Brentwood, TN (November 1, 2018) — Diversicare Healthcare Services, Inc. (NASDAQ: DVCR), a premier provider of long-term care services, today announced its results for the third quarter ended September 20, 2018.
Third Quarter 2018 Highlights
- Net loss from continuing operations was $(7.4) million, or $(1.15) per share, in the third quarter of 2018, compared to net loss from continuing operations of $(0.6) million, or $(0.09) per share, in the third quarter of 2017. The loss in the third quarter of 2018 was mainly attributable to a litigation contingency expense of $6.4 million related to an ongoing Department of Justice (“DOJ”) investigation.
- Our adjusted EBITDA for the quarter was $3.4 million, compared to $3.9 million in the third quarter of 2017.
- Under the new Accounting Standard Codification (“ASC”) 606, net revenue was $141.4 million in the third quarter of 2018. In accordance with ASC 606, revenue for the third quarter of 2017 was not restated. Revenue for the third quarter of 2018 under legacy GAAP was $145.1 million, compared to $146.4 million in the third quarter of 2017, a decrease of $1.3 million or 1.0%. However, on a same store basis quarterly Revenue under legacy GAAP increased by $0.4 million.
- The Company did not declare a quarterly dividend for the quarter ending December 31, 2018.
See below for a reconciliation of all GAAP and non-GAAP financial results.
“As previously announced, Kerry Massey joined our team as Chief Financial Officer of Diversicare on September 10, 2018. Kerry has already proven to be a valuable addition to our team and we look forward to continuing to benefit from his experience and expertise,” said Jay McKnight, President and Chief Executive Officer of Diversicare.
Commenting on the quarter’s results, Jay said, “This was definitely a challenging quarter as we accrued $6.4 million related to an ongoing government investigation, which I discuss further below. Subsequent to the quarter, we entered into an Asset Purchase Agreement to sell our three centers held for sale in Kentucky for a collective sales price of $18.7 million, which is expected to close in the fourth quarter of 2018. As required by the Company’s bank agreements, the proceeds from the sale will be used to retire debt.
Mr. McKnight continued, “As always, our primary focus is caring for our residents and patients who have been entrusted to us. I am proud of our dedicated and hardworking team members as we continue to lead our peer group in quality measures.”View Full Results
– – – – –
James R. McKnight, Jr.
Chief Financial Officer