Genesis Healthcare announces 1st-quarter losses
Kennett Square operator of nursing homes said results met expectations
Genesis Healthcare Inc. on Tuesday reported a loss of $50.8 million in its first quarter, compared to $43.0 million in the previous year’s quarter.
On a per-share basis, the company said it had a loss of 55 cents. Losses, adjusted for restructuring costs and non-recurring costs, came to 50 cents per share.
The operator of nursing homes and senior living communities posted revenue of $1.39 billion in the period, compared to $1.47 billion in the 2016 first quarter.
“First quarter results were in line with our expectations and we are very pleased with the execution and management of the controllable aspects of our business,” said George V. Hager Jr., Chief Executive Officer of Genesis ... “We continue to believe industry fundamentals will remain under pressure in 2017, but are encouraged by sequential volume and mix trends more in line with historical seasonal patterns and some moderation in labor inflation. We are also ahead of schedule on our nonstrategic asset divestitures, which will allow for increased focus on markets where we have geographic density.”
Since Genesis’ last earnings announcement, the company has divested 25 skilled nursing facilities as part of its strategy to exit challenging, low density markets and focus on investment and growth in core, strategic markets. Divestitures included 18 facilities in the states of Kansas, Missouri, Nebraska and Iowa.
Net proceeds of $80.2 million from the sale were used to pay down debt, the company said, and the divestiture of seven leased facilities.
Genesis said it expects to divest an additional 12 underperforming assets during the remainder of 2017.
In March, Genesis broke ground on its 12th PowerBack Rehabilitation location in Exton, just 12 miles from its Kennett Square headquarters. Pow-
erBack Rehabilitation was launched by Genesis in 2012 in response to the market demand for shorter posthospital patient recovery periods and fewer post-discharge setbacks. The other 11 PowerBack centers are located in New Jersey, Pennsylvania,
Colorado, Maryland and Texas.
The new facility will be along Business Route 30 in the Oaklands Corporate Center in West Whiteland.
In April, Genesis noted in its first quarter statement, it entered into a strategic dining and nutrition partnership to leverage its national platforms, process expertise and technology. The relationship will
provide additional liquidity, cost efficiency and enhanced operational performance, Genesis said in its statement.
The company also revised the high end of its revenue range for 2017 from $5.6 billion to $5.5 billion to reflect the timing of recent facility divestitures.