LIQUIDITY AND PROFITABILITY	6 Months Ended
Jun. 30, 2012
LIQUIDITY AND PROFITABILITY
LIQUIDITY AND PROFITABILITY	NOTE 3. LIQUIDITY AND PROFITABILITY The Company had net loss of approximately $345,000 and $2,758,000 for the three and six months ended June 30, 2012, respectively, and a net loss of $4,562,000 and $5,503,000 for the three and six months ended June 30, 2011, respectively. The Company had negative working capital of approximately $26,706,000 at June 30, 2012. The Company’s ability to sustain profitable operations is dependent on continued growth in revenue and controlling costs. Management’s plans for increasing liquidity and profitability in future years include the following: · increasing facility occupancy and improving the occupancy mix by increasing Medicare patients; · acquiring additional long term care facilities with existing cash flowing operations to expand our operations, and · refinancing debt where possible to obtain more favorable terms. Management believes that the foregoing actions, if taken by the Company, should provide the opportunity for the Company to improve liquidity and achieve profitability; however, there is no assurance that such actions will occur or, if they do occur, that they will result in improved liquidity or profitability. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

NOTE 3. LIQUIDITY AND PROFITABILITY

The Company had net loss of approximately $345,000 and $2,758,000 for the three and six months ended June 30, 2012, respectively, and a net loss of $4,562,000 and $5,503,000 for the three and six months ended June 30, 2011, respectively. The Company had negative working capital of approximately $26,706,000 at June 30, 2012. The Company’s ability to sustain profitable operations is dependent on continued growth in revenue and controlling costs.

Management’s plans for increasing liquidity and profitability in future years include the following:

· increasing facility occupancy and improving the occupancy mix by increasing Medicare patients;

· acquiring additional long term care facilities with existing cash flowing operations to expand our operations, and

· refinancing debt where possible to obtain more favorable terms.

Management believes that the foregoing actions, if taken by the Company, should provide the opportunity for the Company to improve liquidity and achieve profitability; however, there is no assurance that such actions will occur or, if they do occur, that they will result in improved liquidity or profitability. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.