Assisted Living Concepts Inc. (ALC), which operates a for profit chain of assisted living centers, reported significantly higher profit margins despite a drop in occupancy in its first quarter. The company operates 211 assisted living centers in 20 states. See full report here. Revenue increased 1.4% to $57.9 million from $57.1 million.
The company reported net income of $3.6 million, or 31 cents a share, compared with a loss of $11.8 million, or 98 cents, a year ago. The year-ago quarter includes a non-cash write-off of $14.7 million in goodwill, an accounting entry that reflects the amount above book value paid for an acquisition. Excluding the write-off, the company earned $2.9 million in first quarter 2009.
An increase in private pay residents, who pay much higher rates than the Medicaid program, rate increase and lower labor and kitchen expenses contributed to the higher profits. It sounds like they stopped properly feeding the residents and provided less staff or less qualified employees.