Beverly Enterprises Net Income from Continuing Operations Up 30% for the Fourth Quarter and 54% for the Year; Full-year EBITDA Totals $191 Million.FORT SMITH, Ark. -- Beverly Beverly, city (1990 pop. 38,195), Essex co., NE Mass., on Massachusetts Bay; inc. as a city 1894. Its chief manufactures are electronic and scientific equipment, consumer goods, and chemicals. Enterprises, Inc. (NYSE NYSE See: New York Stock Exchange : BEV) today announced that net income from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the totaled $14.9 million (13 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. ) in the fourth quarter of 2004, up 30 percent from $11.4 million (10 cents per share diluted) in the same period in 2003. Revenue for the fourth quarter of 2004 totaled $516.6 million, up 10 percent from the comparable period in 2003. (Revenues for both periods have been adjusted to exclude discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. .) For the full year, 2004 net income from continuing operations totaled $42.7 million (37 cents per share diluted), up 54 percent from $27.7 million (26 cents per share diluted) in 2003. EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become (1) totaled $190.8 million in 2004, up 22 percent from $156.2 million in 2003. Revenues totaled nearly $2 billion in 2004, up 10.4 percent from 2003. "Our solid operating and financial performance in the fourth quarter reflects revenue and margin gains in 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 strong revenue and EBITDA improvements in Aegis Therapies and AseraCare 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. , compared with the year-earlier period," said William William, crown prince of Germany William or Frederick William, 1882–1951, crown prince of Germany, son of William II. In World War I he commanded (1914) an army on the Western Front and was nominal commander in the German attack R. Floyd Floyd is a variant spelling of the Welsh name Lloyd, which means grey, and may refer to: Places
A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses more than doubled to $37.9 million, compared to $16.4 million in the 2003 fourth quarter. This enabled us to invest nearly $25 million in capital expenditures to fuel further growth, while increasing our cash balance during the quarter by more than $8 million." Floyd continued: "For the full year, net income from continuing operations totaled nearly $43 million in 2004, and included refinancing Refinancing An extension and/or increase in amount of existing debt. costs of $41 million. Excluding refinancing expenses in both periods, net income would have more than doubled from 2003 levels. Our EBITDA margin averaged 9.6 percent, an increase of 92 basis points from the prior year. The strong momentum we generated during 2004 continues into 2005, and we reaffirm re·af·firm tr.v. re·af·firmed, re·af·firm·ing, re·af·firms To affirm or assert again. re our EBITDA guidance for this year - excluding costs associated with the Whitman Whitman, town (1990 pop. 13,240), Plymouth co., SE Mass., S of Boston; settled c.1670, set off from Abington and inc. 1875. It is an industrial town that manufactures shoes, plastics, foundry products, and textile machinery. The Toll House (1709) is restored. / Appaloosa Appaloosa Colour breed of horse popular in the U.S. It is said to have descended in the Nez Percé Indian territory of North America from wild mustangs, which in turn descended from the horses of Spanish explorers. expression of interest in BEI Bei (pā, bā), river, c.200 mi (320 km) long, formed by the union of two headstreams in the Nanling Mts., N Guangdong prov., S China. It flows S into the Xi River, E of Guangzhou, to form the Pearl River delta. - of $210 million to $215 million." (1) EBITDA is earnings from continuing operations before interest expense (including costs related to early extinguishments of debt), interest income, taxes, depreciation and amortization; EBITDA margin is EBITDA as a percentage of total revenues. Financial and Operating Highlights General --30% increase in 2004 fourth-quarter net income from continuing operations primarily reflects revenue gains and margin improvement in Nursing Facilities, as well as revenue increases of 52% in Aegis Therapies (third party) and more than 100% in AseraCare Hospice (comparisons based on 2003 fourth quarter). --The higher fourth quarter income level also reflects a 32% reduction in interest expense due to lower debt levels and the refinancings accomplished at lower interest rates during late 2003 and 2004. Fourth-quarter interest expense dropped from $15.6 million in 2003 to $10.6 million in 2004. --Net income for the 2004 fourth quarter was $6.1 million (six cents per share diluted), reflecting a net loss from discontinued operations of $8.8 million (seven cents per share diluted). Net income for the 2003 fourth quarter of $40.8 million (35 cents per share diluted), included net income of $29.4 million (25 cents per share diluted) from discontinued operations. --For the full year, 2004 net income totaled $28 million (25 cents per share diluted), which included a net loss from discontinued operations of $14.6 million (12 cents per share diluted). In 2003, full year net income of $80.5 million (74 cents per share diluted) reflected net income from discontinued operations of $52.8 million (48 cents per share diluted). --Results include refinancing costs of $40.9 million (33 cents per share diluted) in 2004 and $6.6 million (6 cents per share diluted) in 2003. Excluding these refinancing costs, net income from continuing operations in 2004 would have been $83.6 million (70 cents per share diluted), compared to $34.3 million (32 cents per share diluted) in 2003. Nursing Facilities --8% increase in fourth-quarter EBITDA and 23 basis-point increase in EBITDA margin primarily reflect 5.3% revenue growth, an increase of 193 basis points in 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. revenue as a percentage of total revenue and continuing effective management of labor costs. --Occupancy at the 324 facilities in continuing operations increased 95 basis points to an average of 89.4% for the 2004 fourth quarter, compared to the fourth quarter of 2003. --Medicare 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 rose 6.2% (fourth quarter of 2004, compared to the year-earlier period) -- reflecting a 2.8% increase in Medicare rates (effective October October: see month. 1, 2004) and treatment of higher-acuity patients. --Medicaid per diem rates increased 5.7% (4.9% net of the cost of provider taxes) and private/managed-care rates were up 3.3% (compared to the 2003 fourth quarter). --The weighted-average wage rate rose 4.3%, compared to the 2003 fourth quarter. This modest increase reflects more efficient facility staffing resulting from the labor management system implemented in early 2004. --Nursing patient receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed at the end of the 2004 fourth quarter were down $47 million from the end of 2003 and totaled $179 million (less than 35 days sales outstanding In accountancy, Days Sales Outstanding is a company's average collection period. A low figure indicates that the company collects its outstanding receivables quickly. Typically it is looked at either quarterly or yearly (90 or 365 days). ). --For the full year, EBITDA was up 24% and EBITDA margin rose 120 basis points, compared to 2003. Medicare revenue increased 166 basis points to 28.3% of total revenue. Aegis Therapies / AseraCare Hospice --Increase of 52% in Aegis Therapies third-party revenues over 2003 fourth quarter. Results primarily reflect net addition of 75 new customers during the year and 28% increase in revenue per nursing home contract. --EBITDA margins for Aegis in 2004 averaged in the mid-teens, more than twice the average margin for other providers of therapy services. Aegis margins were slightly lower compared to 2003, reflecting higher labor costs due to the current tight market for therapists. Aegis has taken aggressive actions to expand its therapist recruiting program, and during 2004 hired more than 1,900 therapists. It plans to hire an additional 2,300 therapists in 2005. EBITDA margins for 2005 are expected to continue in the mid-teens. --AseraCare Hospice revenues more than doubled (compared to 2003 fourth quarter), reflecting incremental Additional or increased growth, bulk, quantity, number, or value; enlarged. Incremental cost is additional or increased cost of an item or service apart from its actual cost. revenue of $8 million from the July July: see month. 30 acquisition of Hospice USA, as well as revenue gains totaling $3.8 million due to a 31% increase in average daily census daily census See Census. in core business locations. --Average daily census -- excluding the Hospice USA acquisition -- was 1,303 for the 2004 fourth quarter, an increase of 31% from the year-earlier period and 7% from the 2004 third quarter. Including the acquisition, average daily census for the 2004 fourth quarter was 2,207, an increase of 123% from the 2003 fourth quarter and up 23% from the 2004 third quarter. --AseraCare more than doubled the number of its hospice locations during 2004 -- to 51 from 21 at the end of the prior year. BEI stockholders may listen to a discussion by senior management of the company's performance at 8:30 a.m. ET today by dialing 1-800-500-0311 or 1-719-457-2698 and entering reservation A clause in a deed of real property whereby the grantor, one who transfers property, creates and retains for the grantor some right or interest in the estate granted, such as rent or an Easement ,a right of use over the land of another. number 4602680. A recording of this conference call will be available from 11:30 a.m. ET today until midnight Friday Friday: see Sabbath; week. Friday young Indian rescued by Crusoe and kept as servant and companion. [Br. Lit.: Robinson Crusoe] See : Servant , March 25. Stockholders may dial 1-888-203-1112 or 1-719-457-0820 and enter reservation number 4602680 to access the recording. IMPORTANT INFORMATION On March 14, 2005, Beverly Enterprises, Inc. ("BEI") filed a preliminary proxy statement Proxy Statement A document containing the information that a company is required by the SEC to provide to shareholders so they can make informed decisions about matters that will be brought up at an annual stockholder meeting. with the Securities and Exchange Commission relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc BEI's solicitation solicitation In criminal law, the act of asking, inducing, or directing someone to commit a crime. The person soliciting another becomes an accomplice to the crime. The term also refers to the act of obtaining bribes, as well as to the crime of a prostitute who offers sexual of proxies with respect to its 2005 annual meeting of stockholders. Prior to the annual meeting, BEI will furnish fur·nish tr.v. fur·nished, fur·nish·ing, fur·nish·es 1. To equip with what is needed, especially to provide furniture for. 2. a definitive proxy statement to its stockholders. BEI URGES INVESTORS AND SECURITY HOLDERS TO READ THE PROXY STATEMENT BECAUSE IT CONTAINS IMPORTANT INFORMATION. You may obtain BEI's proxy statement, any amendments or supplements to the proxy statement and other relevant documents free of charge at www.sec.gov See .gov and GovNet. (networking) gov - The top-level domain for US government bodies. or at www.beverlycorp.com under the tab "Investor Information" and then under the heading "SEC Filings." You may also obtain a free copy of BEI's proxy statement, any amendments and supplements to the proxy statement and other relevant documents by writing to Beverly Enterprises, Inc. at One Thousand Beverly Way, Fort Smith, Arkansas Fort Smith is a city that lies on the Arkansas-Oklahoma state border, situated at the junction of the Arkansas and Poteau Rivers, also known as Belle Point. The city began as a western frontier military post in 1817 and would later become well-known for its role in the settling of 72919, Attn: Investor Relations Investor relations The process by which the corporation communicates with its investors. . INFORMATION REGARDING PARTICIPANTS Information regarding the names, affiliation affiliation (  fil´ēā´sh and interests of
individuals who may be deemed participants in the solicitation of
proxies for BEI's 2005 annual meeting of stockholders is contained
in the preliminary proxy statement filed by BEI with the Securities and
Exchange Commission on March 14, 2005.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. The statements in this document relating to matters that are not historical facts are forward-looking statements based on management's beliefs and assumptions using currently available information and expectations as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" . Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, including the risks and uncertainties detailed from time to time in BEI's filings with the Securities and Exchange Commission. In addition, our results of operations, financial condition and cash flows also may be adversely impacted by the unsolicited un·so·lic·it·ed adj. Not looked for or requested; unsought: an unsolicited manuscript; unsolicited opinions. unsolicited Adjective indication of interest in an acquisition of BEI by Arnold Whitman, Formation Capital, LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control , Appaloosa Management, LP, Franklin Franklin, cities, United States Franklin. 1 City (1990 pop. 12,907), seat of Johnson co., S central Ind., inc. 1823. It is a farm trade center. Manufactures include auto parts, aluminum doors and windows, and copper panels. Mutual Advisors, LLC and Northbrook Northbrook, village (1990 pop. 32,308), Cook co., NE Ill., a suburb of Chicago; settled 1836. It was incorporated as Shermerville in 1901 and was reincorporated as Northbrook in 1923. NBV NBV Net Book Value NBV Nykterhetsrörelsens Bildningsverksamhet (Swedish: Educational activityof the Sobriety Movement) NBV National Bank of Vanuatu NBV Nothing But Volleyball NBV Navigation-Based Vehicle speed NBV Non Bus Vectored , LLC, and related actions taken by this group, including the nomination NOMINATION, This word has several significations. 1. An appointment; as, I nominate A B, executor of this my last will. 2. A proposition; the word nominate is used in this sense in the constitution of the United States, art. 2, s. of candidates for election to BEI's board of directors. These actions may impact our ability to attract and retain customers, management and employees and may result in the incurrence In`cur´rence n. 1. The act of incurring, bringing on, or subjecting one's self to (something troublesome or burdensome); as, the incurrence of guilt, debt, responsibility, etc. s> Noun 1. of significant advisory fees, litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. costs and other expenses. Although BEI believes that the expectations reflected in such forward-looking statements are reasonable, it cannot give any assurances that these expectations will prove to be correct. BEI assumes no duty to publicly update or revise such statements, whether as a result of new information, future events or otherwise. BEI, through 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. , is a leading provider of healthcare services to the elderly 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. . BEI currently operates 347 skilled nursing facilities, as well as 18 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, and 56 hospice and home care centers. Through Aegis Therapies, BEI also offers rehabilitative re·ha·bil·i·tate tr.v. re·ha·bil·i·tat·ed, re·ha·bil·i·tat·ing, re·ha·bil·i·tates 1. To restore to good health or useful life, as through therapy and education. 2. services on a contract basis to facilities operated by other care providers.
BEVERLY ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(In thousands, except per share amounts)
Quarter Ended Year Ended
December 31, December 31,
------------------- -----------------------
2004 2003 2004 2003
--------- --------- ----------- -----------
Revenues $516,573 $470,247 $1,988,852 $1,802,026
Costs and expenses:
Wages and related 298,167 277,717 1,147,743 1,078,548
Provision for insurance
and related items 39,178 28,782 127,653 109,377
Other operating and
administrative 137,107 121,280 522,603 462,144
Depreciation and
amortization 16,239 15,420 62,166 58,807
Adjustment related to
California
investigation
settlement - - - (925)
Asset impairments,
workforce reductions
and other unusual items (740) 1,153 448 3,825
--------- --------- ----------- -----------
Total costs and
expenses 489,951 444,352 1,860,613 1,711,776
--------- --------- ----------- -----------
Income before other income
(expenses) 26,622 25,895 128,239 90,250
Other income (expenses):
Interest expense (10,569) (15,553) (45,637) (63,314)
Costs related to early
extinguishments of debt (505) (6,634) (40,935) (6,634)
Interest income 1,397 1,809 5,485 5,363
Net gains (losses) on
dispositions (218) 23 396 422
Gain on sale of equity
investment - 6,686 - 6,686
--------- --------- ----------- -----------
Total other expenses,
net (9,895) (13,669) (80,691) (57,477)
--------- --------- ----------- -----------
Income before provision for
income taxes and
discontinued operations 16,727 12,226 47,548 32,773
Provision for income taxes 1,852 779 4,890 5,069
--------- --------- ----------- -----------
Income before discontinued
operations 14,875 11,447 42,658 27,704
Discontinued operations,
net of taxes: for the
quarters 2004 - $(231) and
2003 - $3,378; for the
years 2004 - $55 and 2003
- $3,378 (8,770) 29,359 (14,637) 52,764
Net income $6,105 $40,806 $28,021 $80,468
========= ========= =========== ===========
Net income (loss) per share
of common stock:
Basic:
Before discontinued
operations $0.14 $0.11 $0.40 $0.26
Discontinued
operations (0.08) 0.27 (0.14) 0.49
--------- --------- ----------- -----------
Net income per share
of common stock $0.06 $0.38 $0.26 $0.75
========= ========= =========== ===========
Shares used to
compute basic net
income (loss) per
share 108,153 107,201 107,749 106,582
========= ========= =========== ===========
Diluted:
Before discontinued
operations $0.13 $0.10 $0.37 $0.26
Discontinued
operations (0.07) 0.25 (0.12) 0.48
--------- --------- ----------- -----------
Net income per share
of common stock $0.06 $0.35 $0.25 $0.74
========= ========= =========== ===========
Shares used to
compute diluted net
income (loss) per
share 125,031 119,999 124,334 109,922
========= ========= =========== ===========
BEVERLY ENTERPRISES, INC.
SUPPLEMENTARY INFORMATION
Quarter Ended Year Ended
December 31, December 31,
--------------------- -----------------------
2004 2003 2004 2003
--------- --------- ---------- ----------
Number of Nursing Home
Facilities:
Owned 264 275 264 275
Leased 87 98 87 98
--------- --------- ---------- ----------
Total 351(1) 373 351(1) 373
========= ========= ========== ==========
Number of Beds:
Owned 27,448 28,667 27,448 28,667
Leased 9,547 10,768 9,547 10,768
--------- --------- ---------- ----------
Total 36,995(1) 39,435 36,995(1) 39,435
========= ========= ========== ==========
Assisted Living Centers 18 20 18 20
Hospice/Home Care Centers 52 23 52 23
Outpatient Clinics 10(1) 10 10(1) 10
Nursing Patient Days 2,795,000 2,816,000 11,129,000 11,180,000
Nursing Home Occupancy -
Continuing Ops (based on
operational beds) 89.38% 88.43% 88.85% 88.16%
Operational beds 33,962 34,656 33,962 34,656
Patient Mix (based on
patient days):
Medicaid 71.39% 70.94% 70.94% 70.61%
Medicare 11.45% 11.67% 11.97% 11.76%
Private & Other 17.16% 17.39% 17.09% 17.63%
Sources of Revenue
(based on $):
Medicaid 49.76% 52.18% 50.12% 52.17%
Medicare 28.99% 27.06% 28.31% 26.65%
Private & Other 21.25% 20.76% 21.57% 21.18%
Nursing Average per diem
rate (including
ancillaries) $163.94 $154.28 $160.60 $149.57
Hospice Average Daily
Census 2,207 991 1,522 895
Aegis Outside Contracts 585 510 585 510
Wages and related
expenses as a %
of revenues 57.72% 59.06% 57.71% 59.85%
(1) 27 Nursing Home Facilities and 10 Outpatient Clinics are held for
sale as of December 31, 2004.
BEVERLY ENTERPRISES, INC.
SUPPLEMENTARY INFORMATION
ANALYSIS OF REVENUES
Quarter Ended Year Ended
December 31, December 31,
------------------- -----------------------
2004 2003 2004 2003
--------- --------- ----------- -----------
REVENUES (In thousands)
--------
NURSING FACILITIES:
MEDICAID $255,856 $245,842 $ 998,486 $ 942,617
MEDICARE 108,859 105,240 435,348 396,003
PRIVATE & OTHER 94,621 85,102 360,637 341,800
--------- --------- ----------- -----------
SUBTOTAL 459,336 436,184 1,794,471 1,680,420
AEGIS THERAPIES 32,823 21,563 121,846 77,007
ASERACARE 23,205 11,408 65,604 39,164
OTHER 1,209 1,092 6,931 5,435
--------- --------- ----------- -----------
TOTALS $516,573 $470,247 $1,988,852 $1,802,026
========= ========= =========== ===========
NURSING PATIENT DAYS (In thousands)
--------------------
MEDICAID 1,995 1,998 7,895 7,894
MEDICARE 320 329 1,332 1,314
PRIVATE & OTHER 480 489 1,902 1,972
--------- --------- ----------- -----------
TOTALS 2,795 2,816 11,129 11,180
========= ========= =========== ===========
NURSING PER DIEM RATES (Including Ancillaries)
----------------------
MEDICAID $ 128.97 $ 122.00 $ 125.58 $ 118.31
MEDICARE - PART A 340.32 320.31 326.77 301.33
PRIVATE & OTHER 156.26 151.26 156.02 149.18
--------- --------- ----------- -----------
TOTALS(1) $ 163.94 $ 154.28 $ 160.60 $ 149.57
========= ========= =========== ===========
(1) Weighted Average Rates
BEVERLY ENTERPRISES, INC.
SUPPLEMENTARY INFORMATION
ANALYSIS OF OTHER OPERATING AND ADMINISTRATIVE EXPENSES
(In thousands)
Quarter Ended Year Ended
December 31, December 31,
------------------- -------------------
2004 2003 2004 2003
--------- --------- --------- ---------
SUPPLIES $29,388 $28,093 $113,680 $107,126
FOOD 9,813 10,948 38,472 42,327
UTILITIES 13,355 12,889 53,848 51,573
OTHER CONTROLLABLES 57,717 45,978 212,123 169,310
REAL ESTATE RENTAL 7,633 7,477 30,158 30,569
EQUIPMENT RENTAL 4,967 3,544 18,205 15,756
OTHER NONCONTROLLABLES 14,234 12,351 56,117 45,483
--------- --------- --------- ---------
TOTALS $137,107 $121,280 $522,603 $462,144
========= ========= ========= =========
BEVERLY ENTERPRISES, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
December 31,
-----------------------
2004 2003
----------- -----------
ASSETS
Current assets:
Cash and cash equivalents $215,665 $258,815
Accounts receivable - less allowance for
doubtful accounts: 2004 - $26,320; 2003 -
$31,615 235,477 164,635
Notes receivable, less allowance for doubtful
notes: 2004 - $1,686 ; 2003 - $3,336 2,786 13,724
Operating supplies 9,181 10,425
Assets held for sale 14,898 3,498
Investment in Beverly Funding Corporation - 31,342
Prepaid expenses and other 37,266 33,377
----------- -----------
Total current assets 515,273 515,816
Property and equipment, net 653,656 694,220
Other assets:
Goodwill, net 124,066 57,102
Other, less allowance for doubtful accounts
and notes: 2004 - $1,538; 2003 - $2,120 68,390 79,283
----------- -----------
Total other assets 192,456 136,385
----------- -----------
$1,361,385 $1,346,421
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $67,778 $67,572
Accrued wages and related liabilities 104,037 116,717
Accrued interest 3,602 6,896
General and professional liabilities 54,216 93,736
Federal government settlement obligations 14,359 13,125
Liabilities held for sale 676 672
Other accrued liabilities 83,097 102,289
Current portion of long-term debt 12,240 13,354
----------- -----------
Total current liabilities 340,005 414,361
Long-term debt 545,943 552,873
Other liabilities and deferred items 203,024 141,001
Commitments and contingencies
Stockholders' equity:
Preferred stock, shares authorized:
25,000,000 - -
Common stock, shares issued: 2004 -
116,621,715; 2003 - 115,594,806 11,662 11,559
Additional paid-in capital 902,053 895,950
Accumulated deficit (532,804) (560,825)
Treasury stock, at cost: 8,283,316 (108,498) (108,498)
----------- -----------
Total stockholders' equity 272,413 238,186
----------- -----------
$1,361,385 $1,346,421
=========== ===========
BEVERLY ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Years Ended December 31,
------------------------------
2004 2003 2002
--------- --------- ----------
Cash flows from operating activities:
Net income (loss) $28,021 $80,468 $(146,090)
Adjustments to reconcile net income
(loss) to net cash provided by
operating activities, including
discontinued operations:
Depreciation and amortization 64,301 69,663 88,943
Provision for reserves on
patient, notes and other
receivables, net 8,815 21,605 55,570
Amortization of deferred
financing costs 2,754 4,474 3,096
Florida insurance reserve
adjustment - - 22,179
Special charge and adjustment
related to California
investigation settlement - (925) 6,300
Adjustment related to
settlements of federal
government investigations - - (9,441)
Asset impairments, workforce
reductions and other unusual
items 4,790 7,459 85,773
Costs related to early
extinguishments of debt 40,935 6,634 -
Cumulative effect of change in
accounting for goodwill - - 77,171
Losses (gains) on dispositions
of facilities and other
assets, net 725 (81,508) (1,855)
Insurance related accounts 6,523 (32,727) 8,411
Changes in operating assets and
liabilities, net of
acquisitions and dispositions:
Accounts receivable (72,082) (13,968) 7,896
Operating supplies 352 1,467 3,081
Prepaid expenses and other
receivables 5,155 (2,502) 988
Accounts payable and other
accrued expenses (8,584) 117 (85,335)
Income taxes payable (904) 16,103 9,790
Other, net (5,141) (6,499) (9,844)
--------- --------- ----------
Total adjustments 47,639 (10,607) 262,723
--------- --------- ----------
Net cash provided by
operating activities 75,660 69,861 116,633
Cash flows from investing activities:
Capital expenditures (62,718) (43,984) (100,103)
Proceeds from dispositions of
facilities and other assets,
net 15,557 275,039 169,471
Payments for acquisitions, net
of cash acquired (71,352) (459) -
Collections on notes receivable 38,089 8,689 1,616
Payments for designated funds,
net (1,009) (5,183) (260)
Proceeds from Beverly Funding
Corporation investment 28,956 - -
Other, net (17,502) (14,914) (8,389)
--------- --------- ----------
Net cash provided by (used
for) investing activities (69,979) 219,188 62,335
Cash flows from financing activities:
Proceeds from issuance of long-
term debt 211,384 250,000 5,000
Repayments of long-term debt (219,428) (313,352) (116,496)
Repayments of off-balance sheet
financing - (69,456) (42,901)
Proceeds from exercise of stock
options 3,592 1,108 1,699
Deferred financing and other
costs (including those related
to early extinguishments of
debt) (44,379) (13,979) (168)
--------- --------- ----------
Net cash used for financing
activities (48,831) (145,679) (152,866)
--------- --------- ----------
Net increase (decrease) in cash and
cash equivalents (43,150) 143,370 26,102
Cash and cash equivalents at beginning
of year 258,815 115,445 89,343
--------- --------- ----------
Cash and cash equivalents at end of
year $215,665 $258,815 $115,445
========= ========= ==========
Supplemental schedule of cash flow
information:
Cash paid (received) during the year for:
Interest, net of amounts
capitalized $46,356 $67,710 $65,658
Income tax payments (refunds), net 5,849 (7,656) (3,705)
Beverly Enterprises, Inc.
Projected 2005 Continuing Operations EBITDA
Range Reconciliation
(In millions)
Projected EBITDA $210.0 $215.0
Depreciation and amortization 73.0 73.0
Interest expense 43.0 43.0
Interest income (1.0) (1.0)
--------- ---------
Pre-tax income $95.0 $100.0
========= =========
Beverly Enterprises, Inc.
2004 and 2003 Continuing Operations EBITDA
Reconciliation
(In millions)
December 31,
2004 2003
--------- ----------
Revenues $1,988.9 $1,802.0
EBITDA $190.8 $156.2
Depreciation and amortization 62.2 58.8
Costs related to early extinguishments of debt 40.9 6.6
Interest expense, net 40.2 58.0
--------- ----------
Pre-tax income $47.5 $32.8
========= ==========
Beverly Enterprises, Inc.
2004 and 2003 Nursing Actual EBITDA
Reconciliation
(In millions)
Quarter Ended Year Ended
December 31, December 31,
------------------- -------------------
2004 2003 2004 2003
--------- --------- --------- ---------
Revenues $459.3 $436.2 $1,794.5 $1,680.4
EBITDA $39.8 $36.8 $152.2 $122.3
Depreciation and amortization 13.9 12.7 52.7 49.7
Costs related to early
extinguishments of debt 0.5 - 0.5 -
Interest expense, net 1.3 1.6 5.7 8.7
--------- --------- --------- ---------
Pre-tax income $24.1 $22.5 $93.3 $63.9
========= ========= ========= =========
Beverly Enterprises, Inc.
2004 Arkansas Facilities EBITDA
Reconciliation
(In millions)
December 31,
2004
---------------
Revenues $78.0
EBITDA $7.8
Depreciation and amortization 2.5
Interest expense, net 0.2
---------------
Pre-tax income $5.1
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