EX-99 3 a4445056_ex991.txt LTC PROPERTIES EXHIBIT 99.1 Exhibit 99.1 LTC Announces Operating Results for the Three and Six Months Ended June 30, 2003 MALIBU, Calif.--(BUSINESS WIRE)--July 30, 2003--LTC Properties, Inc. (NYSE:LTC) released results of operations for the three and six months ended June 30, 2003. LTC announced that for the three months ended June 30, 2003, net income available to common stockholders was $2.6 million or $0.15 per diluted share compared to $10.6 million or $0.55 per diluted share for the three months ended June 30, 2002. The results for the three months ended June 30, 2003 included a gain on sale of assets of $0.7 million compared to a gain on sale of assets of $13.2 million for the same period in 2002. Additionally, the results for the comparative 2002 period included an impairment charge of $4.9 million and the Company reported no impairment charge for the three months ended June 30, 2003. Revenues for the three months ended June 30, 2003 were $15.9 million versus $17.0 million for the same period last year. Funds From Operations ("FFO"), a non-GAAP measure of a REIT's financial performance defined as net income available to common stockholders adjusted to exclude the gains or losses on the sale of assets and adjusted to add back impairment charges, real estate depreciation and other non cash charges, was $5.2 million or $0.29 per diluted share, compared to $6.0 million or $0.32 per diluted share for the same period in 2002. FFO is used in the REIT industry as a supplemental measure of financial performance, but is not a substitute for net income per share available to common stockholders determined in accordance with GAAP. Please see the attached reconciliation of net income available to common stockholders to FFO available to common stockholders. For the six months ended June 30, 2003, net income available to common stockholders was $2.7 million or $0.15 per diluted share compared to $13.0 million or $0.70 per diluted share for the six months ended June 30, 2002. Revenues for the six months ended June 30, 2003 were $31.9 million versus $34.2 million for the same period last year. FFO was $9.8 million or $0.55 per diluted share, compared to $12.2 million or $0.66 per diluted share for the same period in 2002. Reflected in the results for the three months ended June 30, 2003, was a gain on sale of $0.7 million related to three skilled nursing facilities in Texas, one of which was formerly operated by Sun Healthcare Group, Inc. ("Sun"). Net proceeds of $2.6 million from the sale were used to pay outstanding borrowings under LTC's Senior Secured Revolving Line of Credit. In addition, LTC announced that during the second quarter of 2003, it acquired two skilled nursing facilities in New Mexico with a total of 98 beds from CLC Healthcare, Inc. ("CLC"). LTC paid cash of $1.2 million for the two facilities and CLC used the $1.2 million to repay the outstanding loan balance due to a REMIC pool originated by LTC. LTC leased these facilities, along with two other facilities in New Mexico previously operated by Sun, to a third party operator under a master lease beginning July 1, 2003. This master lease provides for rents of $0.8 million in the initial year with 2.0% increases annually for 15 years. LTC also announced that it had leased to a third party operator four skilled nursing facilities in Georgia formerly operated by CLC for $0.7 million in the initial year beginning July 1, 2003 with 3.0% increases annually for 15 years. At June 30, 2003, LTC had investments in 94 skilled nursing facilities, 96 assisted living residences and one school in 30 states. The Company is a self-administered real estate investment trust that primarily invests in long-term care and other health care related facilities through mortgage loans, facility lease transactions and other investments. This press release includes statements that are not purely historical and are "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding the Company's expectations, beliefs, intentions or strategies regarding the future. All statements other than historical facts contained in this press release are forward looking statements. These forward looking statements involve a number of risks and uncertainties. All forward looking statements included in this press release are based on information available to the Company on the date hereof, and the Company assumes no obligation to update such forward looking statements. Although the Company's management believes that the assumptions and expectations reflected in such forward looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. The actual results achieved by the Company may differ materially from any forward looking statements due to the risks and uncertainties of such statements. LTC PROPERTIES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in thousands, except per share amounts) (Unaudited) Three Months Six Months Ended Ended June 30, June 30, 2003 2002 2003 2002 Revenues: Rental income $10,081 $10,536 $19,982 $21,057 Interest income from mortgage loans and notes receivable 2,489 2,525 4,996 5,118 Interest income from REMIC Certificates 2,551 3,219 5,337 6,486 Interest and other income 783 766 1,615 1,511 Total revenues 15,904 17,046 31,930 34,172 Expenses: Interest expense 5,001 5,310 10,193 10,736 Depreciation and amortization 3,255 3,663 6,457 7,207 Impairment charge -- 4,882 1,260 4,882 Legal expenses 408 74 776 136 Operating and other expenses 1,237 1,392 3,070 2,968 Total expenses 9,901 15,321 21,756 25,929 Income before minority interest 6,003 1,725 10,174 8,243 Minority interest (326) (335) (647) (656) Income from continuing operations 5,677 1,390 9,527 7,587 Discontinued operations: Income (loss) from discontinued operations 24 (220) 58 (164) Gain on sale of assets, net 679 13,192 679 13,120 Net income from discontinued operations 703 12,972 737 12,956 Net income 6,380 14,362 10,264 20,543 Preferred stock dividends (3,756) (3,761) (7,517) (7,519) Net income available to common stockholders $2,624 $10,601 $2,747 $13,024 Net Income (Loss) per Common Share from Continuing Operations Net of Preferred Stock Dividends: Basic $0.11 $(0.13) $0.11 $0.00 Diluted $0.11 $(0.13) $0.11 $0.00 Net Income per Common Share from Discontinued Operations: Basic $0.04 $0.71 $0.04 $0.70 Diluted $0.04 $0.66 $0.04 $0.70 Net Income per Common Share Available to Common Stockholders: Basic $0.15 $0.58 $0.15 $0.71 Diluted $0.15 $0.55 $0.15 $0.70 Basic weighted average shares outstanding 17,775 18,393 17,870 18,393 NOTE: Quarterly and year-to-date computations of per share amounts are made independently. Therefore, the sum of per share amounts for the quarters may not agree with the per share amounts for the year. Computations of per share amounts from continuing operations, discontinued operations and net income are made independently. Therefore, the sum of per share amounts from continuing operations and discontinued operations may not agree with the per share amounts from net income available to common stockholders. Reconciliation of Funds From Operations ("FFO") FFO is a supplemental measure of a REIT's financial performance that is not defined by accounting principles generally accepted in the United States. We define FFO as net income available to common stockholders adjusted to exclude the gains or losses on the sale of assets and adjusted to add back impairment charges, real estate depreciation and other non-cash charges. Other REITs may not use this definition of FFO and therefore, caution should be exercised when comparing our company's FFO to that of other REITs. FFO is used in the REIT industry as a supplemental measure of financial performance, but is not a substitute for net income per share available to common stockholders determined in accordance with accounting principles generally accepted in the United States. The following table reconciles net income available to common stockholders to funds from operations available to common stockholders (unaudited, in thousands, except per share amounts): Three Months Six Months Ended Ended June 30, June 30, 2003 2002 2003 2002 Net income available to common stockholders $2,624 $10,601 $2,747 $13,024 Add: Real estate depreciation 3,275 3,671 6,507 7,384 Add: Impairment charge -- 4,882 1,260 4,882 Less: (Gain) on sale of assets, net (679) (13,192) (679) (13,120) Funds from operations available to common stockholders $5,220 $5,962 $9,835 $12,170 Basic funds from operations available to common stockholders per share $0.29 $0.32 $0.55 $0.66 Diluted funds from operations available to common stockholders per share $0.29 $0.32 $0.55 $0.66 LTC PROPERTIES, INC. CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except per share amounts) June 30, Dec. 31, 2003 2002 ASSETS (Unaudited) Real Estate Investments: Buildings and improvements, net of accumulated depreciation and amortization: 2003 -- $69,877; 2002 -- $63,495 $372,503 $377,566 Land 25,934 25,812 Properties held for sale, net of accumulated depreciation and amortization: 2003 -- $0; 2002 -- $821 -- 1,962 Mortgage loans receivable, net of allowance for doubtful accounts: 2003 -- $1,280; 2002 -- $1,280 83,642 82,675 REMIC Certificates 62,933 64,419 Real estate investments, net 545,012 552,434 Other Assets: Cash and cash equivalents 3,233 8,001 Debt issue costs, net 4,067 5,309 Interest receivable 4,014 3,781 Prepaid expenses and other assets 2,769 2,069 Notes receivable (includes $3,095 due from CLC Healthcare, Inc. in 2003 and 2002) 15,269 15,622 Marketable debt securities 9,650 7,968 Note receivable from CLC Healthcare, Inc. 5,245 4,741 44,247 47,491 Total Assets $589,259 $599,925 LIABILITIES AND STOCKHOLDERS' EQUITY Bank borrowings $49,557 $48,421 Mortgage loans payable 129,479 136,971 Bonds payable and capital lease obligations 14,866 15,361 Senior mortgage participation payable 29,239 29,667 Accrued interest 1,288 1,293 Accrued expenses and other liabilities 5,227 6,419 Distributions payable 979 981 Total Liabilities 230,635 239,113 Minority interest 13,283 13,399 Stockholders' equity: Preferred stock $0.01 par value: 10,000 shares authorized; shares issued and outstanding: 2003 -- 7,052; 2002 -- 7,062 164,986 165,183 Common stock: $0.01 par value; 40,000 shares authorized; shares issued and outstanding: 2003 -- 17,795; 2002 -- 18,055 178 181 Capital in excess of par value 250,998 253,050 Cumulative net income 260,893 250,629 Other (4,194) (6,112) Cumulative distributions (327,520) (315,518) Total Stockholders' Equity 345,341 347,413 Total Liabilities and Stockholders' Equity $589,259 $599,925 CONTACT: LTC Properties, Inc. Andre C. Dimitriadis/Wendy L. Simpson, 805-981-8655