Beverly Earnings Continue On Plan at Eight Cents Per Share Diluted in Second Quarter.Business Editors/Health & Medical Writers FORT SMITH, Ark.--(BW HealthWire)--Aug. 1, 2000 Beverly Enterprises, Inc. (NYSE NYSE See: New York Stock Exchange : BEV) today announced that net income for the second quarter of 2000 totaled $8,522,000 (eight cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. ), compared to a net loss of $115,857,000 ($1.13 per share diluted) in the same quarter of the prior year. The 1999 totals reflect special pre-tax charges of $200,542,000 related to settlements of Federal Medicare Medicare, national health insurance program in the United States for persons aged 65 and over and the disabled. It was established in 1965 with passage of the Social Security Amendments and is now run by the Centers for Medicare and Medicaid Services. investigations and remediation costs related to the Year 2000 (Y2K See Y2K problem and Y2K compliant. Y2K - Year 2000 ) issue of $4,263,000. Revenues for the second quarter of 2000 were $655,888,000, up 3.5 percent from the prior year's second quarter total of $633,678,000, primarily because of increases in Medicare, Medicaid Medicaid, national health insurance program in the United States for low-income persons; established in 1965 with passage of the Social Security Amendments and now run by the Centers for Medicare and Medicaid Services. and private per diem per diem adj. or n. Latin for "per day," it is short for payment of daily expenses and/or fees of an employee or an agent. rates for nursing home care. For the six months ended June 30, 2000, net income totaled $14,783,000 (15 cents per share diluted) on revenues of $1,302,815,000. For the first half of 1999, Beverly recorded a net loss of $109,950,000 ($1.07 per share diluted) on revenues of $1,268,707,000. The 1999 period included special charges for Federal government settlements of $202,447,000 and Y2K remediation costs of $7,249.000. David R. Banks, Chairman and Chief Executive Officer, made the following comments about the company's performance and outlook: -- "Our nursing home operations continue to perform on-target, even though we still are challenged by the high cost and tight availability of labor, and by unpredictable and escalating patient liability costs." -- "Nursing home occupancy averaged 86.8 percent for the second quarter, up 30 basis points from the year-earlier period but down 50 basis points from the first quarter of 2000. Medicare census was 9.6 percent of total patient days in the second quarter of 2000, reflecting a seasonal decline from the first quarter but increases during each month from the levels achieved during the second quarter of 1999." -- "Our average daily rate for Medicare patients during the second quarter of 2000 was on-projection at $267.70, a 5.3 percent increase over the average per diem in the first quarter. We expect to experience this same rate in the third quarter, and then see an increase to about $280 for the fourth quarter, which is the per diem rate we had projected for that period in our 2000 Performance Plan." -- "Our weighted-average wage rate for the 2000 second quarter was up 6.8 percent from the year-earlier period. Some of this increase is due to Medicaid rate improvements in several states that required a portion of the rate increase to be `passed-through' in the form of higher wages. We have actively lobbied for this type of legislation, which provides long-overdue recognition of the important work performed by our caregivers and which should supplement our own efforts to improve recruiting and retention." -- "Our performance plan for the balance of 2000 calls for improved operating results, compared to the first half of this year and also to the third and fourth quarters of 1999. This plan includes a series of initiatives we've recently launched, which are designed to increase revenues and reduce overhead costs. We are encouraged by the initial results we've achieved." Beverly shareholders may listen today to a 7:30 a.m. CDT CDT abbr. Central Daylight Time CDT Central Daylight Time CDT n abbr (US) (= Central Daylight Time) → hora de verano del centro; (BRIT discussion by senior management of the Company's performance by dialing 212/346-6410. A recording of this conference call will be available from 9:30 a.m. CDT today until 5:00 p.m. CDT Friday, August 4. Shareholders may dial 800/633-8284 or 858/812-6440 and enter reservation 15795893 and the pound sign to access the recording. This news release and related conference call may contain 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. , including statements related to expected 2000 performance, made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Forward-looking statements involve known and unknown risks and uncertainties that may cause the Company's actual results in future periods to differ materially from forecasted results. These risks and uncertainties include: national and local economic conditions; the effect of government regulations and changes in regulations governing gov·ern v. gov·erned, gov·ern·ing, gov·erns v.tr. 1. To make and administer the public policy and affairs of; exercise sovereign authority in. 2. the healthcare industry, including the Company's compliance with such regulations; changes in Medicare and Medicaid Medicare and Medicaid U.S. government programs in effect since 1966. Medicare covers most people 65 or older and those with long-term disabilities. Part A, a hospital insurance plan, also pays for home health visits and hospice care. payment levels; liabilities and other claims asserted against the Company, including patient care liabilities as well as the resolution of lawsuits brought about by the announcement of the federal government investigations or the settlements of such investigations; the ability to attract and retain qualified personnel; the availability and terms of capital to fund acquisitions and capital improvements; the competitive environment in which the Company operates; the ability to maintain and increase census levels; demographic changes; and the availability and cost of labor and materials labor and materials (time and materials) n. what some builders or repair people contract to provide and be paid for, rather than a fixed price or a percentage of the costs. . These and other risks and uncertainties that could affect future results are addressed in the Company's filings with the Securities and Exchange Commission, including Forms 10-K and 10-Q. Beverly Enterprises and its operating subsidiaries An operating subsidiary is a business term frequently used within the United States railroad industry. In the case of a railroad, it refers to a company that is a subsidiary but operates with its own identity and rolling stock. comprise a leading provider of post-acute healthcare in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . They operate 553 skilled nursing facilities skilled nursing facility n. Abbr. SNF An establishment that houses chronically ill, usually elderly patients, and provides long-term nursing care, rehabilitation, and other services. , as well as 37 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. centers, 178 outpatient outpatient /out·pa·tient/ (-pa-shent) a patient who comes to the hospital, clinic, or dispensary for diagnosis and/or treatment but does not occupy a bed. out·pa·tient n. therapy clinics, and 62 home care and hospice hospice, program of humane and supportive care for the terminally ill and their families; the term also applies to a professional facility that provides care to dying patients who can no longer be cared for at home. agencies.
BEVERLY ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share amounts)
Three months ended Six months ended
June 30, June 30,
------------------- ----------------------
2000 1999 2000 1999
-------- --------- ---------- ----------
Net operating revenues $655,239 $632,751 $1,301,341 $1,266,352
Interest income 649 927 1,474 2,355
-------- --------- ---------- ----------
Total revenues 655,888 633,678 1,302,815 1,268,707
Costs and expenses:
Operating and
administrative:
Wages and related 405,131 392,297 805,551 787,966
Other 192,065 178,832 383,520 362,699
Interest 20,313 17,045 39,931 34,028
Depreciation and
amortization 25,378 24,600 50,714 48,842
Special charges related
to settlements of
federal government
investigations -- 200,542 -- 202,447
Year 2000 remediation -- 4,263 -- 7,249
-------- --------- ---------- ----------
Total costs
and expenses 642,887 817,579 1,279,716 1,443,231
-------- --------- ---------- ----------
Income (loss) before
provision for (benefit
from) income taxes 13,001 (183,901) 23,099 (174,524)
Provision for (benefit
from) income taxes 4,479 (68,044) 8,316 (64,574)
-------- --------- ---------- ----------
Net income (loss) $8,522 $(115,857) $14,783 $(109,950)
======== ========= ========== ==========
Net income (loss) per
share of common stock:
Basic and diluted:
Net income (loss)
per share of
common stock $0.08 $(1.13) $0.15 $(1.07)
======== ========= ========== ==========
Shares used to
compute basic
net income (loss)
per share 101,321 102,494 101,801 102,487
======== ========= ========== ==========
Shares used to
compute diluted
net income (loss)
per share 101,323 102,494 101,863 102,487
======== ========= ========== ==========
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