Companies In The News
June 1, 2000
Companies In The News
Advocat sees positive 1Q00 earnings
Advocat (Franklin, TN) says it posted a 1Q00 ended March 31 net income of $85,000, 2 cents per share, compared to a 1Q99 net loss of $983,000, 18 cents per share. Advocat reported total revenues in 1Q00 of $47.3 million, up slightly from 1Q99 revenues of $46.7 million. Revenues for the company’s assisted living residences rose 21.3% to $8 million, Advocat says.
The company also has negotiated extensions on two loans with outstanding balances of $25.7 million as of March 31. The loans include a working capital line of credit and a bridge loan with a combined balance outstanding of $14.6 million, and an acquisition line of credit with an outstanding balance of $11.6 million. Advocat says it has received extensions until June 30 for the amounts under the working capital line of credit and bridge loan that had a maturity date of Feb. 28, and the acquisition line of credit that had a maturity date of Dec. 1. The company is negotiating a restructuring of the working capital line of credit and bridge loan, and negotiating replacement, long-term financing on the acquisition line of credit, Advocat says.
Alterra completes share offering
Alterra Healthcare Corp. (Milwaukee) saw 1Q00 ended March 31 total revenues of $106.6 million, up from 1Q99 revenues of $82.9 million. Alterra says it reported a net loss in 1Q00 of $5.3 million, 24 cents per share, compared to a net income in 1Q99, after the effects of an accounting change, of $1.4 million, 6 cents per share.
In 1Q00, the company added 15 operating residences to its portfolio. As a result, Alterra says, its net resident capacity increased by 873.
In addition, Alterra has completed the offering of $173 million of convertible senior debentures and convertible preferred shares to certain of its investors, including significant existing shareholders and convertible debenture holders of the company, as well as an investment entity of Messrs. Daniel Baty and William Colson, senior executives and directors of Holiday Retirement Corporation and Emeritus Corp. (Seattle), respectively.
Alterra says it will use the proceeds from the transaction to finance the completion of residences currently under construction, repay certain interim bridge indebtedness provided by certain of the investors, retire certain convertible subordinated debentures held by certain of the investors, acquire a recently built portfolio of 14 company-managed assisted living residences from certain investors and affiliates, selectively acquire third-party equity interests in certain of its joint-venture arrangements, including joint-venture interests held by certain investors, and for working capital and other general corporate purposes.
ARC reports increase in 1Q00 revenues
American Retirement Corp. (ARC; Nashville, TN) posted total revenues in 1Q00 ended March 31 of $46.8 million, an increase of 7% over 1Q99 revenues of $43.6 million. The company says it recorded a net income of $600,000, 4 cents per share, compared to a 1Q99 net income of $3.4 million, 20 cents per share.
Bill Sheriff, ARC’s chief executive officer, says ARC saw a "solid increase in revenue due to the increased occupancy at our large community expansions and prior period acquisitions, as well as the (1Q00) acquisition of Parklane West (San Antonio, TX)."
ARV sees improved 1Q00 earnings
ARV Assisted Living (Costa Mesa, CA) reported a 1Q00 ended March 31 net income of $2.6 million, 15 cents per share, an improvement over a 1Q99 net loss of $4 million, 25 cents per share. The earnings posted in 1Q00, ARV says, include the benefit of an extraordinary gain of $5.6 million related to the early extinguishment of debt.
The company says it posted total revenues in 1Q00 of $34.9 million, compared to $35.9 million in 1Q99. The decline represents the absence of five assisted living communities the company has divested over the past 12 months in keeping with its strategy to focus on assisted living operations in California and adjacent western states, ARV says.
ALC in danger of financial trouble
Assisted Living Concepts (ALC; Portland, OR) says it probably will not be in compliance with certain restrictive financial covenants at June 30. According to the company’s most recent financial report, there can be no assurance that ALC will be in compliance with certain financial covenants in the future, especially, ALC says, if it is unable to stabilize its operations and efficiently manage its business.
If ALC fails to comply with the covenants or any other debt, all of its debt could become immediately due and payable, according to the filing. Consequences for noncompliance also could include foreclosing on any residences or other collateral securing the obligation.
ALC says, however, that it believes its current cash on hand, cash available from operations, and potential loans on uncollateralized properties are sufficient enough to meet its operating needs through June 2001. To provide it with additional capital, ALC might explore various financing alternatives and commitments to engage in sale and leaseback transactions, according to the report.
In its filing, ALC reported a net loss in 1Q00 ended March 31 of $3.8 million, 22 cents per share, on revenues of $33.1 million. The 1Q00 results compare to a net loss reported in 1Q99 of $7.7 million, 45 cents per share, on revenues of $26.6 million.
The company says it has eliminated its vice president and chief operating officer position held by Leslie Mahon. As a result of the April 21 elimination of this position, ALC will pay Mahon a $350,000 severance payment.
Balanced Care reports 3Q00 loss
Balanced Care (Mechanicsburg, PA) says it posted 3Q00 ended March 31 revenues of $12.1 million, down from 3Q99 revenues of $16.7 million. Assisted living revenues increased in 3Q00 by $3.5 million from 3Q99, Balanced Care says, an increase of 70%.
Offsetting the increase in revenues, the company says, was the elimination of $7.6 million in patient service revenues resulting from the divestiture of the company’s ten Missouri skilled nursing facilities, which was completed early in the quarter.
Balanced Care reported a net loss in 3Q00 of $3.8 million, 11 cents per share, compared to a net loss of $4.6 million, 28 cents per share, in 3Q99.
Brookdale completes sale of shares
Brookdale Living Communities (Chicago) says that The Prime Group and certain of its affiliates have completed their previously disclosed sale of 3.9 million shares of Brookdale common stock, representing about 39.9% of Brookdale’s outstanding shares, to an affiliate of Fortress Investment Fund for an aggregate purchase price of $58.9 million, or $15 per share.
In addition, Fortress has purchased from The Prime Group an additional 75,000 shares of Brookdale’s common stock, which were subject to certain options held by Michael Reschke, the principal shareholder of The Prime Group. Upon completion of the sale, Reschke resigned as chairman of Brookdale’s board. Two of Fortress’ designees, Wesley Edens and William Doniger, have been elected to Brookdale’s board.
The standstill agreement provides that Fortress may not acquire during its term additional Brookdale common stock or engage in other activity designed to acquire control of Brookdale, except in the context of a cash tender offer for all of Brookdale’s shares at not less than $15 per share. A cash tender offer, Brookdale says, cannot be commenced prior to July 5 without the board’s consent.
Brookdale recently posted a 1Q00 ended March 31 net income of $3.1 million, 26 cents per share, compared to a 1Q99 net income of $2.8 million, 24 cents per share. Brookdale reported revenues in 1Q00 of $29.3 million, up from 1Q99 revenues of $25.5 million.
The growth in earnings per share, Brookdale says, comes despite a 32% increase in the diluted share base from 11.7 million to 15.5 million. On May 14, Brookdale issued $100 million of 5.5% convertible subordinated notes, with a conversion price of $18.25 per share, the company says. From September 1999 to March 31, Brookdale has repurchased 1.7 million outstanding common shares.
CareMatrix to file 1Q00 results late
CareMatrix (Needham, MA) says it will file its 1Q00 ended March 31 quarterly results late. The company has filed a notification with the Securities and Exchange Commsision (Washington) extending the due date for filings the report. CareMatrix has yet to file its annual report for FY99 ended Dec. 31.
Emeritus’ 1Q00 revenues down
Emeritus Assisted Living (Seattle) reported 1Q00 total revenues of $30.6 million, down from 1Q99 revenues of $34.2 million. The company says it posted a 1Q00 net loss applicable to common shareholders of $6.4 million, 63 cents per share, compared to a 1Q99 net loss applicable to common shareholders of $3.5 million, 33 cents per share.
In 1Q00, Emeritus began operating two new assisted living facilities, one in Issaquah, WA, and one in Auburn, MA. One facility, Emeritus says, is purchased, and one is leased. The two facilities have capacity for 208 residents.
Regent sees net loss in FY99, 4Q99
Regent Assisted Living (Portland, OR) says it saw total revenues in FY99 ended Dec. 31 of $54.1 million, up from total revenues in FY98 of $30.4 million. The company says it reported a FY99 net loss of $8.8 million, $2.03 per share, compared to a net loss in FY98 of $11.1 million, $2.52 per share.
In 4Q99, the company reported total revenues of $14.9 million, up from revenues of $10.6 million in 4Q98. Regent posted a net loss in 4Q99 of $3.1 million, 71 cents per share, compared to a 4Q98 net loss of $2.4 million, 56 cents per share.
During 1Q00, Regent has taken over the management of The Altenheim (Oakland, CA), a 140-bed assisted living facility, and has opened a 48-bed Regent Court Alzheimer’s facility in Corvallis, OR.
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