Sienna Senior Living Inc. Provides Business Update
MARKHAM, Ontario, July 27, 2020 (GLOBE NEWSWIRE) -- Sienna Senior Living Inc. (“Sienna” or the “Company”) (TSX: SIA) today provided the following business update.
Since the onset of COVID-19, the Company has been singularly focused on steering Sienna through the crisis, learning from it, and positioning Sienna to come out stronger. The health and well-being of our residents and team members remains Sienna’s top priority.
“To date, we have made good progress in implementing important measures in our fight against COVID-19,” said Nitin Jain, President and CEO. “We will take all necessary steps to minimize the impact of new outbreaks and a potential second wave on our ability to provide the best quality care for our seniors, while also keeping our team members healthy and safe.”
COVID-19 Update
No current resident cases of COVID-19 in any of Sienna’s residences
As of July 26, 2020, two long-term care residences of our 83 owned or managed residences are in outbreak, with no active resident COVID-19 cases.
Business Update
Retirement Occupancy and Rent Collection
The Company’s average same property occupancy in the Retirement portfolio continued to be affected by COVID-19 restrictions that have reduced move-in activity and the ability to conduct in-home tours. Rent collection levels remained high and consistent with past experience.
| April 2020 | May 2020 | June 2020 | |
| Retirement same property occupancy (average) | 83.7% | 83.0% | 82.3% |
| Retirement rent collection | 98.5% | 99.4% | 99.2% |
Subsequent to the end of Q2, the Company resumed in-person tours in its Ontario and British Columbia retirement residences in accordance with public health guidelines.
Long-term Care Occupancy and Funding
Average occupancy in the Long-Term Care (LTC) portfolio declined to 92.6% in Q2 2020 from 97.9% in Q1 2020. Long-term care residences are fully funded for vacancies caused by temporary closure of admissions due to an infectious outbreak, including COVID-19. The Government of Ontario has announced that the occupancy protection funding will be in place for long-term care residences until December 31, 2020.
The Government of Ontario provides long-term care funding for personal care, programming, food and accommodation. With the exception of accommodation, all funding is “flow-through” funding required to be spent entirely on residents, with any excess amounts not allocated to direct resident care returned to the Ministry of Long Term Care.
Pandemic Expenses
Sienna expects to continue to incur an increased level of expenses to support the costs of managing COVID-19. While certain of these temporary expenses are expected to be covered by government funding, other of these expenses may not be covered. Non-recoverable expenses include expert counsel fees and expenses related to manager pandemic pay programs. There may be timing differences between the time of incurring these expenses and the funding of such expenses.
For the three months ended June 30, 2020, the net impact of pandemic related expenses was $10.7 million, mainly comprised of additional staffing and administrative costs, expenditures for personal protective equipment and supplies, and advisory fees.
Ontario Government Announcement on Long-term Care Construction and Redevelopment
We are pleased with the July 15 announcement by the Government of Ontario of a new funding model for long-term care. The model is expected to help accelerate the much needed construction and redevelopment of long-term care homes across the province. Sienna has long advocated for a revised model, moving from a one-size fits all approach to a funding model that caters to regional development needs.
The Company has started to evaluate how this program will impact and benefit Sienna’s current portfolio of 5,733 long-term care beds in Ontario, of which approximately 2,200 beds are located in 15 older Class B/C homes.
Balance Sheet and Liquidity Update
The Company maintains a strong financial position with significant liquidity and a substantial unencumbered asset pool. Sienna will continue to focus on enhancing its liquidity position and expects to continue to delay new expansion projects and limit capital expenditures to essential maintenance capital.
- Liquidity is approximately $242 million as at July 27, 2020, comprised of cash and cash equivalents and available credit facilities; and
- Fair value of the unencumbered asset pool remained at approximately $540 million as at June 30, 2020.
With respect to upcoming debt maturities, including scheduled debt repayments of $10 million for the remainder of 2020 and Q1 2021 maturity of the 3.437% Series B Senior Secured Debentures in the amount of approximately $248 million (net of principal reserve fund), the Company expects it will be able to successfully refinance its maturing debt based on Sienna’s current financial position and debt profile.
About Sienna Senior Living
Sienna Senior Living Inc. (TSX:SIA) offers a full range of seniors' living options, including independent living, assisted living, long-term care, and specialized programs and services. Sienna's approximately 12,000 employees are passionate about helping residents live fully every day, and were the driving force behind Sienna being named one of Canada's Most Admired Corporate Cultures. For more information, please visit .
Risk Factors
Refer to the risk factors on “General Business Risks” and “COVID-19 and Other Outbreaks” disclosed in the Company’s Management Discussion and Analysis for the three months ended March 31, 2020, and other risk factors disclosed in its most recent annual Management Discussion and Analysis and Annual Information Form for more information.
Forward-Looking Information
Certain of the statements contained in this news release are forward-looking statements and are provided for the purpose of presenting information about management’s current expectations and plans relating to the future. Readers are cautioned that such statements may not be appropriate for other purposes. These statements generally use forward-looking words, such as “anticipate,” “continue,” “could,” “expect,” “may,” “will,” “estimate,” “believe,” “goals” or other similar words and include, without limitation, statements with respect to the impact of COVID-19 and measures taken to mitigate the impact and statements with respect to the Company’s ability to refinance debt maturities. These statements are subject to significant known and unknown risks and uncertainties that may cause actual results or events to differ materially from those expressed or implied by such statements and, accordingly, should not be read as guarantees of future performance or results and will not necessarily be accurate indications of whether or not such results will be achieved. The forward-looking statements in this news release are based on information currently available and what management currently believes are reasonable assumptions. The Company does not undertake any obligation to publicly update or revise any forward-looking statements except as may be required by applicable law.
For further information, please contact:
Karen Hon
Chief Financial Officer and Senior Vice President
(905) 477-4006 x3069
Nancy Webb
Senior Vice President, Public Affairs and Marketing
(905) 415-7623
