2018 Q4 Form 10-Q Financial Statement

#000136060418000100 Filed on October 26, 2018

View on sec.gov

Income Statement

Concept 2018 Q4 2018 Q3 2017 Q3
Revenue $113.2M $175.1M $176.0M
YoY Change 5.01% -0.49% 48.72%
Cost Of Revenue $42.80M $44.10M $40.60M
YoY Change 5.42% 8.62% 8.27%
Gross Profit $70.40M $69.30M $66.40M
YoY Change 4.76% 4.37% 0.3%
Gross Profit Margin 62.19% 39.57% 37.73%
Selling, General & Admin $8.600M $8.400M $8.000M
YoY Change 3.61% 5.0% -8.05%
% of Gross Profit 12.22% 12.12% 12.05%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $42.40M $42.10M $33.60M
YoY Change 13.37% 25.3% 2.44%
% of Gross Profit 60.23% 60.75% 50.6%
Operating Expenses $51.00M $50.60M $43.90M
YoY Change 11.84% 15.26% 7.86%
Operating Profit $19.40M $35.38M $40.63M
YoY Change -10.19% -12.91% 61.38%
Interest Expense -$13.60M $24.83M -$13.80M
YoY Change 1.49% -279.96% 1.47%
% of Operating Profit -70.1% 70.19% -33.97%
Other Income/Expense, Net $300.0K $89.00K -$27.00K
YoY Change -429.63% -128.42%
Pretax Income $16.30M $6.500M $3.200M
YoY Change -143.82% 103.13% -73.11%
Income Tax
% Of Pretax Income
Net Earnings $16.30M $173.0M $13.76M
YoY Change -143.82% 1156.89% 114.14%
Net Earnings / Revenue 14.4% 98.77% 7.82%
Basic Earnings Per Share $0.83 $0.07
Diluted Earnings Per Share $132.1K $0.82 $0.07
COMMON SHARES
Basic Shares Outstanding 206.9M shares 207.5M shares 200.7M shares
Diluted Shares Outstanding 211.4M shares 204.8M shares

Balance Sheet

Concept 2018 Q4 2018 Q3 2017 Q3
SHORT-TERM ASSETS
Cash & Short-Term Investments $8.400M $10.00M $197.0M
YoY Change 35.48% -94.92% 1463.49%
Cash & Equivalents $126.2M $225.5M $9.410M
Short-Term Investments
Other Short-Term Assets $62.00M $59.00M $65.00M
YoY Change 6.9% -9.23% 47.73%
Inventory
Prepaid Expenses
Receivables $15.00M $13.00M $14.00M
Other Receivables $109.0M $105.0M $94.00M
Total Short-Term Assets $8.400M $10.00M $197.0M
YoY Change 35.48% -94.92% 1463.49%
LONG-TERM ASSETS
Property, Plant & Equipment $2.959B $2.960B $2.739B
YoY Change 0.6% 8.05% -1.01%
Goodwill
YoY Change
Intangibles
YoY Change
Long-Term Investments $67.20M $67.59M $68.30M
YoY Change -2.01% -1.04%
Other Assets $9.300M $8.800M $8.800M
YoY Change -71.9% 0.0% -40.14%
Total Long-Term Assets $6.180B $6.319B $6.217B
YoY Change -4.09% 1.64% 67.86%
TOTAL ASSETS
Total Short-Term Assets $8.400M $10.00M $197.0M
Total Long-Term Assets $6.180B $6.319B $6.217B
Total Assets $6.188B $6.329B $6.414B
YoY Change -4.05% -1.32% 72.6%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $80.40M $72.90M $69.90M
YoY Change 13.24% 4.29% -1.69%
Accrued Expenses
YoY Change
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities $80.40M $72.90M $69.90M
YoY Change 13.24% 4.29% -1.69%
LONG-TERM LIABILITIES
Long-Term Debt $1.346B $1.345B $1.166B
YoY Change 4.84% 15.32% -5.89%
Other Long-Term Liabilities $48.20M $43.10M $45.50M
YoY Change -1.23% -5.27% -3.19%
Total Long-Term Liabilities $1.394B $1.388B $1.212B
YoY Change 4.61% 14.55% -5.79%
TOTAL LIABILITIES
Total Short-Term Liabilities $80.40M $72.90M $69.90M
Total Long-Term Liabilities $1.394B $1.388B $1.212B
Total Liabilities $2.847B $2.889B $3.149B
YoY Change -7.55% -8.26% 65.41%
SHAREHOLDERS EQUITY
Retained Earnings
YoY Change
Common Stock $4.528B $4.577B $4.388B
YoY Change 0.39% 4.3% 59.28%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $3.256B $3.354B $3.176B
YoY Change
Total Liabilities & Shareholders Equity $6.188B $6.329B $6.414B
YoY Change -4.05% -1.32% 72.6%

Cashflow Statement

Concept 2018 Q4 2018 Q3 2017 Q3
OPERATING ACTIVITIES
Net Income $16.30M $173.0M $13.76M
YoY Change -143.82% 1156.89% 114.14%
Depreciation, Depletion And Amortization $42.40M $42.10M $33.60M
YoY Change 13.37% 25.3% 2.44%
Cash From Operating Activities $57.70M $53.50M $45.40M
YoY Change 14.48% 17.84% 5.83%
INVESTING ACTIVITIES
Capital Expenditures -$47.90M -$26.60M -$35.30M
YoY Change -79.18% -24.65% -70.58%
Acquisitions
YoY Change
Other Investing Activities $26.90M $4.600M $800.0K
YoY Change -326.05% 475.0% -108.42%
Cash From Investing Activities -$21.00M -$22.10M -$34.70M
YoY Change -91.32% -36.31% -73.23%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -38.40M -28.70M 175.1M
YoY Change -5585.71% -116.39% 94.12%
NET CHANGE
Cash From Operating Activities 57.70M 53.50M 45.40M
Cash From Investing Activities -21.00M -22.10M -34.70M
Cash From Financing Activities -38.40M -28.70M 175.1M
Net Change In Cash -1.700M 2.700M 185.8M
YoY Change -99.11% -98.55% 5208.57%
FREE CASH FLOW
Cash From Operating Activities $57.70M $53.50M $45.40M
Capital Expenditures -$47.90M -$26.60M -$35.30M
Free Cash Flow $105.6M $80.10M $80.70M
YoY Change -62.35% -0.74% -50.46%

Facts In Submission

Frame Concept Type Concept / XBRL Key Value Unit
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us-gaap Comprehensive Income Net Of Tax Attributable To Noncontrolling Interest
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3830000 USD
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14162000 USD
us-gaap Comprehensive Income Net Of Tax Including Portion Attributable To Noncontrolling Interest
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21474000 USD
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175616000 USD
us-gaap Comprehensive Income Net Of Tax Including Portion Attributable To Noncontrolling Interest
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202403000 USD
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us-gaap Costs And Expenses
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347663000 USD
CY2018Q3 us-gaap Costs And Expenses
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139754000 USD
us-gaap Costs And Expenses
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411529000 USD
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25494000 USD
CY2018Q3 us-gaap Deferred Costs Leasing Net
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28783000 USD
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15850000 USD
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14448000 USD
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70491000 USD
us-gaap Depreciation And Amortization
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172900000 USD
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70568000 USD
us-gaap Depreciation And Amortization
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210064000 USD
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0 USD
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0 USD
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1529000 USD
CY2018Q3 us-gaap Derivative Assets
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1588000 USD
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0 USD
CY2018Q3 us-gaap Derivative Collateral Obligation To Return Cash
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0 USD
CY2017Q4 us-gaap Derivative Collateral Obligation To Return Securities
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0 USD
CY2018Q3 us-gaap Derivative Collateral Obligation To Return Securities
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0 USD
CY2017Q4 us-gaap Derivative Collateral Right To Reclaim Cash
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0 USD
CY2018Q3 us-gaap Derivative Collateral Right To Reclaim Cash
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0 USD
CY2017Q4 us-gaap Derivative Collateral Right To Reclaim Securities
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0 USD
CY2018Q3 us-gaap Derivative Collateral Right To Reclaim Securities
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0 USD
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1529000 USD
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1588000 USD
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1529000 USD
CY2018Q3 us-gaap Derivative Fair Value Of Derivative Asset Amount Offset Against Collateral
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1588000 USD
CY2017Q4 us-gaap Derivative Fair Value Of Derivative Liability
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1089000 USD
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0 USD
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1089000 USD
CY2018Q3 us-gaap Derivative Fair Value Of Derivative Liability Amount Offset Against Collateral
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0 USD
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1089000 USD
CY2018Q3 us-gaap Derivative Liabilities
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0 USD
CY2017Q4 us-gaap Derivative Liability Fair Value Gross Asset
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0 USD
CY2018Q3 us-gaap Derivative Liability Fair Value Gross Asset
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0 USD
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14223000 USD
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27273000 USD
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56331000 USD
us-gaap Direct Costs Of Leased And Rented Property Or Equipment
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138874000 USD
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55789000 USD
us-gaap Direct Costs Of Leased And Rented Property Or Equipment
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165364000 USD
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168416000 USD
us-gaap Dividends
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193881000 USD
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62494000 USD
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65544000 USD
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0.07
us-gaap Earnings Per Share Basic
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0.12
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0.83
us-gaap Earnings Per Share Basic
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0.96
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0.07
us-gaap Earnings Per Share Diluted
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0.12
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0.82
us-gaap Earnings Per Share Diluted
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0.94
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0 USD
us-gaap Equity Method Investment Dividends Or Distributions
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1680000 USD
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0.50
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68577000 USD
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67592000 USD
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312655000 USD
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343251000 USD
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771643000 USD
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733511000 USD
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390260000 USD
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P19Y6M
us-gaap Finite Lived Intangible Assets Remaining Amortization Period1
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P21Y7M12D
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0 USD
us-gaap Gain Loss On Interest Rate Derivative Instruments Not Designated As Hedging Instruments
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884000 USD
CY2018Q3 us-gaap Gain Loss On Interest Rate Derivative Instruments Not Designated As Hedging Instruments
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0 USD
CY2018Q3 us-gaap Gain Loss On Interest Rate Derivative Instruments Not Designated As Hedging Instruments
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0 USD
us-gaap Gain Loss On Interest Rate Derivative Instruments Not Designated As Hedging Instruments
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0 USD
us-gaap Gain Loss On Interest Rate Derivative Instruments Not Designated As Hedging Instruments
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0 USD
CY2017Q3 us-gaap Gain Loss On Sale Of Properties
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0 USD
us-gaap Gain Loss On Sale Of Properties
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3000 USD
CY2018Q3 us-gaap Gain Loss On Sale Of Properties
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166372000 USD
us-gaap Gain Loss On Sale Of Properties
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166372000 USD
CY2017Q3 us-gaap Gains Losses On Extinguishment Of Debt
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us-gaap Gains Losses On Extinguishment Of Debt
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-11192000 USD
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us-gaap Gains Losses On Extinguishment Of Debt
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us-gaap General And Administrative Expense
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25178000 USD
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8770000 USD
us-gaap General And Administrative Expense
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26281000 USD
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13900000 USD
us-gaap Impairment Of Long Lived Assets Held For Use
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8900000 USD
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0 USD
us-gaap Impairment Of Real Estate
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5100000 USD
us-gaap Impairment Of Real Estate
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5093000 USD
CY2018Q3 us-gaap Impairment Of Real Estate
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4281000 USD
us-gaap Impairment Of Real Estate
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8887000 USD
CY2017Q3 us-gaap Income Loss From Equity Method Investments
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318000 USD
us-gaap Income Loss From Equity Method Investments
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381000 USD
CY2018Q3 us-gaap Income Loss From Equity Method Investments
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432000 USD
us-gaap Income Loss From Equity Method Investments
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1405000 USD
us-gaap Income Taxes Paid
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997000 USD
us-gaap Income Taxes Paid
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1656000 USD
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29566000 USD
us-gaap Increase Decrease In Accounts Payable And Accrued Liabilities
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19854000 USD
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7820000 USD
us-gaap Increase Decrease In Deferred Leasing Fees
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3700000 USD
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0 USD
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25924000 USD
us-gaap Interest Expense Debt
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59688000 USD
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25003000 USD
us-gaap Interest Expense Debt
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563000 USD
us-gaap Interest Income Operating
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us-gaap Interest Income Operating
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302000 USD
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51066000 USD
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87303000 USD
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5743439000 USD
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CY2018Q3 us-gaap Land
Land
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3079397000 USD
CY2018Q3 us-gaap Liabilities
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2888545000 USD
CY2017Q4 us-gaap Liabilities And Stockholders Equity
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6449582000 USD
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6328684000 USD
CY2017Q4 us-gaap Long Term Debt
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CY2017Q4 us-gaap Long Term Debt
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2609700000 USD
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4746000 USD
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2826300000 USD
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2550000000 USD
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1662121000 USD
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462089000 USD
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304840000 USD
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99641000 USD
CY2018Q3 us-gaap Long Term Debt Maturities Repayments Of Principal In Year Two
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99453000 USD
CY2018Q3 us-gaap Long Term Debt Maturities Repayments Of Principal Remainder Of Fiscal Year
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1086000 USD
CY2017Q4 us-gaap Minority Interest
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us-gaap Net Cash Provided By Used In Financing Activities
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us-gaap Net Cash Provided By Used In Investing Activities
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us-gaap Net Cash Provided By Used In Investing Activities
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194846000 USD
us-gaap Net Cash Provided By Used In Operating Activities
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228542000 USD
us-gaap Net Cash Provided By Used In Operating Activities
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240751000 USD
CY2017Q3 us-gaap Net Income Loss
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us-gaap Net Income Loss
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21390000 USD
CY2018Q3 us-gaap Net Income Loss
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172986000 USD
us-gaap Net Income Loss
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198134000 USD
CY2017Q3 us-gaap Net Income Loss Attributable To Noncontrolling Interest
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194000 USD
us-gaap Net Income Loss Attributable To Noncontrolling Interest
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715000 USD
CY2018Q3 us-gaap Net Income Loss Attributable To Noncontrolling Interest
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3362000 USD
us-gaap Net Income Loss Attributable To Noncontrolling Interest
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3887000 USD
us-gaap Net Income Loss Including Portion Attributable To Nonredeemable Noncontrolling Interest
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22025000 USD
us-gaap Net Income Loss Including Portion Attributable To Nonredeemable Noncontrolling Interest
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201956000 USD
us-gaap Noncash Or Part Noncash Acquisition Debt Assumed1
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286000000 USD
us-gaap Noncash Or Part Noncash Acquisition Debt Assumed1
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0 USD
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us-gaap Nonoperating Income Expense
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CY2018Q3 us-gaap Nonoperating Income Expense
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89000 USD
us-gaap Nonoperating Income Expense
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129000 USD
CY2018Q3 us-gaap Number Of States In Which Entity Operates
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32 States
CY2017Q3 us-gaap Operating Income Loss
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40628000 USD
us-gaap Operating Income Loss
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92557000 USD
CY2018Q3 us-gaap Operating Income Loss
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35381000 USD
us-gaap Operating Income Loss
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112599000 USD
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us-gaap Operating Leases Income Statement Lease Revenue
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us-gaap Operating Leases Income Statement Lease Revenue
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382000 USD
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205000 USD
us-gaap Proceeds From Issuance Of Common Limited Partners Units
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0 USD
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CY2018Q3 us-gaap Other Finite Lived Intangible Assets Gross
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604215000 USD
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106714000 USD
CY2018Q3 us-gaap Other Intangible Assets Net
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100475000 USD
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15067000 USD
us-gaap Payments For Repurchase Of Common Stock
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us-gaap Payments For Repurchase Of Common Stock
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us-gaap Payments Of Debt Extinguishment Costs
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10391000 USD
us-gaap Payments Of Debt Extinguishment Costs
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1909000 USD
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us-gaap Payments Of Dividends Common Stock
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188414000 USD
us-gaap Payments Of Dividends Minority Interest
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4019000 USD
us-gaap Payments Of Dividends Minority Interest
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3976000 USD
us-gaap Payments Of Financing Costs
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16902000 USD
us-gaap Payments Of Financing Costs
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782000 USD
us-gaap Payments To Acquire Interest In Joint Venture
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68839000 USD
us-gaap Payments To Acquire Interest In Joint Venture
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0 USD
us-gaap Payments To Acquire Productive Assets
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42990000 USD
us-gaap Payments To Acquire Productive Assets
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61136000 USD
us-gaap Payments To Acquire Real Estate
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2357570000 USD
us-gaap Payments To Acquire Real Estate
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17389000 USD
us-gaap Payments To Develop Real Estate Assets
PaymentsToDevelopRealEstateAssets
19163000 USD
us-gaap Payments To Develop Real Estate Assets
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29593000 USD
CY2017Q4 us-gaap Preferred Stock Par Or Stated Value Per Share
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0.01
CY2018Q3 us-gaap Preferred Stock Par Or Stated Value Per Share
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0.01
CY2017Q4 us-gaap Preferred Stock Shares Authorized
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CY2018Q3 us-gaap Preferred Stock Shares Authorized
PreferredStockSharesAuthorized
200000000 shares
CY2017Q4 us-gaap Preferred Stock Shares Issued
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0 shares
CY2018Q3 us-gaap Preferred Stock Shares Issued
PreferredStockSharesIssued
0 shares
CY2017Q4 us-gaap Preferred Stock Shares Outstanding
PreferredStockSharesOutstanding
0 shares
CY2018Q3 us-gaap Preferred Stock Shares Outstanding
PreferredStockSharesOutstanding
0 shares
CY2017Q4 us-gaap Preferred Stock Value
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0 USD
CY2018Q3 us-gaap Preferred Stock Value
PreferredStockValue
0 USD
CY2017Q4 us-gaap Prepaid Expense And Other Assets
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58358000 USD
CY2018Q3 us-gaap Prepaid Expense And Other Assets
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58971000 USD
us-gaap Proceeds From Collection Of Notes Receivable
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0 USD
us-gaap Proceeds From Collection Of Notes Receivable
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524000 USD
us-gaap Proceeds From Issuance Of Common Limited Partners Units
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411000 USD
us-gaap Proceeds From Issuance Of Common Stock
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1624222000 USD
us-gaap Proceeds From Issuance Of Common Stock
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72814000 USD
us-gaap Proceeds From Issuance Of Senior Long Term Debt
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900000000 USD
us-gaap Proceeds From Issuance Of Senior Long Term Debt
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0 USD
us-gaap Proceeds From Lines Of Credit
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515000000 USD
us-gaap Proceeds From Lines Of Credit
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145000000 USD
us-gaap Stock Issued1
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0 USD
us-gaap Proceeds From Sale Of Real Estate
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302440000 USD
CY2017Q3 us-gaap Profit Loss
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13957000 USD
us-gaap Profit Loss
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22105000 USD
CY2018Q3 us-gaap Profit Loss
ProfitLoss
176348000 USD
us-gaap Profit Loss
ProfitLoss
202021000 USD
CY2017Q4 us-gaap Real Estate Investment Property Accumulated Depreciation
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1021691000 USD
CY2018Q3 us-gaap Real Estate Investment Property Accumulated Depreciation
RealEstateInvestmentPropertyAccumulatedDepreciation
1151490000 USD
CY2017Q4 us-gaap Real Estate Investment Property At Cost
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us-gaap Repayments Of Lines Of Credit
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us-gaap Repayments Of Lines Of Credit
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us-gaap Repayments Of Secured Debt
RepaymentsOfSecuredDebt
75444000 USD
us-gaap Repayments Of Secured Debt
RepaymentsOfSecuredDebt
173212000 USD
CY2017Q3 us-gaap Restricted Cash And Cash Equivalents
RestrictedCashAndCashEquivalents
17469000 USD
CY2017Q4 us-gaap Restricted Cash And Cash Equivalents
RestrictedCashAndCashEquivalents
18204000 USD
CY2018Q3 us-gaap Restricted Cash And Cash Equivalents
RestrictedCashAndCashEquivalents
14639000 USD
CY2017Q3 us-gaap Revenues
Revenues
175994000 USD
us-gaap Revenues
Revenues
440220000 USD
CY2018Q3 us-gaap Revenues
Revenues
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us-gaap Share Based Compensation
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5493000 USD
us-gaap Share Based Compensation
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CY2018Q3 us-gaap Stock Repurchase Program Authorized Amount1
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300000000 USD
CY2018Q3 us-gaap Stock Repurchase Program Remaining Authorized Repurchase Amount1
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283500000 USD
us-gaap Stock Repurchased And Retired During Period Value
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3413000 USD
us-gaap Stock Repurchased And Retired During Period Value
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us-gaap Stock Repurchased During Period Value
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16500000 USD
CY2017Q4 us-gaap Stockholders Equity
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3278782000 USD
CY2018Q3 us-gaap Stockholders Equity
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3353627000 USD
CY2016Q4 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
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1780417000 USD
CY2017Q3 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
3260307000 USD
CY2017Q4 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
3363448000 USD
CY2018Q3 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
3433529000 USD
CY2016Q4 us-gaap Temporary Equity Carrying Amount Including Portion Attributable To Noncontrolling Interests
TemporaryEquityCarryingAmountIncludingPortionAttributableToNoncontrollingInterests
4653000 USD
CY2017Q3 us-gaap Temporary Equity Carrying Amount Including Portion Attributable To Noncontrolling Interests
TemporaryEquityCarryingAmountIncludingPortionAttributableToNoncontrollingInterests
6737000 USD
CY2017Q4 us-gaap Temporary Equity Carrying Amount Including Portion Attributable To Noncontrolling Interests
TemporaryEquityCarryingAmountIncludingPortionAttributableToNoncontrollingInterests
6737000 USD
CY2018Q3 us-gaap Temporary Equity Carrying Amount Including Portion Attributable To Noncontrolling Interests
TemporaryEquityCarryingAmountIncludingPortionAttributableToNoncontrollingInterests
6610000 USD
us-gaap Temporary Equity Net Income
TemporaryEquityNetIncome
123000 USD
CY2017Q3 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
204795000 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
177410000 shares
CY2018Q3 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
211444000 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
209968000 shares
CY2017Q3 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
200674000 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
173189000 shares
CY2018Q3 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
207513000 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
205950000 shares
us-gaap Nature Of Operations
NatureOfOperations
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:13px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Organization and Description of Business </font></div><div style="line-height:120%;padding-top:6px;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">HTA, a Maryland corporation, and </font><font style="font-family:inherit;font-size:10pt;">HTALP</font><font style="font-family:inherit;font-size:10pt;">, a Delaware limited partnership, were incorporated or formed, as applicable, on </font><font style="font-family:inherit;font-size:10pt;color:#000000;text-decoration:none;">April&#160;20, 2006</font><font style="font-family:inherit;font-size:10pt;">. HTA operates as a REIT and is the general partner of </font><font style="font-family:inherit;font-size:10pt;">HTALP</font><font style="font-family:inherit;font-size:10pt;">, which is the operating partnership, in an umbrella partnership, or &#8220;UPREIT&#8221; structure. HTA has qualified and intends to continue to be taxed as a REIT for federal income tax purposes under the applicable sections of the Internal Revenue Code. </font></div><div style="line-height:120%;padding-top:7px;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We own real estate primarily consisting of medical office buildings (&#8220;MOBs&#8221;) located on or adjacent to hospital campuses or in off-campus, community core outpatient locations across </font><font style="font-family:inherit;font-size:10pt;">32</font><font style="font-family:inherit;font-size:10pt;"> states within the United States, and we lease space to tenants primarily consisting of health systems, research and academic institutions, and various sized physician practices.&#160; We generate substantially all of our revenues from rents and rental-related activities, such as property and facilities management and other incidental revenues related to the operation of real estate.&#160; </font></div><div style="line-height:120%;padding-top:7px;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Our primary objective is to maximize stockholder value with growth through strategic investments that provide an attractive risk-adjusted return for our stockholders by consistently increasing our cash flow. In pursuing this objective, we: (i) seek internal growth through proactive asset management, leasing, building services and property management oversight; (ii) target accretive acquisitions and developments of MOBs in markets with attractive demographics that complement our existing portfolio; and (iii) actively manage our balance sheet to maintain flexibility with conservative leverage. Additionally, from time to time we consider, on an opportunistic basis, significant portfolio acquisitions that we believe fit our core business and we expect to enhance our existing portfolio.</font></div></div>

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