Delaware | 001-12996 | 62-1559667 |
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
99.2 | Unaudited Pro Forma Statements of Operations of Diversicare Healthcare Services, Inc. as of June 30, 2013, and as of December 31, 2012, December 31, 2011, and December 31, 2010. |
No. | Exhibit | |
Exhibit 99.2 | Unaudited Pro Forma Statements of Operations of Diversicare Healthcare Services, Inc. as of June 30, 2013, and as of December 31, 2012, December 31, 2011, and December 31, 2010. |
EXHIBIT 99.2 UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (in thousands, except per share amounts) | |||||||||||
As Reported (a) | Arkansas Region (b) | Pro Forma | |||||||||
Six Months Ended June 30, | Six Months Ended June 30, | Six Months Ended June 30, | |||||||||
2013 | 2013 | 2013 | |||||||||
PATIENT REVENUES, net | $ | 162,028 | $ | 34,838 | $ | 127,190 | |||||
EXPENSES: | |||||||||||
Operating | 127,279 | 27,162 | 100,117 | ||||||||
Lease and rent expense | 12,533 | 2,440 | 10,093 | ||||||||
Professional liability (c) | 8,471 | 4,320 | 4,151 | ||||||||
General and administrative | 13,342 | 856 | 12,486 | ||||||||
Depreciation and amortization | 3,578 | 348 | 3,230 | ||||||||
Asset impairment | — | — | — | ||||||||
Total expenses | 165,203 | 35,126 | 130,077 | ||||||||
OPERATING LOSS | (3,175 | ) | (288 | ) | (2,887 | ) | |||||
OTHER EXPENSE: | |||||||||||
Equity in net losses of unconsolidated affiliate | (215 | ) | — | (215 | ) | ||||||
Interest expense, net | (1,580 | ) | — | (1,580 | ) | ||||||
Debt retirement costs | (320 | ) | — | (320 | ) | ||||||
(2,115 | ) | — | (2,115 | ) | |||||||
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | (5,290 | ) | (288 | ) | (5,002 | ) | |||||
BENEFIT FOR INCOME TAXES | 2,211 | 60 | 2,151 | ||||||||
LOSS FROM CONTINUING OPERATIONS | (3,079 | ) | (228 | ) | (2,851 | ) | |||||
Loss per common share from continuing operations – basic | $ | (0.56 | ) | $ | (0.53 | ) | |||||
Loss per common share from continuing operations – diluted | $ | (0.56 | ) | $ | (0.53 | ) | |||||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | |||||||||||
Basic | 5,861 | 5,861 | |||||||||
Diluted | 5,861 | 5,861 |
EXHIBIT 99.2 UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) | |||||||||||||||||||||||||||||||||||
As Reported (a) | Arkansas Region (b) | Pro Forma | |||||||||||||||||||||||||||||||||
Year Ended December 31, | Year Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||||||||||||
2012 | 2011 | 2010 | 2012 | 2011 | 2010 | 2012 | 2011 | 2010 | |||||||||||||||||||||||||||
PATIENT REVENUES, net | $ | 308,072 | $ | 309,467 | $ | 285,594 | $ | 67,504 | $ | 65,979 | $ | 60,560 | $ | 240,568 | $ | 243,488 | $ | 225,034 | |||||||||||||||||
EXPENSES: | |||||||||||||||||||||||||||||||||||
Operating | 242,591 | 239,674 | 225,469 | 53,606 | 50,710 | 45,906 | 188,985 | 188,964 | 179,563 | ||||||||||||||||||||||||||
Lease and rent expense | 23,930 | 22,939 | 22,600 | 4,879 | 4,875 | 4,874 | 19,051 | 18,064 | 17,726 | ||||||||||||||||||||||||||
Professional liability (c) | 11,964 | 10,466 | 5,140 | 5,875 | 7,012 | 3,198 | 6,089 | 3,454 | 1,942 | ||||||||||||||||||||||||||
General and administrative | 24,419 | 25,589 | 19,680 | 1,651 | 1,766 | 1,515 | 22,768 | 23,823 | 18,165 | ||||||||||||||||||||||||||
Depreciation and amortization | 7,043 | 6,365 | 5,614 | 767 | 758 | 591 | 6,276 | 5,607 | 5,023 | ||||||||||||||||||||||||||
Asset impairment | — | 344 | — | — | — | — | — | 344 | — | ||||||||||||||||||||||||||
Total expenses | 309,947 | 305,377 | 278,503 | 66,778 | 65,121 | 56,084 | 243,169 | 240,256 | 222,419 | ||||||||||||||||||||||||||
OPERATING INCOME (LOSS) | (1,875 | ) | 4,090 | 7,091 | 726 | 858 | 4,476 | (2,601 | ) | 3,232 | 2,615 | ||||||||||||||||||||||||
OTHER INCOME (EXPENSE): | |||||||||||||||||||||||||||||||||||
Equity in net losses of unconsolidated affiliate | (280 | ) | — | — | — | — | — | (280 | ) | — | — | ||||||||||||||||||||||||
Interest expense, net | (2,809 | ) | (2,355 | ) | (1,632 | ) | — | (1 | ) | 1 | (2,809 | ) | (2,354 | ) | (1,633 | ) | |||||||||||||||||||
Debt retirement costs | — | (112 | ) | (127 | ) | — | — | — | — | (112 | ) | (127 | ) | ||||||||||||||||||||||
(3,089 | ) | (2,467 | ) | (1,759 | ) | — | (1 | ) | 1 | (3,089 | ) | (2,466 | ) | (1,760 | ) | ||||||||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | (4,964 | ) | 1,623 | 5,332 | 726 | 857 | 4,477 | (5,690 | ) | 766 | 855 | ||||||||||||||||||||||||
BENEFIT (PROVISION) FOR INCOME TAXES | 1,747 | (437 | ) | (1,702 | ) | (269 | ) | (317 | ) | (1,656 | ) | 2,016 | (120 | ) | (46 | ) | |||||||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS | (3,217 | ) | 1,186 | 3,630 | 457 | 540 | 2,821 | (3,674 | ) | 646 | 809 | ||||||||||||||||||||||||
Income (Loss) per common share from continuing operations – basic | $ | (0.63 | ) | $ | 0.15 | $ | 0.57 | $ | (0.71 | ) | $ | 0.05 | $ | 0.08 | |||||||||||||||||||||
Income (Loss) per common share from continuing operations – diluted | $ | (0.63 | ) | $ | 0.14 | $ | 0.56 | $ | (0.71 | ) | $ | 0.05 | $ | 0.08 | |||||||||||||||||||||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | |||||||||||||||||||||||||||||||||||
Basic | 5,821 | 5,744 | 5,732 | 5,821 | 5,744 | 5,732 | |||||||||||||||||||||||||||||
Diluted | 5,821 | 5,906 | 5,854 | 5,821 | 5,906 | 5,854 | |||||||||||||||||||||||||||||
a) | Reflects the consolidated historical statements of operations of Diversicare for the six months ended June 30, 2013 and the years ended December 31, 2012, December 31, 2011, and December 31, 2010, as contained in the historical consolidated financial statements and notes thereto presented in the Quarterly Report on Form 10-Q for the quarter ended June 30, 2013 and the Annual Report on Form 10-K for the year ended December 31, 2012, respectively. |
b) | Represents adjustments to reflect the disposition of the Company's Arkansas operations as follows: |
• | The elimination of revenues and expenses directly attributable to Arkansas operations for the periods presented. |
c) | The Company has allocated all professional liability expense to the states where the Company operates based on calculations performed by Diversicare management with assistance from its external actuary’s calculation as completed semi-annually. The actuary designates a percentage allocation of ultimate loss to the states in which the Company operates based upon the result of multiple years of developed loss runs and trends. The actuary aggregates three broadly used actuarial methods in performing the analysis including the Frequency-Severity Method, the Reported Bornhuetter-Ferguson Method, and the Paid Bornhuetter-Ferguson Method. The aggregation of these methods provides the actuary a basis upon which to develop an appropriate statistical range within which the recommended percentage allocations are identified. |