $0.38 per diluted share, in the second quarter of 2024. Funds From Operations (FFO) also declined to $11.8 million, or $0.85 per diluted share, compared to $12.4 million, or $0.90 per diluted share, in the prior-year period. The decrease in net income was $784,000, or $0.06 per diluted share.
For the six-month period ended June 30, 2025, net income was $9.3 million, or $0.67 per diluted share, down from $10.6 million, or $0.76 per diluted share, in the comparable period of 2024. FFO for the first six months of 2025 decreased to $23.7 million, or $1.71 per diluted share, from $24.8 million, or $1.79 per diluted share, in the first half of 2024.
The decline in second-quarter net income was primarily due to a $563,000 property tax reduction recorded in the second quarter of 2024 at the Chicago, Illinois, property, which did not recur. Additionally, a $137,000 increase in interest expense from higher average borrowings and an $84,000 net decrease in income from various properties contributed to the decline.
As of June 30, 2025, UHT had $70.2 million of available borrowing capacity under its $425 million credit agreement, with $354.8 million of borrowings outstanding. The Trust emphasized ongoing tenant risks related to staffing shortages, government healthcare funding, and patient volumes, noting that nearly 27% of its 2024 and 2023 revenues came from tenants highly reliant on federal and state programs like Medicare and Medicaid.
The company did not disclose any major property transactions, additions, or divestitures during the second quarter. Management highlighted that further increases in interest rates could negatively impact future results by raising borrowing costs, underscoring the sensitivity of the Trust's financial performance to macroeconomic conditions.
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