The Ensign Group, Inc. · NASDAQ:ENSG
The Ensign — Ensign Group — Merger or Acquisition (November 2013)
21 slides from The Ensign's merger presentation, Nov 7, 2013
Slide 1: November 7, 2013
Exhibit 99.1 November 7, 2013 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements that are based on management’s current expectations, assumptions and beliefs about its business, financial performance, operating results, the industry in which it operates and other future events. Forward-looking state
Slide 3: Select Management Team
Select Management Team Christopher Christensen President and Chief Executive Officer, The Ensign Group, Inc. Suzanne Snapper Chief Financial Officer, The Ensign Group, Inc. Gregory Stapley President and Chief Executive Officer, CareTrust REIT, Inc. 3
Slide 4: Separation Creates Two Superior Business Platforms
Separation Creates Two Superior Business Platforms On November 7, 2013, The Ensign Group announced plans to separate its Healthcare and Real Estate businesses into two publicly traded companies through a tax-free spin-off transaction The transaction is expected to close in Q1 2014 Operations Real Es
Slide 5: Ensign Has a History of Financial and Operating Success
Ensign Has a History of Financial and Operating Success Business Overview Operated Facilities As of June 30, 2013, operated 118 facilities, 9 home health and 7 hospice operations, and 5 urgent care centers located in 11 states – Owns 95 facilities and operates an additional 23 facilities through lon
Slide 6: Separation Creates Two Very Attractive Opportunities for Investors
Separation Creates Two Very Attractive Opportunities for Investors Pro Forma Overview Pro Forma Overview 119 SNF, ALF and ILF properties Initial ownership of 97 SNF, ALF and ILF properties – 94 to be leased from CareTrust (CareTrust will own and operate 3 ILFs) – Portfolio consists of ~84% SNF campu
Slide 7: Separation Highlights Ensign’s Embedded Real Estate Value
Separation Highlights Ensign’s Embedded Real Estate Value Comparison of Healthcare REIT and SNF Valuation Multiples — Last 5 Years 18x EBITDA Multiple: 14.4x Average: 14.1x (Healthcare REIT Index) 12x EBITDA Multiple: 6.7x 6x (Skilled Nursing Index) Average: 5.2x 0x 2008 2009 2010 2011 2012 2013 In
Slide 8: Compelling Rationale for Separation Drives Shareholder Value
Compelling Rationale for Separation Drives Shareholder Value “Shared Attributes” Strategic Direction and Focus More efficient execution of divergent business models and strategies Independent establishment of strategic priorities, growth strategies and financial objectives Focus on distinct business
Slide 9: Ensign Continues as a Proven Operator with a Focus on Core Operations and Growth
Ensign Continues as a Proven Operator with a Focus on Core Operations and Growth Leadership-centric business model Strong Proven track record of financial and operating performance Operating Established business model and operating strategy that offers potential for tremendous Performance value crea
Slide 10: Ensign Will Operate a Well Diversified Portfolio of Businesses Across a Broad Geographic Footprint
Ensign Will Operate a Well Diversified Portfolio of Businesses Across a Broad Geographic Footprint Significant white space to grow the portfolio 6 6 3 5 5 36 12 6 13 27 # 119 SNFs, ALFs & ILFs 9 Home Health & 7 Hospice 6 Urgent Care Clinics Note: As of November 1, 2013. 10
Slide 11: Ensign Represents THE Growth Story in the SNF Sector
Ensign Represents THE Growth Story in the SNF Sector Revenue Adjusted EBITDAR (1) $825 $758 $650 $142 $130 $542 $107 $469 $87 $411 $73 $60 2007 2008 2009 2010 2011 2012 2007 2008 2009 2010 2011 2012 2007 – 2012 Revenue CAGR 2007 – 2012 Adjusted EBITDAR CAGR 18.6% 15.0% 6.6% 1.9% (1.5%) 1.3% (2) (2)
Slide 12: Ensign’s Proven Track Record of Successful Acquisitions
Ensign’s Proven Track Record of Successful Acquisitions Annual Facilities Growth Acquisition Track Record Annual Facility Acquisitions Strong track record of acquiring, operating Transitioned Facilities and integrating under-performing assets 118 108 10 Focused on improving operating 102 6 efficienc
Slide 13: Ensign has a Long-Tenured and Successful Management Team
Ensign has a Long-Tenured and Successful Management Team Christopher Christensen President, Chief Executive Officer and Director of The Ensign Group, Inc. Co-founder and President of Ensign since 1999 and Chief Executive Officer since April 2006 Member of the board of directors since 1999 Prior to j
Slide 14: CareTrust Will Establish Itself With a Solid Foundation of Quality Seniors Housing Assets
CareTrust Will Establish Itself With a Solid Foundationof QualitySeniorsHousingAssets Strong High-quality initial tenant with an industry-leading management team Underlying Well-maintained real estate assets spread across diverse geographies Portfolio Differentiated Ability to pursue acquisitions an
Slide 15: CareTrust Starts With a Proven Portfolio of Assets Across a Broad Geographical Footprint
CareTrust Starts With a Proven Portfolio of Assets Across a Broad Geographical Footprint 97 owned Skilled Nursing, Assisted Living, and Independent Living facilities with more than 10k operational beds and units across 10 states 27 97 SNFs, ALFs & ILFs (owned) ILFs (owned & operated)` Note: As of No
Slide 16: CareTrust Benefits From Management’s Direct Industry Experience and Strong Tenant Relationships
CareTrust Benefits From Management’s Direct Industry Experience and Strong Tenant Relationships Gregory Stapley President and Chief Executive Officer of CareTrust REIT, Inc. Co-founder and Executive Vice President, Vice President and General Counsel, and Secretary of The Ensign Group, Inc. During hi
Slide 17: Master Lease Agreement Terms
Master Lease Agreement Terms Fiveseparatelong-term“Triple-Net”MasterLeaseAgreements Lease Tenants will be responsible for maintenance, capital expenditures, property taxes, insurance Structure and other expenses at the leased properties All Master Leases will be cross-defaulted and guaranteed by Ens
Slide 18: Expected Transaction Mechanics and Timing
Expected Transaction Mechanics and Timing Ensign will accomplish the separation by distributing all of the outstanding shares of CareTrust common stock to Ensign stockholders on a pro rata basis Number of Ensign shares owned prior to Spin-Off will not change as a result of the Spin-Off CareTrust wil
Slide 19: Appendix
—. ENSIGN = GROUP Appendix 19
Slide 20: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP to Non-GAAP Financial Measures USD in Millions 6 mo. 6/30/13 6 mo. 6/30/12 FY 2012 FY 2011 Net income (loss) ($0.1) $25.1 $39.8 $47.7 Net (income) loss attributable to noncontrolling interests 0.3 0.3 0.8 -- Loss from discontinued operations 1.8 0.2 -- -- Interest expense, net
Slide 21: Ensign Group
—. ENSIGN = GROUP 21