EX-99.1 2 a4813077ex991.txt PRESS RELEASE EXHIBIT 99.1 LTC Announces Operating Results for the Three and Twelve Months Ended December 31, 2004, and Declares First Quarter Cash Dividend on Its Common Stock MALIBU, Calif.--(BUSINESS WIRE)--Feb. 2, 2005--LTC Properties, Inc. (NYSE:LTC) released results of operations for the three and twelve months ended December 31, 2004, and announced that net income available to common stockholders for the fourth quarter was $4.7 million or $0.23 per diluted share. For the same period in 2003, net income available to common stockholders was $1.6 million or $0.09 per diluted share. Included in these 2003 results was a $2.1 million write-off of debt issue costs related to LTC's early retirement of its Secured Revolving Credit, an additional charge of $1.2 million related to LTC's redemption of 40% of its 9.5% Series A Preferred Stock, a gain of $2.0 million resulting from Assisted Living Concepts, Inc.'s redemption of its secured debentures owned by LTC and a gain on sale of assets of $2.0 million. Revenues for the three months ended December 31, 2004, were $16.3 million versus $15.8 million for the same period last year. For the year ended December 31, 2004, net income available to common stockholders was $15.0 million or $0.77 per diluted share. Included in these results was a gain on sale of assets of $0.6 million, a $0.3 million impairment charge and a $4.0 million charge taken in the first quarter of 2004 for the final redemption of LTC's Series A and Series B Preferred Stock. For the same period in 2003, net income available to common stockholders was $6.5 million or $0.36 per diluted share which included an impairment charge of $1.3 million, a $2.3 million gain on sale of assets, a $2.1 million write-off of debt issue costs related to LTC's early retirement of its Secured Revolving Credit, an additional charge of $1.2 million related to LTC's redemption of 40% of its 9.5% Series A Preferred Stock and a gain of $2.0 million resulting from Assisted Living Concepts, Inc.'s redemption of its secured debentures owned by LTC. Revenues for the twelve months ended December 31, 2004, were $66.9 million versus $63.2 million for the same period last year. LTC also announced that it has declared a dividend for the fourth quarter of fiscal 2004 of $0.30 per common share payable on March 31, 2005, to stockholders of record on March 18, 2005. The Company has scheduled a conference call for February 3, 2005, at 9:00 a.m. Pacific time in order to comment on the Company's performance and operating results for the quarter ended December 31, 2004. The conference call is accessible by dialing 800-265-0241, passcode 50085653. The international number is 617-847-8704. The earnings release and any additional financial information that may be discussed on the conference call will also be available on our website. An audio replay of the conference call will be available from 2:00 p.m. Pacific time on February 3, 2005, through February 25, 2005. Callers can access the replay by dialing 888-286-8010 or 617-801-6888 and entering conference ID number 94424339. Webcast replays will also be available on our website until March 3, 2005. At December 31, 2005, LTC had investments in 92 skilled nursing facilities, 100 assisted living residences and two schools in 31 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. For more information on LTC Properties, Inc., visit the Company's website at www.ltcproperties.com. 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 INCOME (Amounts in thousands, except per share amounts) Three Months Ended Year Ended December 31, December 31, ----------------- ----------------- 2004 2003 2004 2003 -------- -------- -------- -------- Revenues: Rental income $11,816 $10,672 $46,584 $40,320 Interest income from mortgage loans and notes receivable 2,531 2,269 9,138 9,814 Interest income from REMIC Certificates 1,109 2,157 7,342 9,964 Interest and other income 869 674 3,853 3,115 -------- -------- -------- -------- Total revenues 16,325 15,772 66,917 63,213 -------- -------- -------- -------- Expenses: Interest expense 2,351 6,176 11,866 20,799 Depreciation and amortization 3,228 3,151 12,816 12,314 Impairment charge 274 -- 274 1,260 Legal expenses 59 69 193 1,076 Operating and other expenses 1,111 2,117 5,297 6,525 -------- -------- -------- -------- Total expenses 7,023 11,513 30,446 41,974 -------- -------- -------- -------- Income before non-operating income and minority interest 9,302 4,259 36,471 21,239 Non-operating income -- 1,970 -- 1,970 Minority interest (101) (332) (896) (1,300) -------- -------- -------- -------- Income from continuing operations 9,201 5,897 35,575 21,909 Discontinued operations: (Loss) income from discontinued operations (25) 142 205 111 Gain on sale of assets, net -- 1,963 608 2,299 -------- -------- -------- -------- Net (loss) income from discontinued operations (25) 2,105 813 2,410 -------- -------- -------- -------- Net income 9,176 8,002 36,388 24,319 Preferred stock redemption charge -- (1,241) (4,029) (1,241) Preferred stock dividends (4,436) (5,155) (17,356) (16,596) -------- -------- -------- -------- Net income available to common stockholders $4,740 $1,606 $15,003 $6,482 ======== ======== ======== ======== Net Income (Loss) per Common Share from Continuing Operations net of Preferred Stock Dividends: Basic $0.23 $(0.03) $0.73 $0.23 ======== ======== ======== ======== Diluted $0.23 $(0.03) $0.73 $0.23 ======== ======== ======== ======== Net Income per Common Share from Discontinued Operations: Basic $-- $0.12 $0.04 $0.13 ======== ======== ======== ======== Diluted $-- $0.12 $0.04 $0.13 ======== ======== ======== ======== Net Income per Common Share Available to Common Stockholders: Basic $0.23 $0.09 $0.77 $0.36 ======== ======== ======== ======== Diluted $0.23 $0.09 $0.77 $0.36 ======== ======== ======== ======== Basic weighted average shares outstanding 20,598 17,804 19,432 17,836 ======== ======== ======== ======== 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 (in thousands, except per share amounts): Three Months Ended Year Ended December 31, December 31, --------------- ----------------- 2004 2003 2004 2003 ------- ------- -------- -------- Net income available to common stockholders $4,740 $1,606 $15,003 $6,482 Add: Real estate depreciation 3,228 3,285 12,927 12,998 Add: Impairment charge 274 -- 274 1,260 Less (gain)/add loss on sale of assets, net -- (1,963) (608) (2,299) ------- ------- -------- -------- FFO available to common stockholders $8,242 $2,928 $27,596 $18,441 ======= ======= ======== ======== Add: Preferred stock redemption charge -- 1,241 4,029 1,241 ------- ------- -------- -------- FFO excluding preferred stock redemption charge $8,242 $4,169 $31,625 $19,682 ======= ======= ======== ======== Basic FFO available to common stockholders per share $0.40 $0.16 $1.42 $1.03 ======= ======= ======== ======== Diluted FFO available to common stockholders per share $0.39 $0.16 $1.37 $1.03 ======= ======= ======== ======== Basic FFO excluding preferred stock redemption charge per share $0.40 $0.23 $1.63 $1.10 ======= ======= ======== ======== Diluted FFO excluding preferred stock redemption charge per share $0.39 $0.23 $1.55 $1.09 ======= ======= ======== ======== In October 2003, NAREIT informed its member companies that the Securities and Exchange Commission (SEC) has taken the position that asset impairment charges should not be excluded in calculating FFO. The SEC's interpretation is that recurring impairments on real property are not an appropriate adjustment. If the Company adopted the SEC's interpretation of FFO and did not adjust for the asset impairment charges, the Company's basic FFO, diluted FFO and FFO per diluted share for historical periods would be different than the amounts reported in this release and in previous disclosures. According to NAREIT, there is inconsistency among NAREIT member companies as to the adoption of the SEC's interpretation of FFO. Therefore, a comparison of the Company's FFO results to another company's FFO results may not be meaningful. The following table presents the Company's FFO results reflecting the impact of asset impairment charges as interpreted by the SEC (in thousands, except per share amounts): Three Months Ended Year Ended December 31, December 31, --------------- ----------------- 2004 2003 2004 2003 ------- ------- -------- -------- FFO available to common stockholders $8,242 $2,928 $27,596 $18,441 Less: Impairment charges (274) -- (274) (1,260) ------- ------- -------- -------- FFO available to common stockholders including impairment charges $7,968 $2,928 $27,322 $17,181 ======= ======= ======== ======== Basic FFO available to common stockholders including impairment charges per share $0.39 $0.16 $1.41 $0.96 ------- ------- -------- -------- Diluted FFO available to common stockholders including impairment charges per share $0.38 $0.16 $1.36 $0.96 ======= ======= ======== ======== LTC PROPERTIES, INC. CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except per share amounts) December 31, December 31, 2004 2003 --------------- --------------- ASSETS Real Estate Investments: Buildings and improvements, net of accumulated depreciation and amortization: 2004 - $83,369; 2003 - $70,895 $359,247 $352,461 Land 26,501 24,824 Properties held for sale, net of accumulated depreciation and amortization: 2004 - $0; 2003 - $2,481 -- 5,340 Mortgage loans receivable, net of allowance for doubtful accounts: 2004 and 2003 - $1,280 90,878 71,465 REMIC Certificates 44,053 61,662 --------------- --------------- Real estate investments, net 520,679 515,752 Other Assets: Cash and cash equivalents 4,315 17,919 Debt issue costs, net 1,348 1,496 Interest receivable 3,161 3,809 Prepaid expenses and other assets 4,451 4,495 Notes receivable 13,926 19,172 Marketable debt securities -- 12,281 --------------- --------------- Total Assets $547,880 $574,924 =============== =============== LIABILITIES AND STOCKHOLDERS' EQUITY Bank borrowings $-- $-- Mortgage loans payable 71,286 120,819 Bonds payable and capital lease obligations 13,967 14,686 Senior mortgage participation payable 15,407 18,250 Accrued interest 649 943 Accrued expenses and other liabilities 3,040 2,478 Accrued expenses and other liabilities related to properties held for sale -- 2,540 Liability for Series A 9.5% Preferred Stock redemption - 1,226 shares -- 30,642 Distributions payable 3,618 2,383 --------------- --------------- Total Liabilities 107,967 192,741 Minority interest 3,706 13,401 Stockholders' equity: Preferred stock $0.01 par value: 15,000 shares authorized; shares issued and outstanding: 2004 - 9,201; 2003 - 8,026 218,532 189,163 Common stock: $0.01 par value; 45,000 shares authorized; shares issued and outstanding: 2004 - 21,374; 2003 - 17,807 214 178 Capital in excess of par value 292,740 250,055 Cumulative net income 311,336 274,948 Other 2,070 (638) Cumulative distributions (388,685) (344,924) --------------- --------------- Total Stockholders' Equity 436,207 368,782 --------------- --------------- Total Liabilities and Stockholders' Equity $547,880 $574,924 =============== =============== CONTACT: LTC Properties, Inc. Andre C. Dimitriadis, Chairman & CEO Wendy L. Simpson, Vice Chairman & CFO 805-981-8655