Capital Senior Living Corp. (CSU, Financial) filed Quarterly Report for the period ended 2010-09-30.
Capital Senior Living Corp. has a market cap of $170.6 million; its shares were traded at around $6.22 with a P/E ratio of 39.4 and P/S ratio of 0.9. Capital Senior Living Corp. had an annual average earning growth of 4% over the past 10 years.CSU is in the portfolios of Ron Baron of Baron Funds, Jim Simons of Renaissance Technologies LLC.
During the first nine months of fiscal 2010, the Company extinguished $5.6 million of its outstanding debt obligations, which further reduced the Companys exposure to the volatility in the credit markets and enabled the Company to reduce interest expense by approximately $0.4 million, or 4.9%, during the first nine months of fiscal 2010 when compared to the first nine months of fiscal 2009.
In November 2004, the Company formed SHPII/CSL with SHPII. SHPII/CSL is owned 95% by SHPII and 5% by the Company. In November 2004, SHPII/CSL acquired the Spring Meadows Communities which currently comprise 628 units with a combined capacity of 758 residents. The Company has contributed $1.3 million for its interests in SHPII/CSL. The Company accounts for its investment in SHPII/CSL under the equity method of accounting and the Company recognized earnings in the equity of SHPII/CSL of $0.1 million and $0.2 million in each of the three and nine month periods ended September 30, 2010 and 2009, respectively. In addition, the Company earned $0.3 million and $0.9 million in management fees on the Spring Meadows Communities in each of the three and nine month periods ended September 30, 2010 and 2009, respectively.
In May 2007, the Company and SHPIII formed SHPIII/CSL Miami to develop a senior housing community in Miamisburg, Ohio. Under the joint venture and related agreements, the Company earns development and management fees and may receive incentive distributions. The senior housing community currently consists of 101 independent living units and 45 assisted living units and opened in August 2008. The Company has contributed $0.8 million to SHPIII/CSL Miami for its 10% interest. The Company accounts for its investment in SHPIII/CSL Miami under the equity method of accounting and the Company recognized losses in the equity of SHPIII/CSL Miami of ($23,000) and ($48,000) during the three month periods ended September 30, 2010 and 2009, respectively. The Company recognized losses in the equity of SHPIII/CSL Miami of ($0.1) million in each of the nine month periods ended September 30, 2010. In addition, the Company earned $37,500 and $0.1 million in management fees on the SHPIII/CSL Miami community in each of the three and nine month periods ended September 30, 2010 and 2009, respectively.
In November 2007, the Company and SHPIII formed SHPIII/CSL Richmond Heights to develop a senior housing community in Richmond Heights, Ohio. Under the joint venture and related agreements, the Company earns development and management fees and may receive incentive distributions. The senior housing community currently consists of 96 independent living units and 45 assisted living units and opened in April 2009. The Company has contributed $0.8 million to SHPIII/CSL Richmond Heights for its 10% interest. The Company accounts for its investment in SHPIII/CSL Richmond Heights under the equity method of accounting and the Company recognized losses in the equity of SHPIII/CSL Richmond Heights of ($18,800) and ($42,800) during the three month periods ended September 30, 2010 and 2009, respectively. The Company recognized losses in the equity of SHPIII/CSL Richmond Heights of ($0.1) million in each of the nine month periods ended September 30, 2010 and 2009. In addition, the Company earned $37,500 and $0.1 million in management fees on the SHPIII/CSL Richmond Heights community in each of the three and nine month periods ended September 30, 2010 and 2009, respectively. Prior to opening SHPIII/CSL Richmond Heights, the Company earned $12,500 in pre-marketing fees in fiscal 2009.
In December 2007, the Company and SHPIII formed SHPIII/CSL Levis Commons to develop a senior housing community near Toledo, Ohio. Under the joint venture and related agreements, the Company earns development and management fees and may receive incentive distributions. The senior housing community currently consists of 101 independent living units and 45 assisted living units and opened in April 2009. The Company has contributed $0.8 million to SHPIII/CSL Levis Commons for its 10% interest. The Company accounts for its investment in SHPIII/CSL Levis Commons under the equity method of accounting and the Company recognized losses in the equity of SHPIII/CSL Levis Commons of ($25,700) and ($72,700) during the three month periods ended September 30, 2010 and 2009, respectively. The Company recognized losses in the equity of SHPIII/CSL Levis Commons of ($0.1) million in each of the nine month periods ended September 30, 2010 and 2009. In addition, the Company earned $37,500 and $0.1 million in management fees on the SHPIII/CSL Levis Commons community in each of the three and nine month periods ended September 30, 2010 and 2009, respectively. Prior to opening SHPIII/CSL Levis Commons, the Company earned $12,500 in pre-marketing fees in fiscal 2009.
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Capital Senior Living Corp. has a market cap of $170.6 million; its shares were traded at around $6.22 with a P/E ratio of 39.4 and P/S ratio of 0.9. Capital Senior Living Corp. had an annual average earning growth of 4% over the past 10 years.CSU is in the portfolios of Ron Baron of Baron Funds, Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
On September 10, 2010, the Company acquired the leasehold interests in 12 senior housing communities and certain related personal property from Signature for aggregate consideration of $25.8 million and executed a Master Lease Agreement with affiliates of HCN valued at $78.8 million. Funds for the transaction were provided by HCN and are non-recourse to the Company, the intent of which was to result in the same economic impact to the Company as a $104.6 million lease at current market rates. Therefore, a principal obligation has not been recorded by the Company within its consolidated financial statements. The Master Lease Agreement has a term of 15 years with one 15-year renewal option beyond the initial lease term. The Master Lease Agreement is a triple net lease pursuant to which the Company pays all expenses of the properties except principal and interest on any mortgage debt of the properties. The Master Lease Agreement contains customary representations and warranties as well as affirmative and negative covenants and the lease payments are guaranteed by subsidiaries of the Company.During the first nine months of fiscal 2010, the Company extinguished $5.6 million of its outstanding debt obligations, which further reduced the Companys exposure to the volatility in the credit markets and enabled the Company to reduce interest expense by approximately $0.4 million, or 4.9%, during the first nine months of fiscal 2010 when compared to the first nine months of fiscal 2009.
In November 2004, the Company formed SHPII/CSL with SHPII. SHPII/CSL is owned 95% by SHPII and 5% by the Company. In November 2004, SHPII/CSL acquired the Spring Meadows Communities which currently comprise 628 units with a combined capacity of 758 residents. The Company has contributed $1.3 million for its interests in SHPII/CSL. The Company accounts for its investment in SHPII/CSL under the equity method of accounting and the Company recognized earnings in the equity of SHPII/CSL of $0.1 million and $0.2 million in each of the three and nine month periods ended September 30, 2010 and 2009, respectively. In addition, the Company earned $0.3 million and $0.9 million in management fees on the Spring Meadows Communities in each of the three and nine month periods ended September 30, 2010 and 2009, respectively.
In May 2007, the Company and SHPIII formed SHPIII/CSL Miami to develop a senior housing community in Miamisburg, Ohio. Under the joint venture and related agreements, the Company earns development and management fees and may receive incentive distributions. The senior housing community currently consists of 101 independent living units and 45 assisted living units and opened in August 2008. The Company has contributed $0.8 million to SHPIII/CSL Miami for its 10% interest. The Company accounts for its investment in SHPIII/CSL Miami under the equity method of accounting and the Company recognized losses in the equity of SHPIII/CSL Miami of ($23,000) and ($48,000) during the three month periods ended September 30, 2010 and 2009, respectively. The Company recognized losses in the equity of SHPIII/CSL Miami of ($0.1) million in each of the nine month periods ended September 30, 2010. In addition, the Company earned $37,500 and $0.1 million in management fees on the SHPIII/CSL Miami community in each of the three and nine month periods ended September 30, 2010 and 2009, respectively.
In November 2007, the Company and SHPIII formed SHPIII/CSL Richmond Heights to develop a senior housing community in Richmond Heights, Ohio. Under the joint venture and related agreements, the Company earns development and management fees and may receive incentive distributions. The senior housing community currently consists of 96 independent living units and 45 assisted living units and opened in April 2009. The Company has contributed $0.8 million to SHPIII/CSL Richmond Heights for its 10% interest. The Company accounts for its investment in SHPIII/CSL Richmond Heights under the equity method of accounting and the Company recognized losses in the equity of SHPIII/CSL Richmond Heights of ($18,800) and ($42,800) during the three month periods ended September 30, 2010 and 2009, respectively. The Company recognized losses in the equity of SHPIII/CSL Richmond Heights of ($0.1) million in each of the nine month periods ended September 30, 2010 and 2009. In addition, the Company earned $37,500 and $0.1 million in management fees on the SHPIII/CSL Richmond Heights community in each of the three and nine month periods ended September 30, 2010 and 2009, respectively. Prior to opening SHPIII/CSL Richmond Heights, the Company earned $12,500 in pre-marketing fees in fiscal 2009.
In December 2007, the Company and SHPIII formed SHPIII/CSL Levis Commons to develop a senior housing community near Toledo, Ohio. Under the joint venture and related agreements, the Company earns development and management fees and may receive incentive distributions. The senior housing community currently consists of 101 independent living units and 45 assisted living units and opened in April 2009. The Company has contributed $0.8 million to SHPIII/CSL Levis Commons for its 10% interest. The Company accounts for its investment in SHPIII/CSL Levis Commons under the equity method of accounting and the Company recognized losses in the equity of SHPIII/CSL Levis Commons of ($25,700) and ($72,700) during the three month periods ended September 30, 2010 and 2009, respectively. The Company recognized losses in the equity of SHPIII/CSL Levis Commons of ($0.1) million in each of the nine month periods ended September 30, 2010 and 2009. In addition, the Company earned $37,500 and $0.1 million in management fees on the SHPIII/CSL Levis Commons community in each of the three and nine month periods ended September 30, 2010 and 2009, respectively. Prior to opening SHPIII/CSL Levis Commons, the Company earned $12,500 in pre-marketing fees in fiscal 2009.
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