Brookdale Senior Living (BKD) 8 Nov 222022 Q3 Earnings call transcript

Welcome to the Brookdale Senior Living Third Quarter 2022 Earnings Call. My name is Irene. I will be coordinating your call today. [Operator Instructions] I would now like to hand over to Kathy MacDonald to begin. Kathy, please go ahead.

morning. good and you Thank I’d like call third earnings to welcome Brookdale Senior you for the Living. quarter to

Joining us statements President today Executive and we are the deemed which time, to factors Cindy during we Baier, our facts, Form the historical file release Steve Officer. differ on statements report SEC Actual maybe factors that note Harbor from our are Financial not XX-K earnings XX-Q. any including of Officer; results be annual President Safe results Swain, Executive present will contained the full well Certain the Chief quarterly our Vice in date to forward-looking and release today’s and the in actual issued direct to the All today, within as and could that for and made are financial of statements differ may federal meaning performance yesterday, the of non-GAAP I detailed these expressly reports and securities this obligation as disclaim materially we risk report are with the measures. time statements. cause update laws. future. These statements forward-looking to Chief we from call, the to please you in Also, on as Form the statement. in

maybe measure, each For which the brookdale.com/investor you at direct I GAAP the was measure to X-K reconciliations and furnished comparable yesterday. non-GAAP information found of most on and release supplemental from an

I Cindy. will over turn to Now, call the

to today. you all joining healthy ones and We XXXX other Good analysts I Kathy. and our hope and us earnings quarter are to you morning call. shareholders, loved our third appreciate you, Thank happy. Welcome of your participants.

challenges report are Hurricane of saw from quarter that Ian. numerous despite operational improvements We number during the third to a pleased we

quarter. the at inflation for nearly Weighted RevPAR mitigate increased than the to to Our the for grew revenue third rate year, Ian grants, sequential as average last year impacting impacts the the excluding even of quarter. prior periods. senior and with challenging which XX% quarter labor as X.X% prior was compared growth EBITDA, quarter better occupancy last the year the housing the Year-to-date, RevPAR strong same XX% compared was year-to-date year and increased of last the helped markets. Adjusted government week continuing Hurricane

In addition, resulted to quarter. operating increase relief third income in helped Sequentially, of million we Phase the adjusted recognized and $XX X provider in flow. EBITDA the cash other the a increase grants deliver free positive funds XXX% adjusted

from and than day, to calendar that also from contract extended pleased it XX% costs, of and That notably our to most and labor second find a the with are was tighten general holiday. labor which third revise said, we the incremental the the Ian all higher maintenance for recovery, repair EBITDA more and the adjusted extra declined guidance We the expenses impacts quarter offset year. sequential cost, Hurricane nearly necessary the

recovery. to quarter our to prior continued on occupancy strong path and financial third RevPAR the we turn the compared me XX% increased Let year of highlights. quarter

year weighted were quarter increased in than higher September points XXth X% basis of quarter’s prior occupancy third average month and XXXX. to Move-ins third growth. the The consecutive XXX of the year-over-year the period compared marked

company’s community most same the In fact, in quarter movements on history. the basis, third saw the quarterly the

sequential housing reported increased occupancy on As basis industry’s NIC, the senior basis. a XXX by points third quarter

XXX growth that industry are again Brookdale points. by sequential exceeded by We occupancy delighted increasing basis

in tailwinds top is both supply strong movement reflected and plus benefit demand execution line the volume. higher our of Our

contract notably labor incremental reduction holiday. was Turning on day, also sequential to basis. quarter calendar our labor, flat most extra the a labor cost, total a sequential costs which third were the nearly mitigated The

for the which filling we labor, As hours. to to training resulted hours contract some hires Quarter reduce by net in saw we hard increase increase new dramatically dedicated in quarter, with we contract care. XXXX for quarter. worked associates declined resolve and more third the peak Sequentially, to December in continue from service by overlapping high an Brookdale contract more than strong associates, labor labor providing XX% quality shifts standards the while of maintaining

residents the by increasing are of hires mentioned Brookdale between achieved exceeded As our is A XX% net hires market, workforce September. end. labor. successful the program caring Year-to-date, and living. continuing large our and ongoing senior are culture X,XXX, we earlier, our good challenges we hires contract of of Despite months workforce positive since consecutive year of reliance our our associates XX net part of and because decreasing net the increasing our consistent benefits and on for labor relationships employed through in residents, U.S. many

While our we Contract continue not is steady make we we usage labor. declining, to but progress progress, are than with is to want where labor expected. be slower

decrease will workforce Associate and as competitive associates fierce turnover and improve wage are highly remains community to for Competition result training reduce and pressure working continues elevated market. productivity. labor a it, remains the costs which of we

reporting yet in labor experience living market, to are the senior some stabilization. industries other Although the stabilization industry has

progress made and the labor we have U.S. less expect steady job in pressure we XXXX. do the openings With shrinking,

labor expected Our XXXX actions pricing inflationary for will costs. and incorporate

caused was in storm the storm, U.S. a to our operations. powerful As the destruction. moving we Ian, ever ended It the fifth landfall make which widespread slow quarter, most Hurricane impacted

evacuated sense I say passionately a dedicated Given as traveled other our our communities that sure relocate our We other that who projected of you to stayed residents residents who residents XX to cared care thank Brookdale’s size It’s communities hard with that communities have X deep Brookdale a our communities Ian. help mobilized path the during associates our protect residents to and evacuated to would important able our storm, worked with the the who who associates to help had chose also want also during and teams to as would grateful and food scale, and we evacuated of feel to field Hurricane that appreciation to for our associates a to I who and evacuation I from to grateful am and continue make each were welcomed help associates corporate of our were in our I communities. to and and normalcy communities evacuation. residents take residents well and thank sleep after host for to XX% within by protect am Florida. want express beds the eat. and special us acted for during sure the With courageously them. Brookdale to nutritious make to many within moment

make execution residents for items with residents’ assisting hard medication critical to success. associates difficult helping a Planning and obtaining as Our as easier time pets. to are for worked well care by personal and

know asset accelerate our worked and the have We happy management the home that same to a ensure so to pre-staged community storm recovery. and return fuel communities quickly a At teams want to maintenance time, closely the home and experience. positive am with resident stayed previously process passes. comfortable, residents evacuated safe share the in communities. Our Where all returned X is after as home welcome I we have as to robust we water can to supplies vendors. teams residents appropriate, possible provide

have annual range. that and updated Turning to our press release, XXXX our tightened our you in guidance, guidance will we see

well the occupancy to an Hurricane for combined double-digit existing year Ian and We as RevPAR continue increase. with gains updated full rate as quarter strong expect growth as make expectations labor incorporated operating recovery We our extended fourth to we third quarter the costs. results annual due

a We disruptive to are occupancy Brookdale increase, costs more we significant many barring operations. appropriately. expect expect COVID-XX labor quarter, have variant in surge, taking see our to efficiencies reducing to labor continue a the larger continues steps fourth premium and as to manage workforce In

As Ian, on increase wage expect labor the and cools, We deliver partners, market of most we of year-over-year and a even of in along increase. communities interest the limits. rates past trusted damage, middle the deductible had the working level In EBITDA the sizeable the Reflecting of we Hurricane with guidance, tirelessly our aftermath less some we, pressure. adjusted complete below hurricane our expenses repairs. bear will range summary, are overheated though reduced to

be what prosperous to early tailwind. of still long We expect stages in and are the we a

occupancy strong impacts. will The markets, will demand have extend benefit current the and low our now need will are for I incorporate inflationary and to services our momentum indisputable. from XXXX tight call turn supply over capital for Steve. new We demographic pricing with years. the several And

and back Thanks, stepped the am sincerely grateful thoughtful to well glad my Cindy. the team leave who all for wishes as absence. Brookdale up medical outstanding from in as I be

the Let me quarter. provide takeaways key for three now

to RevPAR prior XX% the quarter quarter. increased First, compared the in third year

notable along expenses additional seasonally items which a expenses operating and facility basis, was inflationary sequential a utilities on pressure. day, most increased with from X.X%, broad expenses, The higher holiday. labor about calendar an also Second, included

operating of sequentially, Third, by we other provider relief income, August. million funding received an in primarily recognized incremental $XX driven

September of million. total liquidity was our As $XXX nearly XX,

and year context Now, tailwinds, new was quarter’s increased positive points. let of due rates. sequentially quarter a by second growth. third On starting starts, me construction compared or we communities of the prior half stronger increased quarter basis, XXX was a exposed the XX for quarter. community to RevPOR X% same year points. revenue. sequential about of basis demographic long to points on This the the X% compared a highlights to revenue basis to these move-in benefit rate XXX first change With runway currently our with for basis Occupancy power and provide to only lower RevPOR see prior pricing improved basis

quarter more on day, also increases new sequential additional labor the overlapping an labor, and costs Turning XX%, reduced to holiday due for which training mitigated the to basis. We labor with associates. third by X% labor contract operating was starting which expenses a expenses, calendar increased direct than and a

contract supplies quarter and XXX%. in extra by productivity. repairs this OpEx workforce higher other expenses sequentially. third utilities, incremental overtime fourth repairs higher waves. costs. is accelerated change. Four food to COVID-XX and of such The and adjusted day we the were related Broad a operating offset in drivers new Hurricane quarter Utility An the expected also seasonal increased expenses high increased primary labor, record further As cases be and evacuation reductions were maintenance and our costs and facility drove lower in into Sequentially, sequentially factors heat quarter. expenses September. and Ian seasonality Other less BA.X lower to partially pressure in X% as permanent to EBITDA expenses peaked supply stabilizes, remediation due due inflationary multi-decade expect improved the as were

partially government offset in $XX expense This quarter. funds our year interest driven million compared free sequential flow cash rising the the Excluding was increased XX% positive by rates. by EBITDA to Adjusted grants, of benefit improvement quarter. the primarily interest prior of to higher provider adjusted acceptance due turned relief

Turning now October, asset as runway second September support sale. by recovery refinanced nearly to of has with our considering was to exception will XX, a next liquidity are maturity The be. plan XXXX the quarter. $XXX pandemic the for loan an covered XXXX. maturities our the liquidity, been highly and of we priority continue and period, compared plans all of is In debt of the million to total we at flow debt for one end to September have they secured million maturity $XXX and cleared years liquidity. agency Cash Throughout liquidity X that executed successfully

our Now, guidance. let revised XXXX me summarize

growth be expect annual RevPAR We approximately to XX%.

expect reduction was quarter point or trend expenses growth. to net due Barring impacted XXX be the expense, be fourth million Hurricane bear below fourth of The variant historically $X the third improvement. significant occupancy by year-over-year a with a a While expect our deductible impact in flu community limits and basis. sequential included the communities, separate hurricane a community flat, We updated storm deliver wide in continued basis, COVID-XX in the approximately disruptive we to we $XX is quarter over on a points operational of utilities of this more facility seasonal of to along a breadth, had sequential a We deductible. of guidance. non-development such expect Because premium well XX costs XX expected to lower it quarter quarter labor, over expected lower CapEx. recovery with On operating our insurance of currently surge, Ian are efficiency the basis year million basis workforce. fourth each

be offset expect uses we $XXX to in to be fourth net our is by the non-development to Aligned now We adjusted expect expense million million. development EBITDA $XXX previous quarter This interest XXXX. capital annual to range lower is are expected Annual million, hurricane to of CapEx the expected unique million quarter. There working related be of the cash with including investments. $X than $XXX two CapEx. higher increase in guidance, be third around

We of impact have October the of rate we a $XX one-time net fourth which final swap, CARES refinancing Act with the hedged an and $X quarter. a government will in million million interest repayment have

As another we in-place higher in a strong and indicators. growth. inflationary January increases. I’ll early rate operational effective see will We expenses X XXXX expect are will labor November, cost this occupancy few A believe expected greater be will With we we provide are XXXX. and year, incorporate year of increases new than resident’s rates XXXX

covered maturities debt pressure highly XXXX job improve. plan U.S. we secured From with to flow asset an a for noted, Cindy As except for falling, sale. we labor XXXX one loan the no market cash perspective, by openings in have expect

we occupancy. to our past the X Over grow years, ability have demonstrated

senior where and rapidly new builds. construction see significantly, will competition our slowed from population as new is communities minimal has growing Additionally,

combined With back is Cindy. over trends pricing to the power, these turn Brookdale’s I’ll with call now growth strong. outlook

growth. strong drive significant XXXX summarize occupancy flow coupled rate with a and adjusted January To will growth we remarks, increase in-place EBITDA believe on free these X resident continued in cash

residents We have which seen engagement and and by analytics new move-in accelerates success with socialization with existing AI-driven our connecting interest. common pilot, resident

we and continuing the Our is overarching to and of focus associates health innovate. our well-being residents and are

rates emergency when such improved care similar an room our populations. seeing hospitalization and example, as in to use are lower As HealthPlus we compared urgent or outcomes lower communities

Our innovation And in this to to program is to we forward expanding additional XXXX. differentiate another services. our look communities way

call field to enriching close serve. their will we lives I we As the want open now our our for all to Session prepared Question-and-Answer and the of both questions. seniors remarks, the up thank commitment corporate of Operator, associates for we

of the Instructions] Tanquilut Our [Operator line Please Jefferies. is go from Brian first ahead. question of

Hey, good morning.

Hi, Brian.

Good morning.

through for the are So I the performance, progression? as how first, year about me you guess are and my you about Steve you just the I how think Thanks. QX and can for EBITDA is sequentially adjustment your first thinking if question maybe walk guidance bridging

points revenue, morning, EBITDA will million over be XXX $XX on third Sure, bridge I guidance of the fourth Brian. of The thanks the run-rate implies about with without $XX million the quarter’s middle start and of to EBITDA. quarter and three EBITDA over quarter. Really basis. fourth year-over-year on growth on That’s we occupancy sequential a QX first basis points well million expect $XX a to components: XX basis basis. grants

math is that So pretty straightforward.

to $X which larger we expenses. Second by workforce reducing Ian, operational and the expect is reducing premium generally and And have third, in our OpEx, to efficiencies expect utilities and other impact. thereby seasonal offset of labor facility labor, net workforce neighborhood Hurricane have Brookdale we more lower is be continue in a of repairs overlapping see million

should to quarter bridge components fourth So, these you guide. the

think from what Ian that you about maybe QX, gave it’s the on Got to bridge early us it. QX XXXX, And but for adjusting as to guidance, Hurricane just think about $X Steve million know I I then number. given

say earnings So, is I million. expectations in of the right that let’s $XX XXXX? the baseline to off I right build ballpark like Is mean, as there? growth that in for think annualizing about and some putting just sequentially

ahead want too far don’t to I So, of my get skis.

we appears beginning believe are rate we somewhat strong you coupled EBITDA will XXXX. XXXX. super growth drive of cycle of meaning, increases I at give little on will in It a with color So the occupancy

a QX. XXXX So than our be of increase way of stated a I sharper greater dots example, couple of will rate connect picture XXXX. let for by me that

perspective and increase sequential single-digits perspective, XXXX’s average in RevPOR that was X.X%. So, of rate for resident in-place a led to the for high

were couple our before This XX-day rate be and past increases or resident months, will XX-day XX-day the in-place to our be letters notification Over and of letters out December XX%. on XXXX average will year, mailed residents rate over X. mailed

bottom line. significant a to course benefit So, have will this the of

Got it.

of Okay. labor improvement what’s as are should about be of contract And things just sounds place drive, basis. like maybe the on left on expenses you in overall in that some it QX, I to in can facility for if in and $X putting Maybe macro impressive but that I then terms me just in question very walk to opportunity what a labor juice think you bring the on what’s operating terms through are contract initiatives much how left left and level XX% down us mean, labor, factor? decline driving last is

There is opportunity. engage, our a of the lot retain associates. best and goal has develop attract, to And been

labor X,XXX Brookdale, last hired from hires. net say XX% improvement we monthly year net and X.Xx. our of than of effective just So new I by our is contract to on down associates if XX% so is labor our in hires a reason it’s in workforce. The be have full-time have more to because that peak. And the and increase that Xx have premium contract consistent that now basis, a fair you on associate, is think our contract if cost over The am time Xx drive cost thing most we that’s focusing a Brookdale to focus the this pretty brought peaked December about that labor, done it compare And of labor at important year. can we the but Brookdale is on to you

our hourly So more we do Brookdale that full-time that keep too, need work can standard rate. what time is so to part our increasing associates and we Brookdale associates on hours

do that The to to turnover. our is need we thing need improve we second

and healthcare senior particularly the of living. face we is on that has realities One pandemic the been hard

turnover need do so rate. back to what bring is that an down. we And elevated we And seen have

very that. are focused on we So

appropriate we have sure compensation paying rates. are We market that make increased to

our at looking benefit. are We

can live and will understand they opportunities career a history quality by good prepaying we have serving to life med-techs, associates are by they pathing that. can still people and mission, our need to, costs make seniors grow for our career so life on want that being us. their with training in with the unmatched of people they that giving are keep to And focus our our that CNAs we that and We our Brookdale while united can sure

you. Thank

Thanks.

Nephron next of Josh Raskin of Our is question the go ahead. Please from line Research.

Hi, Josh.

Hey, good morning.

taking the Josh. have Marco for here Thanks actually You on question. for

X of that If of Slide business pre-pandemic you to XX%. level if able in to you you at $XXX investor million the occupancy that incremental get peak occupancy revenue the annual is is million look $XXX are the there know and deck, of to get if able back to XX.X% back

So provide back flow thoughts occupancy should revenues to to timing when just you some levels getting of the wondering will Thanks. through how general reported about those the we if could on think those results?

it’s company’s but seen are of Marco, indicative fact occupancy progress that it’s growth. I of have am strong in And have of missed, the am movements question inflected seen we in is we the the we sorry have XXXX you we can And on we firmly good to to from had history. Josh, improvement. to pleased think quarter I about are road last XXX in such basis I March strongest third I our the points really the on occupancy we the that Since great make. the that think X the to about we years no hear call. that If there road recovery. you. that recovery,

do think well supply both a as at that rising as we and the I that of are to result constricted opposed as rates. supply demographic [indiscernible] COVID-XX demand interest tailwinds where with headwinds are as a time So, now and

I And pandemic. sort we if that higher through have is as see have move-outs, in before result worked services one expectation the think things that acuity our the we of we progress the will pushing our they higher keep they our because think additional increase. past a tempered of to That’s acuity. seen of or the when time the majority needed people moved you vast us about in move-outs shorter So, move-ins historically. XXXX, had Therefore, was than with of

is think normal more I that moving forward. us, something So for will that be

any I And more current view if quick you. Thank then in the be whether market inbound levels? you in you one Thank to squeeze it divestitures the great. are could also appetite helpful for debt I you. Okay, some know would and if on thoughts wondering how speak just interest? if EBITDA of light for you lower one seeing Brookdale’s could just could you reducing give

in that the increase front pass rate is market than revenue about I that shows think the is front the a stronger us. we at you expecting and And than huge of are opportunity Steve Slide in think biggest opportunity X opportunity a as through in we and that of XXXX to have rates, us XXXX. market stronger if today’s that mentioned, average

to sell our levels, Now, as say you there of. we the it of that I never a a past. about bigger part our maybe that is think we with level real the here our But There debt. that’s and that community strategy of or with will of think of estate. that not not adjusted doesn’t our dispose EBITDA, real leverage level leverage not it’s fit to future the was the our And issue if choose

the do in improve see leverage a cash profitability just our path we adjusted we ratios flow. improved by our will drop and and as strong performance improvements So EBITDA, to

much. Okay, great. very Thanks

Marco. Thanks,

the Our next question go Valiquette of please Stephen, Steven line Barclays. is of ahead. from

morning, Good everybody. thanks. Great,

Hi, Steve.

good morning. Hi,

Just questions few a here.

don’t of of that want more does ‘XX. for way the as confirm that guess hurricane semantics from bleed a XXXX? quarter other just rate just was like is components but increase curious the or sort the really no going the or the want distant To rate of I First is components to resident or just the around into are to for am then much And contracts on without percent an actual to components themselves? was in kind show and up, you describe that going the inflation increase around the exiting surcharge, specific one it lease flow I all overall just impact the for question fourth year it’s I it’s adjustments perspective like sort contracts a impact, the I question, call normalized either or just next Thanks. or yes of not? increases labor, to show hurricane you rate any does explanation EBITDA of the into verbiage kind clarify why semantics It up? level the with curious actually of on

to going I rate set the We to to us rate So am for hurricane will increases. go residents we that the understand and the our take then And first important individually. as question. imagine, question each it’s rationale and every resident might our you rate

So labor our them our in will with the rate we of we’ve explain costs inflationary share pressure are that will residents with the their executive individual directors we that other seen increase. sort bearing sit and costs, down and

Unlike increase. discussions is components But rent are two support as regularly and there needs our resident our the our our increases of of competitors, as Now are residents one-on-one imagine you residents majority usually to more vast changes rate there that’s at level. X. rate resident and some January Care might the care. individual

our so October X, virtually all market give benefit quarter. start rates we of that will occur us increases for so And there, resident the fourth in in-place selling rent a do

really tiny with XXXX, and should labor Steve But regard into me in XXXX. all virtually be if that, the that there that, the Now, it hurricane OpEx, maintenance. you because on correct be something would what of repairs expect that about goes and might can of most this, and to all we is incremental the cost, virtually think of

might And Now to XXXX, that sort there trails you not to – as that? trail in all occur following anything add to it Steve, into sometimes CaEx want XXXX, the relates that sometimes year. of that is

that’s It’s it. into bleed XXXX. No, CapEx might that really

communities XX impacted. have We

So they are that handful going CapEx to still costs. be a have

be impact whole loss though hurricane as far insurance that? revenue Would the on just to make there ‘XX or from or as any you

from hurricane. have interruption residents business as returned have who the said, prepared X we communities have we the of insurance. home comments, in our all So, And

Now catastrophes, material. have of you we move-ins has then last I about the about that are say family absolutely from process, September. didn’t And – their families probably of number personal I that’s And think as But away. we lose in when XX or the end moved relocate it, that’s may at think is you something who residents residents week move that’s don’t some zero. lost also the people won’t because in but when September

Got it.

Thanks. Okay.

Thanks. activity I in also strong are we should State move-in of seeing Florida. say the

I that the So, want we and I see to sure do positive on usually after hurricane. make a that leave

you. Thank

Our next go the Please Qiu Tao question is line of of Stifel. ahead. from

Good Hey. morning.

Tao. morning Good

Welcome back, Steve.

the really is question first my earlier. a So, on clarification question

that mentioned where see normalizing Xst. You revenue can there think the the at two kind was you I third January pieces growth is And of you affected on would higher care look rent quarter, by the acuity.

the moving, secondarily how year up discounts year well? their of terms throughout and year, next maybe thinking that and on So, they for evolved over how the care has as next rate, should we outlook think your and progression pushing in the about, year about

Yes.

between pre-pandemic we revenue of by acuity XXXX, start saying, And consistent revenue. third overall was just our me see our quarter with acuity residents. our XX% generally Let XX% is care of did during revenue the our and

impact is question that think have the already And the we I an XXXX. we Steve. really will So, to experienced that rest in leave of

acuity Cindy bet. lower some we the higher revenue residents. care due have You mentioned, to seen Like

to lower that out. in pre-pandemic recent with back residents but of have kind these level. as the needs we move-ins to But expect during pandemic, So, moved reflected stabilize based outs move the acuity now moving

residents So, longer as of acuity stay care and see lower should in, of we length stabilized revenue. move a a kind

in to year-over-year on I you a over gave – and dollar just is speaking, that’s going average amount of kind I rent care. what the have that as rates, far rent that includes And As over both number XXXX. the generally mentioned weighted be XX%

of And bit need in on is do that now moving. boost to discounting more you discounts see part of do order we decide really that like the a little to question we on second The occupancy? feel about deceleration how to

we started Xst, important rate. selling it’s like think October I to at Well, a higher know that

the what so that our to are new relative than have that residents And been higher movements existing is they previously. means

always we balance improvement across always appropriate. a better where But Now, is seeing necessary But that goal competitor, discounting that have have discounting an it’s community growing to discounts taking maximize there occupancy the is in that we sort growth And RevPAR and or both RevPAR. where a think a only generally to are market demonstrated where of in the country. I of necessary and done our history be may to get well a by new wait. our is we there

Throughout the have compared seen sequential for strength which seen in-place Yes. we year, rates, re-lease instance. AL, resident in improvement have in to rates particular we

So, we will, where a strong and occupancy rate super at are that think you we cycle we do have performance? growth beginning if on, of the

cycle, I Super the like word. Great.

mentioned, growth also don’t So, year, I recovery? is contract this labor, if that occupancy for you my hiring question any quantify replace additional is the additional second employee year labor know it you to possible on full thing to and XX% in anticipate anticipate time next

work, wages because as workforce to has not when is they keep many and really a to reason an is where want to we absolute they work regular will I hiring the want compared pre-pandemic. how until associates changed to number And want that Yes. want And work. the people of to to that they people work, I to staff What possible. as say good is, It’s question. want hours the are using able

So, associates, of schedule. And little wants you number open, work many have is to bit there of got that when part-time. is particular are schedule a not they as if somebody hours, in always terms even of friction if your fill may they same and the

we people who to they when can infectious that away pre-pandemic, we from that’s keep may The sort other of if them more quarantine, infection. different so from residents thing have be from need

so because And staff to to per have right. should lower take a that communities. What will are workers that’s working we And it we have to, is more that eliminate to hour, play we that sort labor. make. the mean more But costs, doesn’t we trying should we of stabilize cost our premium as are

that sure we location. a for we the have and the got I will little make of think bit right So, hang mix right constantly in employees we

one, difficult. which certainly we compared prior XXXX last forecasting We of was inflation, had just unprecedented may, hurricane, better very getting Corona, in another year look And terms at years. if so I far, I totally makes mean as saw Great. Cindy, to

you provide As do year, about expect guidance year peers is still and of many guiding your quarter-to-quarter? next what to you your philosophy guidance think are full a as

guidance inflation, unprecedented the I say helpful. experienced will United to that really pandemic, XXX-year If could machine never given what I we to position time probably provide have year. evaluate as that’s a market And the a will XX-year pressures. try our would been the has and decision the shareholders. challenged in States, in hurricane is it back, I And fifth get I best a that, labor we worst ability make our will go to right the guidance for guidance Having February. said quarter opposed in for for have

think year’s we what no was we we you this harder is is what to Our environment or share with know try expected. a And than we lot there know. operating that question to goal

you. Great. Thank

Thanks.

line of Please Gajuk America. Bank of is Joanna Our the from of go ahead next question now.

you good hey, so taking the questions much taking for much for Thank here. so Thank you – morning.

around pricing higher the about this expense missed previously, next discussion mean increases I to if you I year, talking were your than into be Sorry, year.

operators forward, guess into I And talking rents we about, increasing, it’s it some by other heard XX%. pulling this year, Some forward raising them actually. pulling –

the the of we you. change Thank in what timing next should year, increases? to these Brookdale and increases do planning magnitude think potential is how rent of any for So, about terms of

Yes.

think thing Brookdale increase about what’s And vast is rate of the January for timing. different the Xst. majority to the address I is first

or weren’t had to to take think that might I do. place increases I going on right our evaluated that of next year, was there about by July until price maintaining rate June then if a the increase January of anniversary we putting next trust thing for was year. residents and When So, whether rate thought we Xst increase appropriate our more an pass year, through and that the internally, from fair to mid-year

that is digits. our levels, double expectation taking that average, we that on our earlier, set pricing at will we individual rate be do rates the said increases they expect have. I the into As will But plans resident consideration

a terms guess sense. of And I sorry, missed in if topic, Yes. that That flu makes I another activity.

of earlier So, we see start the flu season.

what guidance And to communities, have you your anything continues level? admission commentary QX? high at in any bans there your a build Is you. of be in any this your of for communities. you sort on is if see So, into QX terms there that it it more Thank event

any our flu of open, are do not have all that and communities closures. grateful we am I

a flu in that statistics, elevated living. the flu is the traditionally, United for season issue no activity the you at But look CDC States. is there QX there senior if Now is question

vaccinated minimize on so what on to are the for focused our are any COVID-XX residents sure and the we to associates And flu impact trying residents. for both is that and make

If providers is very infected, something back quarter. we prevention focused a guidance infection that both this our protocols. prospects sure build But we to have COVID. make and during to fourth the it strong leadership reflected is flu-related you for on our increased we pandemic do get specifically healthcare are clinical that bills happen just are not to maintaining go And alike point to recognized when to into

our are strong always priority going keep our we focus because being prevention is our well top health be to infection and to and that’s going the of And residents associates. protocol. So,

I one. sense. And makes Definitely may the if squeeze last guess

guess wage in think the as inflationary contract labor reliance think job clinical So, But forward? terms you mentioned both growth contract So, labor coming very a contract high very about of your labor how unskilled environment. the, labor. expenses, still we we down, are your and then but labor, going guess should there expense I obviously, in I on good we some about reducing

year? those about going how next we unskilled wage inflation the and So, should Thank skilled forward into two buckets, think labor in you.

Yes.

Our same in that part year-over-year Part community was of labor of was third that of occupancy. was rate, XX%, expense sort quarter. up the

settings, in And fourth I do our less the increases, reduce quarter budget beds, shutting have think working are it throughout to in us. others is XXXX. we be on we as wage that and But made residents to we live XXXX. don’t other during market I as away XXXX. in our than that the think XXXX, significant our we healthcare really industry and respond option have Unlike of appropriate. labor of the have the rate still increase will setting with

make So, our sure are with most communities that we way do associates regular and need to appropriately staffed. to the Brookdale that part-time full-time is hours. working efficient And

And I and focus or reduction the more on contract down. partially than see time shouldn’t retaining will to you. going associates, the think those engaging is offset, costs going hopefully, don’t in labor more say some in them. be over are offset pressures them, our than at the attracting least So, I we wages that of offset, Thank

to so that Thank occupancy. color. appreciate you I Right. for grow much

And question go Hendrix of our from the line is RBC. Ben next ahead. please of Ben,

Thank you guys.

are in-place harp wanted are as then the what do to into Thanks. for – an we a the follow-up discount if put for in occupancy October, you Just place how in rent get kind rent? to sorry isolate rents that to temper think this were rates. what Just growth to might two-part to year-over-year, idea you that how year? double-digit – in that that If in magnitude increase. But And on the well? or range they of effect there versus quick about growth degree rate of a in-place of putting they street given was which the we place XXXX a double on digit the just or compared in went that

Yes.

the same increases rate the place the market rate were we put that and for increases, increases. in So, the generally rate in-place

toolkit associates get to people have to that move note, Now, it’s important there in. to is sales our that a

to And associates. so that toolkit is always available sales our

we even for think that double-digit net down call. are at add? to the doesn’t it increase, you we of And the make to to to that sure – a want If Steve I going rate that in tried do you say you double-digit take RevPAR. that want you Steve, increase I if beginning through do know

the is, a X.X% XXXX are No. pre-price than that gave fourth RevPAR on being you And to example we to we the digit RevPAR That I or up quarter in start going exactly slightly an into in-place increase. XXXX, fourth year, less see the rate next rate double of increases. quarter

then any year. given on And how progress thoughts Thanks increases just occupancy rent versus might this guys. these

same growth. improved particularly of things silver And we We The have units that to is are And who demand our services, is for care growing is continue not lining balancing rate. put better be think occupancy, we will a EBITDA rates the our construction. us. for new there need us going ultimately will and less is fair the occupancy our that seniors always At two RevPAR help positive together and we people where there a that setting cash the the that supply is charge under unprecedented translate for belief grow And that very adjusted those in and flow. time, into provide. to if barrier pandemic new

Thank much. guys. great, you That’s very

much. so Thanks

over to of We Cindy reached end now I session. the call have question-and-answer End Q&A And back hand the for will the closing of remarks.

optimistic to am I prospects I the joining future. us very much, for want Thank Harry. And thank everyone today. about you so for

things that continue we two protected and we incredibly a the have done be to have have year, will well. This We grown occupancy focus. rate

call, labor on we am that, to making much. With are focused and stay on our Thank progress continue that. you to We you going to Harry. so ask the will I close

for and Thank earnings who has Certainly. us concludes you Living third now Senior everyone XXXX today. This joined lines. quarter Brookdale disconnect may your you call