Brookdale Senior Living Inc. · NYSE:BKD
Brookdale Senior Living — Q2 2020 Earnings Presentation
31 slides from Brookdale Senior Living's earnings presentation, Aug 10, 2020
Slide 1: Supplemental Information 2nd Quarter 2020
Exhibit 99.2 Supplemental Information 2nd 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 and the Company's response efforts adversely impacted the Company's occupancy and resident fee revenue during the first half of 2020 and resulted in incremental direct costs to prepare for and respond to the pandemic, including costs for acquisition of
Slide 5: Overview
Overview 2Q20 vs. YTD 2Q20 vs. 2019 2020 2Q19 YTD 2Q19 Better (B)/ ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q (Worse) (W) B/(W) Resident fee revenue (1) $ 809,479 $ 801,863 $ 801,237 $ 797,352 $3,209,931 $ 782,707 $ 731,629 (8.8)% (6.0)% Management fee revenue $ 15,743 $ 15,449 $ 13,564 $ 12,352 $ 57,1
Slide 6: Adjusted EBITDA and Adjusted Free Cash Flow
Adjusted EBITDA and Adjusted Free Cash Flow 2Q20 vs. YTD 2Q20 vs. 2019 2020 2Q19 YTD 2Q19 ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q B(W) B(W) Resident fee revenue $ 809,479 $ 801,863 $ 801,237 $ 797,352 $3,209,931 $ 782,707 $ 731,629 (8.8)% (6.0)% Management fee revenue 15,743 15,449 13,564 12,352 57,
Slide 7: Adjusted EBITDA and Adjusted Free Cash Flow Distribution 2Q 2020
Adjusted EBITDA and Adjusted Free Cash Flow Distribution 2Q 2020 Senior Senior Housing Housing Owned Leased Health Care Management ($ in 000s) Total Portfolio Portfolio Services Services Other (1) Resident fee revenue $ 731,629 $ 376,140 $ 265,319 $ 90,170 $ — $ — Management fee revenue 6,076 — — —
Slide 8: Segment Overview
Segment Overview 2Q20 vs. YTD 2Q20 vs. 2019 2020 2Q19 YTD 2Q19 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 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 $737,705 (9.7)% (0.8)% Ot
Slide 9: Senior Housing Segments
Senior Housing Segments 2Q20 vs. YTD 2Q20 vs. 2019 2020 2Q19 YTD 2Q19 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q B(W) B(W) Independent Living Revenue $135,694 $135,951 $136,874 $136,039 $ 544,558 $135,862 $130,278 (4.2)% (2.0)% Other operating income $ — $ — $ — $ — $ — $ — $
Slide 10: Senior Housing: Same Community
Senior Housing: Same Community(1) 2Q20 vs. YTD 2Q20 vs. 2019 2020 2Q19 YTD 2Q19 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q B(W) B(W) Revenue $ 624,119 $ 619,285 $ 621,493 $ 622,064 $2,486,961 $ 637,054 $ 597,511 (3.5) % (0.7) % Other operating income — — — — — — 6,445 NM NM Re
Slide 11: Senior Housing Segments: Same Community
Senior Housing Segments: Same Community(1) 2Q20 vs. YTD 2Q20 vs. 2019 2020 2Q19 YTD 2Q19 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q B(W) B(W) Independent Living Revenue $126,822 $126,563 $126,823 $125,521 $ 505,729 $127,943 $122,716 (3.0 )% (1.1 )% Other operating income — — —
Slide 12: Senior Housing Owned Portfolio
Senior Housing Owned Portfolio(1) 2Q20 vs. YTD 2Q20 vs. 2019 2020 2Q19 YTD 2Q19 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q B(W) B(W) Revenue $ 380,691 $ 375,900 $ 377,451 $ 373,793 $1,507,835 $ 402,397 $ 376,140 0.1 % 2.9 % Other operating income — — — — — — 7,156 NM NM Facili
Slide 13: Senior Housing Leased Portfolio
Senior Housing Leased Portfolio(1) 2Q20 vs. YTD 2Q20 vs. 2019 2020 2Q19 YTD 2Q19 ($ in 000s, except RevPAR and RevPOR) 1Q 2Q 3Q 4Q Full Year 1Q 2Q B(W) B(W) Revenue $ 317,256 $ 311,529 $ 312,001 $ 314,050 $1,254,836 $ 285,491 $ 265,319 (14.8)% (12.4)% Other operating income — — — — — — 2,542 NM NM F
Slide 14: Health Care Services
Health Care Services 2Q20 vs. YTD 2Q20 vs. 2019 2020 2Q19 YTD 2Q19 ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q B(W) B(W) Revenue Home health $ 84,185 $ 85,233 $ 80,632 $ 77,440 $ 327,490 $ 65,948 $ 60,935 (28.5)% (25.1)% Hospice 21,722 23,184 25,258 26,062 96,226 23,182 23,849 2.9 % 4.7 % Outpatient The
Slide 15: G&A Expense
G&A Expense 2Q20 vs. YTD 2Q20 vs. Consolidated, unless otherwise noted 2019 2020 2Q19 YTD 2Q19 ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 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 (8.7)% (13.5)% Senior
Slide 16: Capital Expenditures
Capital Expenditures 2Q20 vs. YTD 2Q20 vs. 2019 2020 2Q19 YTD 2Q19 ($ in 000s, except for community level capital expenditures, net, per weighted average unit) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 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 2Q20 vs. YTD 2Q20 vs. 2019 2020 2Q19 YTD 2Q19 ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q B(W) B(W) Operating Lease Obligations Facility lease expense $ 68,668 $ 67,689 $ 67,253 $ 66,056 $ 269,666 $ 64,481 $ 62,379 Operating lease expense adjustment 4,383 4,429 4,814 5,827 1
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 $ 36 4.16% interest rate caps $600 2021 332 5.90% $600 $536 Fixed rate 2022 349 3.58% $479 $481 $455 debt $1,261 2023 230 3.53% ) s n $
Slide 19: Definitions
Definitions Adjusted EBITDA is a non-GAAP performance measure that the Company defines as net Lease Coverage is calculated based on the trailing-twelve months Leased Portfolio 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 and defined by the Company as resident fee revenue for the corresponding portfolio for the other operating income less segment
Slide 21: Appendices
Appendices Pro-Forma Financial Information 22 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 July 1, 2019 to June 30, 2020, the Company acquired 26 formerly leased communities and financed the acquisitions with $251.9 million of non-recourse mortgage debt, modified the terms of the amended and restated master lease with Healthpeak, sold i
Slide 23: Pro-Forma Second Quarter 2020
Pro-Forma Second Quarter 2020 Amounts Attributable to Actual Results Amounts Actual Results Transactions Net of Amounts Attributable to Net of Amounts Completed or Attributable to Transactions Attributable to Expected to be Completed and 2Q20 Actual Completed Completed Completed after Pending Consol
Slide 24: Pro-Forma Second Quarter 2020 YTD
Pro-Forma Second Quarter 2020 YTD Amounts Amounts Attributable to Actual Results Attributable to Actual Results Transactions Net of Amounts Transactions Net of Amounts Completed or Attributable to Completed on Attributable to Expected to be Completed and YTD 2Q20 during YTD Completed Completed after
Slide 25: Pro-Forma Trailing Twelve Months
Pro-Forma Trailing Twelve Months Amounts Amounts Attributable to Less: Impact of Actual Results Attributable to Actual Results 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 2019 2020 Trailing Twelve Months Ended ($ in 000s) 1Q 2Q 3Q 4Q Full Year 1Q 2Q YTD June 30, 2020 Net income (loss) $ (42,606) $ (56,055) $ (78,508) $ (91,323) $(268,492) $369,497 $(118,420) $ 251,077 $ 81,246 Provision (benefit)
Slide 29: Adjusted EBITDAR and Adjusted EBITDA 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) June 30, 2020 Net income (loss) $ 81,246 Provision (benefit) for income taxes (10,905) Equity in (earnings)
Slide 30: Net Debt and Adjusted Net Debt Reconciliations
Non-GAAP Financial Measures (continued) Net Debt and Adjusted Net Debt Reconciliations ($ in 000s) As of June 30, 2020 Long-term debt (including current portion) $ 3,692,365 Line of credit 166,381 Cash and cash equivalents (452,441) Marketable securities (109,873) Cash held as collateral against exi
Slide 31: 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 YTD June 30, 2020 Net cash provided by (used in) operating activities $ (5,009) $ 64,128 $ 69,211 $ 88,082 $216,412 $ 57,479 $ 151,840 $ 209,3
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