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 HOUSTON, Nov. 18 /PRNewswire/ -- Living Centers of America, Inc. (NYSE: LCA), announced today operating results for the fiscal year ended Sept. 30, 1993, and for its fourth quarter. The company reported a net income for the fiscal year of $13,648,000, or $1.46 per share, as compared to $10,531,000, or $1.16 per share, for 1992, up 30 percent over prior year. For the quarter ended Sept. 30, 1993, Living Centers reported net income of $3,567,000, or 38 cents per share, compared to $2,888,000, or 31 cents per share, for the same period in 1992, up 24 percent over prior year.
 Living Centers, a long-term health care company, cited higher acuity levels, improvement in patient mix, and effective cost control as reasons for the increases in year-end earnings. "Our management team set high expectations when we became a publicly held company and it is gratifying now to see those expectations become realities," said Living Centers of America Chairman and Chief Executive Officer Edward L. Kuntz.
 Average center occupancy, after excluding the impact of centers divested and acquired, remained relatively constant at 82.6 percent. Revenues generated from the Medicare program increased to 13 percent from 9 percent with corresponding decreases of 3 percent in revenues generated from the lower-margin Medicaid program and 1 percent in revenues generated from private patients. "The improvement in our quality mix reflects the increase in the number of Medicare patients the company serves and the increase in ancillary services due to higher acuity levels of this class of patient. In response to this trend, we recently announced the creation of a new subacute program, Progressive Care Centers of America, a unique concept in the subacute delivery system designed to expand revenue sources through strategic alliances and joint ventures, and to strengthen relationships with managed care networks," Kuntz explained.
 The company also recently completed a merger transaction in which Vari-Care, Inc., was acquired, providing an additional capacity of 2,541 beds including 19 long-term health care facilities, a 68-unit retirement complex, two supervised living centers, a home health care agency, and a pharmaceutical services company. As part of the transaction, the company issued approximately 1,193,000 shares of Living Centers' stock and restructured and extended its existing bank credit facility and increased the existing term debt balance to $77 million from $55.5 million. "Our debt to total capitalization ratio will be approximately 45 percent after completion of the Vari-Care transaction. We believe this positions us to take advantage of other growth opportunities as they arise," Kuntz noted.
 Living Centers of America, Inc., is the fourth largest provider of long-term health care in the United States. The company operates 242 centers in 10 states: Texas, Colorado, Florida, Oklahoma, Alabama, Louisiana, Nebraska, Wyoming, Arizona and Mississippi. Of the 242 centers, 180 provide long-term care and 62 are devoted to the care of people with mental retardation and developmental disabilities. Headquartered in Houston, the company is a publicly held corporation whose stock is traded on the New York Stock Exchange. The company's facilities are licensed for 21,993 beds and the company employs more than 17,500 individuals dedicated to providing quality care for the elderly, people with mental retardation and developmental disabilities and people with Alzheimer's disease.
 Consolidated Statements of Income
 (in thousands except per share amounts)
 Years Ended Sept. 30,
 1993 1992 1991
 Net Revenues $388,943 $350,977 $396,669
 Costs and Expenses:
 Payroll and payroll
 related 212,338 196,488 229,382
 Operating and administrative 135,827 117,614 127,188
 Depreciation and amortization 14,135 12,977 13,512
 Provision for bad debts 1,975 1,808 1,864
 ARA corporate allocations --- 594 1,541
 Total 364,275 329,481 373,487
 Income from operations 24,668 21,496 23,182
 Interest Expense, net:
 Intercompany interest expense --- 2,866 7,876
 Interest expense 6,914 4,781 1,799
 Interest income (2,832) (2,068) (510)
 Total 4,082 5,579 9,165
 Other Income --- --- 1,300
 Income before income taxes
 and equity earnings 20,586 15,917 15,317
 Provision For Income Taxes 8,585 6,632 5,784
 Income before equity earnings 12,001 9,285 9,533
 Equity Earnings 1,647 1,246 902
 Net Income 13,648 10,531 10,435
 Weighted average common and
 common equivalent shares
 outstanding 9,345 9,072 8,640
 Earnings per share $1.46 $1.16 $1.21
 Consolidated Balance Sheets
 (dollars in thousands, except share amounts)
 ASSETS Sept. 30,
 Current Assets 1993 1992
 Cash and cash equivalents $3,277 $9,902
 Receivables (less allowances of
 $2,146 and $2,747) 36,166 25,007
 Notes receivable, net 3,399 6,899
 Supplies 3,544 3,689
 Prepaid insurance 4,845 5,592
 Deferred income taxes 7,164 7,970
 Other (including patient trust funds
 of $2,572 and $2,673) 5,328 4,638
 Total current assets 63,723 63,697
 Property and Equipment:
 Land, buildings and improvements 173,875 154,159
 Furniture, fixtures and equipment 42,061 36,520
 Leased property under capital leases 2,717 5,423
 Total 218,653 196,102
 Less accumulated depreciation 81,905 73,765
 Total 136,748 122,337
 Goodwill, net 25,087 26,002
 Deferred income taxes 3,622 ---
 Investment in Unconsolidated Affiliate 6,245 4,599
 Notes Receivable, net 4,209 6,055
 Other assets 4,577 2,188
 Total $244,211 $224,878
 Current Liabilities:
 Current maturities of long-term debt 1,200 1,439
 Insurance notes payable 4,005 4,108
 Accounts payable 19,659 12,004
 Accrued payroll and related expenses 19,994 17,819
 Occupational injury and benefit reserve 2,530 2,326
 Accrued property taxes 3,354 3,241
 Patient trust funds 2,572 2,673
 Other accrued expenses 9,594 11,475
 Total current liabilities 62,908 55,085
 Long-Term Debt, net of current
 maturities 59,536 69,282
 Long-Term Insurance Reserves 14,129 1,474
 Deferred Income Taxes and Other
 Noncurrent Liabilities 313 1,746
 Commitments and Contingencies
 Stockholders' Equity:
 Preferred stock, par value $.01;
 5,000,000 shares authorized;
 none issues --- ---
 Common stock, par value $.01;
 35,000,000 shares authorized;
 9,462,180 shares issued 95 95
 Capital surplus 90,328 90,167
 Retained earnings 21,278 7,630
 Treasury stock at cost-274,204 and
 50,000 shares (4,376) (601)
 Total stockholders' equity 107,325 97,291
 Total $244,211 $224,878
 -0- 11/18/93
 /CONTACT: Lee Williams of Living Centers of America, 713-578-4627/

CO: Living Centers of America, Inc. ST: Texas IN: HEA SU: ERN

TW -- NY013 -- 6065 11/18/93 13:08 EST
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Publication:PR Newswire
Date:Nov 18, 1993

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