NEWTON, Mass.--(BUSINESS WIRE)--
Five Star Senior Living Inc. (Nasdaq: FVE) today announced its financial results for the quarter and year ended December 31, 2017.
Financial Results for the quarter ended December 31, 2017:
- Senior living revenue for the fourth quarter of 2017 decreased 0.6% to $279.2 million from $281.0 million for the same period in 2016, primarily due to an estimated $0.9 million revenue reserve recorded in the fourth quarter of 2017 in connection with the previously disclosed 2017 Medicare compliance assessment, or the 2017 Compliance Assessment, at one of Five Star's skilled nursing facilities, or SNFs, and a decrease in occupancy, partially offset by an increase in average monthly rates to residents who pay privately for services. Management fee revenue for the fourth quarter of 2017 increased 4.5% to $3.5 million from $3.4 million for the same period in 2016, primarily due to an increase in the number of managed communities compared to the same period in 2016.
- Net loss for the fourth quarter of 2017 was $1.0 million, or $0.02 per diluted share, compared to net loss of $5.6 million, or $0.11 per diluted share, for the same period in 2016. Net loss for the fourth quarter of 2017 included a gain on sale of senior living communities of $7.3 million, or $0.15 per diluted share, in connection with the sale of two senior living communities in December 2017 pursuant to a transaction agreement Five Star entered with Senior Housing Properties Trust (Nasdaq: SNH), or the 2017 Transaction Agreement. Net loss for the fourth quarter of 2017 also included a benefit from income taxes of $3.2 million, or $0.07 per diluted share, resulting primarily from Five Star’s monetization of alternative minimum tax credits, $1.5 million, or $0.03 per diluted share, for estimated revenue reserve, penalties and fees related to the 2017 Compliance Assessment, and $1.6 million, or $0.03 per diluted share, related to long lived asset impairment Five Star recorded to reduce the carrying value of one senior living community classified as held for sale to its estimated fair value less costs to sell. Net loss for the fourth quarter of 2016 included a benefit from income taxes of $0.5 million, or $0.01 per diluted share, related to a reduction of previously accrued estimated state tax expense.
- Earnings from continuing operations before interest, taxes, depreciation and amortization, or EBITDA, for the fourth quarter of 2017 was $5.8 million compared to $3.5 million for the same period in 2016. EBITDA excluding certain items noted in the supplemental information provided below, or Adjusted EBITDA, was $2.1 million and $3.5 million for the fourth quarters of 2017 and 2016, respectively. A reconciliation of loss from continuing operations determined in accordance with U.S. generally accepted accounting principles, or GAAP, to EBITDA and Adjusted EBITDA for the quarters ended December 31, 2017 and 2016 appears later in this press release.
Operating Results for the quarter ended December 31, 2017:
- Occupancy at owned and leased senior living communities for the fourth quarter of 2017 was 82.6% compared to 83.9% for the same period in 2016.
- The average monthly rate at owned and leased senior living communities for the fourth quarter of 2017 increased 0.3% to $4,653 from $4,639 for the same period in 2016.
- The percentage of revenue derived from residents’ private resources at owned and leased senior living communities for the fourth quarter of 2017 was 77.7% compared to 77.6% for the same period in 2016.
Financial Results for the year ended December 31, 2017:
- Senior living revenue of $1.12 billion for the year ended December 31, 2017 had a slight decrease of 0.1% from 2016. This slight decrease in senior living revenue is primarily a result of an estimated $0.9 million revenue reserve recorded in the fourth quarter of 2017 in connection with the 2017 Compliance Assessment, a decrease in occupancy and a $1.0 million reversal of revenue reserves during 2016 as a result of the final settlement amount in 2016 of the previously disclosed 2014 Medicare compliance assessment, or the 2014 Compliance Assessment, at one of Five Star's SNFs, partially offset by an increase for 2017 in average monthly rates to residents who pay privately for services. Management fee revenue for the year ended December 31, 2017 increased by 14.0% to $14.1 million from $12.4 million for 2016. The increase in management fee revenue was primarily due to an increase in the number of managed communities during 2017 compared to 2016 and the modifications to the calculations of management fees under Five Star's management arrangements with SNH that became effective on July 1, 2016.
- Net loss for the year ended December 31, 2017 was $20.9 million, or $0.42 per diluted share, compared to net loss of $21.8 million, or $0.45 per diluted share, for 2016. Net loss for the year ended December 31, 2017 included a gain on sale of senior living communities of $7.3 million, or $0.15 per diluted share, in connection with the sale of two senior living communities in December 2017 pursuant to the 2017 Transaction Agreement, a benefit from income taxes of $4.5 million, or $0.09 per diluted share, resulting primarily from Five Star’s monetization of alternative minimum tax credits, $1.5 million, or $0.03 per diluted share, for estimated revenue reserve, penalties and fees related to the 2017 Compliance Assessment, and $2.1 million, or $0.04 per diluted share, primarily related to long lived asset impairment Five Star recorded to reduce the carrying value of one senior living community classified as held for sale to its estimated fair value less costs to sell. Net loss for the year ended December 31, 2016 included a $1.5 million, or $0.03 per diluted share, reversal of revenue reserves and accrued liability for estimated penalties related to the 2014 Compliance Assessment and a provision for income taxes of $2.4 million, or $0.05 per diluted share, resulting primarily from state tax expense.
- EBITDA for the year ended December 31, 2017 was $16.3 million compared to $22.3 million for 2016. Adjusted EBITDA was $12.1 million and $22.8 million for the years ended December 31, 2017 and 2016, respectively. A reconciliation of loss from continuing operations determined in accordance with GAAP to EBITDA and Adjusted EBITDA for the years ended December 31, 2017 and 2016 appears later in this press release.
Other:
As previously disclosed, in November 2017, Five Star agreed to sell six senior living communities to SNH pursuant to the 2017 Transaction Agreement for an aggregate sales price of $104.4 million, including $2.4 million of mortgage debt principal that Five Star prepaid in December 2017 in connection with the sale of one of these communities and SNH's assumption of approximately $33.5 million of mortgage debt principal secured by certain of these senior living communities as of December 31, 2017, and excluding closing costs. In December 2017, Five Star sold two of these communities for an aggregate sales price of approximately $39.2 million, excluding closing costs. In January 2018, Five Star sold one of these communities for approximately $19.7 million, excluding closing costs. In February 2018, Five Star sold one of these communities for approximately $22.2 million, including SNH’s assumption of approximately $16.8 million of mortgage debt principal and excluding closing costs. In connection with these sales, Five Star entered management and pooling agreements with SNH to manage these senior living communities, and Five Star expects to enter additional management and pooling agreements with SNH concurrent with the sales of the remaining two communities. The closings of the sales of the remaining two communities for an aggregate sales price of approximately $23.3 million, including SNH’s assumption of approximately $16.7 million of mortgage debt principal, are expected to occur as third party approvals are received by the end of the first half of 2018.
Conference Call:
On Wednesday, March 21, 2018, at 10:00 a.m. Eastern Time, President and Chief Executive Officer, Bruce Mackey, Chief Financial Officer and Treasurer, Richard Doyle, and Senior Vice President and Chief Operating Officer, Scott Herzig, will host a conference call to discuss Five Star's fourth quarter and full year 2017 financial results.
The conference call telephone number is (877) 329-4332. Participants calling from outside the United States and Canada should dial (412) 317-5436. 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 on Wednesday, March 28, 2018. To hear the replay, dial (412) 317-0088. The replay pass code is 10115722.
A live audio webcast of the conference call will also be available in a listen only mode on Five Star’s website at www.fivestarseniorliving.com. Participants wanting to access the webcast should visit Five Star’s website about five minutes before the call. The archived webcast will be available for replay on Five Star’s website for about one week after the call. The transcription, recording and retransmission in any way of Five Star’s fourth quarter 2017 conference call are strictly prohibited without the prior written consent of Five Star. Five Star’s website is not incorporated as part of this press release.
About Five Star Senior Living Inc.:
Five Star Senior Living Inc. is a senior living and healthcare services company. As of December 31, 2017, Five Star operated 283 senior living communities with 31,785 living units located in 32 states, including 213 communities (22,742 living units) that it owned or leased and 70 communities (9,043 living units) that it managed. These communities include independent living, assisted living, continuing care retirement communities and skilled nursing communities. Five Star is 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 FIVE STAR USES WORDS SUCH AS “BELIEVE”, “EXPECT”, “ANTICIPATE”, “INTEND”, “PLAN”, “ESTIMATE”, "WILL", “MAY” AND NEGATIVES OR DERIVATIVES OF THESE OR SIMILAR EXPRESSIONS, FIVE STAR IS MAKING FORWARD LOOKING STATEMENTS. THESE FORWARD LOOKING STATEMENTS ARE BASED UPON FIVE STAR’S 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 FIVE STAR’S FORWARD LOOKING STATEMENTS AS A RESULT OF VARIOUS FACTORS. FOR EXAMPLE:
- FIVE STAR HAS AGREED TO SELL TWO SENIOR LIVING COMMUNITIES TO SNH FOR APPROXIMATELY $23.3 MILLION, INCLUDING SNH’S ASSUMPTION OF APPROXIMATELY $16.8 MILLION OF MORTGAGE DEBT, AND FIVE STAR EXPECTS TO ENTER MANAGEMENT AND POOLING AGREEMENTS WITH SNH FOR FIVE STAR TO MANAGE THESE SENIOR LIVING COMMUNITIES. THESE SALES ARE SUBJECT TO CONDITIONS. THESE CONDITIONS MAY NOT BE MET AND THESE SALES AND ANY RELATED MANAGEMENT AND POOLING ARRANGEMENTS MAY NOT OCCUR, MAY BE DELAYED BEYOND THE FIRST HALF OF 2018 OR THEIR TERMS MAY CHANGE.
- DURING 2017, FIVE STAR RECOGNIZED $1.5 MILLION OF ESTIMATED REVENUE RESERVES, PENALTIES AND FEES RELATED TO THE 2017 COMPLIANCE ASSESSMENT. THE U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES OFFICE OF THE INSPECTOR GENERAL, OR THE OIG, HAS NOT AGREED TO THESE AMOUNTS AND WE HAVE NOT ENTERED A SETTLEMENT AGREEMENT WITH THE OIG REGARDING THIS MATTER. AS A RESULT, WE MAY INCUR, RECORD AND PAY LIABILITIES AND EXPENSES GREATER THAN THE AMOUNTS WE RECOGNIZED IN 2017 FOR THIS MATTER AND THOSE ADDITIONAL AMOUNTS COULD BE SIGNIFICANT.
THE INFORMATION CONTAINED IN FIVE STAR’S FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION, OR SEC, INCLUDING UNDER “RISK FACTORS” IN FIVE STAR’S PERIODIC REPORTS, OR INCORPORATED THEREIN, IDENTIFIES OTHER IMPORTANT FACTORS THAT COULD CAUSE FIVE STAR’S ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE STATED IN OR IMPLIED BY FIVE STAR’S FORWARD LOOKING STATEMENTS. FIVE STAR’S FILINGS WITH THE SEC ARE AVAILABLE ON THE SEC’S WEBSITE AT WWW.SEC.GOV.
YOU SHOULD NOT PLACE UNDUE RELIANCE UPON FORWARD LOOKING STATEMENTS.
EXCEPT AS REQUIRED BY LAW, FIVE STAR DOES NOT INTEND TO UPDATE OR CHANGE ANY FORWARD LOOKING STATEMENTS AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE.
FIVE STAR SENIOR LIVING INC. |
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Three Months Ended |
Year Ended |
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2017 | 2016 | 2017 | 2016 | ||||||||||||||||||||
Revenues: | |||||||||||||||||||||||
Senior living revenue | $ | 279,238 | $ | 280,980 | $ | 1,122,176 | $ | 1,123,258 | |||||||||||||||
Management fee revenue | 3,549 | 3,395 | 14,080 | 12,350 | |||||||||||||||||||
Reimbursed costs incurred on behalf of managed communities | 65,504 | 61,877 | 259,850 | 242,500 | |||||||||||||||||||
Total revenues | 348,291 | 346,252 | 1,396,106 | 1,378,108 | |||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Senior living wages and benefits | 137,965 | 138,669 | 551,102 | 553,310 | |||||||||||||||||||
Other senior living operating expenses | 74,300 | 71,968 | 293,419 | 284,533 | |||||||||||||||||||
Costs incurred on behalf of managed communities | 65,504 | 61,877 | 259,850 | 242,500 | |||||||||||||||||||
Rent expense | 52,007 | 50,830 | 206,531 | 201,667 | |||||||||||||||||||
General and administrative expenses | 18,479 | 19,298 | 75,212 | 73,516 | |||||||||||||||||||
Depreciation and amortization expense | 9,152 | 9,205 | 38,192 | 38,052 | |||||||||||||||||||
Gain on sale of senior living communities | (7,258 | ) | — | (7,258 | ) | — | |||||||||||||||||
Long lived asset impairment | 1,584 | — | 2,112 | 502 | |||||||||||||||||||
Total operating expenses | 351,733 | 351,847 | 1,419,160 | 1,394,080 | |||||||||||||||||||
Operating loss | (3,442 | ) | (5,595 | ) | (23,054 | ) | (15,972 | ) | |||||||||||||||
Interest, dividend and other income | 206 | 218 | 765 | 984 | |||||||||||||||||||
Interest and other expense | (1,108 | ) | (955 | ) | (4,308 | ) | (4,912 | ) | |||||||||||||||
Gain on early extinguishment of debt | — | — | 143 | — | |||||||||||||||||||
Gain (loss) on sale of available for sale securities reclassified from accumulated other comprehensive income (loss) | 57 | (140 | ) | 408 | 107 | ||||||||||||||||||
Loss from continuing operations before income taxes and equity in earnings of an investee | (4,287 | ) | (6,472 | ) | (26,046 | ) | (19,793 | ) | |||||||||||||||
Benefit from (provision for) income taxes | 3,206 | 490 | 4,536 | (2,351 | ) | ||||||||||||||||||
Equity in earnings of an investee | 75 | 30 | 608 | 137 | |||||||||||||||||||
Loss from continuing operations | (1,006 | ) | (5,952 | ) | (20,902 | ) | (22,007 | ) | |||||||||||||||
Income from discontinued operations, net of tax | — | 325 | — | 194 | |||||||||||||||||||
Net loss | $ | (1,006 | ) | $ | (5,627 | ) | $ | (20,902 | ) | $ | (21,813 | ) | |||||||||||
Weighted average shares outstanding—basic and diluted | 49,215 | 48,807 | 49,204 | 48,815 | |||||||||||||||||||
Basic and diluted (loss) income per share from: | |||||||||||||||||||||||
Continuing operations | $ | (0.02 | ) | $ | (0.12 | ) | $ | (0.42 | ) | $ | (0.45 | ) | |||||||||||
Discontinued operations | — | 0.01 | — | — | |||||||||||||||||||
Net loss per share—basic and diluted | $ | (0.02 | ) | $ | (0.11 | ) | $ | (0.42 | ) | $ | (0.45 | ) | |||||||||||
FIVE STAR SENIOR LIVING INC. |
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December 31, | December 31, | |||||||||||
2017 | 2016 | |||||||||||
Assets | ||||||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | $ | 26,255 | $ | 16,608 | ||||||||
Accounts receivable, net of allowance | 38,673 | 38,324 | ||||||||||
Due from related persons | 4,774 | 17,010 | ||||||||||
Investments in available for sale securities | 22,524 | 24,081 | ||||||||||
Restricted cash | 20,747 | 15,059 | ||||||||||
Prepaid expenses and other current assets | 25,132 | 17,295 | ||||||||||
Assets held for sale | 59,080 | 1,010 | ||||||||||
Total current assets | 197,185 | 129,387 | ||||||||||
Property and equipment, net | 251,504 | 351,929 | ||||||||||
Restricted cash | 1,476 | 1,909 | ||||||||||
Restricted investments in available for sale securities | 10,758 | 16,589 | ||||||||||
Equity investment of an investee and other long term assets | 14,985 | 9,920 | ||||||||||
Total assets | $ | 475,908 | $ | 509,734 | ||||||||
Liabilities and Shareholders’ Equity | ||||||||||||
Current liabilities: | ||||||||||||
Revolving credit facility | $ | — | $ | — | ||||||||
Accounts payable and accrued expenses | 74,734 | 68,453 | ||||||||||
Accrued compensation and benefits | 37,893 | 35,939 | ||||||||||
Due to related persons | 18,683 | 18,378 | ||||||||||
Accrued real estate taxes | 11,801 | 12,784 | ||||||||||
Other current liabilities | 40,750 | 37,432 | ||||||||||
Liabilities held for sale | 34,781 | 7 | ||||||||||
Total current liabilities | 218,642 | 172,993 | ||||||||||
Mortgage notes payable | 7,872 | 58,494 | ||||||||||
Deferred gain on sale and leaseback transaction | 66,087 | 72,695 | ||||||||||
Other long term liabilities | 38,313 | 41,286 | ||||||||||
Shareholders’ equity | 144,994 | 164,266 | ||||||||||
Total liabilities and shareholders’ equity | $ | 475,908 | $ | 509,734 | ||||||||
FIVE STAR SENIOR LIVING INC. |
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Year Ended December 31, | ||||||||
2017 | 2016 | |||||||
Cash flows from operating activities: | ||||||||
Net loss | $ | (20,902 | ) | $ | (21,813 | ) | ||
Adjustments to reconcile net loss to cash provided by (used in) operating activities: | ||||||||
Depreciation and amortization expense | 38,192 | 38,052 | ||||||
Gain on sale of senior living communities | (7,258 | ) | — | |||||
Gain on early extinguishment of debt | (298 | ) | — | |||||
Income from discontinued operations before income tax | — | (194 | ) | |||||
Gain on sale of available for sale securities reclassified from accumulated other comprehensive income | (408 | ) | (107 | ) | ||||
Loss on disposal of property and equipment | 277 | 121 | ||||||
Long lived asset impairment | 2,112 | 502 | ||||||
Equity in earnings of an investee | (608 | ) | (137 | ) | ||||
Share based compensation | 1,094 | 1,194 | ||||||
Provision for losses on receivables | 4,697 | 4,033 | ||||||
Amortization of deferred gain on sale and leaseback transaction | (6,608 | ) | (3,340 | ) | ||||
Other non-cash income adjustments, net | 703 | (531 | ) | |||||
Changes in assets and liabilities: | ||||||||
Accounts receivable | (5,046 | ) | (4,528 | ) | ||||
Prepaid expenses and other assets | (10,650 | ) | 521 | |||||
Accounts payable and accrued expenses | 6,306 | (24,661 | ) | |||||
Accrued compensation and benefits | 1,954 | 3,812 | ||||||
Due from (to) related persons, net | 11,439 | (7,923 | ) | |||||
Other current and long term liabilities | 1,120 | (8,454 | ) | |||||
Cash provided by (used in) operating activities | 16,116 | (23,453 | ) | |||||
Cash flows from investing activities: | ||||||||
Increase in restricted cash and investment accounts, net | (5,255 | ) | (10,846 | ) | ||||
Acquisition of property and equipment | (71,095 | ) | (55,419 | ) | ||||
Purchases of available for sale securities | (14,409 | ) | (8,388 | ) | ||||
Proceeds from sale of property and equipment | 39,800 | 21,437 | ||||||
Proceeds from sale of land | 750 | — | ||||||
Proceeds from sale of communities | 39,076 | 112,350 | ||||||
Proceeds from sale of available for sale securities | 22,382 | 17,905 | ||||||
Cash provided by investing activities | 11,249 | 77,039 | ||||||
Cash flows from financing activities: | ||||||||
Proceeds from borrowings on credit facilities | 65,000 | 25,000 | ||||||
Repayments of borrowings on credit facilities | (65,000 | ) | (75,000 | ) | ||||
Repayments of mortgage notes payable | (16,766 | ) | (1,260 | ) | ||||
Payment of deferred financing fees | (1,889 | ) | (300 | ) | ||||
Payment of employee tax obligations on withheld shares | (66 | ) | (86 | ) | ||||
Cash used in financing activities | (18,721 | ) | (51,646 | ) | ||||
Cash flows from discontinued operations: | ||||||||
Net cash provided by operating activities | 1,003 | 11 | ||||||
Net cash used in investing activities | — | (15 | ) | |||||
Net cash flows provided by (used in) discontinued operations | 1,003 | (4 | ) | |||||
Change in cash and cash equivalents | 9,647 | 1,936 | ||||||
Cash and cash equivalents at beginning of period | 16,608 | 14,672 | ||||||
Cash and cash equivalents at end of period | $ | 26,255 | $ | 16,608 | ||||
Supplemental cash flow information: | ||||||||
Cash paid for interest | $ | 3,932 | $ | 4,855 | ||||
Cash (received) paid for income taxes, net | $ | (1,399 | ) | $ | 3,213 | |||
FIVE STAR SENIOR LIVING INC.
RECONCILIATION OF NON-GAAP FINANCIAL
MEASURES
(in thousands)
(unaudited)
Non-GAAP financial measures are financial measures that are not determined in accordance with GAAP. Five Star believes the non-GAAP financial measures presented in the table below are meaningful supplemental disclosures because they may help investors gain a better understanding of changes in Five Star’s operating results and its ability to pay rent or service debt, make capital expenditures and expand its business. These non-GAAP financial measures also may help investors make comparisons between Five Star and other companies on both a GAAP and a non-GAAP basis. Five Star believes that EBITDA and Adjusted EBITDA are meaningful financial measures that may help investors better understand its financial performance, including by allowing investors to compare Five Star’s performance between periods and to the performance of other companies. EBITDA and Adjusted EBITDA are used by management to evaluate Five Star’s financial performance and compare Five Star’s performance over time and to the performance of other companies. Five Star calculates EBITDA and Adjusted EBITDA as shown below. These measures should not be considered as alternatives to income (loss) from continuing operations or net income (loss), as indicators of Five Star’s operating performance or as measures of Five Star’s liquidity. Also, EBITDA and Adjusted EBITDA as presented may not be comparable to similarly titled amounts calculated by other companies.
Five Star believes that income (loss) from continuing operations is the most directly comparable financial measure, determined according to GAAP, to Five Star’s presentation of EBITDA and Adjusted EBITDA. The following table presents the reconciliation of these non-GAAP financial measures to loss from continuing operations for the three months and years ended December 31, 2017 and 2016.
For the three months ended |
For the year |
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2017 | 2016 | 2017 | 2016 | ||||||||||||||||||||||||||
Loss from continuing operations | $ | (1,006 | ) | $ | (5,952 | ) | $ | (20,902 | ) | $ | (22,007 | ) | |||||||||||||||||
Add: interest and other expense | 1,108 | 955 | 4,308 | 4,912 | |||||||||||||||||||||||||
Add: (benefit from) provision for income taxes (1) | (3,206 | ) | (490 | ) | (4,536 | ) | 2,351 | ||||||||||||||||||||||
Add: depreciation and amortization expense | 9,152 | 9,205 | 38,192 | 38,052 | |||||||||||||||||||||||||
Less: interest, dividend and other income | (206 | ) | (218 | ) | (765 | ) | (984 | ) | |||||||||||||||||||||
EBITDA | 5,842 | 3,500 | 16,297 | 22,324 | |||||||||||||||||||||||||
Add (less): | |||||||||||||||||||||||||||||
Long lived asset impairments | 1,584 | — | 2,112 | 502 | |||||||||||||||||||||||||
Costs related to compliance assessments | 1,546 | (2) | — | 1,546 | (2) | (1,498 | ) | (3) | |||||||||||||||||||||
Litigation recovery | — | — | (800 | ) | — | ||||||||||||||||||||||||
Employee litigation matter | 345 | — | 345 | — | |||||||||||||||||||||||||
Gain on sale of senior living communities | (7,258 | ) | — | (7,258 | ) | — | |||||||||||||||||||||||
Transaction costs | — | — | — | 1,480 | |||||||||||||||||||||||||
Gain on early extinguishment of debt | — | — | (143 | ) | — | ||||||||||||||||||||||||
Adjusted EBITDA | $ | 2,059 | $ | 3,500 | $ | 12,099 | $ | 22,808 | |||||||||||||||||||||
(1) | 2017 data includes Five Star's monetization of alternative minimum tax credits. | |||
(2) | Consists of an estimated $0.9 million revenue reserve and $0.7 million of estimated penalties, compliance costs and professional fees related to the 2017 Compliance Assessment. | |||
(3) | Consists of a $1.5 million reversal of revenue reserves and accrued liability for estimated penalties related to the 2014 Compliance Assessment. | |||
FIVE STAR SENIOR LIVING INC. |
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Three months ended |
Year ended |
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2017 | 2016 | 2017 | 2016 | ||||||||||||||||||||
Senior living revenue: | |||||||||||||||||||||||
Independent and assisted living community revenue (owned)(3) | $ | 23,703 | $ | 23,886 | $ | 95,148 | $ | 94,404 | |||||||||||||||
Independent and assisted living community revenue (leased)(3) | 108,330 | 107,804 | 434,111 | 434,217 | |||||||||||||||||||
Continuing care retirement community revenue (leased) | 97,631 | 98,267 | 391,364 | 392,501 | |||||||||||||||||||
Skilled nursing facility revenue (leased)(4) | 41,389 | 43,950 | 170,717 | 174,682 | |||||||||||||||||||
Ageility physical therapy revenue | 8,185 | 7,073 | 30,836 | 27,454 | |||||||||||||||||||
Total senior living revenue (owned and leased) | $ | 279,238 | $ | 280,980 | $ | 1,122,176 | $ | 1,123,258 | |||||||||||||||
Senior living wages and benefits: |
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Independent and assisted living community wages and benefits (owned)(3) | $ | 9,972 | $ | 10,034 | $ | 39,659 | $ | 39,689 | |||||||||||||||
Independent and assisted living community wages and benefits (leased)(3) | 46,783 | 47,039 | 186,407 | 185,826 | |||||||||||||||||||
Continuing care retirement community wages and benefits (leased) | 49,541 | 50,233 | 199,115 | 199,567 | |||||||||||||||||||
Skilled nursing facility wages and benefits (leased) | 27,233 | 27,987 | 109,551 | 111,496 | |||||||||||||||||||
Ageility physical therapy wages and benefits | 5,718 | 5,243 | 20,964 | 19,659 | |||||||||||||||||||
Insurance and other (5) | (1,282 | ) | (1,867 | ) | (4,594 | ) | (2,927 | ) | |||||||||||||||
Total senior living wages and benefits (owned and leased) | $ | 137,965 | $ | 138,669 | $ | 551,102 | $ | 553,310 | |||||||||||||||
Other senior living operating expenses: | |||||||||||||||||||||||
Independent and assisted living community other operating expenses (owned)(3) | $ | 6,502 | $ | 6,187 | $ | 25,350 | $ | 24,863 | |||||||||||||||
Independent and assisted living community other operating expenses (leased)(3) | 27,739 | 27,251 | 108,703 | 107,156 | |||||||||||||||||||
Continuing care retirement community other operating expenses (leased) | 25,597 | 26,333 | 103,020 | 102,272 | |||||||||||||||||||
Skilled nursing facility other operating expenses (leased)(6) | 11,748 | 11,176 | 46,766 | 45,084 | |||||||||||||||||||
Ageility physical therapy other operating expenses | 625 | 360 | 2,055 | 1,448 | |||||||||||||||||||
Insurance and other (5) | 2,089 | 661 | 7,525 | 3,710 | |||||||||||||||||||
Total senior living operating expenses (owned and leased) | $ | 74,300 | $ | 71,968 | $ | 293,419 | $ | 284,533 | |||||||||||||||
(1) | Excludes data for managed communities and discontinued operations. | |||
(2) | The number of owned and leased communities between January 1, 2016 and December 31, 2017 decreased by one due to the sale in September 2016 of one leased community that was not classified as held for sale and the sale of two senior living communities to SNH in December 2017 pursuant to the 2017 Transaction Agreement, partially offset by the leasing of two additional senior living communities from SNH in December 2016; separate comparable senior living community financial data is not presented because the differences between that data and the data for all owned and leased communities is not material to Five Star’s operating results. | |||
(3) | Data presents the seven communities that were sold to SNH in June 2016 pursuant to a sale and leaseback transaction as leased for all periods presented. | |||
(4) | Skilled nursing facility revenue for the three months and year ended December 31, 2017 includes an estimated $0.9 million revenue reserve related to the 2017 Compliance Assessment. Skilled nursing facility revenue for the year ended December 31, 2016 includes a $1.0 million reversal of revenue reserves related to the 2014 Compliance Assessment. | |||
(5) | Insurance and other expenses primarily relate to Five Star's captive insurance company subsidiary, which mainly participates in Five Star's workers' compensation and professional and general liability insurance programs. | |||
(6) | Skilled nursing facility other operating expenses for the three months and year ended December 31, 2017 includes $0.7 million expense related to estimated penalties, compliance costs and professional fees for the 2017 Compliance Assessment. Skilled nursing facility other operating expenses for the year ended December 31, 2016 includes a $0.5 million reversal of accrued liability for estimated penalties related to the 2014 Compliance Assessment. | |||
FIVE STAR SENIOR LIVING INC. |
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Three months ended | ||||||||||||||||||||||||||||
December 31, | September 30, | June 30, | March 31, | December 31, | ||||||||||||||||||||||||
2017 | 2017 | 2017 | 2017 | 2016 | ||||||||||||||||||||||||
Independent and assisted living communities (owned):(2)(3) |
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Number of communities (end of period) | 24 | 26 | 26 | 26 | 26 | |||||||||||||||||||||||
Number of units (end of period)(4) | 2,474 | 2,703 | 2,703 | 2,703 | 2,703 | |||||||||||||||||||||||
Occupancy(4) | 82.7 | % | 82.9 | % | 83.4 | % | 83.6 | % | 84.6 | % | ||||||||||||||||||
Avg. monthly rate(5) | $ | 3,408 | $ | 3,410 | $ | 3,427 | $ | 3,437 | $ | 3,346 | ||||||||||||||||||
Independent and assisted living communities (leased):(2) |
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Number of communities (end of period) | 128 | 128 | 128 | 128 | 128 | |||||||||||||||||||||||
Number of units (end of period)(4) | 10,507 | 10,537 | 10,537 | 10,536 | 10,567 | |||||||||||||||||||||||
Occupancy(4) | 84.4 | % | 84.6 | % | 84.6 | % | 85.0 | % | 85.4 | % | ||||||||||||||||||
Avg. monthly rate(5) | $ | 3,978 | $ | 3,981 | $ | 4,006 | $ | 4,016 | $ | 3,925 | ||||||||||||||||||
Continuing care retirement communities (leased): | ||||||||||||||||||||||||||||
Number of communities (end of period) | 31 | 31 | 31 | 31 | 31 | |||||||||||||||||||||||
Number of units (end of period)(4)(6) | 7,159 | 7,163 | 7,172 | 7,171 | 7,171 | |||||||||||||||||||||||
Occupancy(4) | 81.8 | % | 81.6 | % | 81.8 | % | 82.9 | % | 82.8 | % | ||||||||||||||||||
Avg. monthly rate(5) | $ | 5,433 | $ | 5,400 | $ | 5,490 | $ | 5,562 | $ | 5,391 | ||||||||||||||||||
Skilled nursing facilities (leased): | ||||||||||||||||||||||||||||
Number of communities (end of period) | 30 | 30 | 30 | 30 | 30 | |||||||||||||||||||||||
Number of units (end of period)(4)(7) | 2,602 | 2,602 | 2,602 | 2,601 | 2,601 | |||||||||||||||||||||||
Occupancy(4) | 77.8 | % | 80.1 | % | 79.7 | % | 79.8 | % | 80.0 | % | ||||||||||||||||||
Avg. monthly rate(5) | $ | 6,721 | $ | 6,725 | $ | 6,973 | $ | 7,079 | $ | 6,977 | ||||||||||||||||||
Total senior living communities (owned and leased): | ||||||||||||||||||||||||||||
Number of communities (end of period) | 213 | 215 | 215 | 215 | 215 | |||||||||||||||||||||||
Number of units (end of period)(4) | 22,742 | 23,005 | 23,014 | 23,011 | 23,042 | |||||||||||||||||||||||
Occupancy(4) | 82.6 | % | 83.0 | % | 83.1 | % | 83.6 | % | 83.9 | % | ||||||||||||||||||
Avg. monthly rate(5) | $ | 4,653 | $ | 4,648 | $ | 4,715 | $ | 4,756 | $ | 4,639 | ||||||||||||||||||
Managed communities:(3) | ||||||||||||||||||||||||||||
Number of communities (end of period) | 70 | 68 | 68 | 68 | 68 | |||||||||||||||||||||||
Number of units (end of period)(4)(8) | 9,043 | 8,807 | 8,806 | 8,798 | 8,788 | |||||||||||||||||||||||
Occupancy(4) | 86.0 | % | 85.8 | % | 85.7 | % | 86.0 | % | 86.6 | % | ||||||||||||||||||
Avg. monthly rate(5) | $ | 4,254 | $ | 4,243 | $ | 4,297 | $ | 4,322 | $ | 4,222 | ||||||||||||||||||
Other ancillary services: |
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Ageility physical therapy inpatient clinics (end of period) | 47 | 47 | 47 | 48 | 48 | |||||||||||||||||||||||
Ageility physical therapy outpatient clinics (end of period) | 92 | 88 | 85 | 80 | 76 | |||||||||||||||||||||||
Home health communities served (end of period) | 15 | 15 | 13 | 18 | 16 | |||||||||||||||||||||||
(1) | Excludes data for discontinued operations. | |||
(2) | Data presents the seven communities that were sold to SNH in June 2016 pursuant to a sale and leaseback transaction as leased for all periods presented. | |||
(3) | Occupancy and average monthly rate for the three months ended December 31, 2017 include data for the two senior living communities that were sold to SNH in December 2017 pursuant to the 2017 Transaction Agreement as owned until the time of sale and as managed from the time of sale through the end of the period. | |||
(4) | Includes only living units categorized as in service. As a result, the number of living units may change from period to period for reasons other than the acquisition or disposition of senior living communities. | |||
(5) | Average monthly rate is calculated by taking the average daily rate, which is defined as total operating revenues divided by occupied units during the period, and multiplying it by 30 days. | |||
(6) | Includes 1,916 skilled nursing units in communities where assisted living and independent living services are the predominant services provided. | |||
(7) | Includes 69 assisted living and independent living units in communities where skilled nursing services are the predominant services provided. | |||
(8) | Includes 427 skilled nursing units in communities where assisted living and independent living services are the predominant services provided. | |||
FIVE STAR SENIOR LIVING INC. |
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Three Months Ended |
Year Ended |
||||||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||||||
Independent and assisted living communities (owned):(2) | |||||||||||||||||||
Private and other sources | 99.2 | % | 99.1 | % | 99.0 | % | 99.0 | % | |||||||||||
Medicaid | 0.8 | % | 0.9 | % | 1.0 | % | 1.0 | % | |||||||||||
Total | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||
Independent and assisted living communities (leased):(2) | |||||||||||||||||||
Private and other sources | 98.9 | % | 99.0 | % | 99.0 | % | 99.0 | % | |||||||||||
Medicaid | 1.1 | % | 1.0 | % | 1.0 | % | 1.0 | % | |||||||||||
Total | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||
Continuing care retirement communities (leased): | |||||||||||||||||||
Private and other sources | 74.1 | % | 73.2 | % | 73.9 | % | 73.8 | % | |||||||||||
Medicare | 18.4 | % | 19.8 | % | 18.9 | % | 19.3 | % | |||||||||||
Medicaid | 7.5 | % | 7.0 | % | 7.2 | % | 6.9 | % | |||||||||||
Total | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||
Skilled nursing facilities (leased): | |||||||||||||||||||
Private and other sources | 19.0 | % | 24.6 | % | 21.8 | % | 25.5 | % | |||||||||||
Medicare | 18.9 | % | 21.3 | % | 20.5 | % | 20.7 | % | |||||||||||
Medicaid | 62.1 | % | 54.1 | % | 57.7 | % | 53.8 | % | |||||||||||
Total | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||
Total senior living communities (owned and leased): | |||||||||||||||||||
Private and other sources | 77.7 | % | 77.6 | % | 77.8 | % | 78.2 | % | |||||||||||
Medicare | 9.5 | % | 10.6 | % | 10.0 | % | 10.3 | % | |||||||||||
Medicaid | 12.8 | % | 11.8 | % | 12.2 | % | 11.5 | % | |||||||||||
Total | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||
(1) | Excludes data for managed communities and discontinued operations. | |||
(2) | Data presents the seven communities that were sold to SNH in June 2016 pursuant to a sale and leaseback transaction as leased for all periods presented. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20180321005310/en/