Alterra Announces First Quarter 2002 Results.Business Editors MILWAUKEE--(BUSINESS WIRE)--May 15, 2002 Alterra Healthcare Corporation (AMEX AMEX See: American Stock Exchange : ALI Ali (älē`) (Ali ibn Abu Talib), 598?–661, 4th caliph (656–61). The debate over his right to the caliphate caused a major split in Islam into Sunni and Shiite branches, and he is regarded by the Shiites as the first Imam, or leader: ) today announced financial results for the three-month period ended March 31, 2002 and provided an update on 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). activities. At quarter-end, the Company operated or managed 424 residences with a total capacity to serve approximately 19,882 residents. OPERATING AND FINANCIAL RESULTS In the first quarter of 2002, the Company's residence level operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: were 33.5%, an increase of 4.9% over residence level operating margins in first quarter of 2001. Monthly rates averaged $2,808 for the quarter ended March 31, 2002, an increase of 8.5% over the average monthly rate for the March 2001 quarter. In addition, general and administrative costs administrative costs, n.pl the overhead expenses incurred in the operation of a dental benefits program, excluding costs of dental services provided. (excluding costs related to the Company's restructuring activities) declined to $8.8 million in the quarter ended March 31, 2002, or 7.0% of total residence revenue, from $10.2 million, or 7.9% of total resident revenue for the quarter ended March 31, 2001. For the three months ended March 31, 2002, the Company reported overall average occupancy of 81.1%. "Our first quarter results reflect the continued gradual improvement of our operations and cash flow. Margins improved in the quarter due to growth in average monthly rates and incremental cost Incremental Cost The encompassing change that a company experiences within its balance sheet due to one additional unit of production. Notes: Incremental cost is the overall change that a company experiences by producing one additional unit of good. control. We look forward to continuing to meet the needs of our residents and employees as we seek to conclude our restructuring activities," said Patrick Kennedy
Patrick Kennedy (c. 1823 – November 22, 1858) was the father of Patrick Joseph Kennedy and great grandfather to former United States President John F. , Alterra's President and Chief Executive Officer. The Company implemented Financial Accounting Standards Board Financial Accounting Standards Board (FASB) Board composed of independent members who create and interpret Generally Accepted Accounting Principles (GAAP). Statement of Financial Accounting Standards No. 142 ("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 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. ," effective January January: see month. 1, 2002. As a result of the adoption of SFAS 142, the Company recorded a pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta charge of $54.7 million related to the adoption of this new accounting pronouncement. RESTRUCTURING ACTIVITIES AND PORTFOLIO RATIONALIZATION rationalization, in psychology: see defense mechanism. In March of 2001 the Company commenced efforts to implement a restructuring plan, the principal components of which include the disposition of selected assets and the comprehensive restructuring of its capital structure. Restructuring discussions with various senior capital structure constituents transpired during 2001 and the first quarter of 2002 and are ongoing. While certain binding restructuring arrangements have been executed, negotiations with respect to the majority of the Company's secured debt arrangements have not been concluded. Negotiations with junior capital structure constituents have not commenced, as these negotiations are dependent upon the outcome of negotiations with senior capital structure constituents. The Company's Board of Directors has adopted a plan to dispose of To determine the fate of; to exercise the power of control over; to fix the condition, application, employment, etc. of; to direct or assign for a use. See also: Dispose or terminate leases on 102 residences with an aggregate capacity of 4,444 residents and 33 parcels of land. As of March 31, 2002, 66 residences representing a resident capacity of 3,052 have either been sold or transferred to a new lessee One who rents real property or Personal Property from another. A lessee of land is a tenant. Cross-references Landlord and Tenant. lessee n. the person renting property under a written lease from the owner (lessor). . In addition, the Company has sold ten land parcels. Alterra offers supportive and selected healthcare services to our nation's frail elderly frail elderly, n.pl older persons (usually over the age of 75 years) who are afflicted with physical or mental disabilities that may interfere with the ability to independently perform activities of daily living. and is the nation's largest operator of freestanding free·stand·ing adj. Standing or operating independently of anything else: a freestanding bell tower; a freestanding maternity clinic. Alzheimer's/memory care residences. Alterra currently operates in 25 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 "ALI." Statements in this release relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc matters that are not historical facts are 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. based on management's belief and assumptions based upon currently available information. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable; it is unable to provide assurances that these expectations will prove to be correct. Forward-looking statements involve a number of risks and uncertainties, including, but not limited to, uncertainty regarding the consequences of the Company's restructuring, risks associated with continuing defaults under loan, lease and subordinated debenture subordinated debenture An unsecured bond with a claim to assets that is subordinate to all existing and future debt. Thus, in the event that the issuer encounters financial difficulties and must be liquidated, all other claims must be satisfied before obligations, risks associated with the continuing shortfall Shortfall The amount by which the capital required to fulfill a financial obligation exceeds available capital. Notes: Shortfall risk is often combated with an efficient hedging strategy created by a fund, group, institution, or individual. in the Company's liquidity and the implementation of the Company's restructuring plan, risks associated with the disposition of assets and termination of leases, substantial debt and operating lease Operating Lease A lease contract that allows the use of an asset, but does not convey rights similar to ownership of the asset. Notes: An operating lease is not capitalized it is accounted for as a rental expense. payment obligations and current and pending maturities, risks associated with liability claims and insurance, competition, governmental regulation and other uncertainties outlined in the Company's reports filed with the Securities and Exchange Commission. Should one or more of these risks materialize ma·te·ri·al·ize v. ma·te·ri·al·ized, ma·te·ri·al·iz·ing, ma·te·ri·al·iz·es v.tr. 1. To cause to become real or actual: By building the house, we materialized a dream. (or the consequences of one or more of these risks worsen wors·en tr. & intr.v. wors·ened, wors·en·ing, wors·ens To make or become worse. worsen Verb to make or become worse worsening adjn ) or should the Company's underlying assumptions prove incorrect, the Company's actual results of operation and financial position in the future could differ materially from those forecasted or expected. The Company assumes no duty to publicly update such statements.
ALTERRA HEALTHCARE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
(In Thousands, Except Per Share Data)
Three Months
Ended March 31,
---------------
2002 2001
------------------
Revenue:
Resident service fees $124,432 $125,547
Other 1,116 1,767
-------- --------
Operating revenue 125,548 127,314
Operating expenses:
Residence operations 83,478 86,067
Lease expense 15,062 20,950
Lease income (4,024) (5,544)
General and administrative 10,540 11,411
(Gain) loss on disposal (2,011) 12,036
Depreciation and amortization 7,939 9,222
-------- --------
Total operating expenses 110,984 134,142
Operating income 14,564 (6,828)
Other expense:
Interest expense, net 17,529 16,860
Amortization of financing costs 2,054 2,428
PIK interest 6,136 6,352
Equity in losses of unconsolidated affiliates 2,274 4,566
-------- --------
Total other expense, net 27,993 30,206
Loss from continuing operations before
income taxes and cumulative effect of
change in accounting principle (13,429) (37,034)
Income tax expense (30) (30)
-------- --------
Loss from continuing operations before
cumulative effect of change
in accounting principle (13,459) (37,064)
Loss on discontinued operations (6,344) (558)
Cumulative effect of change in accounting
principles (54,695) --
-------- --------
Net loss $(74,498) $(37,622)
======== ========
Loss per common share - basic and diluted:
Loss from continuing operations before
cumulative effect of change in accounting
principle - basis and diluted (.61) (1.68)
Loss on discontinued operations - basic
and diluted (.28) (.02)
Cumulative effect of change in accounting
principles - basic and diluted (2.46) --
-------- --------
Net loss per common share - basic and
diluted $ (3.35) $ (1.70)
======== ========
Weighted average common shares outstanding -
basic and diluted 22,219 22,110
======== ========
ALTERRA HEALTHCARE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In Thousands)
March 31, December 31,
2002 2001
----------- -----------
ASSETS
Cash $ 20,759 $ 19,996
Assets held for sale 98,103 88,166
Other current assets 43,768 42,385
----------- -----------
Current assets 162,630 150,547
----------- -----------
Land 61,215 65,660
Building and improvements 636,572 659,955
Furniture, fixtures and equipment 87,671 88,271
----------- -----------
Total property and equipment 785,458 813,886
Less: accumulated depreciation (94,016) (86,470)
----------- -----------
Property and equipment, net 691,442 727,416
Other assets 101,829 160,237
----------- -----------
Total assets $ 955,901 $1,038,200
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $1,192,859 $1,211,292
Long-term obligations, less current
installments 93,888 82,752
Deferred gain on sale and other 4,933 5,593
Redeemable preferred stock 5,645 5,489
----------- -----------
Stockholders' equity (341,424) (266,926)
----------- -----------
Total liabilities and stockholders' equity $ 955,901 $1,038,200
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