Leisureworld Senior Care Corporation Reports Strong 2012 Fourth Quarter and Year End Results

Leisureworld Senior Care Corporation Reports Strong 2012 Fourth Quarter and 
Year End Results 
MARKHAM, ONTARIO -- (Marketwire) -- 02/21/13 -- Leisureworld Senior
Care Corporation (TSX:LW) ("Leisureworld" or "the Company") today
announced its financial results for the fourth quarter and year ended
December 31, 2012.  
Percentage calculations in the following summary of Leisureworld's
2012 financial results are based on the numbers in the Financial
Statements and/or Management's Discussion and Analysis, which may not
correspond to rounded figures presented in this release. Full
Financial Statements and Management's Discussion and Analysis are
available on the Company's website at www.leisureworld.ca. 
Financial Highlights 

                                Quarter     Quarter        Year        Year 
                                  ended       ended       ended       ended 
                               Dec. 31,    Dec. 31,    Dec. 31,    Dec. 31, 
$000s except per share data        2012        2011        2012        2011 
Average total occupancy                                                     
 (LTC)                             99.1%       98.6%       98.8%       98.5%
Average private occupancy                                                   
 (LTC)                             99.2%       97.1%       98.5%       96.7%
Average occupancy                                                           
 (retirement and independent                                                
 living) (1)                       76.7%       66.7%       73.9%       64.2%
Net Loss                         (1,347)     (3,344)     (9,134)    (11,977)
Net Operating Income (NOI)                                                  
 (2)                             14,972      12,067      56,337      45,939 
Funds from Operations (FFO)                                                 
 (2)                              6,882       4,760      26,256      19,581 
Construction Funding                                                        
 (Principal)                      1,430       1,380       5,696       5,421 
Maintenance Capex                  (583)       (334)     (1,416)       (864)
Adjusted Funds from                                                         
 Operations (AFFO) (2), (3)       8,289       6,754      34,282      26,580 
Basic AFFO per share         $   0.2835  $   0.2765  $   1.2534  $   1.1544 
Dividends declared per share $   0.2166  $   0.2124  $   0.8538  $   0.8496 
Basic AFFO payout ratio            76.4%       76.8%       68.1%       73.6%
1.  The 2011 retirement and independent living occupancy rates include the
    addition of the Kingston and Kanata properties as of April 27, 2011,
    which are currently in lease-up and not yet at stabilized occupancy. The
    2012 retirement and independent living occupancy rates include the
    addition of the BC retirement properties as of May 24, 2012, with one of
    the properties (The Royale Astoria) currently in lease-up and not yet at
    stabilized occupancy. The 2012 fourth quarter excludes the Muskoka
    retirement property, while the year-end figure includes occupancy at
    Muskoka up until September 30, 2012, when the facility was temporarily
    closed for renovations. 
2.  Net operating income (loss) ("NOI"), funds from operations ("FFO"), and
    adjusted funds from operations ("AFFO") are not measures recognized
    under IFRS and do not have standardized meanings prescribed by IFRS.
    NOI, FFO and AFFO are supplemental measures of a company's performance
    and Leisureworld believes that NOI, FFO and AFFO are relevant measures
    of its ability to pay dividends on the Company's common shares. The IFRS
    measurement most directly comparable to NOI, FFO and AFFO is net income
3.  AFFO includes adjustments of: $0, $47, $52 and $76, respectively, for
    HRIS expenses; $316, $901, $3,188 and $3,105, respectively, for income
    support; and $244, $0, $506 and $0, respectively, for deferred share
    unit plan compensation. 

"We have achieved another year of strong financial performance at
Leisureworld, generating a 23% increase in Net Operating Income and a
29% increase in Adjusted Funds from Operations, compared to 2011. Our
performance enabled us to increase our monthly shareholder dividend
by 5.9% in December, resulting in a current dividend rate of $0.90
per share on an annualized basis," said Dino Chiesa, Interim CEO and
Chairman of Leisureworld. "During 2012, we advanced our growth
strategy with the acquisition of three luxury retirement residences
in the Greater Vancouver Area, bringing Leisureworld's Royale
retirement residence brand to the BC marketplace, and we added
another Class A, Long-term Care home to our existing LTC portfolio
through the acquisition of the Madonna home in Orleans, Ontario, just
outside Ottawa. These growth initiatives were complemented by
increased government funding in our LTC portfolio, our continued
focus on disciplined cost management, and peak LTC occupancy rates."  
"Our Board of Directors has identified its preferred candidate for
the role of President and CEO of Leisureworld, and we expect to make
a formal appointment announcement in the coming weeks," added Mr.
Chiesa. "Looking ahead, our growth strategy will remain focused on:
ensuring exceptional quality seniors care and services, supporting
and increasing our occupancy rates, maintaining disciplined cost
management, building our presence across the continuum of seniors'
living in Canada, and maintaining a strong balance sheet and reliable
shareholder dividends."  
For the quarter ended December 31, 2012, Leisureworld's Net Operating
Income (NOI) increased 24.1% to $15.0 million, compared to $12.1
million in the fourth quarter a year ago. The Company's LTC
operations generated NOI of $11.4 million, compared to $10.3 million
for the fourth quarter 2011. The increase was primarily attributable
to the inclusion of NOI from the Madonna acquisition and increased
accommodations revenue, partly offset by higher property operating
costs. Leisureworld's retirement residence portfolio generated a $1.9
million increase in NOI mainly as a result of the acquisition of the
BC Portfolio. NOI for the Company's Home Care operations was
consistent with the comparable quarter of 2011 at $0.7 million, as
increased personal support contract volumes were offset by higher
staffing costs to accommodate increased volumes and an increase in
operating costs.  
Leisureworld generated $6.9 million in Funds from Operations (FFO) in
the fourth quarter of 2012, an increase of 44.6% from $4.8 million in
the fourth quarter a year ago. The increase reflects higher NOI in
the quarter and a $0.3 million decline in taxes, partly offset by an
increase in net finance charges and higher administrative expenses,
net of transaction costs. Higher net finance charges resulted from
the incremental debt financing costs associated with the
acquisitions, as well as the one-time premium associated with the
early redemption of outstanding bonds amounting to $15.7 million.
Management believes that this early redemption will yield future
interest savings and has also undertaken initial steps towards
refinancing the remaining outstanding bonds prior to maturity. 
Adjusted Funds from Operations (AFFO) for the fourth quarter of 2012
increased 22.7% to $8.3 million, compared with $6.8 million in the
fourth quarter of 2011. Increased AFFO was primarily attributable to
increased FFO in the quarter, partly offset by lower income support
and higher maintenance capital expenditures. The decrease in income
support was due to the full utilization of the escrow amount related
to the Ontario Portfolio in the third quarter. 
Dividends declared by Leisureworld in the quarter totaled $0.2166 per
share and Basic AFFO per share was $0.2835, representing a quarterly
payout ratio of 76.4%. Leisureworld's payout ratio in the fourth
quarter of 2011 was 76.8%.  
Leisureworld generated total revenue of $85.5 million for the quarter
ended December 31, 2012, an increase of 8.2% from $79.0 million in
the fourth quarter a year ago. LTC revenue increased 3.0% to $75.4
million, primarily as a result of the Madonna property acquisition.
Retirement residence revenue increased to $6.6 million from $2.7
million a year ago. The increase was primarily a result of the
addition of the BC properties in the second quarter, as well as
increased revenues from the Ontario Portfolio. Home Care revenue
totaled $3.5 million, a 14.4% increase from a year ago, primarily due
to higher volumes for service contracts.  
The Company's net loss was $1.3 million in the fourth quarter of
2012, compared to a net loss of $3.3 million in the fourth quarter of
2011. This improvement resulted primarily from higher income from
operations, of which $1.9 million was attributable to the timing of
the acquisition of the retirement portfolio and $1.0 million related
to LTC performance. Further, administrative expenses and depreciation
and amortization charges declined in the quarter. This was partly
offset by increased net finance charges of $2.1 million and lower tax
recoveries compared to the fourth quarter a year ago.  
For the year ended December 31, 2012, NOI was $56.3 million, up 22.6%
from $45.9 million in 2011. LTC contributed $3.4 million of the NOI
increase, reflecting increased preferred accommodation premiums and
higher management fees. The retirement portfolio contributed $6.6
million of the NOI increase, attributable to continued lease-up of
the Ontario Portfolio and the acquisition of the BC Portfolio. Home
Care contributed $0.4 million to the increase in NOI. AFFO for the
year increased 29.0% to $34.3 million from $26.6 million in 2011.
Increased AFFO was attributable to a $6.7 million increase in FFO,
partly offset by $0.6 million increase in maintenance capital
expenditures. Further, 2011 AFFO included a $0.7 million reduction
associated with an income tax book-to-filing adjustment which did not
recur in 2012. AFFO for 2012 also included a $0.5 million non-cash
add-back for the deferred share unit plan compensation and increased
construction funding principal. Dividends declared by Leisureworld in
2012 totaled $0.8538 per share and Basic AFFO per share was $1.2534,
representing a payout ratio of 68.1% for the year.  
For the year ended December 31, 2012, the Company's net loss was $9.1
million, compared to $12.0 million in 2011. The decreased net loss
resulted from higher income from operations and decreased
depreciation and amortization expenses, partly offset by a $7.9
million increase in income tax expense, a one-time $2.7 million
impairment loss related to the write down of a human resource
information system in the second quarter, and higher net financing
charges resulting from a one-time premium associated with the partial
early redemption of outstanding bonds and increased financing costs
for the BC retirement portfolio acquisition. 
For the year ended December 31, 2012, total tax expense was $2.3
million compared to a recovery of $5.6 million last year. The current
tax variance was primarily a result of the prior year's
book-to-filing adjustment of $0.7 million. The variance in deferred
taxes arises from a future tax rate change which represents $3.7
million of this variance, with the balance primarily represented by
timing differences. 
"Occupancy rates for the Royale Ontario retirement properties in
Kingston and Kanata at year end were 69.9% and 71.5%, respectively.
We continue to target stabilized occupancy for the Royale Ontario
retirement properties late in 2013. While we have drawn down the full
amount of income support related to these properties, we do not
expect this to have a significant impact on our AFFO or payout ratio
during the remainder of the lease-up period," said Manny DiFilippo,
Chief Financial Officer. "As at December 31, 2012, $1.1 million had
been drawn down from our $2.0 million in income support funds related
to the Royale Astoria, which is in-line with our financial
performance expectations for this property. We expect the Royale
Astoria to reach stabilized occupancy by early 2014. In the fourth
quarter, we appointed a new Vice President of Retirement to oversee
the management of our Royale portfolio and implement a new plan to
improve occupancy levels."  
As at December 31, 2012, the Company's debt to gross book value ratio
was 52.3%. The debt is represented by: 4.814% Series A Senior Secured
Notes due November 24, 2015, rated "A- (negative)" by Standard &
Poor's Rating Services and "A (stable)" by Dominion Bond Rating
Service Limited; $46.0 million drawn from the $61.5 million available
under a revolving credit facility, maturing April 2014; a one-year
$26.1 million term loan, maturing May 2013; a two-year $26.0 million
term loan, maturing May 2014; an assumed $23.7 million mortgage that
matures on January, 2017, and an assumed $15.7 million mortgage,
maturing April 2029. Leisureworld had cash and cash equivalents at
year end totaling $9.5 million and a further committed undrawn
revolving credit facility with a Canadian chartered bank of $10.0
million for working capital purposes. As at December 31, 2012,
Leisureworld had 29,272,889 common shares issued and outstanding.  
Conference Call 
Dino Chiesa, Chairman and Interim CEO, and Manny DiFilippo, CFO, will
host a conference call for the investment community on Friday,
February 22, 2013 at 11:00 a.m. (ET). The call-in numbers for
participants are 416-340-8527 or 877-240-9772. The call will be
webcast at: http://www.gowebcasting.com/4142. 
A replay of the call will be available until March 8, 2013. To access
the replay, dial 905-694-9451 or 800-408-3053 (pass code: 6587786).
The webcast archive will be available via Leisureworld's website or
the web link above.  
About Leisureworld 
Leisureworld Senior Care Corporation is Canada's fifth largest
operator of seniors' housing and the third largest licensed long-term
care (LTC) provider in Ontario. Leisureworld owns and operates 27 LTC
homes across Ontario with 4,474 beds. The Company also owns and
operates five retirement residences and one independent living
residence, representing 739 suites, in Ontario and British Columbia.
Leisureworld subsidiaries include: Preferred Health Care Services, an
accredited provider of professional nursing and personal support
services; and Ontario Long Term Care, a provider of purchasing
services, and dietary, social work, and other regulated health
professional services. For more information, please visit the
Company's website at www.leisureworld.ca. 
Forward-Looking Statements 
Certain of the statements contained in this news release are
forward-looking statements and are provided for the purpose of
presenting information about management's current expectations and
plans relating to the future. Readers are cautioned that such
statements may not be appropriate for other purposes. These
statements generally use forward-looking words, such as "anticipate",
"continue", "could", "expect", "may", "will", "estimate", "believe"
or other similar words and include, among other things, statements
related to the Company's financial results or strategic plans. These
statements are subject to significant known and unknown risks and
uncertainties that may cause actual results or events to differ
materially from those expressed or implied by such statements and,
accordingly, should not be read as guarantees of future performance
or results and will not necessarily be accurate indications of
whether or not such results will be achieved. The forward-looking
statements in this news release are based on information currently
available and what management currently believes are reasonable
assumptions, including the funding of long-term care facilities by
government entities. Other material factors or assumptions that were
applied in formulating the forward-looking statements contained
herein include the assumption that the business and economic
conditions affecting Leisureworld's operations will continue
substantially in their current state, including, with respect to
industry conditions, general levels of economic activity and
government regulations.  
Although management believes that it has a reasonable basis for the
expectations reflected in these forward-looking statements, actual
results may differ from those suggested by the forward-looking
statements for various reasons. The assumptions, risks and
uncertainties described above are not exhaustive and other events and
risk factors could cause actual results to differ materially from the
results and events discussed in the forward-looking statements. These
forward-looking statements reflect current expectations of
Leisureworld as at the date of this news release and speak only as at
the date of this news release. Leisureworld does not undertake any
obligation to publicly update or revise any forward-looking
statements except as may be required by applicable law.
Leisureworld Senior Care Corporation
Manny DiFilippo
Chief Financial Officer
(905) 489-0787 
Leisureworld Senior Care Corporation
Bruce Wigle
Investor Relations
(416) 447-4740 ext. 232
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