-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
Mk+NoH5gUisCvM2GKztGG2Okvxz63QK9Q27/qWmh1bax2qqWoBQ4tAJ+2+GLg6i3
nQTfuQBWQxZT1IM9qr9nYA==
0000950123-10-022574.txt : 20100309
0000950123-10-022574.hdr.sgml : 20100309
20100309162118
ACCESSION NUMBER: 0000950123-10-022574
CONFORMED SUBMISSION TYPE: 8-K
PUBLIC DOCUMENT COUNT: 4
CONFORMED PERIOD OF REPORT: 20100309
ITEM INFORMATION: Results of Operations and Financial Condition
ITEM INFORMATION: Financial Statements and Exhibits
FILED AS OF DATE: 20100309
DATE AS OF CHANGE: 20100309
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: ADVOCAT INC
CENTRAL INDEX KEY: 0000919956
STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-SKILLED NURSING CARE FACILITIES [8051]
IRS NUMBER: 621559667
STATE OF INCORPORATION: DE
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 8-K
SEC ACT: 1934 Act
SEC FILE NUMBER: 001-12996
FILM NUMBER: 10667377
BUSINESS ADDRESS:
STREET 1: 1621 GALLERIA BLVD.
CITY: BRENTWOOD
STATE: TN
ZIP: 37027
BUSINESS PHONE: 6157717575
MAIL ADDRESS:
STREET 1: 1621 GALLERIA BLVD.
CITY: BRENTWOOD
STATE: TN
ZIP: 37027
8-K
1
g22423e8vk.htm
FORM 8-K
e8vk
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported)
March 9, 2010 (March 9, 2010)
(Exact Name of Registrant as Specified in Charter)
|
|
|
|
|
Delaware
|
|
001-12996
|
|
62-1559667 |
|
|
|
|
|
(State or Other Jurisdiction of
Incorporation)
|
|
(Commission File
Number)
|
|
(IRS Employer
Identification No.) |
1621 Galleria Boulevard, Brentwood, TN 37027
(Address of Principal Executive Offices) (Zip Code)
(Registrants telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy
the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
Item 2.02. Results of Operations and Financial Condition.
On March 9, 2010, the Registrant announced its results of operations for the fourth quarter and
year ended December 31, 2009. A copy of the press release is attached as Exhibit 99.1 to this
Current Report on Form 8-K and is incorporated herein by reference in its entirety.
The information furnished pursuant to Item 2.02 herein, including Exhibit 99.1, shall not be deemed
to be filed for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be
deemed incorporated by reference in any filing under the Securities Act of 1933.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
|
|
|
Number |
|
Exhibit |
|
|
|
99.1
|
|
Press Release dated March 9, 2010. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|
|
|
|
|
ADVOCAT INC.
|
|
|
By: |
/s/ L. Glynn Riddle, Jr. |
|
|
|
L. Glynn Riddle, Jr. |
|
|
|
Chief Financial Officer |
|
|
Date: March 9, 2010
-2-
EXHIBIT INDEX
|
|
|
Number |
|
Exhibit |
|
|
|
99.1
|
|
Press Release dated March 9, 2010. |
-3-
EX-99.1
2
g22423exv99w1.htm
EX-99.1
exv99w1
Exhibit 99.1
|
|
|
Company Contact:
|
|
Investor Relations: |
William R. Council, III
|
|
Cameron Associates |
President and CEO
|
|
Rodney OConnor |
(615) 771-7575
|
|
(212) 554-5470 |
Advocat Announces 2009 Year End Results
BRENTWOOD, Tenn., (March 9, 2010) Advocat Inc. (NASDAQ: AVCA) today announced its results
for the fourth quarter and year ended December 31, 2009.
For the fourth quarter of 2009 compared to the fourth quarter of 2008, key highlights include the
following:
|
|
|
Revenue increased 2.9% to $76.1 million in 2009, compared to $74.0 million in 2008. |
|
|
|
|
Occupancy increased to 77.4% in 2009, compared to 76.0% in 2008. |
|
|
|
|
Net income from continuing operations was $174,000 or $0.02 per diluted common share in
2009, compared to $1.2 million in 2008, or $0.19 per diluted common share. |
|
|
|
|
The provision for professional liability was $2.0 million in 2009 compared to $1.0
million in 2008, an increase in expense of $1.0 million. |
|
|
|
|
Funds provided by operations were $3.5 million in 2009 compared to $3.0 million in 2008. |
Highlights for the Year Ended December 31, 2009
Key Highlights for 2009 compared to 2008 include the following:
|
|
|
Revenue increased 5.0% to $302.0 million from $287.6 million in 2008. |
|
|
|
|
Occupancy increased to 76.7% in 2009, compared to 75.3% in 2008. |
|
|
|
|
Medicare rates increased 3.3%. |
|
|
|
|
Operating income was $4.9 million compared to $11.6 million in 2008. |
|
|
|
|
Professional liability was an expense of $9.1 million compared to $1.7 million in 2008,
an increase in expense of $7.4 million. |
|
|
|
|
There was a foreign currency translation gain of $191,000 in 2009 compared to a loss of
$1.0 million in 2008. These gains and losses are related to a note taken on the 2004 sale
of the Canadian operations. |
|
|
|
|
Net income from continuing operations was $2.4 million compared to $5.4 million in 2008,
or $0.36 per diluted common share compared to $0.86 in 2008. |
|
|
|
|
Stockholders equity increased to $19.7 million from $17.6 million a year ago, while
total debt was reduced $7.6 million to $24.8 million. |
|
|
|
|
As a result of these balance sheet improvements, the Companys debt to equity ratio
improved to 1.3 to 1, compared to 1.8 to 1 a year ago. |
|
|
|
|
Funds provided by operations increased to $14.9 million in 2009 compared to $12.0
million in 2008. |
-4-
Funds provided by operations is a non-GAAP performance measurement. A reconciliation of funds
provided by operations to net income is included in the financial tables accompanying this press
release
CEO Remarks
William R. Council, III, noted, Last week we announced the completion of the COO search. I am very
pleased that in a few weeks Kelly Gill will assume the responsibilities for the operations of our
nursing centers. He is an executive with exceptional experience and established credentials in our
profession. Kelly joins us at a very critical time when all providers are challenged by rising
costs and lower reimbursement rates. I am confident that with Kellys contribution, Advocat will
continue to create the flexibility, innovation and team leadership to meet these challenges
successfully.
The revenue drivers in our business are increased occupancy, rate increases, and favorable patient
mix. We achieved good results in two of these metrics this year. Our census initiatives generated
growth in total census and our focus on higher acuity patients increased rates. While our Medicare
percent to total declined because of the increase in non-Medicare census, we had only a marginal
drop in average daily Medicare census.
Funds from operations in 2009 totaled $14.9 million or $2.58 per diluted common share, up from
$12.0 million or $2.03 per diluted common share. This represents the second highest yearly
performance in Advocats last five years, accomplished during a period of recession. We utilized
the funds generated from operations to the shareholders benefit by investing in our nursing centers
($6.6 million), paying off debt ($7.6 million) and providing dividends to our common and preferred
shareholders ($1.2 million).
Mr. Council continued, The key elements of our growth strategy are four fold:
|
1. |
|
Improve physical plants |
|
|
2. |
|
Expand special services |
|
|
3. |
|
Acquire, lease or build additional facilities |
|
|
4. |
|
Concentrate marketing to favorable patient mix |
One of the most successful initiatives is our facility renovation program.
Facility Renovation Update
As of December 31, 2009, we have completed renovations at twelve facilities and have two additional
projects in progress that we expect to complete in the first half of 2010. In January 2010, the
Company celebrated the grand opening of the Companys thirteenth renovation project, which included
a 15 bed expansion to the nursing center. This facility has experienced an increase in daily
census as of the end of February 2010 to 67 compared to 59 as of December 2009. The Company is
developing plans for additional renovation projects.
A total of $19.6 million has been spent on the twelve completed renovations, with $12.5 million
financed through Omega, $6.0 million financed with internally generated cash, and $1.1 million
financed with long-term debt.
A table is included with this press release summarizing operating results at renovated nursing
centers.
-5-
Other Highlights for the Year Ended 2009
The following table summarizes key revenue and census statistics for the year:
|
|
|
|
|
|
|
|
|
|
|
Year Ended |
|
|
December 31, |
|
|
2009 |
|
2008 |
Skilled nursing occupancy |
|
|
76.7 |
% |
|
|
75.3 |
% |
Medicare census as percent of total |
|
|
12.7 |
% |
|
|
13.3 |
% |
Managed care census as percent of total |
|
|
1.3 |
% |
|
|
1.2 |
% |
Medicare revenues as percent of total |
|
|
30.0 |
% |
|
|
31.3 |
% |
Medicaid revenues as percent of total |
|
|
54.8 |
% |
|
|
53.6 |
% |
Managed care revenues as percent of total |
|
|
2.7 |
% |
|
|
2.4 |
% |
Average daily skilled nursing census |
|
|
4,432 |
|
|
|
4,346 |
|
Average daily Medicare census |
|
|
564 |
|
|
|
578 |
|
Average daily Managed care census |
|
|
56 |
|
|
|
51 |
|
Medicare average rate per day |
|
$ |
398.88 |
|
|
$ |
386.30 |
|
Medicaid average rate per day |
|
$ |
146.05 |
|
|
$ |
139.45 |
|
Managed care average rate per day |
|
$ |
372.76 |
|
|
$ |
343.73 |
|
The Companys average rate per day for Medicare Part A patients increased 3.3% in 2009 compared to
2008 as a result of the annual inflation adjustment that was effective October 1, 2008 and the
acuity levels of Medicare patients in our nursing centers, as indicated by RUG level scores, which
were higher in 2009 than in 2008. However, effective October 1, 2009, CMS reduced Medicare rates
approximately 1.1%, The Companys average rate per day for Medicaid patients increased 4.7% in 2009
compared to 2008 as a result of rate increases in certain states, partially funded by increased
provider taxes, and increasing patient acuity levels. Taking higher provider taxes into
consideration, the net increase in the average Medicaid rate per day was 3.6%.
|
|
|
Operating expense increased to $240.1 million in 2009 from $227.6 million in 2008, an
increase of $12.5 million, or 5.5%. Operating expense increased to 79.5% of revenue in
2009, compared to 79.1% of revenue in 2008. The increase in operating expense as a percent
of revenue was primarily due to reductions in the fourth quarter of 2009 in Medicare rates
and increased provider taxes imposed by state Medicaid programs. |
|
|
|
|
The largest component of operating expenses is wages, which increased to $147.2 million
in 2009 from $138.9 million in 2008, an increase of $8.3 million, or 6.0%. Average merit
increases for operating personnel were approximately 2.4% for the year, compared to 4.2% in
2008. |
|
|
|
|
Cash expenditures for professional liability costs were $4.9 million in 2009 compared to
$6.8 million for 2008. |
|
|
|
|
Employee health insurance costs are approximately $1.6 million higher in 2009 compared
to 2008, an increase of 23.7%. |
|
|
|
|
Provider taxes increased approximately $1.8 million in 2009, primarily due to new rate
legislation in Florida. |
General and administrative expense was $18.5 million in 2009 unchanged from 2008. As a percentage
of revenue, general and administrative expense decreased to 6.1% in 2009 from 6.4% in 2008.
-6-
Revolving Credit Facility
The Company expects to enter into an agreement with a bank for a new $15 million revolving
credit facility in March 2010, replacing its current bank revolving credit facility which was to
expire in August 2010. In addition to replacing the existing revolving credit facility, the
Company expects to use $3.2 million in proceeds from the new facility to retire an existing bank
term loan. The new revolver is expected to be secured by accounts receivable, to have a term of
three years and bear interest at the Companys option of LIBOR (subject to a floor of 3.0%) plus
3.5% or the banks prime lending rate.
Conference Call Information
A conference call has been scheduled for Wednesday, March 10, 2010 at 9:00 A.M. Central time (10:00
A.M. Eastern time) to discuss 2009 year end results.
The conference call information is as follows:
|
|
|
Date:
|
|
Wednesday, March 10, 2010 |
Time:
|
|
9:00 A.M. Central, 10:00 A.M. Eastern |
Webcast Links:
|
|
www.streetevents.com |
|
|
www.earnings.com |
|
|
www.irinfo.com/avc |
|
|
|
Dial in numbers:
|
|
888-713-4205 (domestic) or 617-213-4862 (international) |
Passcode:
|
|
61228802 |
The call will consist of remarks from management as well as a question and answer session. In
addition to the questions posed during the live call, management will also be addressing questions
submitted by email. If you would like to submit a question please email it to
InvestorRelations@advocat-inc.com before the start of the call.
A replay of the conference call will be accessible two hours after its completion through March 17,
2010 by dialing (888) 286-8010 (domestic) or (617) 801-6888 (international) and entering passcode
93216164.
FORWARD-LOOKING STATEMENTS
The forward-looking statements contained in this release are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are
predictive in nature and are frequently identified by the use of terms such as may, will,
should, expect, believe, estimate, intend, and similar words indicating possible future
expectations, events or actions. These forward-looking statements reflect our current views with
respect to future events and present our estimates and assumptions only as of the date of this
release. Actual results could differ materially from those contemplated by the forward-looking
statements made in this release. In addition to any assumptions and other factors referred to
specifically in connection with such statements, other factors, many of which are beyond our
ability to control or predict, could cause our actual results to differ materially from the results
expressed or implied in any forward looking statements, including but not limited to, our ability
to complete the contemplated refinancing of our revolving credit facility, our ability to arrange
appropriate financing and successfully construct and operate the replacement facility for the
facility in West Virginia, our ability to increase census at our renovated facilities, changes in
governmental reimbursement, government regulation and health care reforms, any increases in the
cost of borrowing under our credit agreements, our ability to
-7-
comply with covenants contained in those credit agreements, the outcome of professional
liability lawsuits and claims, our ability to control ultimate professional liability costs, the
accuracy of our estimate of our anticipated professional liability expense, the impact of future
licensing surveys, the outcome of regulatory proceedings alleging violations of laws and
regulations governing quality of care or violations of other laws and regulations applicable to our
business, our ability to control costs, changes to our valuation of deferred tax assets, changes in
occupancy rates in our facilities, changing economic and competitive conditions, changes in
anticipated revenue and cost growth, changes in the anticipated results of operations, the effect
of changes in accounting policies, as well as other risk factors detailed in the Companys
Securities and Exchange Commission filings. The Company has provided additional information in its
Annual Report on Form 10-K for the fiscal year ended December 31, 2009, as well as in its Quarterly
Reports on Form 10-Q and other filings with the Securities and Exchange Commission, which readers
are encouraged to review for further disclosure of other factors. These assumptions may not
materialize to the extent assumed, and risks and uncertainties may cause actual results to be
different from anticipated results. These risks and uncertainties also may result in changes to
the Companys business plans and prospects. Advocat Inc. is not responsible for updating the
information contained in this press release beyond the published date, or for changes made to this
document by wire services or Internet services.
Advocat provides long term care services to patients in 50 skilled nursing centers containing 5,799
licensed nursing beds, primarily in the Southeast and Southwest. For additional information about
the Company, visit Advocats web site: http://www.irinfo.com/avc.
-Financial Tables to Follow-
-8-
ADVOCAT INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
|
December 31, |
|
|
|
2009 |
|
|
2008 |
|
ASSETS: |
|
|
|
|
|
|
|
|
Current Assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
8,609 |
|
|
$ |
7,598 |
|
Receivables, net |
|
|
25,787 |
|
|
|
24,627 |
|
Deferred income taxes |
|
|
4,792 |
|
|
|
3,967 |
|
Other current assets |
|
|
2,546 |
|
|
|
3,117 |
|
|
|
|
|
|
|
|
Total current assets |
|
|
41,734 |
|
|
|
39,309 |
|
|
|
|
|
|
|
|
|
|
Property and equipment, net |
|
|
37,362 |
|
|
|
37,456 |
|
Deferred income taxes |
|
|
13,804 |
|
|
|
13,899 |
|
Note receivable, net |
|
|
|
|
|
|
3,486 |
|
Acquired leasehold interest, net |
|
|
9,764 |
|
|
|
10,149 |
|
Other assets, net |
|
|
2,602 |
|
|
|
3,040 |
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
$ |
105,266 |
|
|
$ |
107,339 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS EQUITY: |
|
|
|
|
|
|
|
|
Current Liabilities |
|
|
|
|
|
|
|
|
Current portion of long-term debt |
|
$ |
2,278 |
|
|
$ |
2,238 |
|
Trade accounts payable |
|
|
4,758 |
|
|
|
4,828 |
|
Accrued expenses: |
|
|
|
|
|
|
|
|
Payroll and employee benefits |
|
|
10,177 |
|
|
|
9,545 |
|
Current portion of self-insurance reserves |
|
|
7,860 |
|
|
|
6,469 |
|
Other current liabilities |
|
|
4,327 |
|
|
|
5,344 |
|
|
|
|
|
|
|
|
Total current liabilities |
|
|
29,400 |
|
|
|
28,424 |
|
Noncurrent Liabilities |
|
|
|
|
|
|
|
|
Long-term debt, less current portion |
|
|
22,551 |
|
|
|
30,172 |
|
Self-insurance reserves, less current portion |
|
|
12,235 |
|
|
|
10,212 |
|
Other noncurrent liabilities |
|
|
15,195 |
|
|
|
13,089 |
|
|
|
|
|
|
|
|
Total noncurrent liabilities |
|
|
49,981 |
|
|
|
53,473 |
|
|
|
|
|
|
|
|
|
|
PREFERRED STOCK |
|
|
6,192 |
|
|
|
7,891 |
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS EQUITY |
|
|
19,693 |
|
|
|
17,551 |
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND SHAREHOLDERS EQUITY |
|
$ |
105,266 |
|
|
$ |
107,339 |
|
|
|
|
|
|
|
|
-9-
ADVOCAT INC.
CONSOLIDATED INCOME STATEMENTS
(In thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months |
|
|
For the Year |
|
|
|
Ended December 31, |
|
|
Ended December 31, |
|
|
|
2009 |
|
|
2008 |
|
|
2009 |
|
|
2008 |
|
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
|
|
|
|
|
PATIENT REVENUES, NET |
|
$ |
76,127 |
|
|
$ |
73,957 |
|
|
$ |
302,031 |
|
|
$ |
287,607 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating |
|
|
61,281 |
|
|
|
58,250 |
|
|
|
240,095 |
|
|
|
227,633 |
|
Lease |
|
|
5,992 |
|
|
|
5,759 |
|
|
|
23,422 |
|
|
|
22,962 |
|
Professional liability |
|
|
2,033 |
|
|
|
1,022 |
|
|
|
9,132 |
|
|
|
1,658 |
|
General and administrative |
|
|
4,504 |
|
|
|
4,638 |
|
|
|
18,496 |
|
|
|
18,486 |
|
Depreciation and amortization |
|
|
1,587 |
|
|
|
1,392 |
|
|
|
5,999 |
|
|
|
5,306 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
75,397 |
|
|
|
71,061 |
|
|
|
297,144 |
|
|
|
276,045 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING INCOME |
|
|
730 |
|
|
|
2,896 |
|
|
|
4,887 |
|
|
|
11,562 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER INCOME (EXPENSE): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency transaction gain (loss) |
|
|
|
|
|
|
(712 |
) |
|
|
191 |
|
|
|
(1,005 |
) |
Other income |
|
|
|
|
|
|
|
|
|
|
549 |
|
|
|
|
|
Interest income |
|
|
2 |
|
|
|
83 |
|
|
|
161 |
|
|
|
454 |
|
Interest expense |
|
|
(454 |
) |
|
|
(644 |
) |
|
|
(1,877 |
) |
|
|
(2,870 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(452 |
) |
|
|
(1,273 |
) |
|
|
(976 |
) |
|
|
(3,421 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME FROM CONTINUING OPERATIONS BEFORE
INCOME TAXES |
|
|
278 |
|
|
|
1,623 |
|
|
|
3,911 |
|
|
|
8,141 |
|
PROVISION FOR INCOME TAXES |
|
|
(104 |
) |
|
|
(449 |
) |
|
|
(1,497 |
) |
|
|
(2,759 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME FROM CONTINUING OPERATIONS |
|
|
174 |
|
|
|
1,174 |
|
|
|
2,414 |
|
|
|
5,382 |
|
DISCONTINUED OPERATIONS: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income, net of tax provision of
$1, $52, $117, and $180, respectively |
|
|
2 |
|
|
|
112 |
|
|
|
187 |
|
|
|
353 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME FROM DISCONTINUED OPERATIONS |
|
|
2 |
|
|
|
112 |
|
|
|
187 |
|
|
|
353 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME |
|
|
176 |
|
|
|
1,286 |
|
|
|
2,601 |
|
|
|
5,735 |
|
PREFERRED STOCK DIVIDENDS |
|
|
86 |
|
|
|
86 |
|
|
|
344 |
|
|
|
344 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME FOR COMMON STOCK |
|
$ |
90 |
|
|
$ |
1,200 |
|
|
$ |
2,257 |
|
|
$ |
5,391 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME PER COMMON SHARE: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per common share basic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations |
|
$ |
0.02 |
|
|
$ |
0.19 |
|
|
$ |
0.37 |
|
|
$ |
0.89 |
|
Income from discontinued operations |
|
|
|
|
|
|
0.02 |
|
|
|
0.03 |
|
|
|
0.06 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
0.02 |
|
|
$ |
0.21 |
|
|
$ |
0.40 |
|
|
$ |
0.95 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per common share diluted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
$ |
0.02 |
|
|
$ |
0.19 |
|
|
$ |
0.36 |
|
|
$ |
0.86 |
|
Income from discontinued operations |
|
|
|
|
|
|
0.02 |
|
|
|
0.03 |
|
|
|
0.06 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
0.02 |
|
|
$ |
0.21 |
|
|
$ |
0.39 |
|
|
$ |
0.92 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE COMMON SHARES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
5,687 |
|
|
|
5,671 |
|
|
|
5,678 |
|
|
|
5,693 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
|
5,917 |
|
|
|
5,726 |
|
|
|
5,797 |
|
|
|
5,887 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-10-
ADVOCAT INC.
FUNDS PROVIDED BY OPERATIONS
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Year Ended |
|
|
|
December 31, |
|
|
December 31, |
|
|
|
2009 |
|
|
2008 |
|
|
2009 |
|
|
2008 |
|
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
(Unaudited) |
|
NET INCOME |
|
$ |
176 |
|
|
$ |
1,286 |
|
|
$ |
2,601 |
|
|
$ |
5,735 |
|
Income from discontinued operations |
|
|
2 |
|
|
|
112 |
|
|
|
187 |
|
|
|
353 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income from continuing operations |
|
|
174 |
|
|
|
1,174 |
|
|
|
2,414 |
|
|
|
5,382 |
|
Adjustments to reconcile net income from
continuing operations to funds provided
by operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
1,587 |
|
|
|
1,392 |
|
|
|
5,999 |
|
|
|
5,306 |
|
Provision for doubtful accounts |
|
|
395 |
|
|
|
655 |
|
|
|
2,181 |
|
|
|
2,334 |
|
Deferred income tax provision |
|
|
(230 |
) |
|
|
520 |
|
|
|
(678 |
) |
|
|
775 |
|
Provision (benefit) for self-insured professional
liability, net of cash payments |
|
|
1,084 |
|
|
|
(2,081 |
) |
|
|
3,543 |
|
|
|
(5,717 |
) |
Stock-based compensation |
|
|
133 |
|
|
|
222 |
|
|
|
689 |
|
|
|
867 |
|
Amortization of deferred balances |
|
|
99 |
|
|
|
91 |
|
|
|
382 |
|
|
|
426 |
|
Provision for leases in excess of cash payments |
|
|
209 |
|
|
|
340 |
|
|
|
1,187 |
|
|
|
1,711 |
|
Other |
|
|
|
|
|
|
687 |
|
|
|
(781 |
) |
|
|
884 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FUNDS PROVIDED BY OPERATIONS |
|
$ |
3,451 |
|
|
$ |
3,000 |
|
|
$ |
14,936 |
|
|
$ |
11,968 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FUNDS PROVIDED BY OPERATIONS PER SHARE: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.61 |
|
|
$ |
0.53 |
|
|
$ |
2.63 |
|
|
$ |
2.10 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
$ |
0.58 |
|
|
$ |
0.52 |
|
|
$ |
2.58 |
|
|
$ |
2.03 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE COMMON SHARES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
5,687 |
|
|
|
5,671 |
|
|
|
5,678 |
|
|
|
5,693 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
|
5,917 |
|
|
|
5,726 |
|
|
|
5,797 |
|
|
|
5,887 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advocat provides financial measures using accounting principles generally accepted in the United
States (GAAP) and using adjustments to GAAP (non-GAAP). These non-GAAP measures are not
measurements under GAAP. These measurements should be considered in addition to, but not as a
substitute for, the information contained in our financial statements prepared in accordance with
GAAP. Funds Provided by Operations is defined as cash flow from operating activities before
changes in other assets and liabilities affecting operating activities. Management believes that
Funds Provided by Operations is an important performance measurement because it eliminates the
effect of actuarial assumptions on our professional liability reserves, includes the cash effect of
professional liability payments, and does not include the effects of deferred tax benefit and other
non-cash charges. Since the definition of Funds Provided by Operations may vary among companies
and industries, it should not be used as a measure of performance among companies.
ADVOCAT INC.
SELECTED OPERATING STATISTICS
DECEMBER 31, 2009
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended December 31, 2009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medicare |
|
|
Medicaid |
|
|
|
|
|
|
|
|
|
|
|
Skilled |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Room and |
|
|
Room and |
|
|
|
As of |
|
|
Nursing |
|
|
Occupancy |
|
|
|
|
|
|
2009 |
|
|
Board |
|
|
Board |
|
|
|
December 31, 2009 |
|
|
Weighted |
|
|
(Note 1) |
|
|
|
|
|
|
Q4 |
|
|
Revenue |
|
|
Revenue |
|
|
|
Licensed |
|
|
Available |
|
|
Average |
|
|
Licensed |
|
|
Available |
|
|
Medicare |
|
|
Revenue |
|
|
PPD |
|
|
PPD |
|
Region |
|
Beds |
|
|
Beds |
|
|
Daily Census |
|
|
Beds |
|
|
Beds |
|
|
Utilization |
|
|
($ in millions) |
|
|
(Note 2) |
|
|
(Note 2) |
|
|
Alabama |
|
|
711 |
|
|
|
704 |
|
|
|
585 |
|
|
|
82.3 |
% |
|
|
83.1 |
% |
|
|
11.5 |
% |
|
$ |
10.6 |
|
|
$ |
394.72 |
|
|
$ |
161.16 |
|
Arkansas |
|
|
1,311 |
|
|
|
1,183 |
|
|
|
982 |
|
|
|
74.9 |
% |
|
|
83.0 |
% |
|
|
13.3 |
% |
|
|
16.2 |
|
|
|
374.00 |
|
|
|
145.40 |
|
Florida |
|
|
502 |
|
|
|
462 |
|
|
|
411 |
|
|
|
81.8 |
% |
|
|
88.9 |
% |
|
|
8.7 |
% |
|
|
8.0 |
|
|
|
429.92 |
|
|
|
180.51 |
|
Kentucky (Note 3) |
|
|
775 |
|
|
|
742 |
|
|
|
643 |
|
|
|
82.9 |
% |
|
|
86.6 |
% |
|
|
11.8 |
% |
|
|
12.4 |
|
|
|
394.08 |
|
|
|
175.16 |
|
Tennessee |
|
|
617 |
|
|
|
586 |
|
|
|
491 |
|
|
|
79.6 |
% |
|
|
83.8 |
% |
|
|
16.4 |
% |
|
|
8.5 |
|
|
|
381.14 |
|
|
|
137.59 |
|
Texas |
|
|
1,868 |
|
|
|
1,676 |
|
|
|
1,365 |
|
|
|
73.1 |
% |
|
|
81.4 |
% |
|
|
10.5 |
% |
|
|
20.4 |
|
|
|
399.20 |
|
|
|
122.66 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
5,784 |
|
|
|
5,353 |
|
|
|
4,477 |
|
|
|
77.4 |
% |
|
|
83.6 |
% |
|
|
11.9 |
% |
|
$ |
76.1 |
|
|
$ |
391.07 |
|
|
$ |
148.09 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Year Ended December 31, 2009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medicare |
|
|
Medicaid |
|
|
|
|
|
|
|
|
|
|
|
Skilled |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Room and |
|
|
Room and |
|
|
|
As of |
|
|
Nursing |
|
|
Occupancy |
|
|
|
|
|
|
2009 |
|
|
Board |
|
|
Board |
|
|
|
December 31, 2009 |
|
|
Weighted |
|
|
(Note 1) |
|
|
|
|
|
|
YTD |
|
|
Revenue |
|
|
Revenue |
|
|
|
Licensed |
|
|
Available |
|
|
Average |
|
|
Licensed |
|
|
Available |
|
|
Medicare |
|
|
Revenue |
|
|
PPD |
|
|
PPD |
|
Region |
|
Beds |
|
|
Beds |
|
|
Daily Census |
|
|
Beds |
|
|
Beds |
|
|
Utilization |
|
|
($ in millions) |
|
|
(Note 2) |
|
|
(Note 2) |
|
|
Alabama |
|
|
711 |
|
|
|
704 |
|
|
|
606 |
|
|
|
85.2 |
% |
|
|
86.1 |
% |
|
|
13.5 |
% |
|
$ |
45.5 |
|
|
$ |
406.64 |
|
|
$ |
162.71 |
|
Arkansas |
|
|
1,311 |
|
|
|
1,183 |
|
|
|
954 |
|
|
|
72.8 |
% |
|
|
80.7 |
% |
|
|
14.4 |
% |
|
|
62.2 |
|
|
|
374.13 |
|
|
|
141.78 |
|
Florida |
|
|
502 |
|
|
|
462 |
|
|
|
402 |
|
|
|
80.1 |
% |
|
|
87.0 |
% |
|
|
9.5 |
% |
|
|
30.6 |
|
|
|
419.94 |
|
|
|
173.06 |
|
Kentucky (Note 3) |
|
|
775 |
|
|
|
742 |
|
|
|
654 |
|
|
|
84.3 |
% |
|
|
88.1 |
% |
|
|
11.9 |
% |
|
|
50.4 |
|
|
|
411.44 |
|
|
|
171.78 |
|
Tennessee |
|
|
617 |
|
|
|
586 |
|
|
|
488 |
|
|
|
79.2 |
% |
|
|
83.3 |
% |
|
|
16.0 |
% |
|
|
33.8 |
|
|
|
384.27 |
|
|
|
137.75 |
|
Texas |
|
|
1,868 |
|
|
|
1,676 |
|
|
|
1,328 |
|
|
|
71.4 |
% |
|
|
79.2 |
% |
|
|
11.3 |
% |
|
|
79.5 |
|
|
|
412.98 |
|
|
|
120.66 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
5,784 |
|
|
|
5,353 |
|
|
|
4,432 |
|
|
|
76.7 |
% |
|
|
82.8 |
% |
|
|
12.7 |
% |
|
$ |
302.0 |
|
|
$ |
398.88 |
|
|
$ |
146.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note 1: |
|
The number of Licensed beds is based on the licensed capacity of the facility. The
Company has historically reported its occupancy based on licensed beds. The number of
Available Beds represents licensed beds less beds removed from service. Available beds
is subject to change based upon the needs of the facilities, including configuration of
patient rooms and offices, status of beds (private, semi-private, ward, etc.) and renovations.
Occupancy is measured on a weighted average basis. |
|
Note 2: |
|
These Medicare and Medicaid revenue rates include room and board revenues but do not
include any ancillary revenues related to these patients. |
|
Note 3: |
|
The Kentucky region includes nursing centers in Kentucky, West Virginia and Ohio.
Licensed and available beds increased by 15 in Kentucky in January 2010, following the
expansion of a facility. |
ADVOCAT INC.
SELECTED OPERATING STATISTICS OF RENOVATED FACILITIES
DECEMBER 31, 2009
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Occupancy(1) |
|
Medicare Average Daily Census |
|
|
Q4 |
|
LTM(2) |
|
Q4 |
|
LTM(2) |
Renovation Completion Date |
|
2009 |
|
Prior |
|
2009 |
|
Prior |
|
1st renovation January 2006 |
|
|
84.0 |
% |
|
|
64.9 |
% |
|
|
10.1 |
|
|
|
8.1 |
|
2nd renovation July 2006 |
|
|
71.4 |
% |
|
|
71.2 |
% |
|
|
11.4 |
|
|
|
12.3 |
|
3rd renovation August 2006 |
|
|
71.0 |
% |
|
|
45.1 |
% |
|
|
10.0 |
|
|
|
5.3 |
|
4th renovation October 2006 |
|
|
81.9 |
% |
|
|
71.9 |
% |
|
|
8.0 |
|
|
|
8.6 |
|
5th renovation February 2007 |
|
|
69.1 |
% |
|
|
56.2 |
% |
|
|
10.8 |
|
|
|
8.0 |
|
6th renovation April 2007 |
|
|
50.7 |
% |
|
|
47.5 |
% |
|
|
10.2 |
|
|
|
12.7 |
|
7th renovation July 2007 |
|
|
81.0 |
% |
|
|
85.0 |
% |
|
|
7.1 |
|
|
|
17.4 |
|
8th renovation January 2008 |
|
|
76.3 |
% |
|
|
50.9 |
% |
|
|
17.6 |
|
|
|
8.9 |
|
9th renovation October 2008 |
|
|
83.0 |
% |
|
|
83.0 |
% |
|
|
15.2 |
|
|
|
17.2 |
|
10th renovation November 2008 |
|
|
83.8 |
% |
|
|
80.8 |
% |
|
|
15.5 |
|
|
|
12.2 |
|
11th renovation March 2009 |
|
|
68.9 |
% |
|
|
62.5 |
% |
|
|
16.5 |
|
|
|
7.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
74.4 |
% |
|
|
66.5 |
% |
|
|
132.4 |
|
|
|
117.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Occupancy based on licensed beds. |
|
(2) |
|
Last Twelve Months prior to commencement of construction. |
###
GRAPHIC
3
g22423g2242301.gif
GRAPHIC
begin 644 g22423g2242301.gif
M1TE&.#EA!P$N`/?_`*.QOH2FSFJ4Q:VNL0!*H.GT_J:\V9J:G+_`PWMZ?*JJ
MJZ2BHQMDKEA65]/;ZI.2E92PT_GY^B-GKB$<&Q==J35QL]33TREKL-OA[71R
M=&1B9.KL\T6"O8J*C.'AX9VVU@!2I+O,XO_]_?'Q\=K:VM/@[J>UPKJ[O=OE
M\.3O^<+2Y0!%GL3%R/#P]5J+P:O!W/'T^`!"G?7U]TA[M_3V^9.VV(&`@>;J
M\CESM+[0Y+"QM+##W7*9QTI(2E*#O/SZ^P-6IJ2EJ,C3Y?;X^N[N[FIH:@U5
MINU)V=H,G*S7M]4-\N7F=R7*ZP5:K/S\_(>K
MT965F-SG\I^LN9^\VOGU\FQK;0`YF$M^N<+#QH6$AC%OL@!+H8^,B][:U___
M_8R&A,+`P(2"@H-_?5]:669D9>CEXK*PL/KZ^[R^P>#K]0!(G\/$QP16IL;&
MQJB^VW&5Q:>FIG)M:T)XM[6TM,#"Q>'F[^+L]HFOU=7B[VEG:`]:J'AV=\#!
MQ`!+H"XH)NSIYCYYN`A&B(*"A/CW^/[[
M^XFIS\'"QWKZ0I:J<#.XP!0H]_>W**WUWAW>017J,;(R_?T
M\;'&X'%P<8ZSUIB7F;BVM@9.HCEWM_/R]HVISUB%O7Y]?Y^9EK[+V?#R]^WO
M]-_M^E2(OS)UMPA=KVQK:X!_@&%?8`=3I.;CX`-/HBQPL\O8YY"0DL[)Q;C(
MX&]M;W9P;HB'B%)045914+Z_PFMJ:V=F9_O[_+V^P0!-HL_.SKR]P+*SM[2S
MLY^@HM'0T+>XN_/O[*^]RN?GY^_LZ*:BG\/#P\?5Y[;#T``_F[G'U`)-HEY<
M7@A7IWB9QX:#A8>#@D1`0$]ZMO3S\]?7U[^^OLS+RX1_?9^YV(V)AHRLTJ&?
MG[N\OP!3I?____W]_?___R'Y!`$``/\`+``````'`2X```C_`/T)'$BPH,
M"!,J7,BPH<.'$"-*G$BQHL6$_RYJW,BQH\>/($-.S%BPG\F3*%.J7,FRI2P9H88,.*'4NVK-FS:-.J';L&6#^'/$8+E95Z=VPWY55
M2V(8/\[@0PBJA[,K%#&GN_?NB@VB_RA!GGRC1N$``#C#OKUZ7NG7MV
=`Q)9#$3D#).2A9,,LDSADPP"26O*&"/(<_`8^4D
M>#SS3!S,]+.+-,>HA,<$\+PC))'/'+F+2AL&L`*((!*`PQ@Y.M3/!RCR"<<,
MV+VH*&']D($.')!"&D,R+1*T8T+>W%&$%*)$$HD@031`RS'US)('"YY&(D4G
MC@@B0V_]$/^Q20,*Z(*/(+,4XTP98.B2@2#U**#!``-`HVLT/4S!7#_9V*.!
M%*FR,(`T5J@2*%_^;$%`*GSRDPH%BESK&Z$I\G-HHHNZ2!42?W1+0#"5#G0I
M0OV4T8$4^^1[#1C4O-K/&,-.DZ\H4>@2+U>?.+*-!D\L4,P`K@!R@@;BG`1-
M!ZZP(,H##:RC;$GZN(&OOM_D,8*X@F9QBA<5-.&N$RASM1)5Y!HZPQPPE;32
M0%2U-,="./NLT$L&F21+NWR^BY*ES8U!Q0$*7).O-FVT>I(NRP"B[\)$Y-C/
M$6H,``D]#?0ARC[7Z$"%/&_UHT\';>2K<1%'+.M/+&5$G>\^@%#_0T_,ONWP
M!QL!$.!N*/T45K1)-Z@00@@Y7/&)2?<4"N*AMV2Q00N<=]Z"+UFT4%`$-]S`
M^099]")S/W-L<(4*223A1!@W3'XPCR:!L@$&(<3N!`8W_'!204&WKDD2']2`
M1@@.^!)T;Y^T$`#2(&*3#.>^T,"T;ZHXXTD/TTB]#PNZ?-'V`I>PL+02E]BH0`C>@H(D,`$.W<*&!)(`BQ&O;9>U*.LNV\$ZJDS/
M-"!8@00V\"\FK""6!+"%2:CB`-B`X`^U>,%):D"]70IV>/+RS2=BP0D;6"$!
M]M/&-#1@@:LM`Y,:K0;;/)F-:@P@%I^P0TOO1TF8\B^3,X65-9S!"4?_IF]J
MDG/\@P@/UP06-!0``LU+4?N'",S:@2@0H4]37J
MT$M)(L#*"O!A#%O8$XC^P`'6<44%34A1*OX`BW[<@`'7Y0O``4B0AVE0F`67*`1O
MN[H&`9BD!N+M$V^V"`SBO@8.^^11Y4R(*)/PH+'R/6X`4>"%&/BX"L;(*C_(
M:]Y^Y""]?%J!"_IQ#R@3P(X\4@)^QSMF6019_[ZV`'`)!LR/)K1""P8V`\)N`0MK.$('8BO#9RP0RHC2@-XKL(D0C!&N0B0C.!ZLA]+,+)GX&"`
M^M;L?(%8(18?_88J[Y!`)>^]IRISF723!PBECNL@*VQIU76_%-*+QY
MR^5]]I?%S8`A/-E=U^Y'MOOD%B`G+<[@IO.XRWWN/J4;HO22!S7*$`NN<`(:
M6LMDR3QP$AN4`9.1*$01[,V5>>1A`!P7,8DMO3H\\>@35)A%O>OEALQJ0P,D
MV+$G/Z!7&ISD$/'=LF)OO7*CNIQ'OXYYL/E@73XU@0)A]>0/#K$"G/>#$3]W
M-E>&;OE3].+H24OZTD/D%EFL83KH2(:1A;JY@]P/UKR$`S#R9A4?$@`X%U'Z0`P)
M,'[]8`$:8&-RXPEEH&A%P&AMX`S%QQ7QHPL+\!;45V*\U0^%D``)H``FX7;:
M`'YNP`GDUP\P(`$Q@`3UA090!@>5T"+OIVLM)W]<$7GU!V`&(%=]@@NP`@O:
MI&R?%WI!-WK1=AI-<(`)*%])!P%&\`B8T(9&P`3/DQ*>E($@,G6VAVX=.#2L
M,`L49Q(C4`0#(#ZFE`$G(0_58&H)%#\FP0>QH`!Y_^`--#AW!^<;(E8&*F42
M>*5`QH)@/,2`!O5!?,B`!)6=4M3!0K0B%CS>%LMAD7,$'
M;Q!?<%!@7`$*6Q`#P!6`8-AEI%>'PXAT6V1W_!0&S;`#.R`$66!O9D![&WA[
MU9@0_5`.SK`,B=8V#^`)R?^76P"$@ZQ@/_NB`3V%")<0!205B94VB1&5#;M"
M#/7U!;H@?%7C/GR!:^@P9H_F`[KRN0#X_FBE'X`"Q`(D\<@Q%\`T4
MMC&H=(/\E0I"L"RPD)M:)0$PT#:RR7(+&8MA65^*@`FVV%QJB06[^$U<$9SC
MU9;$688(2(P*\3-,$`.SQI4FP059"9C8*5_:B4?T(@[5$`2QH!*7H`#Z-@T*
MX`BV4XF89)[0\`1O5PWBZ`_TR9DP200S6J,ID0&KI5%%@*1#$P`QP`"^L"Q7
M`$LFYP5F*3->^:"UZ9!<,08X$%_?)@(7^09LMY8=.IP&&*(@.317X`6V>'GA
MPA7F\*'728V#22_T`&_KH`"".JCK<``8A4!Y$'A<<7SV_Z-1E\`-%A>@FEE]
M(;DT7"&3W1`-@SJH#7!V4[-9G=4<(N`#Z,!M*O$#1#6`]\"@7TJ;#9DH*=I8
M6^5>%)"6P+F10O>AQJF`,2-6=,HGV'`!MQ!UXK:G@JEN,*E]08`L/="LS1H-
MLX!Q'1>,/U%`(L>`:&ML-T%!(-W8Q;:.>@2@W"3`)`\!);6.D
MDEA)1V`'T/"RT.`&'<"/3LH*=O^0L1O+"6KP@R'5`6[@4[S9!-AP"@Q0M$9;
MM%A%515@#?8ZF_@*;.@"55HZ7C*D)UZ@H1N*JV)HL"(*DPH+K!?0L-!HG2V)
MAR]9-!ZPGAK0HR<1`=2@`_J&`-U`!:M#CB&U##VP,$^0LM_*%;-0#66P#(*+
M:74C#@\C6BM!#>RY#_,6"^<44;H(!!PPN91;N>Q@@.'RA`[JJA'J26-0>7U"
M"/W``9/"=EG[BVXJC'`:ET/SM=43ML2J@1";G1);$GL0J?'"C1>7+WT`!M7`
MCSR966"@`Y'F;RI[E":V#%*@8BSF8OVP";'0B;G;G=%*,AK0?$-CD3%0"CYS
M`06)7>W_I;F.Q[GY.A`XPP6-!0>VL`&J6:\\,K!`E[H>N;K'F;"_^KIB^["!
M:;9]JC.6*8.!T@]?ATF:Y`CET#;UD`<'I"]2D``,Q"/'NYFN1<"Q%0>NK(3+%/_TP_.H`!%8,4!Q`W!MSX07Q``)7"RLW7+"J>[#(61!C<`N?X,-L!<0._UNL91NQ1>Q)
M;C<`&C!:)5%:$S8PLR!(,G./&/63>PO!NH#%^O-:5%,$WO`$&B!P4LH5%E!C
M%&9*D+!J/"(`,8`)-R`N_3`(4'9YM-2@XTO'M@G!H/L:+9<,IGNZPIFK7!NG
M1?,#/L`#8?`("ZO(8\NB?(JL2\P*T7=!XJ`!A:8O&U5)^M"3^6*.L?QH6..3
MEF9)KW4-)[`.1$`+%A?+O44$U+`-XG,-V^`(/063GX`#,7`(.$,O57"7)F<,
M!>K+*SQ_G6N^_:!^W7)8[ON^6AN,=6AZ@GPM7#)@/^@"P^P+(C0`&UP-FG3+S`%#7`%)P
M":H6!P]@61J]2%%PK:*@`9"(RR5@#"O0?O32`@39+2N`A`K]BL`LIIX$"UE)
MP\OBY:IX^`M4J&A00KO[L4Q^C+S"5!`X\`#&[]NL,:Q"$MU[3[
MR&X#)\Y`"A/_4)1&W`!D0@5%4-Y4\":D0'8KW0#44`1YT`#]'$#^L``:4`T)
M\`"Z``_%H`$]T`#X304:,`L1L`!PH@;P,`'#4$OK,`$-0-[FO0Y6HJ@Z4Z(4
MP(H(,999&:S!%4XL1P"($%9@_;V)K`D__P`*(2#-
M<'PPZ:=K]&I>#MT%,6!S7*:6.:!+(#``O*=$,1B"LO4`!
M\754"9U<*VIZ)A$&QF#H<"![)F$.`0FC!*$%*=#KO;X(9A#LPA[LB^#KQN[K
MPNX'QS[LS&X&?E``!9`"B^`'BU#MQ0[M?A#LRF[LP-[L9E#LQV[L9C`$!<$'
M*(!L5M8(,)`08V`&0*9,RH3")>`+N"#5<(`-HX@B%?`&%."]\#X<%5`"&E(2
ML+`"\!X#-5P20X`%C\"8N#`;+`!/S^"*4P13Y`1[9`")D0\9KW`DS``(^092N`#G]@#,;P
M"!3@`^'+*#F0"Q209:F0"GP\`Q"@`A*`]V#O!R:A`H3`[V__"%YP"!#P*MN)
M.UZQ%KJ_^[S?^V>!#NA`3P,Q!C1``T,P!#0``]:@$,A__,[__,9_$F.P`6'@
M``Z``3%;A!S$`'/'P'&UL8G80VHHPPY@`KF<`.]`"@F,?ZX\V\8
M(`0AL`-((`O-@`IA$)`E!1#]^FW0U*Q9"`<;!/:C,<3APR$P:(SQMS#"AC`.
M,+18Z,^COW\?/Z(A`\7D290I5:YDV=+E2Y@LM8CTN-`F39HV==ZLN%-@3Y\_
M<0+M.#1GT*)&D?(\ZM.?B*4B/@;%&;+I4JQ9M6[EBM7H5[!AQ8XE6];L6;1I
?:?YCV];M6[AQY[EV]?O7\!U`P(`.S\_
`
end
GRAPHIC
4
g22423g2242302.gif
GRAPHIC
begin 644 g22423g2242302.gif
M1TE&.#EA;0`4`/?_`&.3Q;V]OEV2QKFXN;[1Y>WQ]@!&GK6TMC-SM[C/Y76DTGEW>*;`W6UL;?S\_*"_W:"@HC5LHAECK>+J\Q)>JGFC
MS>GHZ,76Z-GD\(VQU92SUL/3YG";R:6DIJZMKHJ)BP!1I(6IT?3W^;&LJ*NF
MH_KZ^P!4I4.!OCN]:C"WK;*X9VZV4F'PJ*BI/_]_0E9J*":EM+>[`16IE2*P4%]NN?GY]'0
MT,'!PM;A[G^ESW*ASL;&QH6#A?K[_&Z:RDJ(Q%")P9RSL??W]\[-SJBHJDR'P+"QM#Y[N*&\V@!*H/'Q\:JKK:_&X$V%OI..B_+T
M^/#T^/GZ^PQ8I_;V]I^>H`!,H=_F\=G8V+Z_PK*RLY65E[&PL:+!WR!GK^7K
M\[.RLG:@S+;,XWVGT/3T],/!P>[N[:JGJ+"PLI&0DKG-XZ:AGFJ8R-_?WU6,
MP@!/H]SD[Q=AK#YUJYJ:FZ.^W*2CHK.SMI*2E$V#O?CY^ZRKJXZ)A8:KT@!,
MH%"&OD9_NR5JL+.TM]33U&:7Q[/)XK+(X:K&X,#!Q*6_W+>XN[*QLO+V^HFK
MTH.IT4R)Q9>2CP]=JKS/Y;:VMZ^OLD>"O:RKK963DY".D(^-D`U;J097IP54
MI?___;6VN;')X7NDSF^>S/O\_+:WNK/*XK&RM;2SM+2UM^SLZ[N\OU:-Q*JI
MJHVOU+"OL//V^4N&P$^(P4N"N*.CI;>PK/S[_/W__?;U]9>VV$F`MI>YVO3S
M]$Z%O/O[^]S;W-[E\(-]>KZ\NZFHJ>#H\MSF\3IWLW^GSSAWM_'P[_GT\%^0
MQ-C3S[FWMZNJJ_GY^>#>WGBAS,C'Q_W__[_3Z,"_O_#S][#$WB-:D(V'A7RC
MSK+'X,7#Q+BWN'^HT7>FU'2CT9R;G7.BT.#@X$=^M=C6U?W]_[;.Y.7L]-+-
MR0A5IM?C[_W]_?_______R'Y!`$``/\`+`````!M`!0```C_`/OU@^6OH,
M"!,J7"BPX4"$#AL2/!BQHL6+'^$VCB#BU:\1R('#GRXSR12I0X@.<@I1*3
M(^$I<3+!'RR),0AQV+FFB0^'L!KMY,"OFH2,2),VI"APH[]@EP3UJJ"@`M6J
M5"L,Z65(@0)GQ"JDJU!OB#.I7:TJ(#:D@TV')C+L^T&JBYF?.*?\^%%(A]*_
M&:U)D<*LX<9^/@S2&&/ESRACHZR,.E&PF[1')U",^3,&!1`4!?6ILX)"W;:"
M%?U=\C)(31=_`A%B@J&FU1R($Q?>9+C0'R8O!@:A/CR0H*5%O"J9\U>E#9\$
M!7?U<9%%D3M_`V(5\U50PX@7G7(5_\2[]-RD;*T!P8;E@T`'2.P\J""!`5T.
M"!#"S.EGP@\G)."4TT48`^9C$!+XY=`%"P:QH,P.RG01A#\QB%,#"4*$48`_
MQ,7&1P1;O.#+,YXHH@@<_?B3P"H]O+"%*=C%$EY!1T30'`5?P!:1/QO<@`T,
M@V332$&0#&)`(1!P0P)]'TQB@!>,D.%/+>(L\`$1,'!Q`20P6`"!#TF<\8H?
M06#PRCHF@/!*(4%`,,@^W!0`B0HUN/+!)QPZY,\5A[@`1AMIX+$$&+R$D(P_
M;D3AB2U;Z.(/'Q100`UL5N["A"4]M%$,-$6DL4D:&J0012XOQ++%`?ZP$4``EOC33!]+^,++
M#.UL*I`//G"3`Q6MD*#"+:,2,0@,LZ1Z(087;"`$":U4\Q0"F$#A+*ZR@#K+
M?!90T0@E!OR`B"M>(%`+!S_XB\^QTE*[U#A]Z)'%"Z>8DT(Q`61A1#,C8%'N
MN0D%PL0N;E2BB'@[DH$`(68@,'`H`0^<@<'TK4&&!8.H@(D_2%"2SS`3^U,Q
M?1DLG'$*DE"231!^E#(AL_XV@/*TL'7HSS=5]),++KH`XX\GNFS_$0`;(^QB
MBKGHZFG.&\>8<\H+55QA+X]<#,F-LY+TDX+`,#S=PL'1^".&LY#XL\,D37`-
M`\46BWV;"60$0Z$..T!P2\DJN#T?W/T0MZ<+2_B#Q0P!]`!..WQT/5FT(<\NCT^AGC\=P$""'&0<@[GF!Q/B#YO*$(!S27HX`1@BH`[PT2*(@I
M<&&+5#Q#CA^0`3\N<`$;+&!@@.@'&<,'F\^Y0A*HD``R5(@Z^K3/A3!,T2_J
M*!3:V2YE.DP1.%RPG!0-H!(O`(,_%-<&0SW*%KBXS@MLT0E/.#(V2]A"&WJ`
M!CF&PGP&`80:@A2,49JQ(*&`P0B?)@%AO)$$I`@;+&'C#P*`8!"#B!4>;XD[
MXHSC`QA`.#PAB?8,)YQB$`5(U`%'(Q@#@J(
MX)+^R`,U!@`'7X`C16NPP`;D>`LU/"D'W#"``8C``D"H]143\@<.2-$QAV$/
M.%#P1P[4R@TD%,(`-2!`#,A``"=,0:V%(`0BS.H%3;"@!L&)!@[RY(]/"$`4
M/%B!9I_P!!Y@=@6=S>P*4/&$%7#A&EP@[1-$(0K-KL"S/.!L.?SQ#$2F",(/
M`H&%!'(`!2@,XQTL2`(JN``"4`P!"D/(02W\(8$[,*(.=[%$`0PX!"!\Z!B"$0P0.W.4PC-#&!^MKWOOB]
M;QSVF]_^VD`@3?!'$QR"U2D9)#$'&3!B#'(3YC&W`#$P"/-@$8P"N([!$HBD
>09XQX>'\X\,@#K&(1TSB$IOXQ"A.L8I7'.*````[
`
end
-----END PRIVACY-ENHANCED MESSAGE-----