ARV Assisted Living Reports First Quarter Results; Income From Operations Improves by $2 Million.Business Editors COSTA MESA Costa Mesa (kŏs`tə mā`sə), city (1990 pop. 96,357), Orange co., S Calif., on the Pacific south of Santa Ana; inc. 1953. It is a transportation, residential, and light industrial center. , Calif.--(BUSINESS WIRE)--May 15, 2002 ARV ARV abbr. Bible American Revised Version ARV n abbr (= American Revised Version) → traducción americana de la Biblia ARV n abbr (= Assisted Living as·sist·ed living n. A living arrangement in which people with special needs, especially older people with disabilities, reside in a facility that provides help with everyday tasks such as bathing, dressing, and taking medication. Inc. (AMEX AMEX See: American Stock Exchange :SRS SRS, SRS-A see slow-reacting substance. ) today announced operating results for the first quarter ended March 31, 2002. The company reported a quarterly net loss of $0.1 million, or ($0.01) per share, compared with net income of $1.7 million, or $0.10 per share, for the first quarter of 2001. For the quarter ended March 31, 2001, however, the net loss prior to one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. gains on sale of partnership interests, was $1.2 million, or ($0.07) per share. When compared with the quarter ended March 31, 2002, during which no one-time gains were realized, the 2002 first quarter net loss of $0.1 million represents a $1.1 million improvement over the $1.2 million net loss prior to one-time gains for the quarter ended March 31, 2001. First Quarter 2002 Results Total revenue for the first quarter of 2002 was $39.8 million compared with $35.4 million for the same quarter last year. The revenue increase reflects the addition of two assisted living communities that the company acquired as part of the American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of Retirement Villas Properties III, LP successful tender offer in December December: see month. 2001. Revenues were also positively affected by a $200, or 9.1%, increase in the average revenue per occupied unit from $2,199 for the first quarter of 2001 to $2,399 for the first quarter of 2002. Revenue from assisted living services on a same community basis for the first quarter of 2002 increased 10.8% over the corresponding quarter for the prior year. On a same community basis, the occupancy Gaining or having physical possession of real property subject to, or in the absence of, legal right or title. In a fire insurance policy, for example, the term occupancy of owned or leased communities by the company for four quarters or more was 86.6% at March 31, 2002, compared with 88.5% at March 31, 2001. In the first quarter of 2002, the company entered into a fee-for-service fee-for-ser·vice adj. Charging a fee for each service performed. contract to manage an 89-unit assisted living facility in Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, . The $2.4 million increase in operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. in the first quarter of 2002 as compared with the first quarter of 2001 relates primarily to the aforementioned a·fore·men·tioned adj. Mentioned previously. n. The one or ones mentioned previously. aforementioned Adjective mentioned before Adj. 1. acquisition of two communities and substantial increases in insurance premiums and utility costs. Income from operations for the first quarter of 2002 was $2.8 million, a $2.0 million improvement over the $0.8 million of income from operations for the first quarter of 2001. On a same community basis, the operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: increased to 38.5% from the 36.7% margin achieved for the year-ago quarter. The company's balance sheet restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). is materially complete except for the refinancing Refinancing An extension and/or increase in amount of existing debt. of a few mortgage loans. In the first quarter of 2002, the company refinanced the mortgage debt secured by an assisted living community by obtaining a new HUD-insured, 35-year fixed rate loan. Today, the company received approval of a loan to refinance Refinance 1. When a business or person revises their payment schedule for repaying debt. 2. Replacing an older loan with a new loan offering better terms. Notes: When a business refinances they typically extend the maturity date. two mortgage loans with an aggregate principal balance totaling $18.4 million that mature within the next 12 months. As of April 24, 2002, the company also extended the maturity of the term loan with its major shareholder to July July: see month. 1, 2004. The company adopted Statement of Financial Accounting Standards (SFAS SFAS Statement of Financial Accounting Standards SFAS Special Forces Assessment and Selection SFAS Student Financial Aid Services SFAS Sport Fishing Association of Singapore SFAS Safety Features Actuation System SFAS Statewide Fixed Assets System ) No.142 "Goodwill and Other Intangible Assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. " on Jan. 1, 2002, which required that the company prospectively cease amortization of goodwill. If the company had not ceased amortization of goodwill, the net loss for the quarter ended March 31, 2002 would have been $0.3 million, or ($0.02) per share. Douglas Douglas, city, Isle of Man Douglas, city (1991 pop. 19,950), capital of the Isle of Man, Great Britain. It is a popular resort, connected by rail to Ramsey and Port Erin, on the Irish Sea. Tourism is the chief industry. M. Pasquale Pasquale may refer to:
adv. 1. Mathematics At right angles: sawed the beam squarely. 2. In a square shape. 3. on continued operational improvement and growth." Conference Call A conference call to discuss ARV's first quarter of 2002 earnings is scheduled for Thursday Thursday: see week. , May 16, 2002 at 1 p.m. PST PST Paroxysmal supraventricular tachycardia, see there . The call-in call-in adj. Being in a format such that listeners or viewers are invited to have their telephone conversations with the host or guests on a show broadcast to other listeners: a call-in radio show. n. number is 800/245-9972. A replay of the call will be available for a 24-hour period beginning two hours following the end of the live call. To access replay, dial 800/642-1687 and enter identification number 20581. An online replay of the call will also be available for registered analysts at www.streetfusion.com. About the company Founded in 1980, ARV is one of the largest operators of assisted living communities in the nation, currently operating 59 communities containing approximately 7,000 units in 11 states. The company's common stock is traded on the American Stock Exchange American Stock Exchange (AMEX) Stock exchange in the U.S. Originally known as “the Curb,” it began as an outdoor marketplace in New York City c. 1850. It moved indoors to its present location in the Wall Street area in 1921. under the symbol SRS, and its home page can be found at www.arvi.com. The forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. contained in this news release are subject to certain risks and uncertainties that could cause actual results to differ materially, including, without limitation, licensing, delays in satisfaction of or the inability to satisfy licensure licensure (lī´s  nsh requirements for acquired communities; the possibility that financing
for acquisition and development and refinancing of maturing loans may
become less available or more expensive; the possibility that
divestitures may not be completed as planned; and the possibility that
integration of operations for communities developed or acquired may not
occur efficiently. These and other risks are detailed in the
company's Form 10-K Form 10-KA report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. filed with the Securities and Exchange Commission for the fiscal period ended Dec. 31, 2001. The company assumes no obligation to update or supplement forward-looking statements that become untrue un·true adj. un·tru·er, un·tru·est 1. Contrary to fact; false. 2. Deviating from a standard; not straight, even, level, or exact. 3. Disloyal; unfaithful. because of subsequent events.
ARV ASSISTED LIVING INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In Thousands)
ASSETS
MARCH 31, DEC. 31,
2002 2001
Current assets:
Cash and cash equivalents $ 13,262 $ 13,234
Accounts receivable and amounts
due from affiliates, net 649 744
Prepaids and other current
assets 3,201 3,701
Impounds 4,223 3,779
Property held for sale, net 792 763
Total current assets 22,127 22,221
Property, furniture and equipment,
net 115,952 116,929
Goodwill, net 18,354 18,354
Operating lease security deposits 9,243 9,414
Other non-current assets, net 14,866 10,259
$180,542 $177,177
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 975 $ 2,212
Accrued payroll costs 4,245 4,055
Other accrued liabilities 6,869 6,659
Notes payable, current portion 2,690 7,269
Accrued interest payable 984 823
Total current liabilities 15,763 21,018
Notes payable, less current portion 114,315 105,062
Lease liabilities 2,023 1,995
Other non-current liabilities 605 641
132,706 128,716
Minority interest in majority owned
entities 141 621
Shareholders' equity 47,695 47,840
Commitments and contingencies
$180,542 $177,177
ARV Assisted Living Inc.
Detail of Assisted Living Communities Operated
Communities March 31, 2002 Dec. 31, 2001
Owned 17 17
Leased 33 33
Managed 9 8
Total 59 58
Units
Owned 1,816 1,816
Leased 4,310 4,310
Managed 737 648
Total 6,863 6,774
ARV ASSISTED LIVING INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2002 AND 2001
(Unaudited)
(In thousands, Except per share amounts)
THREE MONTHS ENDED
MARCH 31,
2002 2001
Revenue:
Assisted living community revenue:
Rental revenue $32,004 $ 28,668
Assisted living and other
services 6,741 5,905
Skilled nursing facility revenue 763 551
Management fees 270 319
Total revenue 39,778 35,443
Operating expenses:
Assisted living community
operating expense 23,624 21,647
Skilled nursing facility
expenses 756 571
Community lease expense 8,022 7,708
General and administrative 2,681 2,669
Depreciation and amortization 1,899 2,012
Total operating expenses 36,982 34,607
Income from operations 2,796 836
Other income (expense):
Interest income 51 434
Other income (expense), net (41) 35
Equity in loss of partnerships (371) --
Gain on sale of properties and
partnership interests -- 2,887
Interest expense (2,309) (2,318)
Total other income (expense) (2,670) 1,038
Income before income tax
expense, minority interest in
income of majority owned entities
and extraordinary item 126 1,874
Income tax expense (3) (23)
Minority interest in income of
majority owned entities (268) (130)
Income (loss) before extraordinary
item (145) 1,721
Extraordinary loss from early
extinguishment of debt, net of
income tax -- (56)
Net income (loss) $ (145) $ 1,665
Basic and diluted income (loss)
per common share:
Income (loss) before
extraordinary loss from
early extinguishment
of debt $ (0.01) $ 0.10
Extraordinary loss from
early extinguishment of
debt, net of income tax -- --
Net income (loss) $ (0.01) $ 0.10
Weighted average common shares
outstanding 17,460 17,460
ARV Assisted Living Inc.
Operations Summary
For the Quarter Ended March 31, 2002
(Unaudited)
(In thousands)
Existing (a) Acquired (b)
Communities Communities Corporate Total
Revenue:
Assisted living
community revenue:
Rental revenue $30,472 $1,532 $32,004
Assisted living and
other services 6,542 199 6,741
Skilled nursing
facility revenue 763 763
Management fees -- 270 270
Total revenue 37,777 1,731 270 39,778
Operating Expenses:
Assisted living
community operating
expense 22,492 1,132 23,624
Assisted living
community lease
expense 8,022 8,022
Skilled nursing
facility expenses 756 756
General and
administrative -- 2,681 2,681
Depreciation and
amortization 1,408 219 272 1,899
Total operating
expenses 32,678 1,351 2,953 36,982
Income (loss) from
operations 5,099 380 (2,683) 2,796
Other income (expense):
Interest income -- 12 39 51
Other income (expense),
net 45 -- (86) (41)
Equity in loss of
partnerships -- -- (371) (371)
Interest expense (1,491) (349) (469) (2,309)
Total other expense (1,446) (337) (887) (2,670)
Income (loss) before
income tax and minority
interest in income of
majority owned
entities $3,653 $43 ($3,570) $126
Minority interest in
income of majority
owned entities (268)
Income tax expense 3
Net loss (145)
(a) Represents operations of 48 communities owned or leased by the
company over four quarters or more as of March 31, 2002
(b) Represents operations of 2 communities acquired as part of the
American Retirement Villas Properties III, L.P. tender offer in
December 2001
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