Brookdale Senior Living Inc. · NYSE:BKD
Brookdale Senior Living — Q4 2019 Earnings Presentation
35 slides from Brookdale Senior Living's earnings presentation, Feb 18, 2020
Slide 1: Supplemental Information 4th Quarter 2019
Exhibit 99.2 Supplemental Information 4th Quarter 2019
Slide 2: Table of Contents
Table of Contents Lease Accounting Standard (ASC 842) Impact 4 Overview 5 Segment Overview 8 Senior Housing 9 Health Care Services 15 G&A Expense 16 Capital Expenditures 17 Cash Facility Lease Payments 18 Unconsolidated Ventures 19 Capital Structure 20 Pro-Forma Net Asset Value Elements 21 Definitio
Slide 3: Safe Harbor
SAFE HARBOR Certain statements in this Supplemental Information may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to various risks and uncertainties and include all statements regarding t
Slide 4: Lease Accounting Standard (ASC 842) Impact
Lease Accounting Standard (ASC 842) Impact The Company’s adoption of the new lease accounting standard, effective January 1, 2019, impacted the timing of the revenue and cost recognition associated with its residency agreements. For the full year 2019, the impact of the adoption and application to i
Slide 5: Overview
Overview 4Q19 vs. Full Year 2018 2019 4Q18 19 vs. 18 Consolidated, unless otherwise noted Better (B)/ ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year (Worse) (W) B/(W) Resident fee and management fee revenue (1) $ 924,947 $ 913,040 $ 858,707 $ 824,503 $3,521,197 $ 825,222 $ 817,312 $ 814,801
Slide 6: Adjusted EBITDA and Adjusted Free Cash Flow
Adjusted EBITDA and Adjusted Free Cash Flow 4Q19 vs. Full Year Consolidated, unless otherwise noted 2018 2019 4Q18 19 vs. 18 ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year B(W) B(W) Resident fee and management fee revenue $ 924,947 $ 913,040 $ 858,707 $824,503 $3,521,197 $ 825,222 $ 817,312
Slide 7: Adjusted EBITDA and Adjusted Free Cash Flow Distribution
Adjusted EBITDA and Adjusted Free Cash Flow Distribution Consolidated 4Q 2019 Senior Senior Housing Housing Consolidated, unless otherwise noted Owned Leased Health Care Management ($ in 000s) Total Portfolio Portfolio Services Services Other (1) Resident fee and management fee revenue $ 809,704 $ 3
Slide 8: Segment Overview
Segment Overview 4Q19 vs. Full Year Consolidated, unless otherwise noted 2018 2019 4Q18 19 vs. 18 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year B(W) B(W) Total Senior Housing, Health Care Services, and Management Services Revenue (1) $924,947 $913,040 $858,707 $82
Slide 9: Senior Housing Segments
Senior Housing Segments Consolidated 4Q19 vs. Full Year ($ in 000s, except RevPAR and RevPOR) 2018 2019 4Q18 19 vs. 18 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year B(W) B(W) Independent Living Revenue $158,397 $159,293 $144,631 $137,656 $ 599,977 $135,694 $135,951 $136,874 $136,039 $ 544,558 (1.2)% (
Slide 10: Senior Housing: Same Community
Senior Housing: Same Community (1) 4Q19 vs. Full Year Consolidated 2018 2019 4Q18 19 vs. 18 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year B(W) B(W) Revenue $ 612,326 $ 605,701 $ 608,018 $ 607,802 $2,433,847 $ 622,525 $ 617,296 $ 619,109 $ 620,419 $2,479,349 2.1 %
Slide 11: Senior Housing Segments: Same Community
Senior Housing Segments: Same Community (1) 4Q19 vs. Full Year Consolidated 2018 2019 4Q18 19 vs. 18 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year B(W) B(W) Independent Living Revenue $115,124 $115,228 $115,887 $116,679 $ 462,918 $119,042 $118,701 $118,981 $117,93
Slide 12: Senior Housing Owned Portfolio
Senior Housing Owned Portfolio 4Q19 vs. Full Year Consolidated 2018 2019 4Q18 19 vs. 18 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year B(W) B(W) Resident fee revenue $ 383,910 $ 388,108 $387,585 $382,533 $1,542,136 $380,691 $375,900 $377,451 $373,793 $1,507,835 (2.
Slide 13: Senior Housing Leased Portfolio
Senior Housing Leased Portfolio 4Q19 vs. Full Year Consolidated 2018 2019 4Q18 19 vs. 18 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year B(W) B(W) Resident fee revenue $ 411,836 $ 398,008 $ 344,318 $ 315,938 $1,470,100 $ 317,256 $ 311,529 $ 312,001 $ 314,050 $1,254,
Slide 14: New Supply: Brookdale's Largest Markets - Competitive Summary
New Supply Brookdale's Largest 20 Markets - Competitive Summary 4Q 2019 Weighted Average Occupancy Quadrant with highest demographic60 growth% & lowest new openings 90.3% Portland ) 86.2% 84.7% 1 ( 55% 85.4% Charlotte Denver h t Seattle w 79.9% o r Colorado Springs 83.7% G Austin 83.1% + k 50% Jacks
Slide 15: Health Care Services
Health Care Services Consolidated 4Q19 vs. Full Year ($ in 000s) 2018 2019 4Q18 19 vs. 18 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year B(W) B(W) Resident fee revenue Home health $ 85,490 $ 83,818 $ 81,722 $ 81,033 $ 332,063 $ 84,185 $ 85,233 $ 80,632 $ 77,440 $327,490 (4.4)% (1.4)% Hospice 19,327 19,
Slide 16: G&A Expense
G&A Expense Consolidated, unless otherwise noted 4Q19 vs. Full Year ($ in 000s) 2018 2019 4Q18 19 vs. 18 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year B(W) B(W) G&A expense allocations (1) Senior Housing Owned Portfolio allocation $ 16,616 $ 14,924 $ 15,061 $ 14,641 $ 61,242 $ 15,693 $ 16,875 $ 15,759
Slide 17: Capital Expenditures
Capital Expenditures 4Q19 vs. Full Year Consolidated 2018 2019 4Q18 19 vs. 18 ($ in 000s, except for community level capital expenditures, net, per weighted average unit) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year B(W) B(W) Community level capital expenditures, including allocations (1) Senior Hous
Slide 18: Cash Facility Lease Payments
Cash Facility Lease Payments 4Q19 vs. Full Year Consolidated 2018 2019 4Q18 19 vs. 18 ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year B(W) B(W) Operating Lease Obligations Facility lease expense $ 80,400 $ 81,960 $ 70,392 $ 70,542 $ 303,294 $ 68,668 $ 67,689 $ 67,253 $ 66,056 $ 269,666 Opera
Slide 19: Unconsolidated Ventures
Unconsolidated Ventures 4Q 2019 Full Year 2019 ($ in 000s) Total CCRC Venture (1) Other Ventures Total Resident fee revenue $ 110,150 $ 109,456 $ 694 $ 436,314 Facility operating expense (83,388) (82,647) (741) (329,638) General and administrative expense including management fees (5,528) (5,491) (3
Slide 20: Capital Structure
Capital Structure Total Liquidity Debt Structure (1) Debt ($ in millions) ($ in millions) ($ in millions) Maturity Weighted Rate Variable rate debt with 2020 (2) $ 339 5.32% interest rate caps $592 2021 333 5.99% $600 $530 Fixed rate 2022 321 4.32% $479 $481 $455 debt 2023 231 4.38% ) $1,129 s n $40
Slide 21: Pro-Forma Net Asset Value Elements
Pro-Forma Net Asset Value Elements Consolidated ($ in millions. Amounts are as of or for the year ended December 31, 2019 unless otherwise noted) Pro-Forma Senior Housing Owned Portfolio (1) Owned Portfolio Operating Income (Loss) (Including G&A assumption) (2) $ 380.1 Net Debt (see page 32) $ 3,199
Slide 22: Definitions
Definitions Adjusted EBITDA is a non-GAAP performance measure that the Company defines as net Brookdale’s Proportionate Share of Adjusted EBITDA of Unconsolidated Ventures income (loss) excluding: benefit/provision for income taxes, non-operating income/ is calculated based on the Company’s equity o
Slide 23: Definitions
Definitions Leased Portfolio Operating Income is defined by the Company as resident fee revenue Same Community information reflects historical results from senior housing operations (excluding Health Care Services segment revenue), less facility operating expense for the for same store communities (
Slide 24: Appendices
Appendices Pro-Forma Financial Information 25 Definitive Agreements with Healthpeak 28 Non-GAAP Financial Measures 29 24
Slide 25: Pro-Forma Financial Information
Pro-Forma Financial Information During 2019, the Company disposed of an aggregate of 14 owned communities, terminated triple-net lease obligations on an aggregate of 10 communities, and transitioned management agreements on 105 net communities. During January 2020, the Company: • acquired eight comm
Slide 26: Pro-Forma Full Year 2019
Pro-Forma Full Year 2019 Amounts Attributable to the Amounts October 1, 2019 Attributable to Actual Results Amounts Announced Other Net of Amounts Attributable to Transactions with Transactions Attributable to Transactions Actual Results Healthpeak Completed or Less: Impact the New Lease Completed o
Slide 27: Pro-Forma Fourth Quarter 2019
Pro-Forma Fourth Quarter 2019 Amounts Attributable to the Amounts October 1, 2019 Attributable to Actual Results Announced Other Net of Amounts Amounts Transactions with Transactions Attributable to Attributable to Actual Results Healthpeak Completed or Less: Impact the New Lease Transactions Net of
Slide 28: Definitive Agreements with Healthpeak
Definitive Agreements with Healthpeak On October 1, 2019, the Company and Healthpeak entered into several definitive agreements providing for multiple transactions, including a Master Transactions and Cooperation Agreement and Equity Interest Purchase Agreement. The parties subsequently amended the
Slide 29: Non-GAAP Financial Measures
Non-GAAP Financial Measures This Supplemental Information contains the financial measures Adjusted EBITDA, Adjusted EBITDAR, Adjusted EBITDA after cash financing lease payments, Adjusted Free Cash Flow, Net Debt, and Adjusted Net Debt (each as defined in the “Definitions” section), which are not cal
Slide 30: Non-GAAP Financial Measures: Adjusted EBITDA Reconciliation
Non-GAAP Financial Measures (continued) Adjusted EBITDA Reconciliation Consolidated ($ in 000s) 2018 2019 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year Net income (loss) $(457,234) $(165,509) $ (37,140) $ 131,531 $(528,352) $ (42,606) $ (56,055) $ (78,508) $ (91,323) $ (268,492) Provision (benefit) fo
Slide 31: Adjusted EBITDAR; Adjusted EBITDA; Adjusted EBITDA after Cash Financing Lease Payments
Non-GAAP Financial Measures (continued) Adjusted EBITDAR; Adjusted EBITDA; and Adjusted EBITDA after Cash Financing Lease Payments Reconciliations (excluding the new lease standard impact) Consolidated ($ in 000s) Full Year 2019 Net income (loss) $ (268,492) Provision (benefit) for income taxes (2,2
Slide 32: Net Debt and Adjusted Net Debt Reconciliations
Non-GAAP Financial Measures (continued) Net Debt and Adjusted Net Debt Reconciliations Pro - Forma Amounts Attributable to the October 1, 2019 Announced Transactions Amounts Attributable to with Healthpeak Other Transactions Actual Amounts Net of Completed or Expected to Completed or Expected to Amo
Slide 33: Adjusted Free Cash Flow Reconciliation
Non-GAAP Financial Measures (continued) Adjusted Free Cash Flow Reconciliation Consolidated 2018 2019 ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q Q4 Full Year Net cash provided by (used in) operating activities $ 37,964 $ 60,620 $ 71,924 $ 33,453 $ 203,961 $ (5,009) $ 64,128 $ 69,211 $ 88,082 $ 216,4
Slide 34: Proportionate Share of Adjusted EBITDA of Unconsolidated Ventures
Non-GAAP Financial Measures (continued) Brookdale's Proportionate Share of Adjusted EBITDA of Unconsolidated Ventures (1) For purposes of this presentation, amounts for each line item represent the aggregate amounts of such line items for all the Company's unconsolidated ventures. ($ in 000s) 2018 2
Slide 35: Proportionate Share of Adjusted Free Cash Flow of Unconsolidated Ventures
Non-GAAP Financial Measures (continued) Brookdale's Proportionate Share of Adjusted Free Cash Flow of Unconsolidated Ventures (1) For purposes of this presentation, amounts for each line item represent the aggregate amounts of such line items for all the Company's unconsolidated ventures. ($ in 000s
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