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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1997
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
--------------------------------------
COMMISSION FILE NUMBER 33-65948
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ROSEWOOD CARE CENTERS CAPITAL FUNDING CORPORATION
(Exact name of Registrant as specified in its charter)
(See table of Co-Registrants)
MISSOURI
(State or other jurisdiction of
incorporation or organization)
11701 Borman Drive, Suite 315
St. Louis, Missouri
(Address of principal executive offices)
43-1623171
(I.R.S. Employer Identification No.)
63146
(Zip Code)
Indicate by check mark whether 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 (or for such shorter period that
Registrant was required to file such reports), (2) has been subject to such
filing requirements for the past 90 days. YES /X/ NO
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares of stock of each of the issuer's classes
of common stock, as of the latest practicable date: N/A
<PAGE> 2
Certain information called for on Item 6 of Part II of this Form 10-Q is
incorporated by reference to Registrants' Registration Statement (No.
33-65948) dated July 13, 1993 which was declared effective October 14, 1993,
Registrants' Form 10-Q filed November 29, 1993, Registrants' Form 10-Q filed
February 11, 1994, Registrants' Form 10-K filed September 28, 1994,
Registrants' Form 10-Q filed February 14, 1995, Registrants' Form 10-Q filed
May 15, 1995, Registrants' Form 10-Q filed February 13, 1996, Registrants'
Form 10-Q filed May 14, 1996, Registrants' Form 10-K filed September 26, 1996,
Registrants' Form 10-Q filed November 13, 1996.
Index to Exhibits is on Page 34
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CO-REGISTRANTS
Rosewood Care Center, Inc. of Swansea
Rosewood Care Center, Inc. of Galesburg
Rosewood Care Center, Inc. of East Peoria
Rosewood Care Center, Inc. of Peoria
Rosewood Care Center, Inc. of Alton
Rosewood Care Center, Inc. of Moline
Swansea Real Estate, Inc.
Galesburg Real Estate, Inc.
East Peoria Real Estate, Inc.
Peoria Real Estate, Inc.
Alton Real Estate, Inc.
Moline Real Estate, Inc.
(Exact names of Co-Registrants as specified in their charters)
No separate periodic or annual reports are filed for each of the co-
registrants and no separate financial statements are included for each of the
co-registrants because the co-registrants are effectively jointly and
severally liable with respect to the Notes and because such separate periodic
or annual reports and such separate financial statements are not deemed
material to investors.
3
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<TABLE>
ROSEWOOD CARE CENTERS CAPITAL FUNDING CORPORATION
INDEX
<CAPTION>
PART I FINANCIAL INFORMATION PAGE
- ----------------------------- ----
<S> <C>
Item 1. Financial Statements 5
Rosewood Care Centers Capital Funding Corporation:
Balance Sheet 5
Statement of Operations 6
Statement of Cash Flows 7
Notes to Financial Statement 8
Rosewood Care Center Obligated Companies:
Rosewood Care Center, Inc. of Swansea
Rosewood Care Center, Inc. of Galesburg
Rosewood Care Center, Inc. of East Peoria
Rosewood Care Center, Inc. of Peoria
Rosewood Care Center, Inc. of Alton
Rosewood Care Center, Inc. of Moline
Swansea Real Estate, Inc.
Galesburg Real Estate, Inc.
East Peoria Real Estate, Inc.
Peoria Real Estate, Inc.
Alton Real Estate, Inc.
Moline Real Estate, Inc.
Combined Balance Sheet 9
Combined Statement of Operations 11
Combined Statement of Cash Flows 12
Notes to Combined Financial Statements 14
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 15
PART II OTHER INFORMATION
- ---------------------------
Item 1. Legal Proceedings 20
Item 2. Changes in Securities 20
Item 3. Defaults Upon Senior Securities 20
Item 4. Submission of Matters to a Vote of Security Holders 20
Item 5. Other Information 20
Item 6. Exhibits and Reports on Form 8-K 20
INDEX TO EXHIBITS 34
- -----------------
SIGNATURES 21
- -----------------
</TABLE>
4
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PART I FINANCIAL INFORMATION
- -----------------------------
ITEM 1. FINANCIAL STATEMENTS
<TABLE>
ROSEWOOD CARE CENTERS CAPITAL FUNDING CORPORATION
BALANCE SHEET
(Dollars in Thousands)
(Unaudited)
<CAPTION>
June 30, March 31,
1996 1997
Assets ---- ----
------
<S> <C> <C>
Cash $ 262 $ 262
Mortgage notes receivable, Rosewood Companies 29,280 27,768
------- -------
29,542 28,030
======= =======
Liabilities and Stockholder's Equity
------------------------------------
First mortgage redeemable bonds $29,363 $27,861
Accrued interest 178 168
Stockholders' equity:
Common stock, $1 par value
Authorized - 30,000 shares
Issued and outstanding - 500 shares,
at issue price 1 1
Retained earnings -- --
------- -------
$29,542 $28,030
======= =======
The accompanying notes are an integral part of this financial statement.
</TABLE>
5
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<TABLE>
ROSEWOOD CARE CENTERS CAPITAL FUNDING CORPORATION
STATEMENT OF OPERATIONS
(Dollars in Thousands)
(Unaudited)
<CAPTION>
Three Months Nine Months
Ended Ended
March 31, March 31,
--------- ---------
1996 1997 1996 1997
---- ---- ---- ----
<S> <C> <C> <C> <C>
Interest Income $551 $505 $1,649 $1,576
Interest Expense 551 505 1,649 1,576
---- ---- ------ ------
Net Income $ 0 $ 0 $ 0 $ 0
==== ==== ====== ======
The accompanying notes are an integral part of this financial statement.
</TABLE>
6
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<TABLE>
ROSEWOOD CARE CENTERS CAPITAL FUNDING CORPORATION
STATEMENT OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
<CAPTION>
Three Months Nine Months
Ended Ended
March 31, March 31,
--------- ---------
1996 1997 1996 1997
---- ---- ---- -------
<S> <C> <C> <C> <C>
Cash flow from operating activities:
Net income $ 0 $ 0 $ 0 $ 0
Increase (decrease) in accrued interest (2) (2) (9) (10)
----- ----- ------- -------
Net cash provided from investing activities (2) (2) (9) (10)
----- ----- ------- -------
Cash flow from investing activities:
Collections on notes receivable 245 276 1,419 1,512
----- ----- ------- -------
Net cash used by investing activities 245 276 1,419 1,512
----- ----- ------- -------
Cash flow from financing operations:
Reduction of redeemable bonds (243) (274) (1,410) (1,502)
----- ----- ------- -------
Net cash provided by financing (243) (274) (1,410) (1,502)
----- ----- ------- -------
Net increase (decrease) in cash 0 0 0 0
Cash, beginning 262 262 262 262
----- ----- ------- -------
Cash, ending 262 262 262 262
===== ===== ======= =======
Cash paid for interest $ 538 $ 505 $ 1,649 $ 1,576
===== ===== ======= =======
The accompanying notes are an integral part of this financial statement.
</TABLE>
7
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ROSEWOOD CARE CENTERS CAPITAL FUNDING CORPORATION
NOTES TO FINANCIAL STATEMENTS
1. Interim Financial Statements
----------------------------
In the opinion of the Company, these unaudited financial statements
include all adjustments necessary for a fair presentation of its
financial position as of June 30, 1996 and March 31, 1997 and the
results of its operations and its cash flows for the three month and the
nine month periods ended March 31, 1996 and 1997. Such adjustments were
of a normal recurring nature.
The results of operations for the nine month periods ended March 31,
1996 and 1997 are not necessarily indicative of the results for the full
year.
It is suggested that these financial statements be read in conjunction
with the financial statements, accounting policies and financial notes
thereto included in the Form 10K Annual Report (No. 33-65948), which has
previously been filed with the Commission.
2. Issuance of Bonds
-----------------
On October 21, 1993, the Company issued $33,000,000 of its 7-1/4% First
Mortgage Redeemable Bonds due November 1, 2013.
Of the ending cash balance, $261,000 represents the note receivable
payment on the 25th of the month which is held in the Bond Payment Fund
- Principal and Interest accounts until it is disbursed to the Bond
Holders on the 1st of the following month.
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<TABLE>
ROSEWOOD CARE CENTER
FACILITY COMPANIES AND REAL ESTATE COMPANIES
COMBINED BALANCE SHEETS
(Dollars in Thousands)
(Unaudited)
<CAPTION>
June 30, March 31,
1996 1997
---- ----
Assets
------
<S> <C> <C>
Current assets:
Cash $ 2,237 $ 2,414
Accounts receivable - residents, net of allowance
for doubtful accounts of $206 and $89
Respectively 1,257 1,521
Accounts receivable - third party payor 3,001 3,154
Interest receivable 326 129
Prepaid insurance and other prepaids 74 94
Deferred income tax benefits 65 65
--------- ---------
Total current assets 6,960 7,377
--------- ---------
Property, plant and equipment:
Land 943 943
Site improvements 2,101 2,131
Building 17,830 17,830
Equipment 3,636 3,673
Leasehold improvements 272 322
--------- ---------
24,782 24,899
Less accumulated depreciation 6,435 7,136
--------- ---------
18,347 17,763
--------- ---------
Other assets:
Notes receivable from Rosewood Care Center
Holding Co. 8,056 7,151
Amortizable Costs, Net 1,094 997
--------- ---------
9,150 8,148
--------- ---------
$ 34,457 $ 33,288
========= =========
The accompanying notes are an integral part of this financial statement.
</TABLE>
9
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<TABLE>
ROSEWOOD CARE CENTER
FACILITY COMPANIES AND REAL ESTATE COMPANIES
COMBINED BALANCE SHEETS
(Dollars in Thousands)
(Unaudited)
<CAPTION>
June 30, March 31,
1996 1997
---- ----
Liabilities and Stockholders' Equity
- -----------------------------------
<S> <C> <C>
Current liabilities:
Current portion of long-term debt $ 1,792 $ 1,892
Accounts payable - trade 1,136 724
Accrued expenses:
Salaries and payroll taxes 438 658
Vacation and employee fringes 124 140
Real estate taxes 480 567
Management fees - affiliate 464 566
Income taxes 88 87
Dividends payable 614 823
------- -------
Total current liabilities 5,136 5,457
------- -------
Long-Term debt:
Notes payable - Rosewood Care Centers
Capital Funding Corporation 29,279 27,768
------- -------
29,279 27,768
Less current maturities 1,792 1,892
------- -------
27,487 25,876
------- -------
Stockholders' equity:
Common stock 65 65
Paid-in capital 481 481
Retained earnings 1,288 1,409
------- -------
1,834 1,955
------- -------
$34,457 $33,288
======= =======
The accompanying notes are an integral part of this financial statement.
</TABLE>
10
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<TABLE>
ROSEWOOD CARE CENTER
FACILITY COMPANIES AND REAL ESTATE COMPANIES
COMBINED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
(Dollars in Thousands)
(Unaudited)
<CAPTION>
Three Months Nine Months
Ended Ended
March 31, March 31,
1996 1997 1996 1997
---- ---- ---- ----
<S> <C> <C> <C> <C.
Patient service revenue:
Private $4,200 $4,382 $12,863 $13,470
Medicare 2,245 2,646 6,816 7,623
Medicaid 316 418 1,013 1,104
Other patient revenues, net of expenses 13 16 48 62
------ ------ ------- -------
6,774 7,462 20,740 22,259
------ ------ ------- -------
Operating expenses:
Facility expenses:
Administrative expense 196 240 621 705
Employee fringe benefits 485 456 1,406 1,376
Dietary 444 470 1,329 1,427
Nursing 1,606 1,780 4,851 5,316
Ancillary Services 1,146 1,268 3,256 3,797
Plant utilities and maintenance 296 283 853 887
Housekeeping and laundry 221 226 630 690
Social services and activities 130 160 400 483
------ ------ ------- -------
4,524 4,883 13,346 14,681
------ ------ ------- -------
Income after facility expenses 2,250 2,579 7,394 7,578
------ ------ ------- -------
Nonfacility expenses:
Real estate taxes and insurance 139 138 414 422
Base management fees 98 198 594 594
Illinois Medicaid assessments 99 99 296 296
Depreciation and amortization 277 264 802 798
------ ------ ------- -------
713 699 2,106 2,110
------ ------ ------- -------
Income before incentives 1,537 1,880 5,288 5,468
------ ------ ------- -------
Incentive management fees (412) (566) (1,538) (1,583)
Officers' bonuses -- -- -- --
------ ------ ------- -------
Income from operations 1,125 1,314 3,750 3,885
------ ------ ------- -------
Other income (expense):
Interest income 166 157 603 515
Interest expense (538) (504) (1,649) (1,553)
------ ------ ------- -------
(372) (347) (1,046) 1,038
------ ------ ------- -------
Income before income taxes 753 967 2,704 2,847
Income tax expense (54) (84) (240) (245)
------ ------ ------- -------
Net income 699 883 2,464 2,602
Retained earnings, beginning 1,228 1,348 1,032 1,288
Dividends declared (638) (823) (2,207) (2,482)
------ ------ ------- -------
Retained earnings, ending $1,289 $1,408 $ 1,289 $ 1,408
====== ====== ======= =======
The accompanying notes are an integral part of this financial statement.
</TABLE>
11
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<TABLE>
ROSEWOOD CARE CENTER
FACILITY COMPANIES AND REAL ESTATE COMPANIES
COMBINED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
<CAPTION>
Three Months Nine Months
Ended Ended
March 31, March 31,
--------- ---------
1996 1997 1996 1997
---- ---- ---- ----
<S> <C> <C> <C> <C>
Cash flow from operating activities
Net income $ 699 $ 882 $ 2,464 $ 2,602
Adjustments:
Depreciation 244 232 703 701
Amortization 32 32 99 97
Decrease (increase) in:
Accounts receivable - residents 78 (90) (433) (264)
Accounts receivable - third party payors (300) 297 (345) (152)
Other receivables and prepaids 300 178 240 177
Increase (decrease) in:
Accounts payable - trade (799) (44) 30 (412)
Accrued salaries, taxes and fringes 209 202 259 236
Accrued real estate taxes 108 111 1 88
Accrued management fees (176) 74 142 102
Other payables and accruals (32) (7) (84) (1)
------- ------- ------- -------
Net cash provided by operating activities 363 1,867 2,792 3,174
------- ------- ------- -------
Cash flow from investing activities:
Purchase of property and equipment (51) (39) (149) (117)
Loans and deposits with affiliate 1,217 (115) 955 904
------- ------- ------- -------
Net cash (used) by investing activities 1,166 (154) 806 787
------- ------- ------- -------
Cash flow from financing activities:
Reduction of long-term debt (245) (276) (1,419) (1,511)
Dividends paid (890) (819) (2,271) (2,273)
------- ------- ------- -------
Net cash (used) by financing activities (1,135) (1,095) (3,690) (3,784)
------- ------- ------- -------
Net increase (decrease) in cash 394 618 (92) 177
Cash, beginning 2,036 1,796 2,522 2,237
------- ------- ------- -------
Cash, ending 2,430 2,414 2,430 2,414
======= ======= ======= =======
Cash paid for:
Interest $ 538 $ 504 $ 1,649 $ 1,553
======= ======= ======= =======
Income taxes $ 115 $ 40 $ 387 $ 246
======= ======= ======= =======
The accompanying notes are an integral part of this financial statement.
</TABLE>
12
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ROSEWOOD CARE CENTER
FACILITY COMPANIES AND REAL ESTATE COMPANIES
NOTES TO COMBINED FINANCIAL STATEMENTS
1. Interim Financial Statements
----------------------------
In the opinion of the Companies, these unaudited combined financial
statements include all adjustments necessary for a fair presentation of
their financial position as of June 30, 1996 and March 31, 1997 and the
results of their operations and their cash flows for the three and nine
month periods ended March 31, 1996 and 1997. Such adjustments were of a
normal recurring nature.
The results of operations for the three month periods ended March 31,
1996 and 1997 are not necessarily indicative of the results for the full
years.
It is suggested that these financial statements be read in conjunction
with the financial statements, accounting policies and financial notes
thereto included in the Form 10K Annual Report (No. 33-65948), which has
previously been filed with the Commission.
2. Litigation
----------
The Companies, from time to time, are involved in litigation in the
ordinary course of business including disputes involving management
contracts, patient services, employment services, employment claims and
construction matters. The Companies are also involved in routine
administrative and judicial proceedings regarding permits and expenses.
The Companies are not a party to any lawsuit or proceeding which, in the
opinion of management, is individually or in the aggregate, likely to
have a material adverse effect on the combined financial position or
results of operations of the Companies.
3. Refinancing of Long-Term Debt
-----------------------------
On October 21, 1993, the Companies refinanced their long-term debt with
Rosewood Care Centers Capital Funding Corporation, which issued
$33,000,000 of its 7-1/4% First Mortgage Redeemable Bonds due November 1,
2013.
Remaining loan proceeds were loaned to Rosewood Care Center Holding
Company under unsecured promissory notes bearing interest at 7-1/4% per
annum and having maturities from October to December 1999.
13
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ROSEWOOD CARE CENTER
FACILITY COMPANIES AND REAL ESTATE COMPANIES
NOTES TO COMBINED FINANCIAL STATEMENTS
3. Refinancing of Long-Term Debt (Continued)
-----------------------------------------
Loan costs of $609,000 and underwriter's discount of $841,500 are being
amortized over the term of the longterm debt, on the interest method.
4. Dividends
---------
Dividends in the amount of $2,482,000 were declared during the nine
months ended March 31, 1997. Of this amount $1,658,700 has been paid
and $823,300 remains unpaid.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
ROSEWOOD CARE CENTERS CAPITAL FUNDING CORPORATION
The Corporation is a pass through entity. Interest income and expenses
offset, resulting in no income or loss.
THE COMBINED FACILITY COMPANIES AND REAL ESTATE COMPANIES
THREE MONTHS ENDED MARCH 31, 1997 COMPARED WITH
THREE MONTHS ENDED MARCH 31, 1996
Overview
--------
The Companies have continued their marketing emphasis on short-term
convalescent care while continuing to provide long-term care. The number of
short-term care patients and demand for ancillary rehabilitative and therapy
services has continued to increase. Revenues and expenses associated with
rehabilitative and therapy services have continued to increase through
March 31, 1997.
The Medicare program and various forms of private payment are principal
payors for short-term nursing home care and rehabilitative services. All six
of the facilities participate in the federally administered Medicare program.
All six of the facilities also participate in the Medicaid program for a
distinct number of beds in each facility.
The Companies will continue to be affected by the government's attempts
to control Medicare costs and by market issues facing the nursing home
industry as a whole. The ability of the Companies to control the costs of
labor which continue to rise and represent one of the largest components of
the Companies' operating expenses, will also significantly impact the future
operating results.
Operating Results
-----------------
Net revenues have increased to $7,462,000 for the three months ended
March 31, 1997 from $6,774,000 for the three months ended March 31, 1996, an
increase of $688,000 or 10.2%. Private revenues have increased $182,000 from
$4,200,000 for the three months ended March 31, 1996 to $4,382,000 for the
three months ended March 31, 1997. Revenue generated from ancillary services
for private paying patients decreased $80,000, while revenue from room charges
increased $262,000 when compared to the same three month period last year.
Private census has increased from 39,475 patient days for 1996 to 39,818
patient days for the current three month period ended March 31, 1997.
Net revenues for Medicare have increased from $2,245,000 for the three
months ended March 31, 1996 to $2,646,000 for the three months ended March 31,
15
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1997, an increase of $401,000 or 17.8%. The Medicare census has increased to
9,476 from 9,454 compared to the same period last year.
Medicaid revenue has increased from $316,000 to $418,000 when compared
to the same three month period last year. The increase is the result of an
increase in census from 4,936 patient days for the three months ended March
31, 1996 to 6,223 patient days for the three months ended March 31, 1997.
The occupancy of the facilities continues to remain strong with an 89.5%
occupancy rate for the current three month period, compared to 86.7% for the
same three month period last year.
Facility operating expenses increased to $4,883,000 (or $87.96 per
patient day) for the current three month period ended March 31, 1997, from
$4,524,000 (or $83.99 per patient day) for the three months ended March 31,
1996.
Administrative expenses have increased $44,000 when compared to the same
three month period last year. The majority of the increase can be accounted
for by the increase in advertising, professional fees, telephone and new
employee training.
The cost of employee fringe benefits has decreased from $485,000 for the
three months ended March 31, 1996 to $456,000 for the three months ended March
31, 1997. The majority of the decrease can be accounted for by the decrease
in workmen's compensation insurance premiums in the current period.
Dietary expenses have increased approximately $26,000 when compared to
the same three month period last year. Wages have increased approximately
$15,000 while the cost of food and supplies has increased $11,000 when
compared to the same three month period last year.
Nursing costs have increased from $1,606,000 for the three months ended
March 31, 1996 to $1,780,000 for the three months ended March 31, 1997, an
increase of $174,000 or 10.8%. Labor costs have increased $139,000, while the
cost of medical supplies has increased $35,000 when compared to the same
period last year.
Ancillary services costs have increased from $1,146,000 for the three
months ended March 31, 1996 to $1,268,000 for the three months ended March 31,
1997, an increase of $122,000 or 10.6%. This increase in costs is the direct
result of the increase in ancillary revenue and services provided to the
Medicare residents of the facilities.
Plant utilities and maintenance costs have decreased $13,000 from
$296,000 for the three months ended March 31, 1996 to $283,000 for the three
month period ended March 31, 1997. The cost of snow removal increased by
$5,000. This increase was offset by a significant decrease in repairs to the
facilities.
Housekeeping and laundry costs have increased $5,000 when compared to
the same three month period last year. Labor costs have increased $10,000
while the cost of supplies has decreased $5,000.
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<PAGE> 17
Social Services and Activities costs have increased $30,000 when
compared to the same three month period last year. The increase can be
accounted for by the increase in staffing for these departments.
Interest income has decreased $9,000 when compared to the same three
month period last year as a result of the decrease in the notes receivable
outstanding during the three month period from the affiliated company,
Rosewood Care Center Holding Co.
Interest expense decreased $34,000 when compared to the same three month
period last year. The decrease is the result of the decrease in the long term
debt of the facility.
NINE MONTHS ENDED MARCH 31, 1997 COMPARED WITH
NINE MONTHS ENDED MARCH 31, 1996
Operating Results
-----------------
Net revenues have increased to $22,259,000 for the nine months ended
March 31, 1997 from $20,740,000 for the nine months ended March 31, 1996, an
increase of $1,519,000 or 7.3%. Private revenues have increased $607,000 from
$12,863,000 for the nine months ended March 31, 1996, to $13,470,000 for the
nine months ended March 31, 1997. Revenue generated from ancillary services
for private paying patients decreased $130,000, while revenue from room
charges increased $737,000 when compared to the same period last year. The
average private room rate for the current period aggregated $109 per patient
day compared to $105 per patient day for the same period last year. Private
census has increased from 122,304 patient days for 1996 to 123,989 patient
days for the current period ended March 31, 1997.
Net revenues for Medicare have increased from $6,816,000 for the nine
months ended March 31, 1996 to $7,623,000 for the nine months ended March 31,
1997, an increase of $807,000 or 11.8%. The Medicare census has increased to
30,176 patient days for 1997 from 28,933 patient days for the same period last
year. The Medicare reimbursement rate has increased approximately $18 per day
which is the result of an increase in ancillary services provided to Medicare
qualified residents.
Medicaid revenue has increased from $1,013,000 to $1,104,000 when
compared to the same period last year. The increase is the result of an
increase in census from 15,905 patient days for the nine months ended
March 31, 1996 to 16,701 patient days for the nine months ended March 31,
1997. The facilities have received a minor increase of approximately $2 per
day in the reimbursement rate paid to the facilities for residents covered
under the Medicaid program.
The occupancy of the facilities continues to remain strong with a 89.9%
occupancy rate for the current nine month period compared to 89.5% for the
same period last year.
Facility operating expenses increased to $14,681,000 (or $85.92 per
patient day) for the current nine month period ended March 31, 1997, from
17
<PAGE> 18
$13,346,000 (or $79.84 per patient day) for the nine months ended March 31,
1996.
Administrative expenses have increased $84,000 when compared to the same
period last year. The majority of the increase can be accounted for by the
increase in advertising, telephone, new employee training, professional fees
and the increase in the cost of continuing education of employees reimbursed
by the Companies.
The cost of employee fringe benefits decreased approximately $30,000
when compared to the same nine month period last year. The majority of the
decrease can be accounted for by the decrease in workmen's compensation
insurance premiums for the current period.
Dietary expenses have increased approximately $98,000 when compared to
the same period last year. Wages have increased approximately $44,000. The
balance of the increase can be accounted for by the increase in raw food
costs.
Nursing costs have increased from $4,851,000 for the nine months ended
March 31, 1996 to $5,316,000 for the nine months ended March 31, 1997, an
increase of $465,000 or 9.6%. Labor costs have increased $422,000 when
compared to the same period last year, with the balance of the increase
accounted for by the increase in the cost of medical supplies.
Ancillary services costs have increased from $3,256,000 for the nine
months ended March 31, 1996 to $3,797,000 for the nine months ended March 31,
1997, an increase of $541,000 or 16.6%. This increase in costs is the direct
result of the increase in ancillary revenue and services provided to the
Medicare residents of the facilities.
Plant utilities and maintenance costs have increased $34,000 from
$853,000 for the nine months ended March 31, 1996 to $887,000 for the nine
month period ended March 31, 1997. The majority of the increase can be
accounted for by an increase of $5,000 in the cost of snow removal, a $4,000
increase in the cost of trash and hazardous waste disposal and the balance for
repairs to the heat pump system and water heaters at five of the facilities.
Housekeeping and laundry costs have increased $60,000 when compared to
the same nine month period last year. Labor costs have increased $42,000.
The balance of the increase can be accounted for by the increase in the cost
of supplies for both departments.
Social Services and Activities costs have increased from $400,000 for
the nine months ended March 31, 1996 to $483,000 for the nine months ended
March 31, 1997. The increased cost is the result of the increase in staffing
at all six of the facilities for these departments.
Interest income has decreased $88,000 when compared to the same period
last year as a result of the decrease in the notes receivable outstanding
during the nine month period from the affiliated company, Rosewood Care Center
Holding Co.
18
<PAGE> 19
Interest expense decreased $96,000 when compared to the same period last
year. The decrease is the result of the decrease in the long term debt of the
facility from $29,528,000 on March 31, 1996 to $27,861,000 as of March 31,
1997.
The Facility Companies file a consolidated income tax return with their
parent company, Rosewood Care Center Holding Co. The income of the Real
Estate Companies is taxed at the individual shareholder level, as each real
estate company is an S corporation. The amount reflected as income taxes is
the facility companies' portion of federal and state taxes calculated for the
nine months ended March 31, 1997 and 1996, on an annualized basis.
Liquidity and Capital Resources
-------------------------------
As of March 31, 1997, the companies had approximately $2,414,000 in cash
and cash equivalents and net working capital of approximately $1,920,000.
There was a net increase in cash of $177,000 since June 30, 1996. For the
nine months ended March 31, 1997, net cash provided by operations was
$3,174,000. Net cash from investing activities was $787,000 of which $904,000
was received from Rosewood Care Center Holding Co. as payment on notes due
from the affiliated company and $117,000 was used by the Companies for the
purchase of personal property and equipment used in the operations of the
facilities. Net cash used in financing activities aggregated $3,784,000 of
which $1,511,000 was used to retire debt and $2,273,000 was used for the
payment of dividends. The Companies believe they have adequate capital for
operations and replacements for the coming year and the foreseeable future.
Accounts receivable from private paying patients increased to $1,521,000
as of March 31, 1997, compared to $1,257,000 as of June 30, 1996. Accounts
receivable from third party payers increased to $3,154,000 as of March 31,
1997, compared to $3,001,000 as of June 30, 1996. $1,550,000 of this amount is
due from Medicare for unsettled cost reports through March 31, 1997 which are
subject to audit.
With the Medicare program facing intense scrutiny and significant
cutbacks, the companies have experienced closer review of the Medicare cost
reports and delays with regard to payment of claims. An additional effect of
Medicare's delay has been the delay of co-payment amounts received from
private payers. Management does not anticipate any cash flow shortages during
the next year, despite the increase in the amounts due from Medicare, unless
Medicare administration and payment terms significantly further deteriorate.
19
<PAGE> 20
PART II OTHER INFORMATION
- --------------------------
ITEM 1. LEGAL PROCEEDINGS.
There were no material developments with respect to legal proceedings
during the quarter ended March 31, 1997.
ITEM 2. CHANGES IN SECURITIES.
Not applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.
ITEM 5. OTHER INFORMATION.
During the period ending September 30, 1996, ground was broken for the
construction of the 60 bed expansion wing at Rosewood Care Center of Alton.
There are certain restrictions on the construction of the expansion which are
contained in the Loan Agreement and the Trust Indenture. In accordance with
those restrictions, the construction is being executed by Alton Real Estate
II, L.L.C., a separate entity from Alton Real Estate, Inc. which owns the
existing nursing home. At March 31, 1997, exterior walls, interior bearing
walls, and roof trusses and roof sheeting were complete.
Although no new managed care contracts with large providers or covering
large groups have been entered into, the companies continue to experience a
trend in which case managers will contact a facility before a patient is
discharged from a hospital and negotiate an individual managed care contract
specific to that patient. Based on the specifically described needs of that
patient, the facility will agree to an flat daily charge for that patient's
stay which charge includes all items necessary to care for that patient.
Although at March 31, 1997, the numbers of these contracts are not
significant, the companies anticipate an increase in these or similar
arrangements in the future.
The companies continue to have discussions with large providers relating
to managed care options. At March 31, 1997, no new contracts had been
finalized.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) See Index to Exhibits on Page 34.
(b) Reports on Form 8-K.
None.
20
<PAGE> 21
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
ROSEWOOD CARE CENTERS CAPITAL
FUNDING CORPORATION, Registrant
Dated: May __, 1997 By: /s/ Larry Vander Maten
--------------------------------
Larry Vander Maten
President and Director
(Principal Executive Officer
and Principal Financial
and Accounting Officer)
21
<PAGE> 22
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
ROSEWOOD CARE CENTER, INC. OF
SWANSEA, Registrant
Dated: May __, 1997 By: /s/ Larry Vander Maten
-------------------------------
Larry Vander Maten
President and Director
(Principal Executive Officer
and Principal Financial
and Accounting Officer)
22
<PAGE> 23
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
ROSEWOOD CARE CENTER, INC. OF
GALESBURG, Registrant
Dated: May __, 1997 By: /s/ Larry Vander Maten
------------------------------
Larry Vander Maten
President and Director
(Principal Executive Officer
and Principal Financial
and Accounting Officer
23
<PAGE> 24
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
ROSEWOOD CARE CENTER, INC. OF
PEORIA, Registrant
Dated: May __, 1997 By: /s/ Larry Vander Maten
-----------------------------------
Larry Vander Maten
President and Director
(Principal Executive Officer
and Principal Financial
and Accounting Officer)
24
<PAGE> 25
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
ROSEWOOD CARE CENTER, INC. OF
EAST PEORIA, Registrant
Dated: May __, 1997 By: /s/ Larry Vander Maten
-----------------------------------
Larry Vander Maten
President and Director
(Principal Executive Officer
and Principal Financial
and Accounting Officer)
25
<PAGE> 26
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
ROSEWOOD CARE CENTER, INC. OF
ALTON, Registrant
Dated: May __, 1997 By: /s/ Larry Vander Maten
------------------------------------
Larry Vander Maten
President and Director
(Principal Executive Officer
and Principal Financial
and Accounting Officer)
26
<PAGE> 27
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
ROSEWOOD CARE CENTER, INC. OF
MOLINE, Registrant
Dated: May __, 1997 By: /s/ Larry Vander Maten
-----------------------------------
Larry Vander Maten
President and Director
(Principal Executive Officer
and Principal Financial
and Accounting Officer)
27
<PAGE> 28
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
SWANSEA REAL ESTATE, INC., Registrant
Dated: May __, 1997 By: /s/ Larry Vander Maten
---------------------------------------
Larry Vander Maten
President and Director
(Principal and Executive Officer
and Principal Financial
and Accounting Officer
28
<PAGE> 29
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
GALESBURG REAL ESTATE, INC., Registrant
Dated: May __, 1997 By: /s/ Larry Vander Maten
--------------------------------------
Larry Vander Maten
President and Director
(Principal Executive Officer
and Principal Financial
and Accounting Officer)
29
<PAGE> 30
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
PEORIA REAL ESTATE, INC., Registrant
Dated: May __, 1997 By: /s/ Larry Vander Maten
------------------------------------
Larry Vander Maten
President and Director
(Principal Executive Officer
and Principal Financial
and Accounting Officer)
30
<PAGE> 31
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
EAST PEORIA REAL ESTATE, INC., Registrant
Dated: May __, 1997 By: /s/ Larry Vander Maten
-----------------------------------
Larry Vander Maten
President and Director
(Principal Executive Officer
and Principal Financial
and Accounting Officer)
31
<PAGE> 32
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
ALTON REAL ESTATE, INC., Registrant
Dated: May __, 1997 By: /s/ Larry Vander Maten
-----------------------------------
Larry Vander Maten
President and Director
(Principal Executive Officer
and Principal Financial
and Accounting Officer)
32
<PAGE> 33
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
MOLINE REAL ESTATE, INC., Registrant
Dated: May 14, 1997 By: /s/ Larry Vander Maten
------------------------------------
Larry Vander Maten
President and Director
(Principal Executive Officer
and Principal Financial
and Accounting Officer)
33
<PAGE> 34
ROSEWOOD CARE CENTERS CAPITAL FUNDING CORPORATION
Exhibit Index
These Exhibits are numbered in accordance with the Exhibit Table of Item 601
of Regulation S-K
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------ -----------
<C> <S>
4.1 Reference is made to Article III of the Articles of Incorporation of
Rosewood Care Centers Capital Funding Corporation filed on September 28,
1994 as Exhibit 3.1 (and referenced in Exhibit 4.1) of the Form 10-K.
4.2 Reference is made to the Trust Indenture filed on November 29, 1993 as
Exhibit 4.2 of the Form 10-Q of Registrants.
4.3 Reference is made to the Bond filed on November 29, 1993 as Exhibit 4.3
of the Form 10-Q of Registrants.
4.4 Reference is made to the Loan Guaranty Agreement between Rosewood Care
Centers Capital Funding Corporation and Rosewood Care Center, Inc. of
Alton and the additional Loan Guaranty Agreements listed on the Schedule
filed on November 29, 1993 as Exhibit 4.4 of the Form 10-Q of
Registrants.
4.5 Reference is made to the Note executed by Alton Real Estate, Inc. and
the additional Notes listed on the Schedule filed on November 29, 1993
as Exhibit 4.5 of the Form 10-Q of Registrants.
10.1 Reference is made to the Trust Indenture filed on November 29, 1993 as
Exhibit 4.2 of the Form 10-Q of Registrants.
10.2 Reference is made to the Collateral Pledge and Security Agreement
between Rosewood Care Centers Capital Funding Corporation and Alton Real
Estate, Inc. and the additional Collateral Pledge and Security
Agreements listed on the Schedule filed on November 29, 1993 as Exhibit
10.2 of the Form 10-Q of Registrants.
10.3 Reference is made to the Mortgage Between Alton Real Estate, Inc. and
Rosewood Care Centers Capital Funding Corporation and the additional
Mortgages listed on the Schedule filed on November 29, 1993 as Exhibit
10.3 of the Form 10-Q of Registrants.
10.4 Reference is made to the Security Agreement between Rosewood Care
Centers Capital Funding Corporation and Rosewood Care Center, Inc. of
Alton and the additional Security Agreements listed on the Schedule
filed on November 29, 1993 as Exhibit 10.4 of the Form 10-Q of
Registrants.
10.5 Reference is made to the Assignment of Rents and Leases between Rosewood
Care Centers Capital Funding Corporation and Alton Real Estate, Inc. and
the additional Assignments of Rents and Leases listed on the Schedule
34
<PAGE> 35
filed on November 29, 1993 as Exhibit 10.5 of the Form 10-Q of
Registrants.
10.6 Reference is made to the Subordination and Attornment Agreement between
Rosewood Care Centers Capital Funding Corporation and Alton Real Estate,
Inc. and the additional Subordination and Attornment Agreements listed
on the Schedule filed on November 29, 1993 as Exhibit 10.6 of the Form
10-Q of Registrants.
10.7 Reference is made to the Acknowledgment and Consent between Rosewood
Care Centers Capital Funding Corporation and Hovan Enterprises, Inc.
filed on November 29, 1993 as Exhibit 10.7 of the Form 10-Q of
Registrants.
10.8 Reference is made to the Administrative Services Agreement between Hovan
Enterprises, Inc. and Alton Real Estate, Inc. and the additional
Administrative Services Agreements listed on the Schedule filed on
November 29, 1993 as Exhibit 10.8 of the Form 10-Q of Registrants.
10.9 Reference is made to the Revised and Restated Management Agreement
between Rosewood Care Center, Inc. of Alton and Hovan Enterprises, Inc.
and the additional Revised and Restated Management Agreements listed on
the Schedule filed on November 29, 1993 as Exhibit 10.9 of the Form 10-Q
of Registrants.
10.10 Reference is made to the Lease between Alton Real Estate, Inc. and
Rosewood Care Center, Inc. of Alton and the additional Leases listed on
the Schedule filed on November 29, 1993 as Exhibit 10.10 of the Form 10-
Q of Registrants.
10.11 Reference is made to the Assignment of Management Agreement between
Rosewood Care Center, Inc. of Alton and Mercantile Bank and the
additional Assignments of Management Agreement listed on the Schedule
filed on November 29, 1993 as Exhibit 10.11 of the Form 10-Q of
Registrants.
10.12 Reference is made to the Contract between Resident and Facility filed on
July 13, 1993 as Exhibit 10.12 of the Registration Statement of
Registrants (No. 33-65948) declared effective October 14, 1993.
10.13 Reference is made to the Loan Agreement among Rosewood Care Centers
Capital Funding Corporation and Alton Real Estate, Inc., Swansea Real
Estate, Inc., Peoria Real Estate, Inc., East Peoria Real Estate, Inc.,
Moline Real Estate, Inc., and Galesburg Real Estate, Inc. filed on
November 29, 1993 as Exhibit 10.13 of the Form 10-Q of Registrants.
10.14 Reference is made to the Loan Guaranty Agreement filed on November 29,
1993 as Exhibit 4.4 of the Form 10-Q of Registrants.
10.15 Reference is made to the Letter of Credit issued by Sun Bank, National
Association to Mercantile Bank of St. Louis N.A. as Trustee under the
Trust Indenture on December 6, 1993 and substituted for the cash in the
Debt Service Reserve Fund on December 9, 1993, filed on February 11,
1994 as Exhibit 10.15 on the Form 10-Q of the Registrants.
35
<PAGE> 36
10.16 Reference is made to the renewal of the Letter of Credit filed on
February 11, 1994 as Exhibit 10.15 on the Form 10-Q of the Registrants,
which renewal was filed on February 14, 1995 as Exhibit 10.16 of the
Form 10-Q of the Registrants.
10.17 Reference is made to the renewal of the Letter of Credit filed on
February 11, 1994 as Exhibit 10.15 on the Form 10-Q of the Registrants,
which renewal was filed on February 13, 1996 as Exhibit 10.17 of the
Form 10-Q of the Registrants.
10.18 Reference is made to the renewal of the Letter of Credit filed on
February 11, 1994 as Exhibit 10.15 on the Form 10-Q of the Registrants,
which renewal was filed on November 13, 1996 as Exhibit 10.18 of the
Form 10-Q of the Registrants.
27.1 Financial Data Schedule of Rosewood Care Center Capital Funding
Corporation.
27.2 Financial Data Schedule of Rosewood Care Center of Galesburg.
27.3 Financial Data Schedule of Rosewood Care Center of Swansea.
27.4 Financial Data Schedule of Rosewood Care Center of East Peoria.
27.5 Financial Data Schedule of Rosewood Care Center of Peoria.
27.6 Financial Data Schedule of Rosewood Care Center of Alton.
27.7 Financial Data Schedule of Rosewood Care Center of Moline.
27.8 Financial Data Schedule of Swansea Real Estate.
27.9 Financial Data Schedule of Galesburg Real Estate.
27.10 Financial Data Schedule of East Peoria Real Estate.
27.11 Financial Data Schedule of Peoria Real Estate.
27.12 Financial Data Schedule of Alton Real Estate.
27.13 Financial Data Schedule of Moline Real Estate.
99.1 Reference is made to the Amended and Restated License Agreement filed
September 28, 1994 as Exhibit 99.1 of Form 10-K of Registrants.
99.2 Reference is made to the Medicare Provider Agreement between The
Secretary of Health and Human Services and Rosewood Care Center, Inc. of
Swansea filed on July 13, 1993 as Exhibit 99.2 of the Registration
Statement of Registrants (No. 33-65948) declared effective October 14,
1993.
99.3 Reference is made to the Medicare Provider Agreement between The
Secretary of Health and Human Services and Rosewood Care Center, Inc. of
Alton filed on July 13, 1993 as Exhibit 99.3 of the Registration
36
<PAGE> 37
Statement of Registrants (No. 33-65948) declared effective October 14,
1993.
99.4 Reference is made to the Medicare Provider Agreement between The
Secretary of Health and Human Services and Rosewood Care Center, Inc. of
East Peoria filed on July 13, 1993 as Exhibit 99.4 of the Registration
Statement of Registrants (No. 33-65948) declared effective October 14,
1993.
99.5 Reference is made to the Medicare Provider Agreement between The
Secretary of Health and Human Services and Rosewood Care Center, Inc. of
Peoria filed on July 13, 1993 as Exhibit 99.5 of the Registration
Statement of Registrants (No. 33-65948) declared effective October 14,
1993.
99.6 Reference is made to the Medicare Provider Agreement between The
Secretary of Health and Human Services and Rosewood Care Center, Inc. of
Galesburg filed on July 13, 1993 as Exhibit 99.6 of the Registration
Statement of Registrants (No. 33-65948) declared effective October 14,
1993.
99.7 Reference is made to the Medicare Provider Agreement between The
Secretary of Health and Human Services and Rosewood Care Center, Inc. of
Moline filed on July 13, 1993 as Exhibit 99.7 of the Registration
Statement of Registrants (No. 33-65948) declared effective October 14,
1993.
99.8 Reference is made to the Medicaid Provider Agreement between The
Illinois Department of Public Aid and Rosewood Care Center, Inc. of
Swansea filed on July 13, 1993 as Exhibit 99.8 of the Registration
Statement of Registrants (No. 33-65948) declared effective October 14,
1993.
99.9 Reference is made to the Medicaid Provider Agreement between The
Illinois Department of Public Aid and Rosewood Care Center, Inc. of
Alton filed on July 13, 1993 as Exhibit 99.9 of the Registration
Statement of Registrants (No. 33-65948) declared effective October 14,
1993.
99.10 Reference is made to the Medicaid Provider Agreement between The
Illinois Department of Public Aid and Rosewood Care Center, Inc. of East
Peoria filed on July 13, 1993 as Exhibit 99.10 of the Registration
Statement of Registrants (No. 33-65948) declared effective October 14,
1993.
99.11 Reference is made to the Medicaid Provider Agreement between The
Illinois Department of Public Aid and Rosewood Care Center, Inc. of
Peoria filed on July 13, 1993 as Exhibit 99.11 of the Registration
Statement of Registrants (No. 33-65948) declared effective October 14,
1993.
99.12 Reference is made to the Medicaid Provider Agreement between The
Illinois Department of Public Aid and Rosewood Care Center, Inc. of
Galesburg filed on July 13, 1993 as Exhibit 99.12 of the Registration
37
<PAGE> 38
Statement of Registrants (No. 33-65948) declared effective October 14,
1993.
99.13 Reference is made to the Medicaid Provider Agreement between The
Illinois Department of Public Aid and Rosewood Care Center, Inc. of
Moline filed on July 13, 1993 as Exhibit 99.13 of the Registration
Statement of Registrants (No. 33-65948) declared effective October 14,
1993.
99.14 Reference is made to the Lease Agreement filed on September 28, 1994 as
Exhibit 99.14 of the Form 10-K of Registrants.
99.15 Reference is made to the Revised and Restated Grant and Declaration of
Easements filed on September 28, 1994 as Exhibit 99.15 of the Form 10-K
of Registrants.
99.16 Reference is made to the Managed Care Agreement between Rosewood Care
Center, Inc. of Moline, Heritage National Health Plan, Inc., John Deere
Family Health Plan and Deere and Company filed on May 15, 1995 as
Exhibit 99.16 of the Form 10-Q of Registrants.
</TABLE>
38
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Financial Statements at March 31, 1997 for the period ended March 31, 1997 and
is qualified in its entirety by reference to such financial statements.
</LEGEND>
<CIK> 0000909110
<NAME> ROSEWOOD CARE CENTER CAPITAL FUNDING CORPORATION
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 262
<SECURITIES> 0
<RECEIVABLES> 27,768
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 262
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 28,030
<CURRENT-LIABILITIES> 168
<BONDS> 27,861
<COMMON> 1
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 28,030
<SALES> 0
<TOTAL-REVENUES> 1,576
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,576
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Combined Financial Statements at March 31, 1997 for the period ended March 31,
1997 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000909114
<NAME> ROSEWOOD CARE CENTER OF GALESBURG
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,414
<SECURITIES> 0
<RECEIVABLES> 4,764
<ALLOWANCES> 89
<INVENTORY> 0
<CURRENT-ASSETS> 7,377
<PP&E> 24,899
<DEPRECIATION> 7,136
<TOTAL-ASSETS> 33,288
<CURRENT-LIABILITIES> 5,457
<BONDS> 0
<COMMON> 65
0
0
<OTHER-SE> 1,890
<TOTAL-LIABILITY-AND-EQUITY> 33,288
<SALES> 22,197
<TOTAL-REVENUES> 22,774
<CGS> 0
<TOTAL-COSTS> 18,374
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,553
<INCOME-PRETAX> 2,847
<INCOME-TAX> 245
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,602
<EPS-PRIMARY> 40
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Combined Financial Statements at March 31, 1997 for the period ended March 31,
1997 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000909113
<NAME> ROSEWOOD CARE CENTER OF SWANSEA
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,414
<SECURITIES> 0
<RECEIVABLES> 4,764
<ALLOWANCES> 89
<INVENTORY> 0
<CURRENT-ASSETS> 7,377
<PP&E> 24,899
<DEPRECIATION> 7,136
<TOTAL-ASSETS> 33,288
<CURRENT-LIABILITIES> 5,457
<BONDS> 0
<COMMON> 65
0
0
<OTHER-SE> 1,890
<TOTAL-LIABILITY-AND-EQUITY> 33,288
<SALES> 22,197
<TOTAL-REVENUES> 22,774
<CGS> 0
<TOTAL-COSTS> 18,374
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,553
<INCOME-PRETAX> 2,847
<INCOME-TAX> 245
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,602
<EPS-PRIMARY> 40
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Combined Financial Statements at March 31, 1997 for the period ended March 31,
1997 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000909115
<NAME> ROSEWOOD CARE CENTER OF EAST PEORIA
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,414
<SECURITIES> 0
<RECEIVABLES> 4,764
<ALLOWANCES> 89
<INVENTORY> 0
<CURRENT-ASSETS> 7,377
<PP&E> 24,899
<DEPRECIATION> 7,136
<TOTAL-ASSETS> 33,288
<CURRENT-LIABILITIES> 5,457
<BONDS> 0
<COMMON> 65
0
0
<OTHER-SE> 1,890
<TOTAL-LIABILITY-AND-EQUITY> 33,288
<SALES> 22,197
<TOTAL-REVENUES> 22,774
<CGS> 0
<TOTAL-COSTS> 18,374
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,553
<INCOME-PRETAX> 2,847
<INCOME-TAX> 245
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,602
<EPS-PRIMARY> 40
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Combined Financial Statements at March 31, 1997 for the period ended March 31,
1997 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000909116
<NAME> ROSEWOOD CARE CENTER OF PEORIA
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,414
<SECURITIES> 0
<RECEIVABLES> 4,764
<ALLOWANCES> 89
<INVENTORY> 0
<CURRENT-ASSETS> 7,377
<PP&E> 24,899
<DEPRECIATION> 7,136
<TOTAL-ASSETS> 33,288
<CURRENT-LIABILITIES> 5,457
<BONDS> 0
<COMMON> 65
0
0
<OTHER-SE> 1,890
<TOTAL-LIABILITY-AND-EQUITY> 33,288
<SALES> 22,197
<TOTAL-REVENUES> 22,774
<CGS> 0
<TOTAL-COSTS> 18,374
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,553
<INCOME-PRETAX> 2,847
<INCOME-TAX> 245
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,602
<EPS-PRIMARY> 40
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Combined Financial Statements at March 31, 1997 for the period ended March 31,
1997 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000909117
<NAME> ROSEWOOD CARE CENTER OF ALTON
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,414
<SECURITIES> 0
<RECEIVABLES> 4,764
<ALLOWANCES> 89
<INVENTORY> 0
<CURRENT-ASSETS> 7,377
<PP&E> 24,899
<DEPRECIATION> 7,136
<TOTAL-ASSETS> 33,288
<CURRENT-LIABILITIES> 5,457
<BONDS> 0
<COMMON> 65
0
0
<OTHER-SE> 1,890
<TOTAL-LIABILITY-AND-EQUITY> 33,288
<SALES> 22,197
<TOTAL-REVENUES> 22,774
<CGS> 0
<TOTAL-COSTS> 18,374
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,553
<INCOME-PRETAX> 2,847
<INCOME-TAX> 245
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,602
<EPS-PRIMARY> 40
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Combined Financial Statements at March 31, 1997 for the period ended March 31,
1997 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000909118
<NAME> ROSEWOOD CARE CENTER OF MOLINE
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,414
<SECURITIES> 0
<RECEIVABLES> 4,764
<ALLOWANCES> 89
<INVENTORY> 0
<CURRENT-ASSETS> 7,377
<PP&E> 24,899
<DEPRECIATION> 7,136
<TOTAL-ASSETS> 33,288
<CURRENT-LIABILITIES> 5,457
<BONDS> 0
<COMMON> 65
0
0
<OTHER-SE> 1,890
<TOTAL-LIABILITY-AND-EQUITY> 33,288
<SALES> 22,197
<TOTAL-REVENUES> 22,774
<CGS> 0
<TOTAL-COSTS> 18,374
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,553
<INCOME-PRETAX> 2,847
<INCOME-TAX> 245
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,602
<EPS-PRIMARY> 40
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Combined Financial Statements at March 31, 1997 for the period ended March 31,
1997 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000909120
<NAME> SWANSEA REAL ESTATE
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,414
<SECURITIES> 0
<RECEIVABLES> 4,764
<ALLOWANCES> 89
<INVENTORY> 0
<CURRENT-ASSETS> 7,377
<PP&E> 24,899
<DEPRECIATION> 7,136
<TOTAL-ASSETS> 33,288
<CURRENT-LIABILITIES> 5,457
<BONDS> 0
<COMMON> 65
0
0
<OTHER-SE> 1,890
<TOTAL-LIABILITY-AND-EQUITY> 33,288
<SALES> 22,197
<TOTAL-REVENUES> 22,774
<CGS> 0
<TOTAL-COSTS> 18,374
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,553
<INCOME-PRETAX> 2,847
<INCOME-TAX> 245
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,602
<EPS-PRIMARY> 40
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Combined Financial Statements at March 31, 1997 for the period ended March 31,
1997 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000909121
<NAME> GALESBURG REAL ESTATE
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,414
<SECURITIES> 0
<RECEIVABLES> 4,764
<ALLOWANCES> 89
<INVENTORY> 0
<CURRENT-ASSETS> 7,377
<PP&E> 24,899
<DEPRECIATION> 7,136
<TOTAL-ASSETS> 33,288
<CURRENT-LIABILITIES> 5,457
<BONDS> 0
<COMMON> 65
0
0
<OTHER-SE> 1,890
<TOTAL-LIABILITY-AND-EQUITY> 33,288
<SALES> 22,197
<TOTAL-REVENUES> 22,774
<CGS> 0
<TOTAL-COSTS> 18,374
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,553
<INCOME-PRETAX> 2,847
<INCOME-TAX> 245
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,602
<EPS-PRIMARY> 40
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Combined Financial Statements at March 31, 1997 for the period ended March 31,
1997 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000909122
<NAME> EAST PEORIA REAL ESTATE
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,414
<SECURITIES> 0
<RECEIVABLES> 4,764
<ALLOWANCES> 89
<INVENTORY> 0
<CURRENT-ASSETS> 7,377
<PP&E> 24,899
<DEPRECIATION> 7,136
<TOTAL-ASSETS> 33,288
<CURRENT-LIABILITIES> 5,457
<BONDS> 0
<COMMON> 65
0
0
<OTHER-SE> 1,890
<TOTAL-LIABILITY-AND-EQUITY> 33,288
<SALES> 22,197
<TOTAL-REVENUES> 22,774
<CGS> 0
<TOTAL-COSTS> 18,374
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,553
<INCOME-PRETAX> 2,847
<INCOME-TAX> 245
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,602
<EPS-PRIMARY> 40
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Combined Financial Statements at March 31, 1997 for the period ended March 31,
1997 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000909123
<NAME> PEORIA REAL ESTATE
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,414
<SECURITIES> 0
<RECEIVABLES> 4,764
<ALLOWANCES> 89
<INVENTORY> 0
<CURRENT-ASSETS> 7,377
<PP&E> 24,899
<DEPRECIATION> 7,136
<TOTAL-ASSETS> 33,288
<CURRENT-LIABILITIES> 5,457
<BONDS> 0
<COMMON> 65
0
0
<OTHER-SE> 1,890
<TOTAL-LIABILITY-AND-EQUITY> 33,288
<SALES> 22,197
<TOTAL-REVENUES> 22,774
<CGS> 0
<TOTAL-COSTS> 18,374
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,553
<INCOME-PRETAX> 2,847
<INCOME-TAX> 245
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,602
<EPS-PRIMARY> 40
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Combined Financial Statements at March 31, 1997 for the period ended March 31,
1997 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000909124
<NAME> ALTON REAL ESTATE
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,414
<SECURITIES> 0
<RECEIVABLES> 4,764
<ALLOWANCES> 89
<INVENTORY> 0
<CURRENT-ASSETS> 7,377
<PP&E> 24,899
<DEPRECIATION> 7,136
<TOTAL-ASSETS> 33,288
<CURRENT-LIABILITIES> 5,457
<BONDS> 0
<COMMON> 65
0
0
<OTHER-SE> 1,890
<TOTAL-LIABILITY-AND-EQUITY> 33,288
<SALES> 22,197
<TOTAL-REVENUES> 22,774
<CGS> 0
<TOTAL-COSTS> 18,374
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,553
<INCOME-PRETAX> 2,847
<INCOME-TAX> 245
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,602
<EPS-PRIMARY> 40
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Combined Financial Statements at March 31, 1996 for the period ended March 31,
1997 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000909125
<NAME> MOLINE REAL ESTATE
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,414
<SECURITIES> 0
<RECEIVABLES> 4,764
<ALLOWANCES> 89
<INVENTORY> 0
<CURRENT-ASSETS> 7,377
<PP&E> 24,899
<DEPRECIATION> 7,136
<TOTAL-ASSETS> 33,288
<CURRENT-LIABILITIES> 5,457
<BONDS> 0
<COMMON> 65
0
0
<OTHER-SE> 1,890
<TOTAL-LIABILITY-AND-EQUITY> 33,288
<SALES> 22,197
<TOTAL-REVENUES> 22,774
<CGS> 0
<TOTAL-COSTS> 18,374
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,553
<INCOME-PRETAX> 2,847
<INCOME-TAX> 245
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,602
<EPS-PRIMARY> 40
<EPS-DILUTED> 0
</TABLE>
