Core Insights - Brookdale Senior Living Inc. (BKD) reported a significant improvement in its weighted average occupancy, which rose by 230 basis points year over year to 80.5% in June 2025, reflecting strong move-ins and favorable move-out activity [1][8] - The consolidated occupancy at the end of June was 82.2%, an increase of 70 basis points sequentially, driven by sustained demand and effective sales execution [2] - The same community occupancy also showed positive trends, with a year-over-year increase of 220 basis points to 81.1% and a sequential rise of 50 basis points [2] Occupancy and Revenue Impact - The increase in occupancy rates indicates rising patient volumes, which is beneficial for Brookdale as its primary revenue source relies on the patient base [4] - Elevated occupancy levels are expected to enhance resident fee revenues, which constituted nearly 96% of the company's total revenues in the first quarter of 2025 [6] - Projected adjusted EBITDA for 2025 is estimated to be between $440 million and $450 million, supported by the anticipated growth in resident fees [6] Company Scale and Operations - As of June 30, 2025, Brookdale operated and managed 645 senior living communities across 41 U.S. states, with the capacity to serve approximately 58,000 residents [5][8] - The company's expansive scale, clinical expertise, and enhanced service offerings position it well to cater to the growing elderly population in the United States [5] Stock Performance - Year-to-date, Brookdale's shares have increased by 38.8%, significantly outperforming the industry average growth of 2.5% [7]

Core Viewpoint - Brookdale Senior Living Inc. is urging shareholders to vote for its nominated directors, emphasizing that the current board's strategy is effectively driving shareholder value and operational momentum [1][3][11]. Financial Performance - In June, Brookdale achieved an 81.1% same community weighted average occupancy, with a month-end occupancy of 82.8%, indicating strong demand and sales execution [2]. - The second quarter weighted average consolidated occupancy was 80.1%, marking a significant milestone for cash flow growth [2]. - Since 2022, Brookdale has renegotiated leases for approximately 250 communities and reduced the number of leased units by 19% since Q1 2021, with plans to decrease its community portfolio to less than 600 by year-end 2025 from over 1,000 in 2017 [7]. Board Composition and Strategy - Brookdale's board consists of eight highly qualified directors, seven of whom are independent, with an average tenure of less than four years, ensuring a mix of skills critical for the company's growth [5][4]. - The board is actively engaged in a CEO search process, supported by an independent search firm, to find a candidate with the necessary experience in senior living, healthcare, hospitality, and real estate [6]. Shareholder Engagement - The company has made efforts to engage with Ortelius Advisors to avoid a proxy contest, but Ortelius has not engaged constructively [10]. - Brookdale emphasizes the importance of every shareholder vote and urges them to disregard any opposing proxy cards from Ortelius [12][11]. Competitive Positioning - Brookdale's operational improvements and strategic initiatives have positioned it to outperform peers in key metrics such as consolidated RevPAR, operating income per available unit, and adjusted EBITDA margin compared to 2019 [7]. - The company highlights that Ortelius lacks understanding of its business model and has proposed a flawed plan that could jeopardize Brookdale's progress [3][8].

Company Overview - Brookdale Senior Living Inc. is the leading operator of senior living communities in the U.S., with 645 communities across 41 states, serving approximately 58,000 residents as of June 30, 2025 [1] - The company offers various living options including independent living, assisted living, memory care, and continuing care retirement communities, focusing on empowering seniors to live with dignity and purpose [1] - Brookdale emphasizes its commitment to compassionate care, clinical expertise, and exceptional service, guided by its core values of passion, courage, partnership, and trust [1] Occupancy Results - The weighted average occupancy for June was 80.5%, reflecting a year-over-year increase of 230 basis points and a sequential increase of 50 basis points, indicating strong demand and sales execution [3] - Month-end consolidated occupancy reached 82.2%, up 70 basis points sequentially, showcasing continued occupancy acceleration driven by higher move-ins and favorable move-out activity [3] - For the same community occupancy in June, the weighted average was 81.1%, which increased by 220 basis points year-over-year and 50 basis points sequentially [3] - The second quarter weighted average consolidated occupancy was 80.1%, marking a 200 basis points increase year-over-year and an 80 basis points increase compared to the first quarter of 2025 [3]

Core Viewpoint - Brookdale Senior Living Inc. urges shareholders to vote "FOR" all eight of its director nominees, opposing Ortelius Advisors' attempt to gain control of the Board, which is supported by proxy advisory firms Glass Lewis and ISS [1][3][8] Group 1: Proxy Advisory Firms' Recommendations - Glass Lewis and ISS recommend against granting control of the Board to Ortelius, citing Ortelius' poor engagement record and lack of operational knowledge about Brookdale [2][3] - ISS highlighted that Ortelius has not provided sufficient details for shareholders to assess its plans for the company [3] Group 2: Brookdale's Board Composition and Strategy - Brookdale's Board emphasizes that its current composition is well-suited to oversee the company's operations, with a mix of fresh perspectives and institutional knowledge [4][8] - The Board argues that electing Ortelius' nominees would risk compromising the execution of Brookdale's strategy and impair the ongoing CEO search [8] Group 3: Performance Metrics and Financial Health - Brookdale reported an 80% same community weighted average occupancy in Q1 2025, a significant milestone towards positive cash flow generation [7] - The company is recognized for its efforts to optimize its real estate portfolio, which has been acknowledged by Glass Lewis [6][7] Group 4: Shareholder Engagement and Voting Instructions - Brookdale reminds shareholders to disregard any white proxy card from Ortelius and emphasizes the importance of voting using the BLUE proxy card [9][10] - The company encourages shareholders to vote electronically or return the BLUE proxy card promptly [10]

Core Viewpoint - Brookdale Senior Living Inc. supports the recommendation from Institutional Shareholder Services (ISS) against granting control of the Board of Directors to Ortelius, emphasizing the lack of a clear performance assessment and feasibility details in Ortelius' plan [1][2]. Group 1: Board Composition and Expertise - Brookdale urges shareholders to vote for all eight of its highly qualified director nominees, highlighting the critical skillsets of directors Lee Wielansky and Victoria Freed, which are essential for the company's strategic direction and operational efficiency [1][2][10]. - The company argues that replacing Wielansky or Freed with Ortelius' nominees would deprive the Board of necessary expertise and institutional knowledge, potentially impairing the recruitment of a new CEO and jeopardizing shareholder value [2][9]. - Wielansky's extensive operational experience in real estate and his leadership in optimizing Brookdale's portfolio are presented as vital for the company's ongoing strategy [4][6]. Group 2: Critique of Ortelius' Candidates - Ortelius candidate Lori Wittman has limited experience in senior living, primarily focused on financial management in REITs, which does not align with Brookdale's operational needs [3]. - Ortelius candidate Steven Vick has not held significant leadership roles in over two decades, raising concerns about his qualifications and experience relevant to Brookdale's scale and operations [7]. - The company emphasizes that the current Board's composition, including experienced directors, is crucial for effective oversight and support during a pivotal time for the company [9]. Group 3: Strategic Direction and Shareholder Value - Brookdale's Board has intentionally refreshed its composition to balance tenure and skillsets, ensuring that the company can effectively navigate its strategic priorities and enhance shareholder value [10][11]. - The company asserts that its eight director nominees collectively possess the right mix of expertise necessary for continued financial and operational performance [10].

Core Viewpoint - Brookdale Senior Living Inc. emphasizes the importance of its refreshed Board of Directors and management team in driving the company's success and urges shareholders to support its nominees against Ortelius' attempt to take control, which could disrupt operational progress and the ongoing CEO search [1][2][3]. Group 1: Board and Management - The Brookdale Board and management have a proven track record in optimizing the company's real estate portfolio and enhancing operational performance [2]. - The Board has streamlined operations, simplified the business, rationalized the lease portfolio, and reduced leverage, with a 19% reduction in leased units since Q1 2021 [2]. - The Board consists of eight highly qualified directors with diverse skills relevant to Brookdale's strategy, including healthcare, finance, hospitality, and senior living experience [2][8]. Group 2: Financial Performance - Brookdale's Adjusted EBITDA Margin improved to over 11% in 2023 and 12% in 2024, with expectations of being Adjusted Free Cash Flow positive in 2025, ranging from $30 million to $50 million [2]. - In Q1 2025, Adjusted EBITDA increased by 27.2% year-over-year, approximately 255% higher than Q1 2021, with a $7.5 million increase in the midpoint of Adjusted EBITDA guidance [2]. - The company's Trailing Twelve Months Adjusted EBITDA after cash financing lease payments more than doubled since 2022, achieving a 10x reduction in Annualized Leverage since pandemic highs [2]. Group 3: Shareholder Engagement - Brookdale strongly urges shareholders to vote "FOR" only its eight director nominees on the BLUE proxy card, emphasizing the importance of their vote regardless of the number of shares owned [3][4]. - The company has been open to shareholder recommendations for director candidates, appointing three since 2015 [2].

Company Overview - Brookdale Senior Living Inc. is the leading operator of senior living communities in the United States, with 647 communities across 41 states and the capacity to serve approximately 58,000 residents as of March 31, 2025 [1] - The company offers a range of living options including independent living, assisted living, memory care, and continuing care retirement communities, focusing on empowering seniors to live with dignity and purpose [1] - Brookdale emphasizes its commitment to compassionate care, clinical expertise, and exceptional service, guided by its core values of passion, courage, partnership, and trust [1] Occupancy Performance - In May, the consolidated weighted average occupancy increased by 190 basis points year-over-year and 20 basis points sequentially to reach 80.0%, marking a significant milestone for the portfolio [3] - The same community weighted average occupancy for May was 80.6%, also reflecting a sequential increase of 20 basis points compared to April [3] - The month-end occupancy for same communities grew by 50 basis points sequentially to 82.1%, representing the highest month-end sequential increase in the last nine months [3] - For the second quarter to date, the consolidated weighted average occupancy stands at 79.9%, which is a 60 basis point sequential increase from the first quarter [3] - The month-end occupancy growth in May 2025 accelerated to 50 basis points sequentially from April, compared to a 30 basis point increase in the same period last year [3]

Core Viewpoint - Brookdale Senior Living Inc. is urging shareholders to vote for its eight highly qualified director nominees on the BLUE proxy card, emphasizing the lack of relevant experience among the nominees proposed by Ortelius Advisors, L.P. [1][2][4] Group 1: Board Composition and Strategy - Brookdale's Board is described as refreshed and well-rounded, consisting of eight highly qualified nominees with expertise necessary for positive financial and operational performance [2][6] - The Board has added four new directors in the past year, enhancing its composition with strong backgrounds in real estate, healthcare, operations, and senior housing [6][12] - The current Board is committed to executing a clear strategy, including the search for a new CEO, and believes that replacing any directors at this time would impair the company's success [4][5] Group 2: Comparison with Ortelius Nominees - Ortelius is attempting to take control of the Board with nominees who lack relevant experience in critical areas such as healthcare and hospitality, which are essential for Brookdale's operations [4][13] - The Brookdale Board argues that electing Ortelius' nominees would undermine the progress made and put shareholder investments at risk [4][18] - Brookdale's nominees possess a diverse range of skills, including healthcare leadership, financial expertise, and operational experience, which are deemed superior to those of Ortelius' candidates [12][18] Group 3: Financial Performance - Brookdale reported positive adjusted free cash flow and adjusted EBITDA that exceeded internal expectations in the first quarter of 2025, indicating successful execution of key initiatives [20][23] - The company achieved an 80% same community weighted average occupancy, a 4.9% growth in consolidated RevPAR year-over-year, and a 90 basis points expansion in same community operating income margin year-over-year [23][24] - Brookdale's performance metrics have outperformed those of its peers, including Sonida Senior Living, Inc., in key areas [21][24] Group 4: Governance Practices - The Board emphasizes its commitment to best practices in corporate governance, including annual elections of all directors and policies against hedging and pledging of securities [7][8] - Governance enhancements are actively being reviewed, including director tenure and performance-based long-term incentive awards [8][19] - The Board's structure includes fully independent standing committees and a majority vote standard for non-contested elections, ensuring accountability to shareholders [7][8]

Core Viewpoint - Brookdale Senior Living Inc. (BKD) reported a first-quarter loss and experienced a decline in share price despite some revenue growth, primarily due to rising operational costs and decreased interest income [1][2]. Financial Performance - BKD incurred a first-quarter loss of 11 cents per share, which is an improvement from a loss of 13 cents in the prior year [2]. - Total revenues increased by 4% year over year to $813.9 million, driven by higher resident and management fee revenues, but fell short of the Zacks Consensus Estimate by 0.8% [2]. - Resident fees reached $777.5 million, up 4.5% year over year, but were below the consensus estimate of $781.3 million [3]. - Management fees rose slightly by 0.1% year over year to $2.6 million, missing the consensus mark of $2.7 million [3]. Operational Metrics - Revenue per occupied unit (RevPOR) increased by 3% year over year, attributed to annual rate increases [4]. - Weighted average occupancy improved by 140 basis points year over year to 79.3% [4]. - Revenue per available unit (RevPAR) saw a 4.9% year-over-year increase [4]. Cost Structure - Facility operating expenses totaled $557 million, reflecting a 2.7% year-over-year increase due to higher wage rates and utility costs [4]. - General and administrative costs rose by 4.7% year over year to $47.9 million [4]. - Interest income decreased by 23.7% year over year to $3.6 million [5]. Net Loss and Cash Flow - The net loss for the quarter was $65 million, wider than the previous year's loss of $29.6 million, primarily due to increased operating and interest expenses [5]. - Adjusted EBITDA rose by 27.2% year over year to $124.1 million [5]. - BKD generated $23.4 million of net cash from operations, a significant improvement from a net cash usage of $1.1 million in the prior year [7]. - Adjusted free cash inflow was $3.8 million, compared to an outflow of $26.3 million in the previous year [7]. Balance Sheet Overview - As of March 31, 2025, BKD had cash and cash equivalents of $239.7 million, down from $308.9 million at the end of 2024 [5]. - Total assets decreased to $6.2 billion from $6.3 billion at the end of 2024 [6]. - Long-term debt increased to $4.2 billion from $4 billion as of December 31, 2024 [6]. - Total equity dropped to $148.1 million from $213.9 million at the end of 2024 [6]. Future Outlook - Management now estimates RevPAR growth for 2025 in the range of 5%-5.75%, an increase from the previous estimate of 4.75%-5.75% [8]. - Adjusted EBITDA is projected to be between $440-$450 million, up from the earlier range of $430-$445 million [8]. - Non-development capital expenditures are expected to remain within $175-$180 million for 2025 [8].

Brookdale Senior Living (BKD) 2025 Conference Summary Company Overview - **Company**: Brookdale Senior Living (BKD) - **Event**: 2025 Conference held on May 20, 2025 Key Industry Insights - **Occupancy Trends**: - Significant momentum in occupancy growth observed in Q1 2025, surpassing typical seasonal trends [3][4] - Year-over-year move-ins increased by 3% compared to the prior year and 12% over historical averages [5] - Move-outs decreased by 3% year-over-year, contributing positively to occupancy [5] - Same-store occupancy remained flat at 80%, which is crucial for covering fixed costs [6] - **Market Positioning**: - The company is experiencing a favorable demographic tailwind, with constraints on new supply in the senior housing market [35] - Brookdale's strategy focuses on addressing clinical challenges and enhancing resident quality of life through programs like Health Plus [36] Financial Performance - **Cash Flow and Occupancy**: - Adjusted free cash flow was positive in Q1 2025, attributed to reaching the 80% occupancy milestone [6] - The company aims to reduce leverage, targeting a low nine times leverage ratio by the end of the year [41] - **Portfolio Optimization**: - Plans to exit 55 non-core Ventas communities and an additional 14 assets by the end of 2025 [15][21] - The strategy includes evaluating community performance and potentially disposing of underperforming assets [16][17] Strategic Initiatives - **Health Plus Program**: - Aimed at providing holistic care through technology-enabled coordination, showing better occupancy growth and lower associate turnover in participating communities [25][26][27] - Rollout to 58 additional communities planned for the latter half of 2025 [26] - **Marketing Strategy**: - Shifted focus to internal marketing due to disruptions in third-party lead sources, resulting in improved move-ins [10][38] - Enhanced digital and direct mail marketing efforts to attract potential residents [38] Management and Leadership - **CEO Transition**: - The company is undergoing a CEO search, with a focus on finding a candidate with operational improvement skills and strategic vision [32][34] - The board emphasizes continuity in the company's long-term strategy despite management changes [32] Macro Environment Considerations - **Economic Factors**: - Cautious outlook on macroeconomic conditions, particularly regarding labor costs, which constitute 65% of total costs [44] - The company benefits from being 94% private pay, insulating it from government funding fluctuations [46][47] Conclusion - Brookdale Senior Living is positioned for growth with a strong focus on occupancy improvement, strategic asset management, and innovative care programs. The company is navigating a transitional phase in leadership while maintaining a commitment to enhancing resident care and operational efficiency.