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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Filed pursuant to Section 13 or 15 (d) of
THE SECURITIES EXCHANGE ACT OF 1934
July 27, 1999 (July 27, 1999)
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(Date of Report (Date of earliest event reported))
BEVERLY ENTERPRISES, INC.
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(Exact name of registrant as specified in its charter)
Delaware
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(State or other jurisdiction of incorporation)
1-9550
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(Commission File Number)
62-1691861
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(IRS Employer Identification No.)
5111 Rogers Avenue, Suite 40-A
Fort Smith AR 72919-0155
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(Address of principal executive offices)
(501) 452-6712
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(Registrant's telephone number, including area code)
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ITEM 5. OTHER EVENTS
Registrant released the press release attached hereto as Exhibit 99 on July 27,
1999.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
Exhibit 99 - Press release dated July 27, 1999.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BEVERLY ENTERPRISES, INC.
Date: July 27, 1999 By: /s/ PAMELA H. DANIELS
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Pamela H. Daniels
Vice President, Controller
and Chief Accounting Officer
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INDEX TO EXHIBITS
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EXHIBIT
NUMBER DESCRIPTION
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99 Press Release dated July 27, 1999
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Exhibit 99
NEWS RELEASE
Contact: Jim Griffith, Senior Vice President
Investor Relations and Corporate Communications
(501) 484-6912
BEVERLY REACHES TENTATIVE SETTLEMENTS OF MEDICARE INVESTIGATIONS;
POSTPONES ANNOUNCEMENT OF SECOND QUARTER RESULTS
(FORT SMITH, ARKANSAS, July 27, 1999)-- Beverly Enterprises, Inc. (NYSE:BEV)
today announced that it has reached a tentative understanding with the U.S.
Department of Justice on potential settlements of the previously announced
Federal investigations into the allocation of nursing labor hours to the
Medicare Program. The understanding is subject to completion and execution of
definitive settlement documents, satisfaction of certain conditions and court
approval.
Beverly plans to record special pre-tax charges in the 1999 second quarter for
the potential settlements and related matters totaling between $175 million and
$225 million. Announcement of financial results for the quarter ended June 30
will be postponed until no later than August 20. Because the potential
settlements are not yet final, Beverly will not elaborate on the matter.
Based on preliminary results for the second quarter, Beverly earned 13 cents
per share diluted from operations, before costs associated with Year 2000
remediation and with the Medicare investigation. Nursing home occupancy
averaged 86.5 percent, a decline of 200 basis points from the second quarter of
1998 and more than 100 basis points from the first quarter of 1999.
"Our continuing cost-reduction efforts enabled us to meet operating earnings
targets, despite disappointing occupancy levels in the second quarter," said
David R. Banks, Chairman of the Board and Chief Executive Officer. "Our
financial targets for the balance of this year assume significant increases in
occupancy. We have launched a series of initiatives to improve our performance
in this critical area, but it is too early to gauge their effectiveness. If
occupancy does not improve, efficiencies alone will not produce operating
earnings (excluding Year 2000 remediation, as well as Medicare investigation
charges and related on-going costs) in the third and fourth quarters above
second-quarter levels."
Banks continued: "We hope to put the government investigation behind us, and
are studying the impact the potential settlements will have on our on-going
operations. We've discussed this matter with our banking group and have
received assurances that, when necessary, waivers will be granted to give us
time to amend certain financial covenants in our debt agreements.
more...
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"For the longer-term, we look forward to continually improving our performance
under a totally new Medicare payment system. Beverly is a cost-effective
provider of quality care, and the segment of the population we serve will grow
dramatically in the years ahead. We've worked hard to build a solid financial
foundation and to upgrade our portfolio of resources - people, facilities and
business operations. We've successfully worked our way out of challenging
situations in the past, and believe we can transform Beverly into an even
better company in the years ahead."
This news release contains forward-looking statements made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements involve known and unknown risks and uncertainties
that may cause the Company's actual results in future periods to differ
materially from forecasted results. These risks and uncertainties include
resolution of the Federal government investigations discussed above, successful
implementation of operational changes required by PPS, national and local
economic conditions, the effect of government regulation, the competitive
environment in which the Company operates, and the availability and cost of
labor and materials. These and other risks and uncertainties that could affect
future results are addressed in the Company's filings with the Securities and
Exchange Commission, including Forms 10-K and 10-Q.
Beverly Enterprises is a leading provider of post-acute healthcare in the
United States. It operates 563 skilled nursing facilities, as well as 36
assisted living centers, 197 outpatient clinics, and 68 home health and hospice
agencies.
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