Company Operations - As of March 31, 2025, the company operates 647 senior living communities across 41 states, serving approximately 58,000 residents[94]. Financial Performance - The company reported a net loss of $65.0 million for the three months ended March 31, 2025, an increase of $35.4 million, or 119.7%, compared to the net loss of $29.6 million in the same period in 2024[103]. - Adjusted EBITDA for the three months ended March 31, 2025, was $124.1 million, reflecting an increase of $26.5 million, or 27.2%, compared to $97.6 million in the same period in 2024[103]. - Resident fees for the three months ended March 31, 2025, increased by $33.2 million, or 4.5%, compared to the same period in 2024, driven by a 2.8% increase in same community RevPOR and a 130 basis point increase in same community weighted average occupancy[103]. - Resident fees increased by 4.5% to $777,454,000 in Q1 2025 from $744,241,000 in Q1 2024[109]. - Facility operating expenses rose by 2.7% to $556,987,000 in Q1 2025 compared to $542,550,000 in Q1 2024[109]. - The increase in net loss was attributed to the loss on extinguishment of financing obligations, increased facility operating expenses, and higher interest expenses, despite the rise in resident fees[106]. Segment Performance - In the Independent Living segment, resident fees grew by 5.5% to $157,117,000 in Q1 2025 from $148,948,000 in Q1 2024[111]. - Assisted Living and Memory Care segment resident fees increased by 4.4% to $533,379,000 in Q1 2025 compared to $510,872,000 in Q1 2024[114]. - CCRC segment resident fees rose by 3.0% to $86,958,000 in Q1 2025 from $84,421,000 in Q1 2024[118]. Expenses and Costs - Facility operating expenses rose by $14.4 million, or 2.7%, primarily due to a 3.2% increase in same community facility operating expenses, influenced by wage rate increases and higher utilities costs[104]. - General and administrative expenses increased by 4.7% to $47,874,000 in Q1 2025 from $45,732,000 in Q1 2024[121]. - Interest expense increased by 12.7% to $65,031,000 in Q1 2025 compared to $57,687,000 in Q1 2024[121]. Cash Flow and Liquidity - The company reported a net cash provided by operating activities of $23.4 million for the three months ended March 31, 2025, compared to a net cash used of $1.1 million in the same period of 2024, representing an increase of $24.5 million[130]. - The company experienced a significant increase in net cash used in investing activities, totaling $(326.8) million, primarily due to $311.0 million paid for the acquisition of formerly leased communities[131]. - The company had total liquidity of $306.0 million as of March 31, 2025, which included $239.7 million of unrestricted cash and cash equivalents, a decrease of $83.3 million from $389.3 million as of December 31, 2024[137]. - As of March 31, 2025, the company’s current liabilities exceeded current assets by $101.7 million, indicating potential liquidity challenges[138]. Debt and Financing - As of March 31, 2025, the company had $4.3 billion of debt outstanding at a weighted average interest rate of 5.21%, with 87.7% of total debt representing non-recourse property-level mortgage financings[135]. - The company had $3.1 billion of long-term debt with a weighted average fixed interest rate of 4.59% as of March 31, 2025[168]. - The company also had $1.2 billion of long-term variable rate debt with a weighted average interest rate of 6.78% as of March 31, 2025[168]. - The company completed the refinancing of all mortgage debt maturities due in 2025, but faces potential challenges in obtaining refinancing for 2026 and later maturities[140]. - The company is in compliance with the financial covenants of its debt agreements and long-term leases as of March 31, 2025[156]. Future Expectations - The company expects organizational restructuring costs related to recent senior leadership changes to be approximately $5,000,000 in Q2 2025[122]. - The company expects its full-year 2025 non-development capital expenditures to be between $175.0 million and $180.0 million, funded from cash on hand, cash equivalents, and cash flows from operations[145]. - The company anticipates an annual interest expense increase of $3.6 million for a 100 basis point increase in SOFR as of March 31, 2025[171]. Tax and Deferred Benefits - The company recorded an aggregate deferred tax benefit of $15.9 million for the three months ended March 31, 2025, partially offset by a $14.7 million increase in the valuation allowance[126].

Financial Data and Key Metrics Changes - Brookdale Senior Living reported a consolidated RevPAR growth of 4.9% in Q1 2025, driven by an increase in weighted average occupancy [24] - Adjusted EBITDA for Q1 2025 was $124 million, representing a 27% increase year-over-year, exceeding internal expectations and analyst consensus [30] - Adjusted free cash flow turned positive at $4 million, a significant improvement from the previous year [30] Business Line Data and Key Metrics Changes - Same community RevPAR increased by 4.5% year-over-year, with a 130 basis point occupancy growth [26] - Same community operating income margin expanded by 90 basis points to 29%, the highest margin achievement in five years [28] - Labor expenses as a percentage of revenue improved by 90 basis points compared to the prior year [27] Market Data and Key Metrics Changes - First quarter move-ins were 3% above the prior year and 12% above the historic average, contributing to a weighted average occupancy increase of 140 basis points to 79.3% [24] - The company expects to exit another 55 leased communities and divest 14 non-core owned communities by year-end 2025 [17] Company Strategy and Development Direction - The company is focused on improving operating performance, optimizing its real estate portfolio, and reducing leverage to enhance shareholder value [12] - A leadership transition is underway, with a search for a new CEO aimed at driving operational improvements and strategic vision for the future [8][9] - The company plans to expand its health plus offering to 58 additional communities in 2025 to improve resident quality of life [15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong start to 2025, raising annual guidance for both RevPAR and adjusted EBITDA [7][36] - The company acknowledges macroeconomic uncertainties but remains confident in its strategic plans and operational improvements [90][94] - Management is focused on addressing communities with occupancy below 70% and has implemented a SWAT team approach to drive improvements [35] Other Important Information - The board has appointed two new independent directors to enhance expertise and perspectives [10] - The company is actively evaluating additional disposition opportunities to unlock value from owned assets [82] Q&A Session Summary Question: Can you provide more details on your pricing strategy? - Management indicated that pricing promotions are being piloted in targeted areas to increase occupancy while maintaining rate discipline [44][46] Question: How should we think about the seasonality of margins throughout the year? - Management noted that Q1 typically has the highest margin due to fewer workdays, and they expect a headwind of approximately $10 million in adjusted EBITDA between Q1 and Q2 due to seasonal factors [55][39] Question: What initiatives are contributing to better occupancy results? - Management highlighted the ongoing SWAT team initiatives and targeted pricing strategies as key contributors to improved occupancy [64][66] Question: What is the board looking for in the new CEO? - The board is prioritizing candidates with operational expertise and strategic vision to propel Brookdale into the future [86] Question: Is the guidance raised due to Q1 outperformance? - Yes, the guidance was raised based on Q1 outperformance, particularly in occupancy and expense management [90]

Financial Data and Key Metrics Changes - Brookdale Senior Living reported a consolidated RevPAR growth of 4.9% in Q1 2025, driven by an increase in weighted average occupancy [25][32] - Adjusted EBITDA for Q1 2025 was $124 million, representing a 27% increase year-over-year, exceeding internal expectations and analyst consensus [32] - Adjusted free cash flow turned positive at $4 million, a significant improvement from the previous year [32][33] Business Line Data and Key Metrics Changes - Same community RevPAR increased by 4.5% year-over-year, with a weighted average occupancy of 80% [28] - Same community expense per occupied unit rose by only 1.6%, indicating effective cost management relative to revenue growth [29] - Operating income margin for same communities expanded by 90 basis points to 29%, the highest in five years [30] Market Data and Key Metrics Changes - The company experienced a 3% increase in move-ins compared to the prior year, significantly above historical averages [25] - The weighted average occupancy increased by 140 basis points to 79.3% in Q1 2025, reflecting positive market dynamics [25] Company Strategy and Development Direction - The company is focused on improving operational performance, optimizing its real estate portfolio, and reducing leverage to enhance shareholder value [13][19] - A leadership transition is underway, with the board seeking a new CEO to drive operational improvements and strategic vision [9][10] - The company plans to exit 55 leased communities and divest 14 non-core owned communities by year-end 2025, aiming for 75% of its portfolio to be owned [16][18] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong start to 2025, raising annual guidance for RevPAR and adjusted EBITDA [24][39] - The company acknowledged macroeconomic uncertainties but remains confident in its strategic plans and operational improvements [95][99] - Management highlighted the importance of maintaining pricing power while balancing occupancy growth [62] Other Important Information - The company has appointed two new independent directors to enhance board expertise and oversight [12] - A focus on enhancing the quality of living environments for residents has led to multiple recognitions, including being named a "most loved workplace" by Newsweek [22] Q&A Session Summary Question: Can you elaborate on your pricing strategy? - Management indicated that pricing promotions are being piloted to boost occupancy while maintaining rate discipline [47][49] Question: What is the timeline for the impact of the First Impressions investment initiatives? - Management stated that targeted investments are expected to positively influence occupancy and rates, with budgeting for 2026 to begin later in the year [52][53] Question: How should we think about the seasonality of margins throughout the year? - Management explained that Q1 typically has the highest margins due to fewer workdays, with expected headwinds in Q2 from merit increases and additional workdays [58][60] Question: What initiatives are already contributing to better occupancy results? - Management noted that the SWAT teams and dynamic pricing strategies have been effective in improving occupancy [68][70] Question: What is the board prioritizing in the CEO search? - The board is looking for candidates with operational expertise and strategic vision to propel the company forward [90][91]

Group 1 - Brookdale Senior Living reported a quarterly loss of $0.11 per share, which is an improvement from a loss of $0.13 per share a year ago, aligning with the Zacks Consensus Estimate [1] - The company's revenues for the quarter ended March 2025 were $813.86 million, missing the Zacks Consensus Estimate by 0.81%, but showing an increase from $782.83 million year-over-year [2] - Over the last four quarters, Brookdale has consistently failed to surpass consensus EPS and revenue estimates [2] Group 2 - Brookdale shares have increased approximately 31.8% since the beginning of the year, contrasting with a decline of 3.9% in the S&P 500 [3] - The company's earnings outlook is crucial for assessing future stock performance, with current consensus EPS estimates at -$0.13 for the coming quarter and -$0.55 for the current fiscal year [4][7] - The Medical - Nursing Homes industry, to which Brookdale belongs, is currently ranked in the top 9% of over 250 Zacks industries, indicating a favorable industry outlook [8]

Company Overview - Brookdale operates 647 senior living communities across 41 states[8] - The company has the ability to serve approximately 58,000 residents[6] - 94% of senior living resident fees are private pay[8] - The company has approximately 36,000 caring and dedicated associates[8] Financial Performance and Guidance - First quarter Adjusted EBITDA increased by 27% year-over-year[35] - First quarter Adjusted Free Cash Flow improved by $30 million year-over-year and was positive[35] - The company positively revised its 2025 Adjusted EBITDA guidance to $440 to $450 million[38] - The company expects 2025 Adjusted Free Cash Flow to be $30 to $50 million[38] Occupancy and Revenue - First quarter consolidated weighted average occupancy grew by 140 bps over the prior year[35] - Move-ins increased by 12% and move-outs decreased by 3% compared to historical averages[35] - Returning to pre-pandemic occupancy of 84.5% would drive at least $200 million of incremental revenue[52] - Achieving the historic occupancy high of 89% would drive at least $380 million of incremental revenue[52]

Financial Performance - The financial results for the quarter ended March 31, 2025, will include key performance metrics that reflect the company's operational efficiency[8] - The company is committed to transparency in its financial disclosures, ensuring stakeholders are informed of its performance[9] Occupancy and Market Trends - Brookdale Senior Living Inc. announced its consolidated occupancy for March 2025, with specific figures to be detailed in the press release[8] - The press release dated April 8, 2025, will provide insights into user data and occupancy trends, which are critical for assessing market demand[8] Strategic Outlook - Future outlook and performance guidance will be discussed, indicating the company's strategic direction and expected growth[8] - Market expansion strategies are likely to be outlined, focusing on increasing the company's footprint in key regions[8] - Potential mergers and acquisitions may be explored as part of the company's growth strategy, aiming to enhance market position[8] - Other new strategies will be highlighted, reflecting the company's adaptability to changing market conditions[8] Product and Technology Development - New product and technology developments are anticipated, which may enhance service offerings and operational capabilities[8] Leadership Insights - The executive team, led by CFO Dawn L. Kussow, will provide further insights during the earnings call[14]

Core Insights - Brookdale Senior Living Inc. reported solid first quarter results for 2025, indicating significant momentum in meeting the needs of the aging population and positioning for accelerated growth [3][4][6] - The company raised its annual guidance for RevPAR and Adjusted EBITDA, reflecting an improved outlook for 2025 [14][18] Financial Performance - Resident fees increased to $777.5 million in Q1 2025 from $744.2 million in Q1 2024, a rise of 4.5% [4][9] - Adjusted EBITDA rose to $124.1 million, up 27.2% from $97.6 million in the prior year [4][36] - Net loss for Q1 2025 was $65.0 million, compared to a loss of $29.6 million in Q1 2024, marking a 119.7% increase in loss [4][9] Operational Metrics - Weighted average occupancy improved to 79.3% in Q1 2025 from 77.9% in Q1 2024, an increase of 140 basis points [4][5] - RevPAR increased to $5,090, up 4.9% from $4,854 in the previous year [4][5] - Same community operating income increased by 7.6% year-over-year [6] Liquidity and Cash Flow - Total liquidity as of March 31, 2025, was $306.0 million, down $83.3 million from December 31, 2024, primarily due to cash used for acquisitions [11] - Net cash provided by operating activities improved to $23.4 million from a negative $1.1 million in the prior year [8][10] - Adjusted Free Cash Flow for Q1 2025 was $3.8 million, a significant improvement from a negative $26.3 million in Q1 2024 [8][41] Strategic Transactions - In February 2025, the company acquired 30 previously leased communities for $310.0 million, funded through mortgage debt and cash [12] - The company settled its remaining outstanding prepaid stock purchase contracts in March 2025, delivering over 29 million shares of common stock [13] 2025 Guidance - The company revised its full-year 2025 guidance for RevPAR growth to a range of 5.00% to 5.75% and Adjusted EBITDA to $440 million to $450 million [18]

Financial Data and Key Metrics Changes - The company reported a 3.9% increase in residency revenue year-over-year despite a 2.2% reduction in capacity [38] - Consolidated RevPAR grew 5.5%, driven by a 100 basis point increase in weighted average occupancy and a 4.2% increase in RevPOR [39] - Adjusted EBITDA grew 15% year-over-year, reaching approximately $99 million, which was above the top end of the guidance range [46][47] - Adjusted free cash flow was approximately $12 million negative for the fourth quarter, but positive adjusted free cash flow was achieved in the second half of 2024 [47][48] Business Line Data and Key Metrics Changes - Weighted average occupancy grew by 140 basis points, and RevPAR increased by 6.1% [8][9] - Move-ins in the fourth quarter were 8% above pre-pandemic averages, marking the strongest fourth quarter move-in volume since 2016 [12] - Same community operating income increased by 4.4% year-over-year [44] Market Data and Key Metrics Changes - The senior living industry is experiencing a favorable environment with record low inventory growth and high demand due to an aging population [28][29] - Less than 2% of the company's communities faced new construction within a 20-minute radius [27] Company Strategy and Development Direction - The company aims to grow profitable occupancy and RevPAR while improving adjusted free cash flow [8][9] - Strategic transactions included lease amendments and acquisitions to optimize the portfolio and manage capital structure effectively [22][24] - The company plans to expand the Brookdale Health Plus program to enhance care delivery and improve resident outcomes [17][18] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, citing favorable supply-demand dynamics and a growing senior population [26][28] - The company is focused on maintaining high-quality care and personalized service while managing costs effectively [32][35] - Management highlighted the importance of attracting and retaining top associates to ensure operational excellence [34] Other Important Information - The company received several awards for its commitment to quality care and social stewardship, including recognition from Newsweek and U.S. News and World Report [20][21] - The company has successfully addressed over $1 billion in future maturities, eliminating all 2025 debt maturities [25][55] Q&A Session Summary Question: Clarification on RevPAR guidance and impact of Ventas lease amendment - Management indicated that the 4.75% to 5.75% RevPAR guidance includes the impact of the Ventas lease amendment and reflects expected move-ins and move-outs [69][70] Question: Future growth and shareholder value creation - Management emphasized the focus on profitable occupancy growth and the unique aspects of Brookdale's service offerings to differentiate from competitors [72][75] Question: Impact of political landscape on business - Management noted that Brookdale has a low reliance on Medicaid, which differentiates its occupancy metrics from industry averages [93][94] Question: Long-term EBITDA growth expectations - Management expressed confidence in continued disciplined profitable growth, with a focus on capturing the growing demand for senior living services [106][110]

Company Operations - Brookdale operates and manages 647 senior living communities across 41 states, serving approximately 58,000 residents as of December 31, 2024[18]. - The company has 647 communities with a total of 55,095 units as of December 31, 2024, with 60.8% in Assisted Living and Memory Care[53]. - The company managed 28 communities (4,256 units) on behalf of others, representing 8% of its senior housing capacity[66]. - The company provides memory care services at 336 communities, totaling 8,962 memory care units, including 107 freestanding memory care communities[62]. - The company owned 353 communities, leased 266 communities, and managed 28 communities on behalf of others as of December 31, 2024[200]. - The total number of communities operated by the company is 55,095, with 353 owned, 266 leased, and 28 managed[201]. Financial Performance - Total resident fee and management fee revenue reached $2,982,571, with Assisted Living and Memory Care contributing 68.3% at $2,038,660[55]. - For the year ended December 31, 2024, 93.8% of resident fee revenue was generated from private pay residents[54]. - The company anticipates benefiting from operating leverage as occupancy increases, which will improve margins and drive Adjusted EBITDA growth[22]. - As of December 31, 2024, the company had $4.1 billion of debt outstanding, including $3.0 billion of long-term fixed rate debt at a weighted average interest rate of 4.50%[29]. - For the year ended December 31, 2024, debt interest expense increased by $5.8 million, or 2.7%, compared to the prior year[31]. - The company has significant indebtedness and lease obligations, which could adversely affect future operations and stockholder interests[145]. - The company’s debt and lease documents contain financial covenants that, if breached, could lead to acceleration of indebtedness and adverse effects on capital structure[147]. Strategic Initiatives - The company aims to improve occupancy levels and profitability by increasing move-ins and managing controllable expenses, targeting a return to pre-pandemic occupancy and margins[21]. - Brookdale plans to exit non-strategic or underperforming assets and explore growth opportunities through acquisitions and expansions in core markets[25]. - The company is focused on strategic innovation and technology to enhance resident engagement and improve operational efficiency[25]. - The company has implemented centralized support functions, achieving cost efficiencies in procurement, human resources, and other operational areas[70]. - The company plans to implement a new ERP system throughout 2025, which requires significant financial and personnel resources[124]. Labor and Workforce - Labor costs account for approximately two-thirds of total facility operating expenses, with a 3.0% increase in labor expenses in 2024 compared to the prior year due to wage adjustments[26][27]. - The company aims to enhance associate engagement and reduce turnover through improved training and career development opportunities[21]. - The company employed approximately 36,000 associates, with 68% being full-time[77]. - In 2024, the company focused on reducing turnover, resulting in contract labor costs returning to pre-pandemic inflation-adjusted levels[78]. - The company implemented various recruitment strategies, including partnerships with nursing schools and support for military recruitment[80]. Regulatory and Compliance - The company is subject to increasing regulatory scrutiny, which could materially affect its operations and expansion plans[86]. - The company is subject to government reviews and audits related to compliance with Medicare and Medicaid programs, which could result in penalties or loss of participation[101]. - Compliance with evolving regulations may require unanticipated expenditures, adversely affecting results of operations and financial condition[181]. - The company is subject to various federal, state, and local employment-related laws and regulations, which could increase operational costs significantly[186]. - Violations of federal and state laws governing healthcare provider relationships could lead to criminal penalties, civil sanctions, and loss of government reimbursement eligibility[179]. Market and Competition - The senior living industry is projected to see over one million new potential residents per year for the next decade due to demographic trends[45]. - The company faces increased competition from various organizations, including not-for-profit entities, in the senior living industry[48]. - The senior living industry is highly competitive, with numerous organizations offering similar services, which may impact occupancy and revenue[114]. - The geographic concentration of communities in states like California, Florida, and Texas increases vulnerability to local economic downturns and regulatory changes[115]. Risks and Challenges - The company faces risks from environmental regulations that could lead to significant liabilities for hazardous substances on properties[102]. - The management of infectious medical waste is subject to strict regulations, and non-compliance could adversely affect financial condition and operations[105]. - The company acknowledges that future pandemics or health crises could adversely impact business operations and financial performance[136]. - The company may incur significant remediation costs and face negative publicity due to cybersecurity vulnerabilities, which could materially impact revenues and cash flow[123]. - Increased competition for qualified associates and wage pressures could negatively impact the company's operating results and cash flow[160]. Technology and Innovation - The company is undergoing a transformative process to modernize technology platforms, which may disrupt operations if not completed successfully[124]. - Cybersecurity risks are managed by a dedicated Chief Information Security Officer, with ongoing assessments and compliance efforts in place[196]. - The company has engaged external experts to enhance cybersecurity strategies and ensure compliance with legal standards[199]. Stock and Dividends - The company suspended its quarterly cash dividend indefinitely as of December 30, 2008, focusing on capital expenditures and strategic investments[208]. - The stock price performance shows a decline from $100 in December 2019 to $69.19 in December 2024[212]. - The company’s common stock is traded on the NYSE under the symbol "BKD"[207]. - Future offerings of debt or equity securities may adversely affect the market price of the company's common stock and dilute existing shareholders[191].

Press Release Information - Consolidated occupancy for December 2024 announced, with specific details provided in the press release[13] - Press release dated January 9, 2025, includes information on the quarter ended December 31, 2024[13] - The press release is furnished as Exhibit 99.1[14]