LOUISVILLE, Ky., Nov. 16 /PRNewswire/ -- Caretenders HealthCorp
(Nasdaq: CTND) announced earnings for the quarter and six months ended
September 30, 1999 following its announcement last Friday of the sale of its
product operations for $14.5 million and plans to separate its visiting nurse
operations. Accordingly, the results described in the following three
paragraphs are applicable to the Company's continuing adult day health
services operations on a standalone basis.
For the three months ended September 30, 1999, net income from continuing
operations was $199,388 or $0.06 per share on revenues of $11,105,137. This
compares to a net loss of ($160,454) or ($0.05) on revenues of $9,925,252 in
the same quarter last year. For the six months the Company reported net
income from continuing operations of $202,708 or $0.06 per share on revenues
of $21,440,145. This compares to a net loss of ($750,410) or ($0.24) per
share, on revenues of $19,313,192 on the same basis for the first half of the
prior year. Actual results for the six months ended September 1999 included a
($0.02) non-recurring loss on the sale of a building while the same period in
the prior year included a ($0.02) non-recurring goodwill write-down.
As announced on Friday, November 12, 1999, the Company sold its product
operations to Lincare Holdings, Inc. (Nasdaq-NM: LNCR) for $14.5 million and
is pursuing available strategic alternatives to complete the separation of its
visiting nurse operations. As a result of the operational separations, the
Company has recorded a one-time net of tax loss of approximately $5 million or
($1.60) in the quarter ended September 30, 1999. This charge reduces the book
value of the operations to their expected net realizable value and includes
the estimated future operating results of the visiting nurse operations prior
to separation.
By November 19, 1999 the outstanding balance on the line of credit is
expected to be approximately $2.5 million. The Company has retained certain
assets and liabilities associated with the product operations, the liquidation
of which is expected to generate additional proceeds of approximately
$2 million. This will reduce the Company's bank borrowings to nearly zero and
make borrowing capacity available for further development of the adult day
care business.
Giving pro-forma effect to the lower interest expense which will result
from the sale of the product operations, net income from continuing
operations, excluding non-recurring items, would have been $250,656 or
$0.08 per share compared to a loss of ($84,654) or ($0.03) per share for the
quarters ended September 30, 1999 and 1998 respectively and $359,486 or
$0.12 per share compared to a loss of ($525,639) or ($0.17) per share for the
six months ended September 30, 1999 and 1998 respectively.
"Now that the results of the ADHS operations are presented on a standalone
basis, the earnings and growth potential of this business are more clearly
evident. The primary driver in our year to year earnings growth was increased
occupancy in our day centers. On a year to date basis our occupancy is at 74%
of capacity this year versus 69% last year. As occupancy rates increase, the
incremental margin impact becomes quite apparent. Although there can be no
assurance that our fill rates will improve, or even continue at current rates,
we are optimistic about the future given our new singular focus on adult day
care," said William B. Yarmuth, Caretenders' Chairman and CEO. "As we said in
last Friday's release, we believe the opportunities available to us to
maximize shareholder value are much stronger in adult day care than in the
other divisions and we are very excited about the future of the Company."
The Company has extended the due date of its Form 10Q for the quarter
ended September 30, 1999 for up to 5 days past its November 15, 1999 due date
to properly reflect these recent operating changes in its financial
statements.
Results of operations for the three and six month periods ended
September 30, 1999 and 1998 are set forth in the table below. As discussed
above, the results of continuing operations now consist solely of the
Company's ADHS operations. These operations include adult day care center in-
center care and personal care services provided in patients' homes.
Results of Operations
Periods ending September 30,
Three Months Change
1999 1998 Amount Percent
Continuing Operations
Net Revenues $ 11,105,137 $ 9,925,252 $ 1,179,885 11.9%
Pre-tax Center
Contribution 1,690,653 1,327,105 363,548 27.4%
Net Income (loss) from
Continuing Operations 199,388 (160,454) 359,842
Discontinued Operations
Results of operations 22,347 4,321 18,026
Estimated loss on
disposal (5,000,000) -- (5,000,000)
Net income (loss) $ (4,778,265) $ (156,133) $(4,622,132)
Earnings (loss) per share
Continuing
operations $ 0.06 $ (0.05) $ 0.12
Discontinued operations
Results of
operations 0.01 0.00 0.01
Estimated loss on
disposal (1.60) -- (1.60)
Total Earnings (loss) per
share $ (1.53) $ (0.05) $ (1.48)
Continuing operations
excluding non-recurring items with
pro-forma adjustment to
reflect debt retired with
proceeds of product sale:
Net income
(loss) $ 250,656 $ (84,654) $ 335,310
Earnings
(loss) per
share $ 0.08 $ (0.03) $ 0.11
Periods ending September 30,
Six months Change
1999 1998 Amount Percent
Continuing Operations
Net Revenues $ 21,440,145 $ 19,313,192 $ 2,126,953 11.0%
Pre-tax Center
Contribution 3,123,369 2,189,719 933,650 42.6%
Net Income (loss)
from Continuing
Operations 202,708 (750,410) 953,118
Discontinued Operations
Results of operations 131,445 (5,153,953) 5,285,398
Estimated loss on
disposal (5,000,000) -- (5,000,000)
Net income (loss) $ (4,665,847) $ (5,904,363) $ 1,238,516
Earnings (loss) per share
Continuing
operations $ 0.06 $ (0.24) $ 0.31
Discontinued operations
Results of
operations 0.04 (1.65) 1.69
Estimated loss on
disposal (1.60) -- (1.60)
Total Earnings (loss)
per share $ (1.50) $ (1.89) $ 0.40
Continuing operations
excluding non-recurring
items with pro-forma adjustment
to reflect debt retired
with proceeds of
product sale:
Net income
(loss) $ 359,486 $ (525,639) $ 885,125
Earnings (loss)
per share $ 0.12 $ (0.17) $ 0.28
Note: As discussed previously in this release, the Company used the
proceeds of the sale of the product operations to reduce outstanding debt.
This table includes a pro-forma adjustment to remove interest expense as if
the debt had been retired for the entirety of the periods presented.
Caretenders HealthCorp is an adult day health care services company
focused on providing alternatives for seniors and other special needs adults
who wish to avoid nursing home placement. The Company has locations in
Kentucky, Maryland, Alabama, Massachusetts, Connecticut, Indiana, Ohio, and
Florida.
Contact: William Yarmuth or Steve Guenthner (502) 899-5355.
All statements, other than statements of historical facts, included in
this news release, including the objectives and expectations of management for
future operating results, are forward-looking statements. These forward-
looking statements are based on the company's current expectations. Although
the company believes that the expectations with respect to the future of adult
day and home health services reflected in such forward-looking statements are
reasonable, there can be no assurance that such expectations will prove to be
correct.
Because forward-looking statements involve risks and uncertainties, the
company's actual results could differ materially. The potential risks and
uncertainties which could cause actual results to differ materially could
include the impact of further changes in the Medicare reimbursement system,
including the ultimate implementation of a prospective payment system;
government regulation; health care reform; pricing pressures from third-party
payers; and changes in laws and interpretations of laws relating to the
healthcare industry. For a more complete discussion regarding these and other
factors which could affect the company's financial performance, refer to the
company's Securities and Exchange Commission filing on Form 1O-K for the year
ended March 31, 1999, in particular information under the headings "Business"
and "Management's Discussion and Analysis of Financial Condition and Results
of Operations." The company disclaims any intent or obligation to update its
forward-looking statements.
SOURCE Caretenders HealthCorp
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Company News On-Call:
http://www.prnewswire.com/comp/784275.html or fax,
800-758-5804, ext. 784275
CONTACT:
William Yarmuth or Steve Guenthner of
Caretenders HealthCorp, 502-899-5355
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