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Press release from Business Wire

Amica Mature Lifestyles Announces Second Quarter Fiscal 2013 Results and Dividend

Monday, January 14, 2013

Amica Mature Lifestyles Announces Second Quarter Fiscal 2013 Results and Dividend17:30 EST Monday, January 14, 2013 VANCOUVER, British Columbia (Business Wire) -- (TSX Symbol: ACC) – Amica Mature Lifestyles Inc. (“Amica” or the “Company”) is pleased to announce the Company's operating and financial results for the second quarter, with several key items to highlight: Revenues increased 35% to $24.7 million compared to Q2/12; Diluted AFFO per share for Q2/13 compared to Q2/12 increased $0.01 to $0.10 per share; Diluted AFFO Adjusted per share for Q2/13 decreased 4% to $0.13 compared to Q2/12; Overall occupancy in mature communities at November 30, 2012 was 94.7%, compared to 93.9% at May 31, 2012 and 92.4% at November 30, 2011; Overall occupancy in the Company's communities in lease-up (excluding Amica at Westboro Park and Amica at Thornhill) at November 30, 2012 was 65.9% compared to 61.7% at May 31, 2012; Mature same communities(1) MARPAS increased by 6.5% for Q2/13 compared to Q2/12. The Company has experienced monthly year-over-year MARPAS increases in its mature same communities for 35 consecutive months; Increased ownership in Amica at Bearbrook to 100% from 10%, and commenced consolidation as of September 1, 2012 (prior to September 1, 2012, Amica at Bearbrook was a cost-accounted investment); Commenced construction on Amica at Oakville, located in Oakville, Ontario; and The Board approved fiscal 2013 third quarter dividend of $0.105 per common share. “We are pleased to report strong second quarter performance at Amica,” said Samir Manji, Chairman, President & CEO. “A number of operational successes, combined with executing on our growth strategy, produced a 31% ($1.9 million) increase in our quarterly operating margin for our consolidated communities. Our solid operating results continue to demonstrate the strength of our brand and the growing demand we see for our Wellness & Vitality™ communities and the environment and lifestyle that we provide for our residents. We are proud of the exceptional team we have at Amica and our long-term commitment to providing our residents with beautiful physical communities and delivering on our philosophy of service excellence. There are a number of opportunities that we are excited to pursue in calendar 2013 that include growth related initiatives, refinancing opportunities and avenues that will further enhance our overall operational performance. We believe Amica is well positioned for strong long-term operational and financial performance and look forward to building on the results of the first six months of this fiscal year.” FINANCIAL HIGHLIGHTS The following table provides operational highlights for the three months ended November 30, 2012 (“Q2/13”) compared to the three months ended November 30, 2011 (“Q2/12”) and the six months ended November 30, 2012 (“YTD Fiscal 2013”) compared to the six months ended November 30, 2011 (“YTD Fiscal 2012”): (Expressed in thousands of Canadian dollars, except per share and share amounts)   Q2/13   Q2/12   Change   YTD Fiscal 2013   YTD Fiscal 2012   Change   $ $ $ $ $ $ Revenues24,697 18,339 6,358 48,269 36,413 11,856 Net loss and comprehensive loss attributable to: Amica shareholders (2,208) (1,093) (1,115) (3,830) (3,190) (640) Non-controlling interests (32) (327) 295 (171) (670) 499   (2,240) (1,420) (820) (4,001) (3,860) (141) Basic and diluted loss per share attributable to:   Amica shareholders (0.07) (0.05) (0.02) (0.13) (0.14) 0.01 EBITDA(1)7,713 5,830 1,883 15,271 10,731 4,540 EBITDA Adjusted(1)7,587 6,027 1,560 14,732 11,291 3,441   CFFO(1)4,523 3,586 937 8,863 6,669 2,194 Diluted per share 0.15 0.16 (0.01) 0.29 0.29 -   FFO(1)3,336 2,292 1,044 6,310 3,625 2,685 Diluted per share 0.11 0.10 0.01 0.20 0.16 0.04   AFFO(1)3,176 2,072 1,104 5,550 3,105 2,445 Diluted per share 0.10 0.09 0.01 0.18 0.14 0.04   AFFO Adjusted(1)4,019 3,092 927 8,529 5,601 2,928 Diluted per share 0.13 0.14 (0.01) 0.28 0.25 0.03 Weighted average number of shares: Basic 30,585 22,579 30,523 22,569 Diluted 30,915 22,807   30,868 22,804   (1) This is a Non-IFRS Financial Measure used by the Company in evaluating its operating and financial performance. Please refer to the cautionary statements under the heading “NON-IFRS FINANCIAL MEASURES” in this news release. See also “DEFINITION AND RECONCILIATION OF NON-IFRS FINANCIAL MEASURES” section of the Company's management's discussion and analysis for the three and six months ended November 30, 2012 (the “MD&A”), which is available on SEDAR at www.sedar.com for additional information on Non-IFRS Financial Measures including reconciliations thereof to net income/loss and comprehensive income/loss.RevenuesQ2/13 revenues increased by 35% or $6.4 million to $24.7 million compared to $18.3 million in Q2/12. YTD Fiscal 2013 consolidated revenues increased by 33% or $11.9 million to $48.3 million compared to $36.4 million in YTD Fiscal 2012, primarily due to higher retirement communities revenue. Q2/13 retirement communities revenue increased by $6.3 million, or 38%, to $23.1 million compared to $16.8 million in Q2/12 as follows: $5.5 million due to acquisitions as follows: (i) 50% proportionate consolidation of Amica at Dundas starting in Q4/12; (ii) 100% consolidation of Amica at Westboro Park beginning in Q1/13; (iii) 100% consolidation of Amica at Bearbrook beginning in Q2/13 and (iv) the acquisition of Quinte Gardens in Q3/12; and $0.8 million increase in revenues on a consolidated same community basis, due to improved occupancy and MARPAS. YTD Fiscal 2013 Retirement communities revenues increased by $11.6 million, or 35%, to $45.0 million compared to YTD Fiscal 2012 as follows: $10.0 million due to acquisitions as follows: (i) 50% proportionate consolidation of Amica at Dundas starting in Q4/12; (ii) 100% consolidation of Amica at Westboro Park beginning in Q1/13; (iii) 100% consolidation of Amica at Bearbrook beginning in Q2/13 and (iv) the acquisition of Quinte Gardens in Q3/12; and $1.6 million increase in revenues on a consolidated same community basis, due to improved occupancy and MARPAS. Expenses and other itemsQ2/13 expenses and other items increased to $27.6 million from $20.4 million in Q2/12 primarily due to higher retirement communities expenses and depreciation expense, partially offset by lower losses from equity accounted properties. YTD Fiscal 2013 expenses and other items increased to $53.7 million from $41.6 million for YTD Fiscal 2012 primarily due to the same items, partially offset by gains recorded on the Amica at Westboro Park and Amica at Bearbrook acquisitions. In Q2/13, retirement communities expenses increased by $4.4 million to $15.0 million compared to $10.6 million in Q2/12, as follows: $3.7 million due to acquisitions as follows: (i) 50% proportionate consolidation of Amica at Dundas starting in Q4/12; (ii) 100% consolidation of Amica at Westboro Park beginning in Q1/13; (iii) 100% consolidation of Amica at Bearbrook beginning in Q2/13 and (iv) the acquisition of Quinte Gardens in Q3/12; and $0.7 million increase in expenses on a consolidated same community basis. Retirement communities margin (retirement communities revenues less retirement communities expenses) increased $1.9 million over Q2/12 to $8.1 million in Q2/13. Retirement communities margin as a percentage of retirement communities revenues decreased from 36.8% in Q2/12 to 35.0% in Q2/13. YTD Fiscal 2013 Retirement communities expenses increased by $7.7 million to $29.2 million compared to $21.5 million for YTD Fiscal 2012, as follows: $6.7 million due to acquisitions as follows: (i) 50% proportionate consolidation of Amica at Dundas starting in Q4/12; (ii) 100% consolidation of Amica at Westboro Park beginning in Q1/13; (iii) 100% consolidation of Amica at Bearbrook beginning in Q2/13 and (iv) the acquisition of Quinte Gardens in Q3/12; and $1.0 million increase in expenses on a consolidated same community basis. YTD Fiscal 2013 retirement communities margin increased $3.8 million over YTD Fiscal 2012 to $15.8 million. Retirement communities margin as a percentage of retirement communities revenues decreased from 35.8% in YTD Fiscal 2012 to 35.1% in YTD Fiscal 2013. Net loss and comprehensive lossFor Q2/13 the net loss was $2.2 million compared to $1.4 million in Q2/12. The increase in the loss is principally attributable to increases in depreciation and finance costs as a result of the internal consolidations and acquisitions noted above in excess of the increase in retirement community margin. For YTD Fiscal 2013 the net loss was $4.0 million compared to $3.9 million for YTD Fiscal 2012. The increase in the loss is principally attributable to the above items, largely offset by the gain on the acquisition of Amica at Westboro Park. FFOQ2/13 FFO increased 46% to $3.3 million ($0.11 per share diluted) compared to $2.3 million in Q2/12 ($0.10 per share diluted) and YTD Fiscal 2013 FFO increased by 74% to $6.3 million ($0.20 per share diluted) compared to $3.6 million for YTD Fiscal 2012 ($0.16 per share diluted). AFFOQ2/13 AFFO increased 53% to $3.2 million ($0.10 per share diluted) compared to $2.1 million in Q2/12 ($0.09 per share diluted). YTD Fiscal 2013 AFFO increased by 78% to $5.6 million ($0.18 per share diluted) compared to $3.1 million for YTD Fiscal 2012 ($0.14 per share diluted). Maintenance capital expenditures were $0.2 million for Q2/13 (Q2/12 – $0.2 million) and $0.8 million for YTD Fiscal 2013 (YTD Fiscal 2012 – $0.5 million). AFFO AdjustedQ2/13 AFFO Adjusted increased 30% to $4.0 million ($0.13 per share diluted) compared to $3.1 million in Q2/12 ($0.14 per share diluted). YTD Fiscal 2013 AFFO Adjusted increased by 52% to $8.5 million ($0.28 per share diluted) compared to $5.6 million for YTD Fiscal 2012 ($0.25 per share diluted). As at November 30, 2012, the Company has drawn down and received the full amount of the income support fund, which formed part of the purchase arrangement of Quinte Gardens. As a result, there was only a nominal add-back to Q2/13 AFFO Adjusted for this remaining amount. COMMUNITY UPDATE The following is a summary of occupancy in the Company's mature same communities: Mature Same Community Occupancy     Overall*   Ontario*   British Columbia November 30, 2012 94.7% 94.7% 94.7% May 31, 2012 93.9% 91.9% 97.0% November 30, 2011 92.4% 89.2% 97.2% *All figures include Amica at Westboro Park to report on a same community basis Ontario mature communities continue to experience strong occupancy. The decrease in occupancy in the Company's British Columbia communities is primarily due to the slow-down in the Vancouver Island residential real estate market which has impacted the rate of move-ins. The Vancouver area remains strong with three out of four communities ending the quarter at 100% occupancy. The following is a summary of overall occupancy in the Company's communities in lease-up: Lease-up Community Occupancy * January 7, 2013   65.9%** November 30, 2012 65.9% May 31, 2012   61.7% *Excluding Amica at Westboro Park and Amica at Thornhill. Amica at Westboro Park and Amica at Thornhill became mature communities effective October 1, 2012, and December 1, 2012, respectively **Anticipated to increase to 69.2% following an additional 29 net pending move-ins Amica at London will become a mature community effective April 1, 2013 and will be incorporated into the Company's mature same community MARPAS and occupancy statistics. Net pending move-ins reflect suites that have been reserved with a deposit made for the reservation, less suites for which notice of termination has been received. The Company expects to continue to achieve further quarter over quarter growth in overall occupancy in its communities in lease-up on a same community basis. Amica at Quinte Gardens is in transition to the Amica model and while it is behind schedule in its lease-up and financial performance, the Company expects significant improvements in Amica at Quinte Garden's performance in upcoming quarters. Amica at Quinte Gardens will be incorporated into the Company's mature same community MARPAS and occupancy statistics after the earlier of reaching 90% occupancy or two years post the acquisition by the Company. On September 1, 2012, the Company completed the acquisition of an additional 90% in Amica at Bearbrook, increasing the Company's ownership position to 100% from 10%. The Company's condensed consolidated interim financial statements for the three and six months ended November 30, 2012 include the assets and liabilities of Amica at Bearbrook and the operating results and cash flows of Amica at Bearbrook from September 1, 2012 to November 30, 2012. Subsequent to quarter end, on December 1, 2012, the Company acquired additional ownership interests in Amica at Kingston, Amica at London, Amica at Thornhill and Amica at Whitby co-tenancies as summarized in the MD&A for aggregate cash consideration of $0.3 million and contingent payments totaling $0.1 million. The $0.3 million payment was made on November 27, 2012 and these funds are included in deposits and other assets at November 30, 2012. The Company commenced site excavation and servicing in October 2012 on Amica at Oakville and continues to advance the design and planning for Amica at Dundas and Amica at Swan Lake expansion projects. Amica at Aspen Woods, the Company's first project in Calgary, Alberta, is under construction and is on budget and on schedule to open in summer 2013. The Company has 27 independent living suites reserved as of January 7, 2013, which represents 23% of the total available independent living suites. FINANCIAL POSITION The Company's consolidated cash and cash equivalents balance as at November 30, 2012 was $13.3 million. As at November 30, 2012, the balance drawn on the Company's demand operating loan is $nil. THIRD QUARTER DIVIDEND The Company's Board of Directors has approved a quarterly dividend of $0.105 per common share on all issued and outstanding common shares which will be payable on March 15, 2013, to shareholders of record on February 28, 2013. RESULTS CONFERENCE CALL ON TUESDAY, JANUARY 15, 2013 Amica has scheduled a conference call to discuss the results on Tuesday, January 15, 2013 at 10:00 am Pacific Time (1:00 pm Eastern Time). To access the call, dial (647) 438-4398 (Local/International access) or 1-866-971-7629 (North American toll-free access). A slide presentation to accompany management's comments during the conference call will be available. To view the slides, access Amica's website at www.amica.ca and click on “Investor Relations” – “Presentations & Webcasts”. Please log on at least 15 minutes before the call commences. The Company's unaudited condensed consolidated interim financial statements for the three and six months ended November 30, 2012 and the management's discussion and analysis are available on SEDAR at www.sedar.com and available on the Company's website at www.amica.ca.CONSOLIDATED STATEMENT OF FINANCIAL POSITION HIGHLIGHTS     November 30, 2012   May 31, 2012 (Expressed in thousands of Canadian dollars)   $   ASSETS   Current Cash and cash equivalents 13,303 31,277 Other   7,932 5,700     21,235 36,977 Non-current Loans receivable 28,152 34,845 Investments in associates 11,961 8,011 Property, plant & equipment 429,362 384,906 Other   1,844 3,871     471,319 431,633 Total assets   492,554 468,610   LIABILITIESCurrent Mortgages payable 155,243 85,612 Other   14,414 14,574     169,657 100,186 Non-current Mortgages payable 130,849 168,145 Deferred income taxes 10,586 11,839 Obligation to investments in associates 4,737 3,836 Other   367 353     146,539 184,173 Total liabilities   316,196 284,359   EQUITY Equity attributable to owners of the company 164,372 173,169 Non-controlling interests   11,986 11,082 Total equity   176,358 184,251 Total liabilities and equity   492,554 468,610 CONSOLIDATED STATEMENT OF COMPREHENSIVE LOSS HIGHLIGHTS     3 Months Ended   6 Months EndedNovember 30,November 30,       2012   2011 2012   2011       $ $ $ $   Revenues: Retirement communities 23,088 16,751 45,034 33,470 Other     1,609 1,588 3,235 2,943       24,697 18,339 48,269 36,413 Expenses and other items: Retirement communities 15,017 10,595 29,237 21,503 General and administrative 2,184 1,851 4,469 3,842 Depreciation 5,979 3,856 11,625 7,690 Finance costs 3,177 2,520 6,226 5,235 Share of losses from associates 1,248 1,547 2,547 3,293 Gain on acquisitions     (14) - (406) -       27,591 20,369 53,698 41,563   Loss before income tax     (2,894) (2,030) (5,429) (5,150)   Income tax recovery:     654 610 1,428 1,290   Net loss and comprehensive loss     (2,240) (1,420) (4,001) (3,860)   Net loss and comprehensive loss attributable to: Owners of the company (2,208) (1,093) (3,830) (3,190) Non-controlling interests     (32) (327) (171) (670)       (2,240) (1,420) (4,001) (3,860)   Basic and diluted loss per share     ($0.07) ($0.05) ($0.13) ($0.14) ABOUT AMICA MATURE LIFESTYLES INC.Amica Mature Lifestyles Inc., a Vancouver based public company, is a leader in the management, marketing, design, development and ownership of luxury seniors residences. There are 23 Amica Wellness & Vitality™ Residences in operation in Ontario and British Columbia, Canada. Additionally, Amica has one residence under construction in Calgary, Alberta, one under construction in Oakville, Ontario and two existing operational residences in Ontario with expansions that are in pre-development. The common shares of Amica are traded on the Toronto Stock Exchange under the symbol “ACC”. For more information, visit www.amica.ca.Forward-Looking InformationThis news release contains “forward-looking information” within the meaning of applicable securities laws (“forward-looking statements”).These forward-looking statements are made as of the date of this news release and the Company does not intend, and does not assume any obligation, to update these forward-looking statements, except as otherwise required by law. Users of forward-looking statements are cautioned that actual results may vary from forward-looking statements contained herein. Forward-looking statements include, but are not limited to, statements regarding future occupancy rates; anticipated future revenues, financial results and operating performance; future MARPAS growth; completing construction of Amica at Aspen Woods in the summer of 2013; the advancement of the Amica at Dundas and Amica at Swan Lake expansion projects; dividends and other similar statements concerning anticipated future events, conditions or results that are not historical facts. In certain cases, forward-looking statements can be identified by the use of words such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”. While the Company has based these forward-looking statements on its expectations about future events as at the date that such statements were prepared, the statements are not a guarantee of the Company's future performance and are subject to risks, uncertainties, assumptions and other factors which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Such factors and assumptions include, amongst others, the effects of general economic and market conditions; actions by government authorities, including the granting of zoning and other approvals and permits; uncertainties associated with potential legal proceedings and negotiations, including negotiations with respect to construction financing and debt refinancing; and misjudgements in the course of preparing forward-looking statements. In addition, there are known and unknown risk factors which could cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Known risk factors include, among others, risks related to dependence on the ability of Amica's co-tenancy participants to meet their obligations; interest rate volatility in the marketplace; job actions including strikes and labour stoppages; possible liability under environmental laws and regulations, relating to removal or remediation of hazardous or toxic substances on properties owned or operated by Amica; risks associated with new developments, including cost overruns and start-up losses; the ability of seniors to pay for Amica's services; regulatory changes; risks inherent in the ownership of real property; operational risks inherent in owning and operating residences; the risks associated with global events such as infectious diseases, extreme weather conditions and natural disasters; the availability of capital to finance growth or refinance debt as it comes due; Amica's ability to attract seniors with its services and keep pace with changing consumer preferences, as well as those factors discussed in the “Risks and Uncertainties” section ofthe Company's Management's Discussion and Analysis for the three and six months ended November 30, 2012, and in the “Risk Factors” section of the Company's Annual Information Form dated August 10, 2012, filed with the Canadian Securities Administrators and available at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements, or the material factors or assumptions used to develop such forward looking statements, will prove to be accurate. Accordingly, readers should not place undue reliance on forward-looking statements.NON-IFRS FINANCIAL MEASURES This news release makes reference to the following terms: “Cash Flow From Operations” (or “CFFO”), “Earnings Before Interest, Taxes, Depreciation and Amortization” (or “EBITDA”), “EBITDA Adjusted”, “Funds From Operations” (or “FFO”), “Adjusted Funds From Operations” (or “AFFO”), “AFFO Adjusted”, and “Monthly Average Revenue Per Available Suite” (or “MARPAS”) (collectively the “Non-IFRS Financial Measures”). These Non-IFRS Financial Measures are not recognized under IFRS and do not have standardized meanings prescribed by IFRS. The Company considers these Non-IFRS Financial Measures relevant in evaluating the operating and financial performance of the Company, along with IFRS measures such as net earnings (loss) and comprehensive income (loss), basic and diluted earnings (loss) per share and cash provided by (used in) operations. Definitions and detailed descriptions of these terms are contained in Amica's Management Discussion and Analysis for the three and six months ended November 30, 2012. (1) Mature Same Communities: Effective June 1, 2011, mature same communities was defined by the Company to be mature communities that are classified as income-producing properties for thirteen months after the earlier of reaching 90% occupancy or 36 months of operation, with the exception of Amica at Quinte Gardens. Amica at Quinte Gardens will be classified as a mature community after the earlier of reaching 90% occupancy or two years post-acquisition by the Company. To view this press release as webpage please click on the following link:http://www.usetdas.com/pr/amicajan142013.htm Amica Mature Lifestyles Inc.Art Ayres, (604) 630-3473Chief Financial Officera.ayres@amica.caorAlyssa Barry, (604) 639-2171Manager, Investor Communicationsa.barry@amica.ca