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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q/A
(Mark one)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1998
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OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission file number 000-22771
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CENTENNIAL HEALTHCARE CORPORATION
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(Exact name of registrant as specified in its charter)
Georgia 58-1839701
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(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) (identification No.)
400 Perimeter Center Terrace, Suite 650, Atlanta, Georgia 30346
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 770-698-9040
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Indicate by check mark whether the registrant, (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months, and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
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Indicate the number of shares outstanding of each of the issuer's classes of
Common Stock, as of the latest practicable date.
There were 11,923,618 shares of Common Stock outstanding as of November 6,
1998
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NOTE 3--CERTAIN THIRD QUARTER TRANSACTIONS, AMENDED AND RESTATED IN ITS ENTIRETY
AS FOLLOWS:
In December 1995, as part of the Company's merger with Transitional Health
Services, Inc., (the "THS Merger"), the Company assumed operations of THS of
South Bend, a 191-bed skilled nursing facility located in South Bend, Indiana.
Prior to its acquisition by the Company, this facility had a history of
operating losses, had received negative state licensure surveys, and was in
jeopardy of losing its license. At the time of the acquisition, the Company
recorded a $3.0 million reserve against a future loss on the disposition of the
facility, which the Company intended to complete within two years. The Company
has been unable to sell the facility, and as a result, management has
determined that the best course of action is to close the facility. All
necessary notices for closure have been sent and it is anticipated that the
facility will close during late November 1998. During the third quarter of 1998,
the Company recorded an estimated loss of $4.0 million associated with the
closure of this facility and the relocation of its residents. The Company will
continue to market the facility for sale with disposition expected during the
second quarter of 1999. As of September 30, 1998, the carrying value of this
facility was approximately $1.8 million. The Company suspended depreciation of
these assets in August of 1998. Depreciation on these assets would have
approximated $15,000 during the third quarter. The action filed by the local
county prosecutor's office during the third quarter of 1998 remains pending. The
Company continues to believe that this action is without merit.
During the third quarter of 1998, the Company completed its review of the
effects of the upcoming prospective payment system ("PPS") on its operations.
Based upon the Company's projections of future revenue and expense changes
associated with the phase-in of PPS, the Company determined that profitability
at certain of its nursing centers acquired in the THS Merger would be less than
expected. In addition, the Company has experienced continued declines in
revenue at Total Care, Inc., ("TC"), the Company's subsidiary providing home
health services, due to decreases in home health visits during 1998 and
decreases in Medicare reimbursement for home health services. Accordingly,
during the third quarter of 1998, the Company recorded write-downs of property
and equipment and goodwill at its nursing centers of approximately $3.8 million
and $7.2 million, respectively. In addition, the Company wrote off
approximately $1.2 million of goodwill associated with Total Care, Inc.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Date: March 17, 1999 CENTENNIAL HEALTHCARE CORPORATION
By: /s/ J. Stephen Eaton
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J. Stephen Eaton, Chairman of the Board,
President and Chief Executive Officer
Date: March 17, 1999
By: /s/ Alan C. Dahl
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Alan C. Dahl, Executive Vice President and
Chief Financial Officer
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