Brookdale Senior Living Inc. · NYSE:BKD
Brookdale Senior Living — Q3 2020 Earnings Presentation
31 slides from Brookdale Senior Living's earnings presentation, Nov 4, 2020
Slide 1: Supplemental Information 3rd Quarter 2020
Exhibit 99.2 Supplemental Information 3rd Quarter 2020
Slide 2: Table of Contents
Table of Contents COVID-19 Financial Impact 4 Overview 5 Segment Overview 8 Senior Housing 9 Health Care Services 14 G&A Expense 15 Capital Expenditures 16 Cash Facility Lease Payments 17 Capital Structure 18 Definitions 19 Appendices: Pro-Forma Financial Information 22 2019 Lease Accounting Standar
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: COVID-19 Financial Impact
COVID-19 Financial Impact The COVID-19 pandemic adversely impacted the Company's occupancy and resident fee revenue during 2020 and resulted in incremental direct costs to prepare for and respond to the pandemic, including costs for: acquisition of additional personal protective equipment ("PPE"), m
Slide 5: Overview
Overview 3Q20 vs. YTD 3Q20 vs. 2019 2020 3Q19 YTD 3Q19 Better (B)/ ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q (Worse) (W) B/(W) Resident fee revenue (1) $ 809,479 $ 801,863 $ 801,237 $ 797,352 $ 3,209,931 $ 782,707 $ 731,629 $ 700,771 (12.5) % (8.2) % Management fee revenue $ 15,743 $ 15,449 $ 13,56
Slide 6: Adjusted EBITDA and Adjusted Free Cash Flow
Adjusted EBITDA and Adjusted Free Cash Flow 3Q20 vs. YTD 3Q20 vs. 2019 2020 3Q19 YTD 3Q19 ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q B(W) B(W) Resident fee revenue $ 809,479 $ 801,863 $ 801,237 $ 797,352 $ 3,209,931 $ 782,707 $ 731,629 $ 700,771 (12.5) % (8.2) % Management fee revenue 15,743 15,449
Slide 7: Adjusted EBITDA and Adjusted Free Cash Flow Distribution 3Q 2020
Adjusted EBITDA and Adjusted Free Cash Flow Distribution 3Q 2020 Senior Senior Housing Housing Owned Leased Health Care Management ($ in 000s) Total Portfolio Portfolio Services Services Other (1) Resident fee revenue $ 700,771 $ 356,105 $ 254,763 $ 89,903 $ — $ — Management fee revenue 5,669 — — —
Slide 8: Segment Overview
Segment Overview 3Q20 vs. YTD 3Q20 vs. 2019 2020 3Q19 YTD 3Q19 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q B(W) B(W) Total Senior Housing, Health Care Services, and Management Services Revenue (1) $ 825,222 $ 817,312 $ 814,801 $ 809,704 $ 3,267,039 $ 891,422 $ 737,705 $ 706,
Slide 9: Senior Housing Segments
Senior Housing Segments 3Q20 vs. YTD 3Q20 vs. 2019 2020 3Q19 YTD 3Q19 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q B(W) B(W) Independent Living Revenue $ 135,694 $ 135,951 $ 136,874 $ 136,039 $ 544,558 $ 135,862 $ 130,278 $ 125,762 (8.1) % (4.1) % Other operating income $ — $
Slide 10: Senior Housing: Same Community
Senior Housing: Same Community(1) 3Q20 vs. YTD 3Q20 vs. 2019 2020 3Q19 YTD 3Q19 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q B(W) B(W) Revenue $ 616,142 $ 611,202 $ 613,260 $ 613,935 $ 2,454,539 $ 628,468 $ 589,207 $ 565,881 (7.7) % (3.1) % Other operating income — — — — — —
Slide 11: Senior Housing Segments: Same Community
Senior Housing Segments: Same Community(1) 3Q20 vs. YTD 3Q20 vs. 2019 2020 3Q19 YTD 3Q19 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q B(W) B(W) Independent Living Revenue $ 126,822 $ 126,563 $ 126,823 $ 125,521 $ 505,729 $ 127,944 $ 122,716 $ 118,384 (6.7) % (2.9) % Other ope
Slide 12: Senior Housing Owned Portfolio
Senior Housing Owned Portfolio(1) 3Q20 vs. YTD 3Q20 vs. 2019 2020 3Q19 YTD 3Q19 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q B(W) B(W) Revenue $ 380,691 $ 375,900 $ 377,451 $ 373,793 $ 1,507,835 $ 402,397 $ 376,140 $ 356,105 (5.7) % 0.1 % Other operating income — — — — — — 7,
Slide 13: Senior Housing Leased Portfolio
Senior Housing Leased Portfolio(1) 3Q20 vs. YTD 3Q20 vs. 2019 2020 3Q19 YTD 3Q19 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q B(W) B(W) Revenue $ 317,256 $ 311,529 $ 312,001 $ 314,050 $1,254,836 $ 285,491 $ 265,319 $ 254,763 (18.3) % (14.4) % Other operating income — — — — —
Slide 14: Health Care Services
Health Care Services 3Q20 vs. YTD 3Q20 vs. 2019 2020 3Q19 YTD 3Q19 ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q B(W) B(W) Revenue Home health $ 84,185 $ 85,233 $ 80,632 $ 77,440 $ 327,490 $ 65,948 $ 60,935 $ 61,586 (23.6) % (24.6) % Hospice 21,722 23,184 25,258 26,062 96,226 23,182 23,849 22,997 (9.0)
Slide 15: G&A Expense
G&A Expense 3Q20 vs. YTD 3Q20 vs. Consolidated, unless otherwise noted 2019 2020 3Q19 YTD 3Q19 ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q B(W) B(W) G&A expense allocations (1) Senior Housing Owned Portfolio allocation $ 15,693 $ 16,875 $ 15,759 $ 13,553 $ 61,880 $ 18,635 $ 18,336 $ 17,804 (13.0) % (
Slide 16: Capital Expenditures
Capital Expenditures 3Q20 vs. YTD 3Q20 vs. 2019 2020 3Q19 YTD 3Q19 ($ in 000s, except for community level capital expenditures, net, per weighted average unit) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q B(W) B(W) Community level capital expenditures, including allocations Senior Housing Owned Portfolio $ 24,967
Slide 17: Cash Facility Lease Payments
Cash Facility Lease Payments 3Q20 vs. YTD 3Q20 vs. 2019 2020 3Q19 YTD 3Q19 ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q B(W) B(W) Operating Lease Obligations Facility lease expense $ 68,668 $ 67,689 $ 67,253 $ 66,056 $ 269,666 $ 64,481 $ 62,379 $ 51,620 Operating lease expense adjustment 4,383 4,429 4
Slide 18: Capital Structure
Capital Structure Total Liquidity Debt Structure(1) Debt (1)(2) ($ in millions) ($ in millions) ($ in millions) Maturity Weighted Rate Variable rate debt with 2020 $ 15 3.94 % $600 interest rate caps $600 2021 68 4.26 % $536 Fixed rate $481 $491 2022 348 3.58 % $455 debt $1,394 2023 231 3.52 % $400
Slide 19: Definitions
Definitions Adjusted EBITDA is a non-GAAP performance measure that the Company defines as Lease Coverage is calculated based on the trailing-twelve months Leased Portfolio net income (loss) excluding: benefit/provision for income taxes, non-operating income/ Operating Income, excluding resident fee
Slide 20: Definitions
Definitions RevPOR, or average monthly senior housing resident fee revenue per occupied unit, is Segment Operating Income (Loss) is defined by the Company as segment revenue defined by the Company as resident fee revenue for the corresponding portfolio for the and other operating income less segment
Slide 21: Appendices
Appendices Pro-Forma Financial Information 22 2019 Lease Accounting Standard (ASC 842) Impact 26 Non-GAAP Financial Measures 27 21
Slide 22: Pro-Forma Financial Information
Pro-Forma Financial Information During the period of October 1, 2019 to September 30, 2020, the Company: • acquired 27 formerly leased communities and financed the acquisitions with $263.0 million of non-recourse mortgage debt. • modified the terms of the amended and restated master lease with Healt
Slide 23: Pro-Forma Third Quarter 2020
Pro-Forma Third Quarter 2020 Amounts Attributable to Transactions Actual Results Amounts Actual Results Completed or Net of Amounts Attributable to Net of Amounts Expected to be Attributable to Transactions Attributable to Completed after Completed and 3Q20 Actual Completed Completed September 30, P
Slide 24: Pro-Forma Third Quarter 2020 YTD
Pro-Forma Third Quarter 2020 YTD Amounts Attributable to Amounts Transactions Actual Results Attributable to Actual Results Completed or Net of Amounts Transactions Net of Amounts Expected to be Attributable to Completed on Attributable to Completed after Completed and YTD 3Q20 Actual during YTD Com
Slide 25: Pro-Forma Trailing Twelve Months
Pro-Forma Trailing Twelve Months Amounts Amounts Attributable Less: Impact of Actual Results Attributable to Actual Results to Transactions Lease Standard Net of Amounts Trailing Twelve Transactions Net of Amounts Completed or Adopted on Attributable to the Months Ended Completed on Attributable to
Slide 26: 2019 Lease Accounting Standard (ASC 842) Impact
2019 Lease Accounting Standard (ASC 842) Impact The Company’s adoption of the 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
Slide 27: 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 28: Non-GAAP Financial Measures: Adjusted EBITDA Reconciliation
Non-GAAP Financial Measures (continued) Adjusted EBITDA Reconciliation Trailing Twelve 2019 2020 Months Ended ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q YTD September 30, 2020 Net income (loss) $ (42,606) $ (56,055) $ (78,508) $ (91,323) $ (268,492) $ 369,497 $ (118,420) $ (124,993) $ 126,084 $ 34,7
Slide 29: Non-GAAP Financial Measures: Adjusted EBITDAR Reconciliations
Non-GAAP Financial Measures (continued) Adjusted EBITDAR; Adjusted EBITDA; and Adjusted EBITDA after Cash Financing Lease Payments Reconciliations (1) Trailing Twelve Months Ended ($ in 000s) September 30, 2020 Net income (loss) $ 34,761 Provision (benefit) for income taxes 5,779 Equity in (earnings
Slide 30: Non-GAAP Financial Measures: Net Debt and Adjusted Net Debt
Non-GAAP Financial Measures (continued) Net Debt and Adjusted Net Debt Reconciliations ($ in 000s) As of September 30, 2020 Long-term debt (including current portion) $ 3,930,165 Cash and cash equivalents (354,621) Marketable securities (136,136) Cash held as collateral against existing debt (19,266
Slide 31: Non-GAAP Financial Measures: Adjusted Free Cash Flow Reconciliation
Non-GAAP Financial Measures (continued) Adjusted Free Cash Flow Reconciliation 2019 2020 Trailing Twelve Months Ended ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q YTD September 30, 2020 Net cash provided by (used in) operating activities $ (5,009) $ 64,128 $ 69,211 $ 88,082 $ 216,412 $ 57,479 $ 151,84
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