Capital Senior Living Corporation Reports Second Quarter 2002 Earnings of Five Cents Per Share From Recurring Operations.Business Editors DALLAS--(BUSINESS WIRE)--July 31, 2002 Capital Senior Living Corporation (NYSE NYSE See: New York Stock Exchange :CSU See DSU/CSU. 1. CSU - California State University. 2. CSU - Cleveland State University. 3. CSU - Channel Service Unit. ), one of the country's largest operators of senior living communities, announced its operating results for the second quarter of 2002. The Company reported net income of $0.8 million, or four 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. , including earnings of five cents per share from recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. operations and an after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. charge of one cent per share which resulted primarily from the retirement of $29.1 million of long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. upon the contribution of four assets to the Blackstone Blackstone, river, c.50 mi (80 km) long, rising near Worcester, Mass., and flowing SE to Narragansett Bay at Providence, R.I. The river's clean water was a major factor in the early development of the area's textile industry. joint venture. "Recurring earnings of five cents per share matched our first quarter results," James A. Stroud This article or section needs sources or references that appear in reliable, third-party publications. Alone, primary sources and sources affiliated with the subject of this article are not sufficient for an accurate encyclopedia article. , Chairman of the Company said. "We were also pleased to reduce debt and increase liquidity during the quarter." OPERATING AND FINANCIAL RESULTS For the second quarter of 2002, the Company had revenues of $16.2 million compared to revenues of $18.4 million for the same period in 2001. The primary factor contributing to the lower revenue in 2002 was the sale of the Cambridge Cambridge, city, Canada Cambridge (kām`brĭj), city (1991 pop. 92,772), S Ont., Canada, on the Grand River, NW of Hamilton. It was formed in 1973 with the amalgamation of Galt, Hespeler, and Preston, all founded in the early 19th cent. Nursing Home in the third quarter of last year. This facility contributed approximately $1.4 million of revenue in the second quarter of 2001. 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 for the second quarter of 2002 was $4.4 million, compared to $5.2 million in the prior year, largely due to a reduction in rental and lease income. Triple net leases on four communities owned by an affiliated partnership expired ex·pire v. ex·pired, ex·pir·ing, ex·pires v.intr. 1. To come to an end; terminate: My membership in the club has expired. 2. in the fourth quarter of 2001. During the second quarter of 2002, the Company contributed four senior living communities with a resident capacity of 600 to a recently formed joint venture with Blackstone Real Estate Advisors ("Blackstone"), an affiliate of the Blackstone Group Blackstone Group L.P. (NYSE: BX) is a prominent private equity and investment management firm founded in 1985 by Peter G. Peterson and Stephen A. Schwarzman. The company is based in New York City, in River House on Park Avenue at Fifty-first Street, with offices in Atlanta, . As a result of the contribution, the Company retired $29.1 million of long-term debt, received $7.3 million in cash from the venture, and retained a 10% interest in the communities. Pursuant to the terms of the joint venture, the Company will earn management fees under long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. management contracts and potential additional incentive payments. Due to the retirement of this debt, the Company wrote off approximately $0.5 million of unamortized loan costs. This expense, combined with a small gain on the sale of a parcel of land, reduced net income by approximately one cent per share. Net income, including the write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of the loan costs, was $0.8 million or four cents per share in the second quarter of 2002 compared to net income of $0.6 million or three cents per share in the comparable prior year period. Cash earnings, defined as net income plus depreciation, were $2.3 million or $0.12 per share for the second quarter of 2002, equal to the prior year. For the first half of 2002 the Company produced revenues of $32.8 million and net income of $2.6 million, or $0.13 per share. This compares to revenues of $36.4 million and net income of $1.0 million, or $0.05 per share for the same period in 2001. The Company generated cash earnings of $5.8 million, or $0.29 per share, compared to cash earnings of $4.5 million or $0.23 per share for the first half of 2001. The revenue difference between the two years is primarily attributable to the sale of the Cambridge Nursing Home in the third quarter of last year and the expiration EXPIRATION. Cessation; end. As, the expiration of, a lease, of a contract, or statute. 2. In general, the expiration of a contract puts an end to all the engagements of the parties, except to those which arise from the non- fulfillment of obligations created of triple net leases on four communities which expired in the fourth quarter. As of June June: see month. 30, 2002, the Company had $21.5 million in cash, cash equivalents and restricted cash, and $116.2 million in shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. . "We made substantial progress in the second quarter," stated Lawrence Lawrence. 1 City (1990 pop. 26,763), Marion co., central Ind., a residential suburb of Indianapolis, on the West Fork of the White River. It has light manufacturing. 2 City (1990 pop. 65,608), seat of Douglas co., NE Kans. A. Cohen cohen or kohen (Hebrew: “priest”) Jewish priest descended from Zadok (a descendant of Aaron), priest at the First Temple of Jerusalem. The biblical priesthood was hereditary and male. , Chief Executive Officer of the Company. "Along with strong operating results, we were able to increase cash and reduce long-term debt. We now have the flexibility to grow while continuing to strengthen the Balance Sheet." HIGHLIGHTS FOR THE QUARTER Company highlights for second quarter 2002 include: -- Net income of $0.8 million and basic and diluted net income per share of $0.04; -- Cash earnings of $2.3 million, or $0.12 per share; -- Average occupancy rate on stabilized communities of 92 percent; -- Recently opened communities are leased to 68 percent; -- Same community revenue increase of 5 percent; and -- Independent and assisted living community operating margins averaged 43 percent. 2Q02 CONFERENCE CALL INFORMATION Members of the Company's senior management team will discuss second quarter 2002 results via a telephone conference call on Wednesday Wednesday: see week. , July July: see month. 31, at 11 a.m. Eastern Daylight Time. 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 913-981-5532. No confirmation number is required. A link to a simultaneous webcast of the teleconference will be available at www.capitalsenior.com through Windows Media Player Digital jukebox software for Windows from Microsoft that plays a variety of audio, video and streaming formats including MP3, WMA, CD audio and MIDI. Starting with Version 6.2 in 1999, the Windows Media Rights Manager was added for securing copyrighted content. or RealPlayer A multimedia player from RealNetworks that plays RealAudio and RealVideo transmissions. Included is the technology (see RealJukebox) for organizing music files and creating MP3 files from audio CDs. . For the convenience of the Company's shareholders and the public, the conference call will be recorded and available for replay starting July 31, 2002 at 2:00 pm Eastern Daylight Time until August 7, 2002 at 8:00 p.m. Eastern Daylight Time. To access the conference call replay, call 719/457-0820 (reference code 712812). The conference call will also be made available for playback Playback could mean:
ABOUT THE COMPANY Capital Senior Living Corporation is one of the nation's largest operators of residential communities for senior adults. The Company's operating philosophy emphasizes a continuum Continuum (pl. -tinua or -tinuums) can refer to:
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. and home care services, to provide residents the opportunity to age in place. The Company currently owns and/or operates 43 communities in 20 states with a total capacity of approximately 6,900 residents. In the communities operated by the Company, 85 percent of residents live independently and 15 percent of residents require assistance with activities of daily living. 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. in this release are subject to certain risks and uncertainties that could cause results to differ materially, including, but not without limitation to, the Company's ability to find suitable acquisition properties at favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. terms, financing, licensing, business conditions, risks of downturns in economic condition generally, satisfaction of closing conditions such as those pertaining per·tain intr.v. per·tained, per·tain·ing, per·tains 1. To have reference; relate: evidence that pertains to the accident. 2. to licensure licensure (lī´s  nsh , and changes in accounting principles and
interpretations. These and other risks are detailed in the
Company's reports filed with the Securities and Exchange
Commission.
CAPITAL SENIOR LIVING CORPORATION
CONSOLIDATED BALANCE SHEETS
(in thousands)
June 30, December 31,
2002 2001
---------- -----------
ASSETS (Unaudited) (Audited)
Current assets:
Cash and cash equivalents $ 14,052 $ 9,975
Restricted cash 7,490 2,100
Accounts receivable, net 1,155 1,438
Accounts receivable from affiliates 680 366
Interest receivable 4,629 6,072
Investment in limited partnership 222 5,774
Federal and state income taxes
receivable 871 1,145
Deferred taxes 2,770 2,770
Prepaid expenses and other 4,490 1,218
--------- ---------
Total current assets 36,359 30,858
Property and equipment, net 154,868 196,821
Deferred taxes 7,339 7,540
Notes receivable from affiliates 71,936 59,020
Investments in limited partnerships 1,307 1,827
Assets held for sale 4,255 4,924
Other assets 5,307 7,092
--------- ---------
Total assets $ 281,371 $ 308,082
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 4,532 $ 3,040
Accrued expenses 2,727 3,363
Current portion of notes payable 26,320 25,594
Customer deposits 1,025 1,144
--------- ---------
Total current liabilities 34,604 33,141
Deferred income 537 507
Deferred income from affiliates 1,500 1,750
Notes payable, net of current portion 119,077 149,202
Line of credit 7,553 7,553
Minority interest in consolidated
partnership 1,938 2,385
Commitments and contingencies
Shareholders' equity:
Preferred stock, $.01 par value:
Authorized shares 15,000,000; no
shares issued or outstanding -- --
Common stock, $.01 par value:
Authorized shares 65,000,000;
issued and outstanding
19,723,927 and 19,717,347 at
June 30, 2002 and December 31,
2001, respectively 197 197
Additional paid-in capital 91,964 91,935
Retained earnings 24,001 21,412
--------- ---------
Total shareholders' equity 116,162 113,544
--------- ---------
Total liabilities and
shareholders' equity $ 281,371 $ 308,082
========= =========
CAPITAL SENIOR LIVING CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(in thousands)
Three Months Ended Six Months Ended
June 30, June 30,
------------------ -------------------
2002 2001 2002 2001
---- ---- ---- ----
(Unaudited)(Unaudited) (Unaudited)(Unaudited)
Revenues:
Resident and healthcare
revenue $ 15,329 $ 16,099 $ 30,908 $ 32,139
Rental and lease income -- 1,106 37 2,137
Unaffiliated management
services revenue 212 528 578 1,032
Affiliated management
services revenue 444 433 854 820
Unaffiliated development
fees -- 16 -- 40
Affiliated development
fees 216 221 399 278
-------- -------- -------- --------
Total revenues 16,201 18,403 32,776 36,446
Expenses:
Operating expenses 8,882 9,675 17,654 18,979
General and administrative
expenses 2,958 3,481 6,115 6,595
Depreciation and
amortization 1,534 1,753 3,180 3,496
-------- -------- -------- --------
Total expenses 13,374 14,909 26,949 29,070
-------- -------- -------- --------
Income from operations 2,827 3,494 5,827 7,376
Other income (expense):
Interest income 1,434 1,592 2,863 3,133
Interest expense (2,748) (3,843) (5,576) (8,092)
Equity in the gains
(losses) of affiliates 20 (83) 31 (336)
(Loss) gain on sale of
assets (354) -- 1,929 --
-------- ------- -------- --------
Income before income taxes
and minority interest in
consolidated partnership 1,179 1,160 5,074 2,081
Provision for income taxes (460) (369) (1,584) (630)
-------- ------- -------- --------
Income before minority
interest in consolidated
partnership 719 791 3,490 1,451
Minority interest in
consolidated partnership 59 (189) (901) (421)
-------- -------- -------- --------
Net income $ 778 $ 602 $ 2,589 $ 1,030
======== ======== ======== ========
Net income per share:
Basic $ 0.04 $ 0.03 $ 0.13 $ 0.05
======== ======== ======== ========
Diluted $ 0.04 $ 0.03 $ 0.13 $ 0.05
======== ======== ======== ========
Weighted average shares
outstanding - basic 19,721 19,717 19,719 19,717
======== ======== ======== ========
Weighted average shares
outstanding - diluted 19,978 19,717 20,000 19,717
======== ======== ======== ========
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