[September 17, 2014] |
|
Five Star Quality Care, Inc. Reports Fourth Quarter and Year End 2013 Results
NEWTON, Mass. --(Business Wire)--
Five Star Quality Care, Inc. (NYSE: FVE) today announced its financial
results for the quarter and year ended December 31, 2013.
Fourth Quarter 2013 Financial Results:
-
Total revenues for the fourth quarter of 2013 increased 0.9% to $325.2
million from $322.5 million for the same period in 2012. Growth in our
revenues was negatively impacted in the fourth quarter of 2013 by the
sequestration mandated Medicare payment rate reductions that went into
effect on April 1, 2013 and a decrease in occupancy, partially offset
by increases in our average monthly rates to residents who pay
privately for our services.
-
Earnings before interest, taxes, depreciation and amortization, or
EBITDA, for the fourth quarter of 2013 were $5.9 million compared to
$11.3 million for the same period in 2012. EBITDA for the fourth
quarter of 2013 included $1.0 million of accounting costs incurred in
connection with the restatement of certain of our previously issued
financial statements. EBITDA excluding these and certain other items
was $7.1 million and $11.4 million in the fourth quarters of 2013 and
2012, respectively. A reconciliation of (loss) income from continuing
operations determined in accordance with U.S. generally accepted
accounting principles, or GAAP, to EBITDA and EBITDA excluding certain
items for the quarters ended December 31, 2013 and 2012 appears later
in this press release.
-
Loss from continuing operations for the fourth quarter of 2013 was
$3.3 million, or $0.07 per basic and diluted share, compared to income
from continuing operations of $1.6 million, or $0.04 and $0.03 per
share, basic and diluted, respectively, for the same period in 2012.
Loss from continuing operations for the fourth quarter of 2013
included $1.0 million, or $0.02 per basic and diluted share, of
general and administrative expenses incurred in connection with the
restatement of certain of our previously issued financial statements.
Also, for the fourth quarter of 2013, we incurred increases in our
senior living wages and benefits and other senior living operating
expenses primarily due to increases in our workers' compensation and
professional and general liability insurance programs, increases in
operating expenses as a result of harsh weather conditions experienced
during the quarter and increases in general maintenance expenses.
-
Net loss for the fourth quarter of 2013 was $5.4 million, or $0.11 per
basic and diluted share, compared to net income of $1.6 million, or
$0.04 and $0.03 per share, basic and diluted, respectively, for the
same period in 2012. Net loss in the fourth quarter of 2013 included a
loss from discontinued operations of $2.1 million. Net income in the
fourth quarter of 2012 included a loss from discontinued operations of
$47,000.
Fourth Quarter 2013 Operating Results:
-
Occupancy at our owned and leased senior living communities for the
fourth quarter of 2013 was 85.6% compared to 86.3% for the same period
in 2012.
-
The average monthly rate at our owned and leased senior living
communities for the fourth quarter of 2013 increased by 0.5% to $4,417
from $4,393 for the same period in 2012.
-
The percentage of revenues derived from residents' private resources
at our owned and leased senior living communities for the fourth
quarter of 2013 increased 70 basis points to 76.8% from 76.1% for the
same period in 2012.
Fiscal Year Financial Results:
-
Total revenues for the year ended December 31, 2013 increased 7.4% to
$1.3 billion from $1.2 billion for the year ended December 31, 2012.
Growth in our revenues was negatively impacted for the year ended
December 31, 2013 by the sequestration mandated Medicare payment rate
reductions that went into effect on April 1, 2013 and a decrease in
occupancy, partially offset by increases in our average monthly rates
to residents who pay privately for our services.
-
EBITDA for the year ended December 31, 2013 was $36.8 million compared
to $47.6 million for the year ended December 31, 2012. EBITDA for the
year ended December 31, 2013 included $1.0 million of accounting costs
incurred in connection with the restatement of certain of our
previously issued financial statements. EBITDA for the year ended
December 31, 2012 included a gain on settlement of our litigation with
Sunrise Senior Living, Inc., or Sunrise, which increased EBITDA by
$3.4 million. EBITDA excluding the restatement costs, the litigation
settlement and certain other items was $38.8 million and $44.3 million
for the year ended December 31, 2013 and 2012, respectively. A
reconciliation of income from continuing operations determined in
accordance with GAAP to EBITDA and EBITDA excluding certain items for
the years ended December 31, 2013 and 2012 appears later in this press
release.
-
Income from continuing operations for the year ended December 31, 2013
was $3.4 million, or $0.07 per basic and diluted share, compared to
$10.6 million, or $0.23 per basic and diluted share, for the year
ended December 31, 2012. Income from continuing operations for the
year ended December 31, 2013 included $1.0 million, or $0.02 per basic
and diluted share, of general and administrative expenses incurred in
connection with the restatement of certain of our previously issued
financial statements, a loss on early extinguishment of debt of
$599,000, or $0.01 per basic and diluted share, and an income tax
benefit of $1.5 million, or $0.03 per basic and diluted share,
relating to a work opportunity tax credit program that expired in 2012
and then was retroactively reinstated in January 2013. Also, for the
year ended December 31, 2013, we incurred increases in our senior
living wages and benefits and other senior living operating expenses
primarily due to increases in employee health insurance, increases in
our workers' compensation and professional and general liability
insurance programs, increases in operating expenses as a result of
harsh weather conditions experienced during the fourth quarter of 2013
and increases in general maintenance expenses. Income from continuing
operations for the year ended December 31, 2012 included a gain on
settlement of our litigation with Sunrise of $2.0 million (net of
taxes), or $0.04 per basic and diluted share.
-
Net loss for the year ended December 31, 2013 was $2.3 million, or
$0.05 per basic and diluted share, compared to net income of $22.3
million, or $0.47 and $0.46 per share, basic and diluted,
respectively, for the year ended December 31, 2012. Net loss for the
2013 period included a loss from discontinued operations of $5.8
million. Net income for the 2012 period included income from
discontinued operations of $11.7 million and was primarily impacted by
a $23.3 million gain on sale that we recorded related to the sale of
our pharmacy business, partially offset by income tax expense of $5.4
million and other losses incurred at our discontinued senior living
communities and rehabilitation hospitals.
Expansion and Disposition Activities:
Since October 1, 2013, we have begun managing four communities with a
combined 281 living units and we have acquired one assisted living
community with 116 living units:
-
In October 2013, we began managing two senior living communities in
Georgia with a combined total of 153 living units and a senior living
community in Tennessee with 60 living units. In November 2013, we
began managing a senior living community in Wisconsin with 68 living
units. These four communities are owned by Senior Housing Properties
Trust, or SNH, and leased to one of its taxable REIT subsidiaries.
-
In May 2014, we acquired an assisted living community with 116 living
units located in Dothan, Alabama for approximately $19.9 million,
including the assumption of approximately $13.9 million of mortgage
debt and excluding closing costs. We funded this acquisition with cash
on hand and borrowings under our $150.0 million revolving credit
facility.
Since October 1, 2013, we and SNH have disposed of two rehabilitation
hospitals, including 13 affiliated out-patient clinics, with a combined
321 beds, and three senior living communities with a combined 203 living
units:
-
As of December 31, 2013, we and SNH completed the transfer of
operations and sale of the real estate at two rehabilitation hospitals
and 13 out-patient clinics affiliated with those rehabilitation
hospitals, which were previously disclosed as held for sale and
discontinued operations. We previously leased the rehabilitation
hospitals from SNH and the out-patient clinics from others. As a
result of this transaction, SNH received proceeds of approximately
$90.0 million for the sale of the real estate associated with the
rehabilitation hospitals, we retained certain net assets of
approximately $9.6 million and our annual rent payable to SNH and
others decreased by approximately $11.5 million. In 2013, we recorded
losses of approximately $2.2 million relating to closing costs and
legal fees associated with this transaction and we incurred $2.6
million of non-cash asset impairment charges to reduce the fixed
assets we owned which are related to the rehabilitation hospitals to
their estimated fair market values.
-
In January 2014, SNH sold an assisted living community with 48 living
units that we leased from SNH that was previously disclosed as held
for sale for a sales price of $2.4 million. As a result of this sale,
our annual minimum rent payable to SNH decreased by $210,000 in
accordance with the terms of the applicable lease.
-
In June 2014, SNH sold two skilled nursing facilities, or SNFs, with a
combined total of 155 living units that we leased from SNH that were
previously disclosed as held for sale for a sales price of $4.5
million. As a result of this sale, our annual minimum rent payable to
SNH decreased by $450,000 in accordance with the terms of the
applicable lease.
As of the date of this press release, we and SNH continue to market for
sale seven senior living communities with a combined total of 509 living
units that were previously disclosed as held for sale and discontinued
operations.
Conference Call:
Tomorrow, September 18, 2014, at 8:30 a.m. Eastern Time, we will host a
conference call to discuss the fourth quarter financial results.
Following management's presentation, there will be a question and answer
period.
The conference call telephone number is (800) 288-8967. Participants
calling from outside the United States and Canada should dial (612)
332-0107. No pass code is necessary to access the call from either
number. Participants should dial in about 15 minutes prior to the
scheduled start of the call. A replay of the conference call will be
available through 11:59 p.m. Eastern Time, September 25, 2014. To hear
the replay, dial (320) 365-3844. The replay pass code is 337177.
A live audio webcast of the conference call will also be available in a
listen only mode on the Company's website at www.fivestarseniorliving.com.
Participants wanting to access the webcast should visit the Company's
website about five minutes before the call. The archived webcast will be
available for replay on the Company's website for about one week after
the call. The transcription, recording and retransmission in any way
of the Company's fourth quarter 2013 conference call is strictly
prohibited without the prior written consent of the Company. The
Company's website is not incorporated as part of this press release.
About Five Star Quality Care, Inc.:
Five Star Quality Care, Inc. is a senior living and healthcare services
company. As of December 31, 2013, we operated 255 senior living
communities (excluding those senior living communities we have
classified as discontinued operations) with 30,023 living units located
in 31 states, including 30 communities (2,946 living units) that we own
and operate, 181 communities (20,026 living units) that we lease and
operate, and 44 communities (7,051 living units) that we manage. These
communities include independent living, assisted living, continuing care
and skilled nursing communities. We are headquartered in Newton,
Massachusetts.
WARNING CONCERNING FORWARD LOOKING STATEMENTS
THIS PRESS RELEASE CONTAINS STATEMENTS THAT CONSTITUTE FORWARD LOOKING
STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995 AND OTHER SECURITIES LAWS. ALSO, WHENEVER WE USE
WORDS SUCH AS "BELIEVE", "EXPECT", "ANTICIPATE", "INTEND", "PLAN",
"ESTIMATE" OR SIMILAR EXPRESSIONS, WE ARE MAKING FORWARD LOOKING
STATEMENTS. THESE FORWARD LOOKING STATEMENTS ARE BASED UPON OUR PRESENT
INTENT, BELIEFS OR EXPECTATIONS, BUT FORWARD LOOKING STATEMENTS ARE NOT
GUARANTEED TO OCCUR AND MAY NOT OCCUR. ACTUAL RESULTS MAY DIFFER
MATERIALLY FROM THOSE CONTAINED IN OR IMPLIED BY THESE FORWARD LOOKING
STATEMENTS AS A RESULT OF VARIOUS FACTORS. FOR EXAMPLE:
-
THIS PRESS RELEASE STATES THAT WE AND SNH CONTINUE TO MARKET FOR SALE
SEVEN SENIOR LIVING COMMUNITIES. WE AND SNH MAY NOT BE ABLE TO SELL
THESE COMMUNITIES ON TERMS ACCEPTABLE TO US OR OTHERWISE, AND THE
SALES OF ANY OR ALL OF THESE COMMUNITIES MAY NOT OCCUR.
THE INFORMATION CONTAINED IN OUR FILINGS WITH THE SECURITIES AND
EXCHANGE COMMISSION, OR SEC, INCLUDING UNDER THE CAPTION "RISK FACTORS"
IN OUR PERIODIC REPORTS, OR INCORPORATED THEREIN, IDENTIFIES OTHER
IMPORTANT FACTORS THAT COULD CAUSE DIFFERENCES FROM OUR FORWARD LOOKING
STATEMENTS. OUR FILINGS WITH THE SEC ARE AVAILABLE ON THE SEC'S WEBSITE
AT WWW.SEC.GOV.
YOU SHOULD NOT PLACE UNDUE RELIANCE UPON OUR FORWARD LOOKING STATEMENTS.
EXCEPT AS REQUIRED BY LAW, WE DO NOT INTEND TO UPDATE OR CHANGE ANY
FORWARD LOOKING STATEMENTS AS A RESULT OF NEW INFORMATION, FUTURE EVENTS
OR OTHERWISE.
|
FIVE STAR QUALITY CARE, INC.
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(in thousands, except per share data)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended December 31,
|
|
|
|
|
Twelve months ended December 31,
|
|
|
|
|
2013
|
|
|
|
|
2012
|
|
|
|
|
2013
|
|
|
|
|
2012
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior living revenue
|
|
|
|
$
|
269,078
|
|
|
|
|
$
|
269,790
|
|
|
|
|
$
|
1,077,062
|
|
|
|
|
$
|
1,074,333
|
Management fee revenue
|
|
|
|
|
2,361
|
|
|
|
|
|
2,150
|
|
|
|
|
|
9,234
|
|
|
|
|
|
5,817
|
Reimbursed costs incurred on behalf of managed
communities
|
|
|
|
|
53,786
|
|
|
|
|
|
50,529
|
|
|
|
|
|
210,491
|
|
|
|
|
|
127,656
|
Total revenues
|
|
|
|
|
325,225
|
|
|
|
|
|
322,469
|
|
|
|
|
|
1,296,787
|
|
|
|
|
|
1,207,806
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior living wages and benefits
|
|
|
|
|
131,424
|
|
|
|
|
|
128,998
|
|
|
|
|
|
525,733
|
|
|
|
|
|
522,444
|
Other senior living operating expenses
|
|
|
|
|
67,524
|
|
|
|
|
|
67,693
|
|
|
|
|
|
265,764
|
|
|
|
|
|
261,749
|
Costs incurred on behalf of managed communities
|
|
|
|
|
53,786
|
|
|
|
|
|
50,529
|
|
|
|
|
|
210,491
|
|
|
|
|
|
127,656
|
Rent expense
|
|
|
|
|
48,785
|
|
|
|
|
|
47,733
|
|
|
|
|
|
193,820
|
|
|
|
|
|
190,184
|
General and administrative
|
|
|
|
|
17,660
|
|
|
|
|
|
16,229
|
|
|
|
|
|
63,509
|
|
|
|
|
|
61,817
|
Depreciation and amortization
|
|
|
|
|
7,331
|
|
|
|
|
|
6,284
|
|
|
|
|
|
27,022
|
|
|
|
|
|
24,480
|
Impairment of long-lived assets
|
|
|
|
|
186
|
|
|
|
|
|
-
|
|
|
|
|
|
186
|
|
|
|
|
|
-
|
Gain on settlement
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
|
|
(3,365)
|
Total operating expenses
|
|
|
|
|
326,696
|
|
|
|
|
|
317,466
|
|
|
|
|
|
1,286,525
|
|
|
|
|
|
1,184,965
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating (loss) income
|
|
|
|
|
(1,471)
|
|
|
|
|
|
5,003
|
|
|
|
|
|
10,262
|
|
|
|
|
|
22,841
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest dividend and other income
|
|
|
|
|
182
|
|
|
|
|
|
243
|
|
|
|
|
|
781
|
|
|
|
|
|
881
|
Interest and other expense
|
|
|
|
|
(1,237)
|
|
|
|
|
|
(1,475)
|
|
|
|
|
|
(5,227)
|
|
|
|
|
|
(6,268)
|
Acquisition related costs
|
|
|
|
|
(62)
|
|
|
|
|
|
(8)
|
|
|
|
|
|
(181)
|
|
|
|
|
|
(108)
|
(Loss) gain on early extinguishment of debt
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
|
|
(599)
|
|
|
|
|
|
45
|
Loss on sale of available for sale securities
reclassified from other comprehensive income
|
|
|
|
|
(11)
|
|
|
|
|
|
(81)
|
|
|
|
|
|
(5)
|
|
|
|
|
|
(19)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) income from continuing operations before
income taxes and equity in earnings of an investee
|
|
|
|
|
(2,599)
|
|
|
|
|
|
3,682
|
|
|
|
|
|
5,031
|
|
|
|
|
|
17,372
|
Provision for income taxes
|
|
|
|
|
(840)
|
|
|
|
|
|
(2,139)
|
|
|
|
|
|
(1,916)
|
|
|
|
|
|
(7,098)
|
Equity in earnings of an investee
|
|
|
|
|
115
|
|
|
|
|
|
80
|
|
|
|
|
|
334
|
|
|
|
|
|
316
|
(Loss) income from continuing operations
|
|
|
|
|
(3,324)
|
|
|
|
|
|
1,623
|
|
|
|
|
|
3,449
|
|
|
|
|
|
10,590
|
(Loss) income from discontinued operations
|
|
|
|
|
(2,106)
|
|
|
|
|
|
(47)
|
|
|
|
|
|
(5,789)
|
|
|
|
|
|
11,717
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income
|
|
|
|
$
|
(5,430)
|
|
|
|
|
$
|
1,576
|
|
|
|
|
$
|
(2,340)
|
|
|
|
|
$
|
22,307
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding - basic
|
|
|
|
|
48,350
|
|
|
|
|
|
48,066
|
|
|
|
|
|
48,277
|
|
|
|
|
|
47,952
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding - diluted
|
|
|
|
|
48,350
|
|
|
|
|
|
49,979
|
|
|
|
|
|
49,263
|
|
|
|
|
|
50,134
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic (loss) income per share from:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
|
|
$
|
(0.07)
|
|
|
|
|
$
|
0.04
|
|
|
|
|
$
|
0.07
|
|
|
|
|
$
|
0.23
|
Discontinued operations
|
|
|
|
|
(0.04)
|
|
|
|
|
|
-
|
|
|
|
|
|
(0.12)
|
|
|
|
|
|
0.24
|
Net (loss) income per share - basic
|
|
|
|
$
|
(0.11)
|
|
|
|
|
$
|
0.04
|
|
|
|
|
$
|
(0.05)
|
|
|
|
|
$
|
0.47
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted (loss) income per share from:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
|
|
$
|
(0.07)
|
|
|
|
|
$
|
0.03
|
|
|
|
|
$
|
0.07
|
|
|
|
|
$
|
0.23
|
Discontinued operations
|
|
|
|
|
(0.04)
|
|
|
|
|
|
-
|
|
|
|
|
|
(0.12)
|
|
|
|
|
|
0.23
|
Net (loss) income per share - diluted
|
|
|
|
$
|
(0.11)
|
|
|
|
|
$
|
0.03
|
|
|
|
|
$
|
(0.05)
|
|
|
|
|
$
|
0.46
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
These financial statements should be read in conjunction with our
Annual Report on Form 10-K for the year ended December 31, 2013 filed
with the SEC on September 17, 2014, including the audited financial
statements and notes thereto which include descriptions of certain
revisions to the 2011 and 2012 financial statements that we determined
were not material.
|
FIVE STAR QUALITY CARE, INC.
|
CONDENSED CONSOLIDATED BALANCE SHEETS DATA
|
(in thousands)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2013
|
|
|
|
|
December 31, 2012
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
$
|
23,628
|
|
|
|
|
$
|
24,638
|
Accounts receivable, net of allowance
|
|
|
|
|
|
36,940
|
|
|
|
|
|
39,205
|
Due from related persons
|
|
|
|
|
|
11,659
|
|
|
|
|
|
7,957
|
Investments in available for sale securities
|
|
|
|
|
|
19,150
|
|
|
|
|
|
12,920
|
Restricted cash
|
|
|
|
|
|
9,003
|
|
|
|
|
|
6,548
|
Prepaid expenses and other current assets
|
|
|
|
|
|
33,799
|
|
|
|
|
|
38,318
|
Assets of discontinued operations
|
|
|
|
|
|
16,705
|
|
|
|
|
|
30,100
|
Total current assets
|
|
|
|
|
|
150,884
|
|
|
|
|
|
159,686
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property and equipment, net
|
|
|
|
|
|
340,276
|
|
|
|
|
|
337,494
|
Restricted cash
|
|
|
|
|
|
9,795
|
|
|
|
|
|
12,166
|
Restricted investments in available for sale securities
|
|
|
|
|
|
11,905
|
|
|
|
|
|
10,580
|
Goodwill, equity investment and other long term assets
|
|
|
|
|
|
77,323
|
|
|
|
|
|
75,065
|
Total assets
|
|
|
|
|
$
|
590,183
|
|
|
|
|
$
|
594,991
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Revolving credit facility, secured, principally by real estate
|
|
|
|
|
$
|
35,000
|
|
|
|
|
$
|
-
|
Current portion of convertible senior notes
|
|
|
|
|
|
-
|
|
|
|
|
|
24,872
|
Other current liabilities
|
|
|
|
|
|
163,528
|
|
|
|
|
|
178,078
|
Total current liabilities
|
|
|
|
|
|
198,528
|
|
|
|
|
|
202,950
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage notes payable
|
|
|
|
|
|
36,461
|
|
|
|
|
|
37,621
|
Other long term liabilities
|
|
|
|
|
|
44,816
|
|
|
|
|
|
43,067
|
Shareholders' equity
|
|
|
|
|
|
310,378
|
|
|
|
|
|
311,353
|
Total liabilities and shareholders' equity
|
|
|
|
|
$
|
590,183
|
|
|
|
|
$
|
594,991
|
|
|
|
|
|
|
|
|
|
|
|
|
|
These financial statements should be read in conjunction with our
Annual Report on Form 10-K for the year ended December 31, 2013 filed
with the SEC on September 17, 2014, including the audited financial
statements and notes thereto which include descriptions of certain
revisions to the 2011 and 2012 financial statements that we determined
were not material.
|
FIVE STAR QUALITY CARE, INC.
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(in thousands)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended December 31,
|
|
|
|
|
Twelve months ended December 31,
|
|
|
|
|
2013
|
|
|
|
|
2012
|
|
|
|
|
2013
|
|
|
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income
|
|
|
|
$
|
(5,430)
|
|
|
|
|
$
|
1,576
|
|
|
|
|
$
|
(2,340)
|
|
|
|
|
$
|
22,307
|
Adjustments to reconcile net (loss) income to cash provided by
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
|
|
7,274
|
|
|
|
|
|
6,284
|
|
|
|
|
|
28,109
|
|
|
|
|
|
24,480
|
Loss (gain) on early extinguishment of debt
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
|
|
599
|
|
|
|
|
|
(45)
|
Loss (income) from discontinued operations
|
|
|
|
|
3,209
|
|
|
|
|
|
570
|
|
|
|
|
|
9,327
|
|
|
|
|
|
(17,158)
|
Loss on sale of available for sale securities
|
|
|
|
|
11
|
|
|
|
|
|
81
|
|
|
|
|
|
5
|
|
|
|
|
|
19
|
Impairment of long-lived assets
|
|
|
|
|
186
|
|
|
|
|
|
-
|
|
|
|
|
|
186
|
|
|
|
|
|
-
|
Equity in earnings of an investee
|
|
|
|
|
(115)
|
|
|
|
|
|
(80)
|
|
|
|
|
|
(334)
|
|
|
|
|
|
(316)
|
Stock-based compensation
|
|
|
|
|
618
|
|
|
|
|
|
662
|
|
|
|
|
|
1,410
|
|
|
|
|
|
1,445
|
Deferred income taxes
|
|
|
|
|
(506)
|
|
|
|
|
|
1,356
|
|
|
|
|
|
(2,793)
|
|
|
|
|
|
10,560
|
Provision for losses on receivables
|
|
|
|
|
1,998
|
|
|
|
|
|
1,488
|
|
|
|
|
|
6,412
|
|
|
|
|
|
4,446
|
Changes in assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
|
|
(712)
|
|
|
|
|
|
696
|
|
|
|
|
|
(4,147)
|
|
|
|
|
|
(2,431)
|
Prepaid expenses and other assets
|
|
|
|
|
(2,113)
|
|
|
|
|
|
(3,885)
|
|
|
|
|
|
2,334
|
|
|
|
|
|
(11,357)
|
Accounts payable and accrued expenses
|
|
|
|
|
1,391
|
|
|
|
|
|
15,378
|
|
|
|
|
|
(2,565)
|
|
|
|
|
|
18,623
|
Accrued compensation and benefits
|
|
|
|
|
(8,082)
|
|
|
|
|
|
(5,866)
|
|
|
|
|
|
(3,414)
|
|
|
|
|
|
1,403
|
Due (from) to related persons, net
|
|
|
|
|
(1,283)
|
|
|
|
|
|
(488)
|
|
|
|
|
|
(1,074)
|
|
|
|
|
|
(6,773)
|
Other current and long term liabilities
|
|
|
|
|
942
|
|
|
|
|
|
(2,452)
|
|
|
|
|
|
4,062
|
|
|
|
|
|
2,305
|
Cash (used in) provided by operating activities
|
|
|
|
|
(2,612)
|
|
|
|
|
|
15,320
|
|
|
|
|
|
35,777
|
|
|
|
|
|
47,508
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payments to restricted cash and investment accounts, net
|
|
|
|
|
(1,701)
|
|
|
|
|
|
(3,548)
|
|
|
|
|
|
(84)
|
|
|
|
|
|
(9,784)
|
Acquisition of property and equipment
|
|
|
|
|
(16,466)
|
|
|
|
|
|
(15,284)
|
|
|
|
|
|
(53,766)
|
|
|
|
|
|
(51,805)
|
Purchase of available for sale securities
|
|
|
|
|
(559)
|
|
|
|
|
|
-
|
|
|
|
|
|
(13,974)
|
|
|
|
|
|
(5,076)
|
Proceeds from sales of improvements to SNH
|
|
|
|
|
4,707
|
|
|
|
|
|
9,929
|
|
|
|
|
|
24,641
|
|
|
|
|
|
24,818
|
Proceeds from sale of available for sale securities
|
|
|
|
|
360
|
|
|
|
|
|
3,235
|
|
|
|
|
|
6,285
|
|
|
|
|
|
4,163
|
Cash used in investing activities
|
|
|
|
|
(13,659)
|
|
|
|
|
|
(5,668)
|
|
|
|
|
|
(36,898)
|
|
|
|
|
|
(37,684)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from borrowings on credit facilities
|
|
|
|
|
25,000
|
|
|
|
|
|
15,000
|
|
|
|
|
|
85,000
|
|
|
|
|
|
62,500
|
Repayments of borrowings on credit facilities
|
|
|
|
|
-
|
|
|
|
|
|
(15,000)
|
|
|
|
|
|
(50,000)
|
|
|
|
|
|
(62,500)
|
Repayments of borrowing on the bridge loan from
Senior Housing Properties Trust
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
|
|
(38,000)
|
Purchase and retirement of convertible senior notes
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
|
|
(24,872)
|
|
|
|
|
|
(12,038)
|
Repayments of mortgage notes payable
|
|
|
|
|
(280)
|
|
|
|
|
|
(263)
|
|
|
|
|
|
(1,093)
|
|
|
|
|
|
(1,028)
|
Cash provided by (used in) financing activities
|
|
|
|
|
24,720
|
|
|
|
|
|
(263)
|
|
|
|
|
|
9,035
|
|
|
|
|
|
(51,066)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from discontinued operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash (used in) provided by discontinued operations
|
|
|
|
|
(3,361)
|
|
|
|
|
|
298
|
|
|
|
|
|
(7,000)
|
|
|
|
|
|
1,763
|
Net cash (used in) provided by investing activities
|
|
|
|
|
(1,040)
|
|
|
|
|
|
692
|
|
|
|
|
|
5,610
|
|
|
|
|
|
35,885
|
Net cash used in financing activities
|
|
|
|
|
-
|
|
|
|
|
|
(36)
|
|
|
|
|
|
(7,534)
|
|
|
|
|
|
(142)
|
Net cash flows (used in) provided by discontinued operations
|
|
|
|
|
(4,401)
|
|
|
|
|
|
954
|
|
|
|
|
|
(8,924)
|
|
|
|
|
|
37,506
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in cash and cash equivalents during the period
|
|
|
|
|
4,048
|
|
|
|
|
|
10,343
|
|
|
|
|
|
(1,010)
|
|
|
|
|
|
(3,736)
|
Cash and cash equivalents at beginning of period
|
|
|
|
|
19,580
|
|
|
|
|
|
14,295
|
|
|
|
|
|
24,638
|
|
|
|
|
|
28,374
|
Cash and cash equivalents at end of period
|
|
|
|
$
|
23,628
|
|
|
|
|
$
|
24,638
|
|
|
|
|
$
|
23,628
|
|
|
|
|
$
|
24,638
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental cash flow information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash paid for interest
|
|
|
|
$
|
705
|
|
|
|
|
$
|
1,210
|
|
|
|
|
$
|
3,361
|
|
|
|
|
$
|
4,921
|
Cash paid for income taxes
|
|
|
|
$
|
110
|
|
|
|
|
$
|
580
|
|
|
|
|
$
|
1,884
|
|
|
|
|
$
|
2,132
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
These financial statements should be read in conjunction with our
Annual Report on Form 10-K for the year ended December 31, 2013 filed
with the SEC on September 17, 2014, including the audited financial
statements and notes thereto which include descriptions of certain
revisions to the 2011 and 2012 financial statements that we determined
were not material.
|
FIVE STAR QUALITY CARE, INC.
|
SENIOR LIVING COMMUNITY FINANCIAL DATA(1)
|
(dollars in thousands, except average monthly rate)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
|
|
|
Twelve months ended
|
|
|
|
|
|
|
December 31,(2)
|
|
|
|
|
December 31,(2)
|
|
|
|
|
|
|
2013
|
|
|
|
|
2012
|
|
|
|
|
2013
|
|
|
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior living communities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of communities (end of period)
|
|
|
|
|
|
211
|
|
|
|
|
|
211
|
|
|
|
|
|
211
|
|
|
|
|
|
211
|
Number of units (end of period)(3)
|
|
|
|
|
|
22,972
|
|
|
|
|
|
22,972
|
|
|
|
|
|
22,972
|
|
|
|
|
|
22,972
|
Occupancy
|
|
|
|
|
|
85.6%
|
|
|
|
|
|
86.3%
|
|
|
|
|
|
85.8%
|
|
|
|
|
|
86.2%
|
Avg. monthly rate(4)
|
|
|
|
|
$
|
4,417
|
|
|
|
|
$
|
4,393
|
|
|
|
|
$
|
4,437
|
|
|
|
|
$
|
4,382
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior living revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Independent and assisted living community revenue
|
|
|
|
|
$
|
125,325
|
|
|
|
|
$
|
123,889
|
|
|
|
|
$
|
497,742
|
|
|
|
|
$
|
490,710
|
Continuing care retirement community revenue
|
|
|
|
|
|
96,844
|
|
|
|
|
|
97,789
|
|
|
|
|
|
388,285
|
|
|
|
|
|
389,024
|
Skilled nursing facility revenue
|
|
|
|
|
|
44,170
|
|
|
|
|
|
44,408
|
|
|
|
|
|
178,667
|
|
|
|
|
|
181,010
|
Other(5)
|
|
|
|
|
|
2,739
|
|
|
|
|
|
3,704
|
|
|
|
|
|
12,368
|
|
|
|
|
|
13,589
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total senior living revenue
|
|
|
|
|
$
|
269,078
|
|
|
|
|
$
|
269,790
|
|
|
|
|
$
|
1,077,062
|
|
|
|
|
$
|
1,074,333
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior living wages and benefits:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Independent and assisted living community wages and benefits
|
|
|
|
|
$
|
53,259
|
|
|
|
|
$
|
51,960
|
|
|
|
|
$
|
212,884
|
|
|
|
|
$
|
211,035
|
Continuing care retirement community wages and benefits
|
|
|
|
|
|
47,990
|
|
|
|
|
|
47,539
|
|
|
|
|
|
192,829
|
|
|
|
|
|
191,648
|
Skilled nursing facility wages and benefits
|
|
|
|
|
|
28,647
|
|
|
|
|
|
28,104
|
|
|
|
|
|
113,665
|
|
|
|
|
|
113,600
|
Other(5)
|
|
|
|
|
|
1,528
|
|
|
|
|
|
1,395
|
|
|
|
|
|
6,355
|
|
|
|
|
|
6,161
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total senior living wages and benefits
|
|
|
|
|
$
|
131,424
|
|
|
|
|
$
|
128,998
|
|
|
|
|
$
|
525,733
|
|
|
|
|
$
|
522,444
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior living other operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Independent and assisted living community other operating expenses
|
|
|
|
|
$
|
34,422
|
|
|
|
|
$
|
30,401
|
|
|
|
|
$
|
124,506
|
|
|
|
|
$
|
118,036
|
Continuing care retirement community other operating expenses
|
|
|
|
|
|
24,971
|
|
|
|
|
|
25,736
|
|
|
|
|
|
99,713
|
|
|
|
|
|
96,837
|
Skilled nursing facility other operating expenses
|
|
|
|
|
|
7,845
|
|
|
|
|
|
11,546
|
|
|
|
|
|
41,314
|
|
|
|
|
|
43,933
|
Other(5)
|
|
|
|
|
|
286
|
|
|
|
|
|
10
|
|
|
|
|
|
231
|
|
|
|
|
|
2,943
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total senior living other operating expenses
|
|
|
|
|
$
|
67,524
|
|
|
|
|
$
|
67,693
|
|
|
|
|
$
|
265,764
|
|
|
|
|
$
|
261,749
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
This supplemental data should be read in conjunction with our
Annual Report on Form 10-K for the year ended December 31, 2013
filed with the SEC on September 17, 2014, including the audited
financial statements and notes thereto which include descriptions
of certain revisions to the 2011 and 2012 financial statements
that we determined were not material.
|
|
|
|
|
|
|
(1)
|
|
|
|
|
Excludes data for managed communities and discontinued senior living
operations.
|
(2)
|
|
|
|
|
The number of communities operated between January 1, 2012 and
December 31, 2013 did not change; as a result, there is no separate
same property comparable senior living community financial data
presented.
|
(3)
|
|
|
|
|
Excludes 48 units of one senior living community that has been
temporarily closed for renovations.
|
(4)
|
|
|
|
|
Average monthly rate is calculated by taking the average daily rate,
which is defined as total operating revenue divided by occupied
units, during the period and multiplying it by 30 days.
|
(5)
|
|
|
|
|
Other senior living relates primarily to rehabilitation and other
specialty service revenues and expenses provided at our residential
facilities.
|
|
FIVE STAR QUALITY CARE, INC.
|
PERCENT BREAKDOWN OF SENIOR LIVING COMMUNITY REVENUES(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
|
|
|
Twelve months ended
|
|
|
|
|
|
|
December 31,
|
|
|
|
|
December 31,
|
|
|
|
|
|
|
2013
|
|
|
|
|
2012
|
|
|
|
|
2013
|
|
|
|
|
2012
|
Independent and assisted living communities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Private and other sources
|
|
|
|
|
|
99.2%
|
|
|
|
|
|
98.9%
|
|
|
|
|
|
99.1%
|
|
|
|
|
|
98.9%
|
Medicaid
|
|
|
|
|
|
0.8%
|
|
|
|
|
|
1.1%
|
|
|
|
|
|
0.9%
|
|
|
|
|
|
1.1%
|
Total
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing care retirement communities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Private and other sources
|
|
|
|
|
|
72.2%
|
|
|
|
|
|
70.4%
|
|
|
|
|
|
71.6%
|
|
|
|
|
|
70.7%
|
Medicare
|
|
|
|
|
|
21.9%
|
|
|
|
|
|
22.7%
|
|
|
|
|
|
22.2%
|
|
|
|
|
|
22.6%
|
Medicaid
|
|
|
|
|
|
5.9%
|
|
|
|
|
|
6.9%
|
|
|
|
|
|
6.2%
|
|
|
|
|
|
6.7%
|
Total
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Skilled nursing facilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Private and other sources
|
|
|
|
|
|
25.0%
|
|
|
|
|
|
27.0%
|
|
|
|
|
|
25.6%
|
|
|
|
|
|
26.8%
|
Medicare
|
|
|
|
|
|
24.3%
|
|
|
|
|
|
24.4%
|
|
|
|
|
|
25.7%
|
|
|
|
|
|
25.4%
|
Medicaid
|
|
|
|
|
|
50.7%
|
|
|
|
|
|
48.6%
|
|
|
|
|
|
48.7%
|
|
|
|
|
|
47.8%
|
Total
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total senior living communities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Private and other sources
|
|
|
|
|
|
76.8%
|
|
|
|
|
|
76.1%
|
|
|
|
|
|
76.6%
|
|
|
|
|
|
76.1%
|
Medicare
|
|
|
|
|
|
12.1%
|
|
|
|
|
|
12.5%
|
|
|
|
|
|
12.5%
|
|
|
|
|
|
12.7%
|
Medicaid
|
|
|
|
|
|
11.1%
|
|
|
|
|
|
11.4%
|
|
|
|
|
|
10.9%
|
|
|
|
|
|
11.2%
|
Total
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
100.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)Excludes data for managed communities and discontinued senior
living operations.
|
|
FIVE STAR QUALITY CARE, INC.
|
SENIOR LIVING OTHER OPERATING DATA(1)
|
(dollars in thousands, except average monthly rate)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
|
|
|
|
|
|
|
December 31,
|
|
|
|
September 30,
|
|
|
|
June 30,
|
|
|
|
March 31,
|
|
|
|
December 31,
|
|
|
|
|
|
|
|
|
2013
|
|
|
|
2013
|
|
|
|
2013
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Independent and assisted living communities (owned):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of communities (end of period)
|
|
|
|
|
30
|
|
|
|
|
30
|
|
|
|
|
30
|
|
|
|
|
30
|
|
|
|
|
30
|
Number of units (end of period)
|
|
|
|
|
2,946
|
|
|
|
|
2,946
|
|
|
|
|
2,946
|
|
|
|
|
2,946
|
|
|
|
|
2,946
|
Occupancy
|
|
|
|
|
87.5%
|
|
|
|
|
88.2%
|
|
|
|
|
87.6%
|
|
|
|
|
87.5%
|
|
|
|
|
87.8%
|
Avg. monthly rate(2)
|
|
|
|
$
|
3,385
|
|
|
|
$
|
3,370
|
|
|
|
$
|
3,377
|
|
|
|
$
|
3,374
|
|
|
|
$
|
3,293
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Independent and assisted living communities (leased):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of communities (end of period)
|
|
|
|
|
119
|
|
|
|
|
119
|
|
|
|
|
119
|
|
|
|
|
119
|
|
|
|
|
119
|
Number of units (end of period)(3)
|
|
|
|
|
9,858
|
|
|
|
|
9,858
|
|
|
|
|
9,858
|
|
|
|
|
9,858
|
|
|
|
|
9,858
|
Occupancy
|
|
|
|
|
88.7%
|
|
|
|
|
88.9%
|
|
|
|
|
88.1%
|
|
|
|
|
88.6%
|
|
|
|
|
89.2%
|
Avg. monthly rate(2)
|
|
|
|
$
|
3,645
|
|
|
|
$
|
3,641
|
|
|
|
$
|
3,676
|
|
|
|
$
|
3,674
|
|
|
|
$
|
3,606
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CCRC communities (leased):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of communities (end of period)
|
|
|
|
|
31
|
|
|
|
|
31
|
|
|
|
|
31
|
|
|
|
|
31
|
|
|
|
|
31
|
Number of units (end of period)(4)
|
|
|
|
|
7,346
|
|
|
|
|
7,346
|
|
|
|
|
7,346
|
|
|
|
|
7,346
|
|
|
|
|
7,346
|
Occupancy
|
|
|
|
|
82.6%
|
|
|
|
|
82.9%
|
|
|
|
|
83.3%
|
|
|
|
|
83.7%
|
|
|
|
|
83.4%
|
Avg. monthly rate(2)
|
|
|
|
$
|
5,204
|
|
|
|
$
|
5,203
|
|
|
|
$
|
5,227
|
|
|
|
$
|
5,276
|
|
|
|
$
|
5,204
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Skilled nursing facilities (leased):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of communities (end of period)
|
|
|
|
|
31
|
|
|
|
|
31
|
|
|
|
|
31
|
|
|
|
|
31
|
|
|
|
|
31
|
Number of units (end of period)(5)
|
|
|
|
|
2,822
|
|
|
|
|
2,822
|
|
|
|
|
2,822
|
|
|
|
|
2,822
|
|
|
|
|
2,822
|
Occupancy
|
|
|
|
|
80.9%
|
|
|
|
|
80.8%
|
|
|
|
|
80.7%
|
|
|
|
|
81.5%
|
|
|
|
|
82.2%
|
Avg. monthly rate(2)
|
|
|
|
$
|
6,448
|
|
|
|
$
|
6,409
|
|
|
|
$
|
6,496
|
|
|
|
$
|
6,644
|
|
|
|
$
|
6,460
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total senior living communities (owned and leased):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of communities (end of period)
|
|
|
|
|
211
|
|
|
|
|
211
|
|
|
|
|
211
|
|
|
|
|
211
|
|
|
|
|
211
|
Number of units (end of period)(3)
|
|
|
|
|
22,972
|
|
|
|
|
22,972
|
|
|
|
|
22,972
|
|
|
|
|
22,972
|
|
|
|
|
22,972
|
Occupancy
|
|
|
|
|
85.6%
|
|
|
|
|
85.9%
|
|
|
|
|
85.6%
|
|
|
|
|
86.0%
|
|
|
|
|
86.3%
|
Avg. monthly rate(2)
|
|
|
|
$
|
4,417
|
|
|
|
$
|
4,407
|
|
|
|
$
|
4,446
|
|
|
|
$
|
4,479
|
|
|
|
$
|
4,393
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Managed communities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of communities (end of period)
|
|
|
|
|
44
|
|
|
|
|
40
|
|
|
|
|
39
|
|
|
|
|
39
|
|
|
|
|
39
|
Number of units (end of period)(6)
|
|
|
|
|
7,051
|
|
|
|
|
6,771
|
|
|
|
|
6,678
|
|
|
|
|
6,678
|
|
|
|
|
6,678
|
Occupancy
|
|
|
|
|
87.9%
|
|
|
|
|
87.6%
|
|
|
|
|
87.4%
|
|
|
|
|
87.2%
|
|
|
|
|
87.7%
|
Avg. monthly rate(2)
|
|
|
|
$
|
4,093
|
|
|
|
$
|
4,140
|
|
|
|
$
|
4,215
|
|
|
|
$
|
4,296
|
|
|
|
$
|
4,144
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other ancillary services:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rehabilitation and wellness inpatient clinics (end of period)
|
|
|
|
|
50
|
|
|
|
|
50
|
|
|
|
|
51
|
|
|
|
|
53
|
|
|
|
|
50
|
Rehabilitation and wellness outpatient clinics (end of period)
|
|
|
|
|
50
|
|
|
|
|
51
|
|
|
|
|
51
|
|
|
|
|
49
|
|
|
|
|
49
|
Home health communities served (end of period)
|
|
|
|
|
6
|
|
|
|
|
6
|
|
|
|
|
6
|
|
|
|
|
6
|
|
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
|
|
|
Excludes data for discontinued operations.
|
(2)
|
|
|
|
|
Average monthly rate is calculated by taking the average daily rate,
which is defined as total operating revenue divided by occupied
units, during the period and multiplying it by 30 days.
|
(3)
|
|
|
|
|
Excludes 48 units of one senior living community that has been
temporarily closed for renovations.
|
(4)
|
|
|
|
|
Includes 2,031 skilled nursing units in communities where assisted
living and independent living services are the predominant services
provided.
|
(5)
|
|
|
|
|
Includes 69 assisted living and independent living units in
communities where skilled nursing services are the predominant
services provided.
|
(6)
|
|
|
|
|
Includes 472 skilled nursing units in communities where assisted
living and independent living services are the predominant services
provided.
|
|
FIVE STAR QUALITY CARE, INC.
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
|
(in thousands)
|
|
Earnings before interest, taxes, depreciation and amortization, or
EBITDA, and EBITDA excluding certain items, and EBITDA excluding
certain items plus rent expense (EBITDAR excluding certain items),
or collectively, Non-GAAP financial measures, are not financial
measures determined according to U.S. generally accepted accounting
principles, or GAAP. We consider these Non-GAAP financial measures
to be meaningful disclosures because we believe that the
presentation of these Non-GAAP financial measures may help investors
to gain a better understanding of changes in our operating results,
and may also help investors who wish to make comparisons between us
and other companies on both a GAAP and a non-GAAP basis. These
Non-GAAP financial measures are used by management to evaluate our
financial performance and for comparing our performance over time
and to the performance of our competitors. These Non-GAAP financial
measures as presented may not, however, be comparable to amounts
calculated by other companies. This information should not be
considered as an alternative to income from continuing operations,
net income, cash flows from operating activities or any other
financial operating or performance or liquidity measure established
by GAAP. The following table includes the reconciliation of these
Non-GAAP financial measures to income from continuing operations,
the most directly comparable financial measure under GAAP reported
in our consolidated financial statements, for the three and twelve
months ended December 31, 2013 and 2012.
|
|
|
|
|
|
|
|
For the three months
|
|
|
|
|
|
|
For the twelve months
|
|
|
|
|
|
|
ended December 31,
|
|
|
|
|
|
|
ended December 31,
|
|
|
|
|
|
|
|
2013
|
|
|
|
|
|
|
|
2012
|
|
|
|
|
|
|
|
2013
|
|
|
|
|
|
|
|
2012
|
(Loss) income from continuing operations
|
|
|
|
|
|
$
|
(3,324)
|
|
|
|
|
|
|
$
|
1,623
|
|
|
|
|
|
|
$
|
3,449
|
|
|
|
|
|
|
$
|
10,590
|
Add: interest and other expense
|
|
|
|
|
|
|
1,237
|
|
|
|
|
|
|
|
1,475
|
|
|
|
|
|
|
|
5,227
|
|
|
|
|
|
|
|
6,268
|
Add: income tax expense
|
|
|
|
|
|
|
840
|
|
|
|
|
|
|
|
2,139
|
|
|
|
|
|
|
|
1,916
|
|
|
|
|
|
|
|
7,098
|
Add: depreciation and amortization
|
|
|
|
|
|
|
7,331
|
|
|
|
|
|
|
|
6,284
|
|
|
|
|
|
|
|
27,022
|
|
|
|
|
|
|
|
24,480
|
Less: interest, dividend and other income
|
|
|
|
|
|
|
(182)
|
|
|
|
|
|
|
|
(243)
|
|
|
|
|
|
|
|
(781)
|
|
|
|
|
|
|
|
(881)
|
EBITDA
|
|
|
|
|
|
|
5,902
|
|
|
|
|
|
|
|
11,278
|
|
|
|
|
|
|
|
36,833
|
|
|
|
|
|
|
|
47,555
|
Add (less):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial accounting restatement costs
|
|
|
|
|
|
|
971
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
971
|
|
|
|
|
|
|
|
-
|
Acquisition related costs
|
|
|
|
|
|
|
62
|
|
|
|
|
|
|
|
8
|
|
|
|
|
|
|
|
181
|
|
|
|
|
|
|
|
108
|
Loss on sale of investments in available for sale
securities
|
|
|
|
|
|
|
11
|
|
|
|
|
|
|
|
81
|
|
|
|
|
|
|
|
5
|
|
|
|
|
|
|
|
19
|
Impairment of long-lived assets
|
|
|
|
|
|
|
186
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
186
|
|
|
|
|
|
|
|
-
|
Gain on litigation settlement
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
(3,365)
|
Loss (gain) on early extinguishment of debt
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
599
|
|
|
|
|
|
|
|
(45)
|
EBITDA excluding certain items
|
|
|
|
|
|
|
7,132
|
|
|
|
|
|
|
|
11,367
|
|
|
|
|
|
|
|
38,775
|
|
|
|
|
|
|
|
44,272
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rent expense
|
|
|
|
|
|
|
48,785
|
|
|
|
|
|
|
|
47,733
|
|
|
|
|
|
|
|
193,820
|
|
|
|
|
|
|
|
190,184
|
EBITDAR excluding certain items
|
|
|
|
|
|
$
|
55,917
|
|
|
|
|
|
|
$
|
59,100
|
|
|
|
|
|
|
$
|
232,595
|
|
|
|
|
|
|
$
|
234,456
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
These financial statements should be read in conjunction with our
Annual Report on Form 10-K for the year ended December 31, 2013 filed
with the SEC on September 17, 2014, including the audited financial
statements and notes thereto which include descriptions of certain
revisions to the 2011 and 2012 financial statements that we determined
were not material.
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