Brookdale Narrows Q2 Loss, Sees Record CCRC Sales

Brookdale Senior Living Inc. (NYSE: BKD) reported a net loss of $5.2 million, or $0.04 per diluted common share, for the second quarter ending June 30, 2013. 

Compared to the same period in 2012, the company narrowed its year-earlier loss of $19 million, or $0.16 per share.

Despite posting a net loss for the quarter, the nation’s largest senior living providers saw increases in total revenue and cash from facility operations (CFFO).

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Total revenue for the second quarter was $716.5 million, an increase of $26 million, or 3.8%, from the second quarter of 2012. 

This revenue for the period is comprised of resident fee revenue of $620.9 million, which increased 3.1% from a year ago; a 3.3% increase in management fee revenue of $7.7 million; and an 8.5% rise in managed community reimbursed costs of $87.8 million.

Cash from facility operations (CFFO) jumped 8.1% from year-ago levels to $74.8 million, or $0.61 per share, for the quarter.

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“We produced solid second quarter results,” said Brookdale CEO T. Andrew Smith. “Driving top-line revenue growth, while managing expense growth, resulted in CFFO growth of 8% for the quarter and 13% year to date.”

Revenue for the company’s consolidated senior housing portfolio was $562.2 million for the second quarter of 2013, an increase of 3.3% from the second quarter of 2012. 

Average monthly revenue per unit for Brookdale’s senior housing portfolio rose 2.5%, which was impacted by a 60 basis point increase in average occupancy to 88.3% for the second quarter. 

“This year’s trend in occupancy growth is typical of our historical experience, where occupancy turns mid-second quarter and increases over the remainder of the year,” Smith said in an earnings call Thursday morning. “We expect the same for the balance of this year.” 

Another “major demand,” Smith added, is the company’s independent living entry fee sales from the company’s continuing care retirement communities (CCRCs) segment. 

Entry fee CCRCs produced a second quarter record 128 independent living entry fee unit closings and $16.4 million of net cash flow, an increase of $2.2 million compared to year-ago levels.

Based on results through the first half of 2013, Brookdale increased its guidance, now expecting full-year CFFO to range between $2.35 and $2.45 per share. This excludes integration, as well as transaction-related and EMR roll-out costs.

“Our second quarter results, like those for the first quarter, demonstrate positive momentum of a slowly strengthening economic environment that enables us to increase our full year CFFO guidance,” Smith said.

Written by Jason Oliva

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