Sunrise's Net Loss Increases

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Sunrise Senior Living(SRZ Quote) posted a higher Q4 FY08 loss on March 2, 2009 due to one-time charges for write-offs, restructuring expenses, and other items. Net loss increased to $305.61 million or $6.07 per share from $123.98 million or $2.48 per share a year ago. Net loss from continuing operations before extraordinary items increased to $272.43 million or $5.41 per share from $73.86 million or $1.48 per share. The most recent consensus estimate was for a loss of $0.57 per share.

Operating revenue grew 8.1% to $435.60 million, helped by increased occupancy and improved average daily rate. Average occupancy rate rose to 90.5% from 89.5% and average daily rate rose to $149.31 from $142.61. Resident fees for consolidated communities jumped 13.0% to $116.84 million and reimbursed contract services revenue ascended 9.6% to $260.27 million. Professional fees from development, marketing, and other jumped 5.5% to $14.43 million. However, management fees declined marginally to $33.81 million and ancillary fees dropped 26.2% to $9.63 million.

Sunrise operated 435 communities located in the US, Canada, UK, and Germany, with resident capacity of almost 54,000 as of December 31, 2008. SRZ had 26 communities under construction, with capacity for an additional 2,700 residents. The company recently announced a regulatory filing with the US Securities and Exchange Commission, indicating that it may have to file for bankruptcy if it is unable to obtain necessary waivers or restructure its financial obligations.

FY08 operating revenue grew 7.5% to $1.70 billion from $1.58 billion in the previous year. However, net loss widened to $439.18 million or $8.72 per share from $70.28 million or $1.41 per share, hurt by one-time charges for write-offs, restructuring expenses, and other items.

SRZ expects spending on the completion of its 26 communities under construction during FY09.