Long-term care services provider Advocat Inc. (NASDAQ:AVCA) recently agreed to sell one of its skilled nursing centers in Arkansas to an unrelated party for an undisclosed sum.
The facility’s operating margins didn’t meet the company’s long-term strategic goals, said Advocat in a statement, as it contributed revenues of $2.59 million and a pre-tax net loss of $18,000 in the six-month period ended June 30, 2012.
“Our focus on portfolio growth as part of our strategic operating initiatives has allowed us also to contemplate targeted divestitures of underperforming nursing centers, which can have a positive financial impact without compromising the scale of our growing Company,” said Kelly Gill, Advocat’s president and CEO. “The Arkansas facility was operating at a modest loss, and its replacement in our portfolio with better performing nursing centers as described in our growth plan not only will provide an immediate financial benefit but also diversify our operations modestly from the state of Arkansas, which has been a challenging market for us in terms of professional liability.”
Written by Alyssa Gerace