2016 Year End Results Conference Call. March 1, 2017

Transcription

1 2016 Year End Results Conference Call March 1,

2 FORWARD-LOOKING STATEMENTS This presentation contains forward-looking statements, based on our best judgements, which reflect risks and uncertainties. Actual results could vary from expectations. EBITDA, Adjusted EBITDA, net operating income (NOI), funds from operations (FFO), and adjusted funds from operations (AFFO) are non-gaap measures and do not have standardized meanings prescribed by GAAP. Further information can be found in the disclosure documents filed by Extendicare. EXTENDICARE 2

3 We are a leader in the Canadian senior care and services sector Long-term Care Retirement Living Home Health Care Management and Group Purchasing Services Our mission is.helping h l i people l live li better b tt 3

4 2016 HIGHLIGHTS Revenue +13% NOI +9% Adjusted EBITDA +11% 1, AFFO (continuing ops) % 66.7 YR 2015 YR 2016 ($ millions) YR 2015 YR 2016 YR 2015 YR 2016 YR 2015 YR 2016 Year-over-year performance strong on all measures Continued progress on key strategic initiatives Positioned for growth across senior care continuum Delivering value for our Shareholders EXTENDICARE 4

5 LONG-TERM CARE Own and Operate ,116 CENTRES* RESIDENT CAPACITY 4 11,500 PROVINCES EMPLOYEES LTC operations delivered 58% of Canadian revenue 2016 LTC inflationary increases in Ontario and Alberta Preferred and overall occupancy remains strong Q LTC western provinces retro- funding of $2.2M NOI margin of 12.4% up from 11.7% in 2015 Strong consistent performance from core LTC operations EXTENDICARE 5

6 BUILDING ON OUR SOLID LONG-TERM CARE BUSINESS ONTARIO LTC CAPITAL REDEVELOPMENT PROGRAM 21 3,287 C CENTRES TO REDEVELOP BEDS Seven applications for redevelopment submitted to Ministry (5 new/2 renos) Working closely with all stakeholders to receive necessary approvals and support Land acquired/identified in 3 locations Extendicare Maple View Sault Ste. Marie, ON Putting capital to work profitably in long-term stable return investments EXTENDICARE 6

7 RETIREMENT LIVING OWN AND OPERATE COMMUNITIES SUITES DEVELOPMENT PIPELINE $11.0M EXPECTED STABILIZED NOI CONTRIBUTION COMMUNITIES SUITES Two communities acquired in 2015 have achieved occupancy of 95% from 72% at beginning of year Lease-up communities experiencing consistent growth in occupancy Average monthly rents up 5.5% in 2016 Cedar Crossing (Simcoe, ON) opened Q Private-pay revenues deliver diversification and higher margins EXTENDICARE 7

8 UXBRIDGE, BOLTON & BARRIE, ON DEVELOPMENT PROJECTS $106.8M 354 $7.4M 70% 7.0% DEVELOPMENT COST* Development pipeline under way with three projects in Ontario Douglas Crossing, Uxbridge (106 suites) Q4/17 Bolton (124 suites) Q1/18 Barrie (124 suites) Q4/18 SUITES (INDEPENDENT/ ENHANCED) EXPECTED STABILIZED NOI CONTRIBUTION STABILIZED NOI YIELD Rendering of Uxbridge project Internal developments complement acquisition strategy * Development costs are inclusive of an imputed cost of capital and lease up to stabilized NOI EXTENDICARE 8

9 DOUGLAS CROSSING, UXBRIDGE, ON OPENING FALL SUITES (INDEPENDENT/ ENHANCED) Strong pre-opening interest EXTENDICARE 9

10 HOME HEALTH CARE 41 LOCATIONS 6 PROVINCES 11 M HOME HEALTH CARE HOURS ANNUALLY 11,800 EMPLOYEES Represents 39% of Canadian revenue Volume increases experienced overall, driven from growth in B.C. and Ontario funded hours Key initiatives progressing well to improve efficiencies, reduce costs and optimize delivery of care National platform for growth of private and government-funded home health care EXTENDICARE 10

11 OTHER CANADIAN OPERATIONS MANAGEMENT & CONSULTING SERVICES 46 * LOCATIONS UNDER MANAGEMENT GROUP PURCHASING SERVICES >430 THIRD-PARTY MEMBER SITES BEDS UNDER MANAGEMENT 17% -1% -10% 9% THIRD-PARTY RESIDENTS SERVED 38% 9% 5,470 6,426 6,332 5,693 6,187 27,100 29,600 40, Jan/ committed Ancillary services continued growth 2016 over 2015: revenue up 19% & NOI up 21% * 46 locations (5,693 beds) as of January 31, EXTENDICARE 11

12 FINANCIAL REVIEW YEAR 2016

13 FINANCIAL SUMMARY YEAR 2016 Increase (decrease) Year Year Over 2015 ($ millions unless otherwise noted) ($) (%) Total Revenue $ 1,060.8 $ $ % Net operating income $ $ $ % NOI margin 12.3% 12.7% Same-store Revenue $ $ $ % Net operating income $ $ $ % NOI margin 13.4% 13.1% Same-store NOI up $5.7M or 5.4% EXTENDICARE 13

14 FINANCIAL SUMMARY Q Increase (decrease) Q4 Q4 Over Q ($ millions unless otherwise noted) ($) (%) Total Revenue $ $ $ % Net operating income $ 33.7 $ 32.8 $ % NOI margin 12.2% 12.5% Same-store Revenue $ $ $ % Net operating income $ 30.1 $ 27.5 $ % NOI margin 13.8% 13.0% Same-store NOI up $2.6M or 9.5% EXTENDICARE 14

15 LONG-TERM CARE Q4 Q4 Increase (decrease) Over Q Year Year Increase (decrease) Over 2015 ($ millions unless otherwise noted) ($) (%) ($) (%) Revenue $ $ $ % $ $ $ % Net operating income $ 19.6 $ 16.6 $ % $ 75.6 $ 69.5 $ % NOI margin 12.5% 10.8% 12.4% 11.7% Total average occupancy 97.9% 98.1% 98.0% 97.9% average e occupancy ON Private-New ON Private-C 97.6% 98.2% 98.7% 96.8% 93.8% 88.7% LTC NOI up $6.1M or 8.8% EXTENDICARE 15

16 HOME HEALTH CARE Q4 Q4 Increase (decrease) Over Q Year Year Increase (decrease) Over 2015 ($ millions unless otherwise noted) ($) (%) ($) (%) Total Revenue $ $ $ % $ $ $ % Net operating income $ 10.0 $ 10.7 $ (0.7) (6.7)% $ 40.2 $ 36.5 $ % NOI margin 9.2% 10.7% 9.7% 11.2% Same-store Revenue $ 53.9 $ 50.9 $ % $ $ $ % Net operating income $ 6.5 $ 5.6 $ % 1% $ 22.8 $ $ (0.5) (2.2)% 2)% NOI margin 12.0% 11.0% 11.0% 11.9% 29,310 29,807 29,230 30,932 Service Volumes (hours / day) 13,925 Same-store Home health care acquisition Q4/15 Q4/16 Continued Growth in Service Volumes EXTENDICARE 16

17 RETIREMENT LIVING Year Year ($ millions unless otherwise noted) Revenue en e $ 15.5 $ 1.2 Net operating income $ 0.6 $ 0.3 NOI margin 4.2% 20.3% AFFO Income support $ 6.2 $ 0.5 As at Average Occupancy for Mature Communities (Empire/Stonebridge) 72.2% 73.3% 3% 80.6% 88.9% 95.0% Avg. monthly revenue / occupied suite $ 4,480 $ 4,245 Avg. occupancy for year Mature 80.6% 60.8% Lease-up 47.7% 70.2% Total 59.8% 64.1% Dec. 31/15 Mar. 31/16 Jun. 30/16 Sept. 30/16 Dec. 31/16 Avg. occupancy as at period end Mature 95.0% 72.2% Lease-up 49.6% 68.5% Expected stabilized NOI of $11M annually EXTENDICARE 17

18 OTHER CANADIAN OPERATIONS Increase (decrease) Increase (decrease) Q4 Q4 Over Q Year Year Over 2015 ($ millions unless otherwise noted) ($) (%) ($) (%) Revenue $ 4.7 $ 3.7 $ % $ 18.5 $ 15.5 $ % Net operating income $ 2.5 $ 1.8 $ % $ 9.9 $ 8.2 $ % NOI margin 51.9% 48.8% 53.5% 52.7% MANAGEMENT & CONSULTING SERVICES GROUP PURCHASING SERVICES Strong growth in NOI and NOI margin EXTENDICARE 18

19 AFFO AND PAYOUT RATIO Q & YEAR 2016 ( $ per basic share) Cdn Ops AFFO continuing operations U.S. Ops Q Q YR 2015 YR 2016 Q Q YR 2015 YR 2016 AFFO ($ millions) $ 10.4 $ 13.5 $ 43.6 $ 66.7 Current taxes (affecting AFFO) ($ millions) $ 9.8 $ FFO effective tax rate 19.1% 15.1% Cash dividend/share $ 0.48 $ 0.48 Payout ratio (Cdn Ops) 96% 72% Payout ratio (total AFFO) 83% 65% EXTENDICARE 19

20 FINANCIAL POSITION (millions, unless otherwise noted) Dec. 31/16 Dec. 31/15 Cash $ 102 $104 Long-term debt (1) $ 513 $ 465 TTM EBITDA interest coverage (2) x x Debt to GBV (3) 43% 38% WAR 5.2% ৷ WAM 8 years 1) Includes current portion, reflects converts at face and excludes financing costs. 2) 2015 interest coverage excludes bridge loan financing. 3) Includes convertible debentures. EXTENDICARE 20

21 CONCLUSION 21

22 NATIONAL PLATFORM FOR CONTINUED GROWTH As at December 31, 2016 LONG-TERM CARE CENTRES RETIREMENT LIVING PARAMED HOME HEALTH CARE LOCATIONS Province Owned/Leased Managed Owned/Leased Managed Owned/Leased Ontario Alberta Manitoba Saskatchewan 5 4 British Columbia 1 Quebec 2 Nova Scotia 1 Total EXTENDICARE 22

23 DISCIPLINED EXECUTION OF STRATEGIC PLAN Commitment to quality customer-centred care and services. Growth across the continuum of senior care Meet the needs of a growing Canadian seniors population Redevelop long-term care centres and improve LTC revenue stream through an enhanced mix of preferred accommodations Expand our private-pay retirement business lines through accretive acquisitions and developments Grow revenue in privatepay home health care market and expand volume of services provided through ParaMed division Support growth in Extendicare Assist management services and SGP Purchasing Partner Network divisions EXTENDICARE 23

24 2016 Year End Results Conference Call March 1,