<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB/A
AMENDMENT NO. 1
(Mark One)
/X/ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities and
Exchange Act of 1934
For the period ended June 30, 1997, or
/ / Transition Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from to .
----------------- -------------
COMMISSION FILE NUMBER 0-25908
----------------
JUST LIKE HOME, INC.
(Exact name of registrant as specified in its charter)
FLORIDA 65-0568234
(State or other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)
3647 CORTEZ ROAD WEST 34210-3106
BRADENTON, FLORIDA (Zip Code)
(Address of Principal Executive Offices)
REGISTRANT'S TELEPHONE NUMBER AND AREA CODE: 941-756-2555
2440 TAMIAMI TRAIL NORTH 34275
NOKOMIS, FLORIDA (Former Zip Code)
(Former Address of Principal Executive Offices)
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
None
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
COMMON STOCK, PAR VALUE $.001 NASDAQ
(Title of Class) (Name of Each Exchange on
Which Registered)
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 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No .
----- -----
As of June 30, 1997, there were outstanding 7,073,711 shares of Just Like
Home, Inc. Common Stock, par value $.001.
<PAGE> 2
ITEM 1. FINANCIAL STATEMENTS
JUST LIKE HOME, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEET
JUNE 30, 1997
(UNAUDITED)
<TABLE>
<S> <C>
ASSETS
Current Assets:
Cash and cash equivalents $ 1,589,911
Restricted cash 142,588
Accounts receivable - trade 245,760
Due from related parties 148,671
Other current assets 106,911
-----------
Total current assets 2,233,841
-----------
Property and equipment, net 5,023,263
Property held for sale 1,622,861
Construction Work in Process 418,231
Restricted Cash 250,000
Intangible assets, net 1,307,915
Other Assets 26,182
-----------
8,648,452
-----------
Total Assets $10,882,293
===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 356,157
Accrued interest 65,262
Accrued compensation 101,329
Current portion of long-term debt 682,288
Current portion, notes payable to related party 150,000
Other current liabilities 93,131
-----------
Total current liabilities 1,448,167
-----------
Long-term debt 4,584,033
Note payable to related party 411,288
-----------
4,995,321
-----------
Total liabilities 6,443,488
-----------
Common Stock and Options Subject to Put Options 857,003
-----------
Stockholders' Equity
Preferred stock, $.01 par value; 2,000,000 shares
authorized; none issued and outstanding 0
Common stock, $.001 par value; 13,000,000 shares
authorized; 7,073,711 shares issued
and outstanding 6,858
Additional paid-in capital 8,869,645
Accumulated deficit (5,294,701)
-----------
Total stockholders' equity 3,581,802
-----------
Total Liabilities and Stockholders' Equity $10,882,293
===========
</TABLE>
See accompanying notes to consolidated financial statements
1
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JUST LIKE HOME, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
1996 1997 1996 1997
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenue:
Resident fees $ 322,629 $ 452,434 $ 499,871 873,350
Management and consulting fees 147,160 214,801 291,387 383,188
Companion care fees -- 75,758 -- 155,751
Other income 38,914 22,066 69,880 59,977
---------------------------------------------------------------
Total revenue 508,703 765,059 861,138 1,472,266
---------------------------------------------------------------
Expenses:
Operating 723,852 1,216,051
General and administration 873,288 575,972 1,464,988 830,079
---------------------------------------------------------------
Total expenses 873,288 1,299,824 1,464,988 2,046,130
---------------------------------------------------------------
Operating Loss (364,586) (534,765) (603,850) (573,864)
---------------------------------------------------------------
Non-Operating Income (Expense)
Interest expense (61,003) (158,037) (113,527) (260,462)
Interest income 26,754 17,635 51,423 28,946
---------------------------------------------------------------
(34,249) (140,402) (62,104) (231,516)
---------------------------------------------------------------
Loss Before Income Taxes (398,834) (675,167) (665,954) (805,380)
---------------------------------------------------------------
Income Tax Expense -- -- -- --
Net Loss $ (398,834) $ (675,167) $ (665,954) $ (805,380)
===============================================================
Net Loss Per Common Share $ (0.10) $ (0.10) $ (0.17) $ (0.15)
===============================================================
Weighted Average Common Shares Outstanding 3,904,999 6,761,554 3,904,999 5,347,364
===============================================================
</TABLE>
See accompanying notes to consolidated financial statements
2
<PAGE> 4
JUST LIKE HOME, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOW
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30,
1996 1997
---- ----
<S> <C> <C>
------------ -------------
Cash Flows from Operating Activities: $ (338,291) $ (742,384)
------------ -------------
Cash Flows from Investing Activities:
Acquisitions of property and equipment (3,212,699) (547,709)
Loans to related parties (26,012) --
Repayments of related-party loans 23,110 --
Payments made goodwill and other intangible costs (458,724) (877,772)
Payments for other assets (96,479) --
Purchase of certificate of deposit (800,000) (250,000)
Proceeds from certificate of deposit 775,000 56,216
Deposits into restricted cash accounts (1,347) --
------------ -------------
Net cash used in investing activities ` (3,797,151) (1,619,265)
------------ -------------
Cash Flows from Financing Activities:
Proceeds from mortgages and notes payable 2,500,418 1,165,808
Repayment of mortgages and notes payable (65,255) (788,872)
Borrowings from related parties -- 225,883
Repayment of related-party loans (4,166) --
Issuance of common stock-private placement 1,510,000
Issuance of common stock-acquisition -- 1,651,605
------------ -------------
Net cash provided by financing activities 2,430,997 3,764,424
------------ -------------
Net increase (decrease) in cash (1,704,445) 1,402,775
Cash, beginning of period 1,847,974 187,135
------------ -------------
Cash, end of period $ 143,529 $ 1,589,910
============ =============
</TABLE>
See accompanying notes to consolidated financial statements
3
<PAGE> 5
JUST LIKE HOME, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
JUNE 30, 1997
(UNAUDITED)
NOTE 1 - BASIS OF PRESENTATION
In the opinion of the management of the Company, the accompanying unaudited
consolidated condensed financial statements contain all adjustments, consisting
only of normal recurring accruals, necessary to present fairly the Company's
financial position, results of operations and cash flows for the periods
presented. The results of operations for the interim periods presented are not
necessarily indicative of the results to be expected for the full year.
These unaudited interim consolidated condensed financial statements should be
read in conjunction with the audited financial statements and related
disclosures included in the Company's annual report on Form 10-KSB for the year
ended December 31, 1996.
NOTE 2 - NET LOSS PER COMMON SHARE
Primary net loss per common share is computed by dividing net loss by the
weighted average number of common shares outstanding during each period.
Common stock equivalents are not included in the calculation as their impact
would be anti-dilutive.
NOTE 3 - BUSINESS COMBINATION
On April 30, 1997, the Company acquired Community Assisted Living Centers, Inc.
("Community") through the issuance of the Company's common stock. The
acquisition was accounted for using the purchase method of accounting. The
purchase price of $1,646,250 (1,646,250 shares of common stock) was allocated
based on estimated fair values at the date of acquisition, which resulted in an
excess of purchase price over assets acquired of approximately $867,000. This
goodwill is being amortized over a five-year period.
For the six months ended June 30, 1996 the Company reported $861,000 of
revenues and a net loss of ($666,000). Community was not in operation during
this same period. In 1997, prior to consummation of the business combination
with the Company, Community recorded $13,000 of revenue and a net loss of
($132,000).
4
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The following unaudited pro forma information presents a summary of
consolidated results of operations of the Company and Community as if the
acquisition had occurred January 1, 1997. Pro forma results for the same
periods in 1996 have not been presented as Community was not in operation
during the first quarter of 1996.
<TABLE>
<CAPTION>
3 months ended 6 months ended
June 30, 1997 June 30, 1997
-------------- --------------
<S> <C> <C>
Revenues $ 763,597 $ 1,486,736
Operating Loss $ (577,596) $ (939,483)
Net Loss $ (717,998) $ (1,140,443)
Net Loss Per Share $ (0.10) $ (0.18)
</TABLE>
These pro forma results have been prepared for comparative purposes only and do
not purport to be indicative of the results of operations which actually would
have resulted had the acquisition occurred on the date indicated, or which may
result in the future.
The previously filed financial statements incorrectly reported the business
combination as a pooling of interest. This correction resulted in a decrease in
revenues of $6,000 and increase in net loss of $99,000 for the three-month
period ended June 30, 1997 and a decrease in revenue of $6,000 and a decrease in
net loss of $57,000 for the six-month period ended June 30, 1997. Related net
loss per common share increased by $0.01 for the three-month period and
decreased by $0.01 for the six-month period ended June 30, 1997.
NOTE 4 - FUTURE ACCOUNTING REQUIREMENTS
Comprehensive Income: In June 1997, the Financial Accounting Standards Board
issued Statement of Financial Accounting Standards (SFAS) No. 130, Reporting of
Comprehensive Income, which established standards for reporting and display of
comprehensive income and its components (revenues, expenses, gains, and losses)
in a full set of financial statements. This statement also requires that all
items that are required to be recognized under accounting standards as
components of comprehensive income be reported in a financial statement that is
displayed with the same prominence as other financial statements.
This statement is effective for fiscal years beginning after December 15, 1997.
Earlier application is permitted. Reclassification of financial statements for
earlier periods provided for comparative purposes is required. Management does
not believe that adoption of SFAS No. 130 will have a material impact on the
Company's financial statements.
Disclosures About Segments of an Enterprise: In June 1997, the financial
Accounting Standards Board also issued SFAS No. 131, Disclosures about Segments
of an Enterprise and Related Information, which establishes standards for the
way that public business enterprises report information about operating segments
in annual financial statements and requires that those enterprises report
selected information about operating segments in interim financial reports
issued to shareholders. This statement also establishes standards for related
disclosures about products and services, geographic areas, and major
5
<PAGE> 7
customers. This statement requires the reporting of financial and descriptive
information about an enterprise's reportable operating segments.
This statement is effective for financial statements for periods beginning after
December 15, 1997. In the initial year of application, comparative information
for earlier years is to be restated. The Company has not yet determined the
impact adoption of SFAS No. 131 will have on its financial statements.
NOTE 5 - SUBSEQUENT EVENTS AND LIQUIDITY
Private Placement: On March 27, 1997, the Company issued a private placement
memorandum offering up to 2,500,000 shares of its common stock at a purchase
price of $1.00 per share. The Company will use the proceeds of the offering to
pay certain existing liabilities of the Company, to pay anticipated and future
operating expenses, to fund development and start-up costs, and for general
corporate purposes. The private placement closed on April 10, 1997, and the
Company received approximately $1,510,000 in proceeds.
REIT Financing: The Company entered into an agreement on April 30, 1997, with
HealthCare REIT, Inc., a real estate investment trust (the "REIT"), for up to
$41,800,000 in operating lease financings for assisted living facilities. The
initial financing was completed on July 18, 1997, and involved the
sale-leaseback of four assisted living facilities owned by the Company for an
aggregate sale price of $2,700,000.
Going Concern: The Company has experienced recurring losses and at December 31,
1996 had limited resources. On April 10, 1997, the management of Community ("New
Management") took effective control of the Company. In addition to the events
described above, New Management has plans to dispose of the property held for
sale at its carrying value, sell certain operating assets to an assisted-living
facility real estate investment trust and lease them back, significantly improve
operating results at facilities owned by the Foundation and utilize Community's
existing resources. Current projections and plans indicate that the Company
will have sufficient resources to continue as a going concern.
NOTE 6 - COMMITMENTS AND CONTINGENCIES
Common Stock and Options Subject to Put Options relate to a litigation
settlement. The settlement requires the Company to repurchase 214,882 common
shares at $4 per share in 1999 at the shareholder's option. Additionally, the
Company issued an option to the stockholder to purchase 50,000 additional common
shares at an option price of $2 per share, these shares also being part of the
put option. The common stock related to this transaction has been reclassified
to common stock and options subject to put options on the balance sheet.
6
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF CONDITIONS AND RESULTS OF
OPERATIONS.
This discussion and analysis contains both historical and
forward-looking information. The forward-looking statements may be
significantly affected by risks and uncertainties and are made pursuant to the
safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
There can be no assurance that anticipated future results will be achieved.
Readers are cautioned that a number of factors, which are described in this
report, the Company's report on Form 10-KSB and below, could adversely affect
the Company's ability to obtain these results.
OVERVIEW
The historical financial statements represent the consolidated results
of operations and financial condition of Just Like Home, Inc. and its
subsidiaries (JLH or the Company). On April 10, 1997, Community Assisted
Living Centers, Inc. (Community) merged into a newly formed subsidiary of the
Company. All financial information reflects the combined operations of JLH and
Community since January 1, 1997.
The following table sets forth the number of facilities owned or
managed and the total beds and occupancy as of the end of each of the periods
presented.
<TABLE>
<CAPTION>
December 31, June 30,
----------------------- --------
1995 1996 1997
---- ---- ----
<S> <C> <C> <C>
Facilities owned . . . . . . . . . . . . . . . . . . . . . 2 6 6
Facilities managed . . . . . . . . . . . . . . . . . . . . 3 3 3
Total beds . . . . . . . . . . . . . . . . . . . . . . . . 100 184 184
Occupancy percentage at end of period . . . . . . . . . . . 97.0% 81.0% 84.7%
</TABLE>
________________
REVENUES
Six Months
Revenues for the six-month period ended June 30, 1997 increased by 71% from
approximately $861,000 in 1996 to approximately $1,472,000 in 1997. Resident
fees increased due to the inclusion of newly acquired and constructed
facilities adding 84 additional rental units. Resident fee income increased
75% from $500,000 in 1996 to $873,000 in 1997. Management and Consulting Fees
increased 32% from $291,000 in 1996 to $383,000 in 1997 due to increased
revenues from Project Market Decisions, Inc. In addition, Just Like Family, the
Company's companion care service, reflected revenues of $3,000 during its start
up phase in 1996 and posted revenues of $156,000 in 1997.
7
<PAGE> 9
Three Months
Revenues for the three-month period ended June 30, 1997 increased by 50% from
approximately $509,000 in 1996 to approximately $765,000 in 1997. The same
factors affecting the six-month revenues combine to affect the second quarter
mostly due to the timing of the acquisitions and start up operations.
OPERATING, SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Six Months
Operating and other expenses for the six-month period ended June 30, 1997
increased by 40% from approximately $1,465,000 in 1996 to approximately
$2,046,000 in 1997 primarily due to start up costs of the two newly constructed
facilities and the acquisition of Charis Place, the start up of the companion
care services, and the merger with Community. The acquisition of Community
resulted in overlapping management and home office expenses. Management's
efforts to eliminate duplicative costs and to realize other savings from the
combination of the Company and Community were not reflected in the second
quarter results.
Three Months
Operating and other expenses for the three-month period ended June 30, 1997
increased by 49% from approximately $873,000 in 1996 to approximately $1,300,000
in 1997. The same factors effecting the six-month Expenses combine to affect
the second quarter.
INTEREST EXPENSE
Six Months
Interest expense for the six-month period ended June 30, 1997 increased from
approximately $114,000 in 1996 to approximately $260,000 in 1997 due to the
inclusion of the Charis Place, Inc. acquisition with its associated debt and
the opening of two additional facilities with their associated debt. Also, the
company incurred debt for working capital totaling $850,000 during late 1996.
Three Months
Interest expense for the three-month period ended June 30, 1997 increased from
approximately $61,000 in 1996 to approximately $158,000 in 1997. The same
factors effecting the six-month Interest Expense combine to affect the second
quarter.
LOSS BEFORE INCOME TAXES
As a result of the above, the Company incurred a loss before taxes of
approximately ($805,000) for the 1997 period as compared to a loss of
approximately ($666,000) for the 1996 period.
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LIQUIDITY AND CAPITAL RESOURCES
For the six months ended June 30, 1997 the Company sustained a loss of
approximately $805,000. This resulted primarily from the Company not having a
sufficient number of facilities in operation to generate necessary income to
cover home office overhead costs and the carrying costs associated with
non-income producing properties. The Company's merger with Community has
resolved the immediate short-term cash requirements of the Company.
Additionally, simultaneously with the closing of the merger, the Company closed
a private placement of 1,510,000 shares of its Common Stock at a purchase price
of $1.00 per share, for an aggregate purchase price of $1,510,000. The Company
also is offering for sale two parcels of land acquired in the last two years
for future assisted living facility developments. These parcels are of a size
or in a location that is not consistent with the Company's current plans to
focus on smaller facilities in more rural communities. The Company is
obligated to apply all of the net proceeds of these sales to the reduction of
certain indebtedness of the Company. Therefore, these transactions will not
directly provide additional working capital, but they should reduce the debt
burden of the Company and the corresponding interest expense. In addition,
the Company is in the process of selling the operations of its subsidiary,
Project Market Decisions. Management has determined that this consulting
business does not directly add to the renewed focus on development and
operation of assisted living facilities.
The Company entered into an agreement on April 30, 1997, with HealthCare REIT,
Inc., a real estate investment trust (the "REIT"), for up to $41,800,000 in
sale-leaseback financings for assisted living facilities. The initial
financing was completed on July 18, 1997, and involved the sale-leaseback of
four assisted living facilities owned by the Company for an aggregate sale
price of $2,700,000. By transferring ownership of the Company's assisted
living facilities to the REIT, the Company will free up capital in existing
facilities that can be used to help roll-out new facilities and will reduce the
amount of capital needed by the Company for future growth. Each phase of the
REIT financing is subject to numerous conditions, including satisfaction of
certain financial coverage tests by the Company. The initial REIT financing
provided the Company with approximately $1,000,000 ($750,000 from REIT proceeds
and $250,000 of certificate of deposit held as collateral by mortgage lender)
in additional working capital after the payment of certain long-term and
short-term indebtedness related to the four facilities sold to the REIT, which
the Company intends to use to fund start-up losses associated with opening new
facilities. Financing of a fifth existing facility for a sale price of
$1,300,000 is currently in process. It is expected that an additional $750,000
of working capital will be provided from the sale of this facility. This
initial phase of the REIT financing project will replace approximately
$3,538,000 of fixed assets and $2,414,000 of debt with $1,750,000 of working
capital.
The remaining $37,800,000 of REIT funding will be available, subject to
continuing satisfaction of the various financial and other covenants in the
agreement, to fund up to 21 assisted living facilities in the eastern United
States over a three-year period. The financing commitment expires on May 1,
2000. Currently, three development projects and one acquisition project are
being analyzed by the REIT.
As of June 30, 1997, the Company had working capital of approximately $786,000.
Operating losses are expected to continue to occur until additional facilities
are in operation. It is anticipated that these losses will be funded by
existing working capital and the sale-leaseback of existing buildings. The
primary cash needs of the Company relate to start-up costs associated with
opening new facilities, projected operating losses for those facilities until
they reach a stabilized occupancy and certain corporate office expense until
all facilities are generating sufficient cash flow to cover those expenses.
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<PAGE> 11
The Company has recently acquired three sites for new facilities and has
several other sites under contract. The Company expects to finance at least
one of these existing sites through a sale-leaseback financing with a private
investor, and presently intends to finance any additional sites under the REIT
financing commitment. The rate at which the Company can develop these sites
and future sites will be directly affected by the continuing availability of
the REIT financing and the Company's ability to generate or raise the cash
necessary to finance the anticipated start-up costs associated with opening new
facilities.
These development plans are part of the Company's development program that will
include construction of additional assisted living facilities which, when
matched with appropriate debt funding, are ultimately expected to generate
incremental operating cash flows sufficient to fund operations. Construction of
the first of these facilities began on August 4, 1997 and is expected to be
completed during February 1998. The Company anticipates construction on these
additional sites by October 1997.
If the Company is unable to develop its various projects in a timely manner, it
will be required to modify or curtail its expansion plans, which could have a
material adverse effect on the Company's ability to continue its operations.
The Company's common stock is traded on NASDAQ and listed under the symbol
"JLHC".
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PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGE IN SECURITIES
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
The following exhibit is filed with this Form 10-QSB:
27.1 Financial Data Schedule (for SEC use only).
(b) Reports on Form 8-K:
Form 8-K dated April 10, 1997, reporting merger with
Community Assisted Living Centers, Inc. as amended, by
report dated June 23, 1997, reporting Financial Statements
of Business Acquired and Pro Forma Financial Information.
11
<PAGE> 13
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Date: April 24, 1998 Just Like Home, Inc.
(John F. Robenalt)
----------------------------------
Chief Executive Officer
(Michael W. Monahan)
----------------------------------
Chief Financial Officer
12
