Capital Senior Living(SNDA)2024-03-27 21:28Company Operations - As of December 31, 2023, the Company operated 71 senior housing communities across 18 states, with a total capacity of approximately 8,000 residents[200]. - Weighted average occupancy for the communities owned by the Company was 84.6% for the year ended December 31, 2023, compared to 83.0% in 2022, indicating a recovery in occupancy rates[220]. - The average monthly rental rate for owned communities increased by 9.6% for the year ended December 31, 2023, compared to the previous year[221]. Financial Performance - The Company generated resident revenue of approximately $232.0 million for the year ended December 31, 2023, an increase of approximately $23.3 million or 11.2% compared to $208.7 million in the prior year[219]. - Total revenues for 2023 were $255.3 million, compared to $238.4 million in 2022[243]. - The company reported a net loss of $21.1 million for 2023, significantly improved from a net loss of $54.4 million in 2022[255]. Expenses and Costs - Operating expenses increased to $177.3 million in 2023, up $5.7 million from 2022, with labor costs rising approximately $7.2 million[246]. - General and administrative expenses rose to $32.2 million, an increase of $1.9 million or 6.3% year-over-year[247]. - Labor costs accounted for approximately two-thirds of total operating expenses[269]. - Labor expenses in the community portfolio increased by approximately $7.2 million, or 6.9%, in 2023 compared to 2022[269]. - The increase in labor costs was driven by merit and market wage rate adjustments, higher occupancy, and increased use of premium labor[269]. Debt and Financing - The Company incurred restructuring costs of $0.7 million in the year ended December 31, 2023, related to the Fannie Mae loan modification[205]. - The Company has extended maturities on 18 community mortgages to December 2026, with no scheduled principal payments required until then[206]. - The Company is required to escrow 50% of Net Cash Flow less Debt Service for the first twelve months following the Loan Modification Agreements[206]. - The Company drew down $10.0 million from the Equity Commitment as of December 31, 2023, with $3.5 million remaining[204]. - The Company entered into a private placement transaction on February 1, 2024, selling 5,026,318 shares of common stock at a price of $9.50 per share, raising approximately $47.7 million[232][233]. - The Company plans to use proceeds from the private placement for capital expenditures, working capital, potential acquisitions, and other corporate purposes[234]. Impairments and Losses - The Company recognized a non-cash impairment charge of $6.0 million to its property and equipment during the year ended December 31, 2023[239]. - The company recorded a non-cash impairment charge of $6.0 million in 2023, compared to $1.6 million in 2022[249]. - The Company sold the Shaker Heights property for $1.0 million in August 2023, resulting in a loss of $0.2 million[224]. Grants and Relief Funds - The Company received approximately $9.1 million in grants from the Provider Relief Fund in the year ended December 31, 2022, to address COVID-19 related expenses[214]. - The Company incurred approximately $0.1 million and $0.4 million in direct costs related to COVID-19 for the years ended December 31, 2023 and 2022, respectively[213]. Market Conditions and Future Outlook - The company expects to continue facing inflationary pressures in 2024, impacting future revenues and operating results[268]. - The unemployment rate in the United States remained at or below 4.0% throughout 2023 and 2022, contributing to labor pressures[269]. - The company anticipates continued labor cost pressures in 2024 due to ongoing competitive labor conditions and expected increases in hours worked[269]. - The company may need to enhance pay and benefits packages to attract and retain employees amid competition and inflationary pressures[269].