Care Enterprises Posts $2.2-Million Profit
Care Enterprises Inc., showing signs of recovering from a bankruptcy reorganization a year ago, reported a profit of $2.2 million in 1991.
The Tustin-based nursing home operator has pared down its size, installed new management and sold much of its stock to creditors.
Gary Massimino, executive vice president and chief financial officer, said the company was very pleased with the 1991 profits. “We have been really successful in selling off some of the marginal nursing homes but keeping ones that are the bread and butter of our operations,” he said.
Although the company earned $107.6 million in 1990, all of those earnings were linked to the company’s reorganization, including $73.1 million from the conversion of bond debt to stock, $8.2 million for the settlement of litigation and $27.5 million from the revaluation of company assets.
The company’s revenue in 1991 was $186 million, down about 13% from $215 million the previous year.
Care Enterprises sold 34 nursing homes in 1990, which the company said was the main reason for the lower revenue in 1991.
The company’s per-share earnings in 1991 were 24 cents. The figures from a year earlier are not directly comparable because its stock was revalued as part of the bankruptcy reorganization. The company now has 11.7 million shares of stock outstanding.
Care Enterprises filed for bankruptcy in 1988 after an ill-fated expansion that left it with $75 million in losses in 1986 and 1987.
It now operates 52 nursing and rehabilitation centers, 13 home health agencies, five pharmacies and four drug distribution centers. In the past year, the company has concentrated its efforts on expanding therapy programs, as well as health care services for patients with special needs, such as Alzheimer’s disease and AIDS, Massimino said.
“We’re trying to continue to solidify our management,” Massimino said. “We’re not going to grow by acquisitions, but by our (health-related) programs.”
For the fourth quarter, the company reported earnings of $1.4 million, including $838,000 relating to the reorganization, on revenue of $48.7 million.
