Results are presented in Canadian dollars unless otherwise noted. MARKHAM, ONTARIO — (Marketwire) — 06/07/11 — Extendicare Real Estate Investment Trust (“Extendicare REIT” or “Extendicare”) (TSX: EXE.UN) today reported results for the three months ended March 31, 2011, in accordance with the newly adopted International Financial Reporting Standards (IFRS) for interim financial statements.
“Extendicare achieved solid financial and operating results in the 2011 first quarter. Our strong performance was primarily due to growth from same-facility operations, improved government funding and higher Medicare census levels,” said Tim Lukenda, President and CEO of Extendicare REIT. “The average daily Medicare Part A rate increased 13% as a result of changes to the Medicare reimbursement system introduced in the fourth quarter of 2010, along with our operational response to those changes, while the daily Managed Care rate improved by 10.1% over the 2010 first quarter.”.
The completion of this US$639 million refinancing will lower our costs of debt while bolstering our financial flexibility and further strengthening our balance sheet. “At the same time, we made significant progress towards the completion of the U.S. The financing is set to be completed in stages, with the first closing anticipated by the end of June 2011 and the balance through to December 2011,” he added. Department of Housing and Urban Development (HUD) refinancing during the quarter, locking in very advantageous rates on the first series of loans.
Medicare census levels, partially offset by lower Medicaid census and prior period revenue. Consolidated revenue increased by $12.3 million, or 2.3%, excluding the negative effect of the stronger Canadian dollar. Centers disposed of, or to be disposed, net of new centers (collectively “non same-facility operations”), resulted in lower revenue of $6.8 million between periods. However, the stronger Canadian dollar partially offset the underlying improvement in revenue, resulting in an overall decline of $7.1 million to $519.5 million in the 2011 first quarter from $526.6 million in the 2010 first quarter. Growth from same-facility operations of $19.1 million, or 3.8%, benefited from funding improvements and higher U.S.
This improvement was partially offset by a decline in Medicaid ADC of 232, for a net decline in same-facility census of 175 ADC between quarters. EBITDA from U.S. Our average Medicare Part A rate improved by 13.0% over the 2010 first quarter, increasing revenue by US$13.0 million due to a combination of changes in funding and in the mix of patients served. Non same-facility operations contributed US$0.1 million to EBITDA this quarter compared to US$0.3 million in the 2010 first quarter, for a net decline of US$0.2 million between periods. Growth in same-facility operations of US$3.8 million, or 8.9%, resulted from higher revenue of US$16.5 million, partially offset by higher costs of US$12.7 million. Operating and administrative costs were affected primarily by higher labour costs of US$8.6 million (which included a US$0.9 million increase in the accrual for unit appreciation rights), food, supplies and state provider taxes. The average daily census (ADC) of our same-facility Skilled Mix improved by 108 ADC over the 2010 first quarter, improving our Skilled Mix to 23.6% from 22.6%. Revenue improvements included a contribution from higher average rates of US$17.9 million and higher Medicare census levels, partially offset by lower Medicaid census levels. operations improved by US$3.6 million, or 8.4%, to US$46.4 million in the 2011 first quarter from US$42.8 million in the 2010 first quarter, and as a percent of revenue was 13.2% compared to 12.2%, respectively.
As a percent of revenue, EBITDA was 8.5% this quarter compared to 9.9% in the 2010 first quarter, or 8.7% adjusted for prior period funding. Excluding the $2.1 million of prior period home health care funding received in the 2010 first quarter, EBITDA improved by $0.4 million this quarter. Non same-facility operations contributed EBITDA of $0.4 million this quarter compared to $0.2 million in the 2010 first quarter, for a net improvement of $0.2 million between periods. EBITDA from Canadian operations was $14.2 million this quarter compared to $15.9 million in the 2010 first quarter. Remaining growth from same-facility operations of $0.2 million resulted from increased revenue of $4.0 million, partially offset by higher operating and administrative costs of $3.8 million, which included a $0.6 million increase in the accrual for unit appreciation rights.
census levels and higher average funding rates. Approximately $5.7 million of this decline was from same-facility operations primarily due to the timing of recognition of funding under the Ontario flow-through envelopes, and two fewer days between quarters, partially offset by improved U.S. In comparison to the 2010 fourth quarter, consolidated revenue in the first quarter declined by $2.8 million, excluding the negative effect of the stronger Canadian dollar.
operations was lower by $5.3 million, primarily due to higher labour costs, and EBITDA from Canadian operations was lower by $1.0 million, as discussed below. EBITDA from U.S. As a percent of revenue, EBITDA was 11.5% compared to 12.7% in the 2010 fourth quarter. Consolidated EBITDA declined by $6.3 million this quarter, excluding the negative effect of the stronger Canadian dollar.
The REIT reported a net loss of $8.4 million in the 2011 first quarter compared to net earnings of $5.4 million in the 2010 first quarter. These related primarily to unrealized losses on fair valuing the Class B units of Extendicare Limited Partnership (the “Exchangeable LP Units”) and the convertible debentures. The 2011 first quarter results reflected an after-tax and pre-tax loss on our derivative financial instruments and foreign exchange items of $17.6 million compared to an after-tax loss of $4.4 million (pre-tax loss of $5.9 million) in the same 2010 period. In addition, the 2011 results included an after-tax loss of $0.4 million (pre-tax $0.6 million) related to the early prepayment penalty incurred on a closed Alberta center.
The improvements in EBITDA previously discussed were offset by higher depreciation costs and $0.5 million due to the negative effect of the stronger Canadian dollar. Earnings prior to separately reported items, as outlined in Table 2 above, were $10.3 million in the 2011 first quarter compared to $10.5 million in the 2010 first quarter.
Related Stories
