Adjusted EBITDA for the year ended December 31, 2012 was $42.0 million, or 18.4% of revenues and
•decreased $25.8 million or 38.0% from $67.8 million and 28.9% of revenues in the year ended December 31, 2011.
Year ended December 31, 2012 compared to the year ended December 31, 2011
Revenues in the year ended December 31, 2012 decreased by $6.1 million from the year ended December 31, 2011 primarily due to a decrease in rented private pay units ($7.5 million), and the planned reduction in the number of units rented to by Medicaid residents ($1.6 million), partially offset by higher average daily revenue from rate increases ($2.4 million) and one additional day in the 2012 period due to leap year ($0.6 million). Average rates increased in the year ended December 31, 2012 by 1.5% over average rates for the year ended December 31, 2011.
Both Adjusted EBITDA and Adjusted EBITDAR decreased in the year ended December 31, 2012 primarily from an increase in residence operations expenses ($17.2 million) (this excludes the gain on disposal of fixed assets and write-off of construction costs), a decrease in revenues discussed above ($6.1 million), and an increase in general and administrative expenses ($6.8 million) (this excludes non-cash equity based compensation) and, for Adjusted EBITDA only, a decrease in residence lease expense ($4.3 million). Residence operations expenses increased as a result of increased salaries and wages associated with quality restoration efforts initiated in June 2012 and an increase in professional fees from litigation and regulatory issues primarily in the southeast. General and administrative expenses increased as a result of an internal investigation, the SEC investigation, litigation and expenses incurred in connection with public relations, and quality improvement initiatives.
At December 31, 2012 ALC had cash of $10.2 million and availability of $8.0 million under its credit agreement. At December 31, 2012, ALC owned 94 unencumbered residences that may be used to secure future capital.
As previously announced, on February 25, 2013, ALC entered into an Agreement and Plan of Merger (the "Merger Agreement") with affiliates of TPG Capital, L.P. At the effective time of the merger, each share of ALC Class A and Class B common stock issued and outstanding immediately prior to the effective time of the merger will be converted automatically into the right to receive $12.00 and $12.90 in cash, respectively.
Assisted Living Concepts, Inc. and its subsidiaries operated 211 senior living residences comprising 9,348 resident units in 20 states at December 31, 2012. ALC's senior living facilities typically consist of 40 to 60 units and offer residents a supportive, home-like setting and assistance with the activities of daily living. ALC employed approximately 4,600 people at December 31, 2012.
Statements contained in this release other than statements of historical fact, including statements regarding anticipated financial performance, business strategy and management's plans and objectives for future operations, including management's expectations about improving occupancy and private pay mix, are forward-looking statements. Forward-looking statements generally include words such as "expect," "point toward," "intend," "will," "indicate," "anticipate," "believe," "estimate," "target," "plan," "foresee," "strategy" or "objective." Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied. In addition to the risks and uncertainties referred to in the release, other risks and uncertainties are contained in ALC's filings with United States Securities and Exchange Commission and include, but are not limited to, the following: any conditions imposed on the parties in connection with consummation of the transactions contemplated by the Merger Agreement; the ability to obtain regulatory approvals of the transactions contemplated by the Merger Agreement on the proposed terms and schedule; the failure of ALC's stockholders to approve the transactions contemplated by the Merger Agreement; ALC's ability to maintain relationships with customers, employees or suppliers following the announcement of the Merger Agreement; the ability of the parties to satisfy the conditions to closing of the transactions contemplated by the Merger Agreement; the risk that the transactions contemplated by the Merger Agreement may not be completed in the time frame expected by the parties or at all; the risk that ALC is unable to comply with covenants under its credit agreement or ALC cannot obtain waivers of or amendments to the covenants; changes in the health care industry in general and the senior housing industry in particular because of governmental and economic influences; changes in general economic conditions, including changes in housing markets, unemployment rates and the availability of credit at reasonable rates; changes in regulations governing the industry and ALC's compliance with such regulations; changes in government funding levels for health care services; resident care litigation, including exposure for punitive damage claims and increased insurance costs, and other claims asserted against ALC; ALC's ability to maintain and increase census levels; ALC's ability to attract and retain qualified personnel; the availability and terms of capital to fund acquisitions and ALC's capital expenditures; changes in competition; and demographic changes. Given these risks and uncertainties, readers are cautioned not to place undue reliance on ALC's forward-looking statements. All forward-looking statements contained in this report are necessarily estimates reflecting the best judgment of the party making such statements based upon current information. ALC assumes no obligation to update any forward-looking statement.
Most Popular Stories
- Twitter Coming to Phones Without Internet
- Twitter Names Woman to Board
- Thalia Gets Star on Hollywood Walk of Fame
- Rand Paul Signs up for Obamacare
- Obamacare Doing Just Fine, Ky. Governor Says
- How to Arm Yourself Against CryptoLocker Virus
- World Cup Draws: Coaches, Players Offer Insights
- Warner Bros. Unleashes 'Hobbit: Desolation of Smaug' Merchandise
- Texas Chiller Moves East
- Hispanic Employment Improves in November