Sonida Senior Living, Inc. (the “Company,” “Sonida,” “we,”
“our,” or “us”) (NYSE: SNDA) a leading owner, operator and investor
of senior housing communities, today announced its results for the
fourth quarter and for the full year ended December 31, 2024.
“2024 was a transformative year for Sonida, highlighted by the
combination of organic and inorganic growth and continued
strengthening of our balance sheet. We delivered another year of
strong NOI growth in our same-store portfolio, driven by
improvements across all key metrics, and coupled this with the
acquisition of 20 high-quality communities with significant
embedded upside. Sonida executed on its first overnight equity
offering and put in place a new secured corporate credit facility,
creating the dry powder to fuel the rapid pace of acquisition
activity. Cumulatively, these activities position Sonida for
accelerated NOI growth in 2025, demonstrating the power of our
owner/operator model and high-touch approach to the resident
experience,” said Brandon Ribar, President and CEO.
Fourth Quarter and Full Year Highlights
- Weighted average occupancy for the Company’s owned same-store
portfolio increased 70 basis points to 86.6% in Q4 2024 from 85.9%
in Q4 2023.
- Same-store resident revenue increased $3.6 million, or 6.0%,
comparing Q4 2024 to Q4 2023.
- Net loss attributable to Sonida stockholders for 2024 was $2.1
million compared to $21.1 million for 2023, representing a $19.0
million improvement.
- 2024 Adjusted EBITDA, a non-GAAP measure, was $43.2 million, as
compared to $33.9 million in 2023, representing an increase of $9.3
million or 27.4%, driven primarily by continued improvement in
operations.
- Results for the Company’s same-store owned portfolio of 61
communities:
- Q4 2024 vs. Q4 2023:
- Revenue Per Available Unit (“RevPAR”) increased 6.0% to
$3,678.
- Revenue Per Occupied Unit (“RevPOR”) increased 5.1% to
$4,248.
- Q4 2024 Community Net Operating Income, a non-GAAP measure, was
$16.0 million compared to $16.3 million for Q4 2023. The slight
decrease was a result of prior year real estate tax protest
settlements of $1.0 million and decrease in workers compensation
reserve of $0.7 million recognized in Q4 2023, partially offset by
continued improvement in operations.
- Community Net Operating Income Margin (“NOI Margin”), a
non-GAAP measure, was 25.5% as compared to 27.4% for Q4 2023.
Excluding the Q4 2023 real estate tax protest settlements and
workers compensation reserve decrease, the NOI Margin for Q4 2023
would have been 24.6%.
- 2024 vs. 2023:
- RevPAR increased 8.1% to $3,650.
- RevPOR increased 5.9% to $4,224.
- Community Net Operating Income increased $7.5 million to $65.4
million.
- Community Net Operating Income Margin was 26.2% and 25.0% for
2024 and 2023, respectively. Adjusted Community Net Operating
Income Margin, which excludes $2.9 million in state relief grants
received in 2023, was 26.2% and 24.0% for 2024 and 2023,
respectively.
Recent Highlights
Cincinnati Acquisition
In December 2024, the Company closed on the acquisition of an
unoccupied single senior living community located in Cincinnati,
Ohio for a purchase price of $16.3 million. Sonida funded the
transaction with $18.3 million of senior mortgage debt, including
$2.0 million for capital expenditure investment into the facility,
which is expected to be utilized to furnish the community and
prepare it for residents prior to opening. The non-recourse
mortgage has an 84-month term and 24-month interest waiver to
support lease-up and stabilization, with a 3% fixed-interest-only
rate thereafter. Due to its geographical proximity, this community
is operationally positioned as a dual campus with the Company’s
existing community, the Wellington at North Bend Crossing.
Atlanta Acquisition
In November 2024, the Company acquired two senior living
communities in the Atlanta, Georgia market for $29.0 million
(“Atlanta Acquisition”) to further expand our owned communities and
support our growth initiative.
Fannie Mae Loan Extension
In December 2024, the Company entered into an Omnibus Amendment
to Multifamily Loan and Security Agreements (the “Omnibus
Amendment”) with Federal National Mortgage Association (“Fannie
Mae”). The Omnibus Amendment amends the terms of each of the loan
agreements (each, a “2024 Loan Agreement” and collectively, the
“2024 Loan Agreements”) relating to an aggregate of $220 million of
loans for 18 of the Company’s 37 senior living communities
encumbered by mortgage agreements with Fannie Mae to, among other
things, extend the maturity dates of each 2024 Loan Agreements from
December 1, 2026 to January 1, 2029 in exchange for $10 million of
scheduled principal paydowns on the 2024 Loan Agreements, which
included a $2 million paydown made at closing and a series of $2
million, $3 million and $3 million due in November 2025, 2026 and
2027, respectively.
Senior Secured Revolving Credit Facility
In October 2024, the Company closed on the additional $75.0
million commitment under our senior secured revolving credit
facility (the “Credit Facility”). The incremental $75.0 million
availability results in a total aggregate commitment under the
Credit Facility of up to $150.0 million. The Credit Facility has a
term of three years, a leverage-based pricing matrix between SOFR
plus 2.10% margin and SOFR plus 2.60% and is fully recourse to
Sonida. On October 30, 2024, the Company drew down $60.0 million
under the Credit Facility and used such borrowing to fund the
Atlanta Acquisition and the Texas DPO (as defined below) as well as
for liquidity and general corporate purposes. Borrowing
availability under the Credit Facility is generally determined
based upon the value of the senior living communities that secure
the Company’s obligations under the Credit Facility. Our current
borrowing of $60 million is secured by 13 of our senior living
communities.
Texas DPO
In November 2024, the Company exercised its option to make a
discounted payoff (“Texas DPO”) of the outstanding loan principal
for two communities located in Texas. The Texas DPO amount of $18.3
million represents a discount of 36% on the total principal
outstanding of $28.4 million (as of November 1, 2024). The Texas
DPO represents the last material restructuring of the Company’s
legacy debt portfolio, with 58 of 60 loans having been addressed
over the past 12 months.
Results of Operations
Three months ended December 31, 2024 as compared to three
months ended December 31, 2023
Revenues
Resident revenue for the three months ended December 31, 2024
was $77.1 million as compared to $59.3 million for the three months
ended December 31, 2023, an increase of $17.8 million, or 30.0%.
The increase in revenue was primarily due to increased occupancy,
increased average rent rates, and 16 acquired consolidated
communities (including one unoccupied community acquired on
December 31, 2024) as compared to the prior period.
Expenses
Operating expenses for the three months ended December 31, 2024
were $59.2 million as compared to $44.4 million for the three
months ended December 31, 2023, an increase of $14.8 million. The
increase was attributable to increases in community labor costs of
$8.8 million and an increase in other variable operating expenses
of $6.0 million, primarily as a result of increased occupancy in
the Company's same store communities and 16 acquired consolidated
communities (including one unoccupied community acquired on
December 31, 2024) as compared to the prior period.
General and administrative expenses for the three months ended
December 31, 2024 were $11.8 million as compared to $9.9 million
for the three months ended December 31, 2023, an increase of $1.9
million, or 19.2%. The increase primarily represents additional
labor costs of $3.5 million incurred to support the Company’s 2024
acquisitions, which includes $2.1 million in severance. These
additional labor costs are offset by a decrease in transaction
costs of $1.4 million and a decrease in other expenses of $0.2
million.
Gain on extinguishment of debt for the three months ended
December 31, 2024 was $10.4 million, related to the derecognition
of notes payable and accrued interest as a result of the Texas
DPO.
The Company reported a net loss of $6.2 million for the three
months ended December 31, 2024 compared to $14.6 million for the
three months ended December 31, 2023.
Year ended December 31, 2024 as compared to the year ended
December 31, 2023
Revenues
Resident revenue for the year ended December 31, 2024 was $267.8
million as compared to $232.0 million for the year ended December
31, 2023, an increase of $35.8 million, or 15.4%. The increase in
revenue was primarily due to increased occupancy, increased average
rent rates, and 16 acquired consolidated communities (including one
unoccupied community acquired on December 31, 2024) as compared to
the prior year.
Managed community reimbursement revenue for the year ended
December 31, 2024 was $33.1 million as compared to $21.1 million
for the year ended December 31, 2023, representing an increase of
$12.0 million, or 56.9%. The increase was primarily a result of
managing three more third-party communities and four unconsolidated
joint venture communities during the year ended December 31, 2024
that were not in our prior year results.
Expenses
Operating expenses for the year ended December 31, 2024 were
$202.0 million as compared to $177.3 million for the year ended
December 31, 2023, an increase of $24.7 million. The increase was
primarily attributable to the increase in community labor costs of
$15.7 million and an increase in other variable operating expenses
of $5.3 million, as a result of increased occupancy in the
Company's same store communities and 16 acquired consolidated
communities (including one unoccupied community acquired on
December 31, 2024) as compared to the prior the year.
General and administrative expenses for the year ended December
31, 2024 were $40.0 million as compared to $32.2 million for year
ended December 31, 2023, an increase of $7.8 million, or 24.2%. The
increase is primarily due to a $6.6 million increase in labor costs
to support the Company's 2024 acquisitions and continued
acquisition strategy, including $2.1 million in severance, and a
$1.6 million increase in stock-based compensation expense,
partially offset by a decrease in other expenses of $0.4
million.
During the year ended December 31, 2024, there were no
impairments on long-lived assets. During the year ended December
31, 2023, the Company recorded a non-cash impairment charge of $6.0
million related to one owned community with decreased cash flow
estimates as a result of recurring net operating losses.
Managed community reimbursement expense for the year ended
December 31, 2024 was $33.1 million as compared to $21.1 million
for the year ended December 31, 2023, an increase of $12.0 million,
or 56.9% related to the result of managing more communities during
the year ended December 31, 2024 as compared to the prior year
period.
Gain on extinguishment of debt for the year ended December 31,
2024 was $48.5 million related to the derecognition of notes
payable and accrued liabilities as a result of the 2024 Loan
Purchase and the Texas DPO from two of our lenders. Gain on
extinguishment of debt for the year ended December 31, 2023 was
$36.3 million related to the derecognition of notes payable and
liabilities as a result of the transition of legal ownership of two
communities to Fannie Mae, the holder of the related non-recourse
debt.
As a result of the foregoing factors, the Company reported net
loss of $3.3 million for the year ended December 31, 2024, compared
to net loss of $21.1 million for the year ended December 31,
2023.
Liquidity and Capital
Resources
Cash flows
The table below presents a summary of the Company’s net cash
provided by (used in) operating, investing, and financing
activities (in thousands):
Years ended December
31,
2024
2023
Net cash provided by (used in) operating
activities
$
(1,782
)
$
10,683
Net cash used in investing activities
(208,923
)
(16,562
)
Net cash provided by (used in) financing
activities
232,042
(7,113
)
Increase (decrease) in cash and cash
equivalents
$
21,337
$
(12,992
)
In addition to $17.0 million of an unrestricted cash balance as
of December 31, 2024, our future liquidity will depend in part upon
our operating performance, which will be affected by prevailing
economic conditions, and financial, business and other factors,
some of which are beyond our control. Principal sources of
liquidity are expected to be cash flows from operations, proceeds
from equity offerings, including sales of common stock under our
ATM Sales Agreement, borrowings under our Credit Facility, proceeds
from debt refinancings or loan modifications, and proceeds from the
sale of owned assets. During 2023, we entered into loan
modifications with Fannie Mae, an amendment with Ally Bank,
including a revised Limited Payment Guaranty, and an Equity
Commitment with Conversant. During 2024, we completed the 2024
Private Placement pursuant to which we issued and sold an aggregate
of approximately 5.0 million shares of our common stock to several
of our shareholders for gross cash proceeds of $47.8 million, which
enabled us to purchase all the Company's debt then outstanding with
a certain lender at a substantial discount, as well as fund future
working capital and growth initiatives. Additional financing of
$24.8 million for the debt purchase was provided by an expansion of
the Company’s existing Ally Bank term loan. In addition, during
April 2024, the Company entered into the At-the-Market Issuance
Sales Agreement (the “ATM Sales Agreement”), whereby the Company
may sell, at its option, shares of its common stock up to an
aggregate offering price of $75,000,000. As of December 31, 2024,
the Company has received $18.7 million in net proceeds from the ATM
sales. During August 2024, the Company completed a public offering
and issued 4.8 million shares of common stock for net proceeds of
$124.1 million, after deducting underwriting discounts and
commissions and the Company’s offering expenses. During August
2024, the Company entered into a Credit Facility in which borrowing
availability is determined based upon the value of the senior
living communities. As of December 31, 2024, the Company had
outstanding borrowings under its Credit Facility of $60.0 million.
These transactions are expected to provide additional financial
flexibility to us and increase our liquidity position.
The Company, from time to time, considers and evaluates
financial and capital raising transactions related to its
portfolio, including debt financing and refinancings, purchases and
sales of assets, equity offerings, and other transactions. There
can be no assurance that the Company will continue to generate cash
flows at or above current levels, or that the Company will be able
to obtain the capital necessary to meet the Company’s short and
long-term capital requirements.
Recent changes in the current economic environment, and other
future changes, could result in decreases in the fair value of
assets, slowing of transactions, and the tightening of liquidity
and credit markets. These impacts could make securing debt or
refinancings for the Company or prospective buyers of the Company’s
properties more difficult or on terms not acceptable to the
Company. The Company’s actual liquidity and capital funding
requirements depend on numerous factors, including its operating
results, its capital expenditures for community investment, and
general economic conditions, as well as other factors described in
“Item 1A. Risk Factors” of our Annual Report on Form 10-K for the
fiscal year ended December 31, 2024, filed with the SEC on March
17, 2025.
Conference Call
Information
The Company will host a conference call with senior management
to discuss the Company’s financial results for the fourth quarter
and full year 2024, on Monday March 17, 2025, at 11:00 a.m. Eastern
Time. To participate, dial 800-715-9871, passcode 4619110. A link
to the simultaneous webcast of the teleconference will be available
at: https://events.q4inc.com/attendee/338479365.
For the convenience of the Company’s shareholders and the
public, the conference call will be recorded and available for
replay starting March 18, 2025 through March 24, 2025. To access
the conference call replay, call 800-770-2030, passcode 4619110. A
transcript of the call will be posted in the Investor Relations
section of the Company’s website.
About the Company
Dallas-based Sonida Senior Living, Inc. is a leading owner,
operator and investor in independent living, assisted living and
memory care communities and services for senior adults. The Company
provides compassionate, resident-centric services and care as well
as engaging programming at our senior housing communities. As of
December 31, 2024, the Company owned, managed or invested in 94
senior housing communities in 20 states with an aggregate capacity
of approximately 10,000 residents, including 81 owned senior
housing communities (including four owned through joint venture
investments in consolidated entities, and four owned through a
joint venture investment in an unconsolidated entity, and one
unoccupied) and 13 communities that the Company managed on behalf
of a third-party. For more information, visit
www.sonidaseniorliving.com or connect with the Company on Facebook,
X or LinkedIn.
Safe Harbor
This release contains forward-looking statements which are
subject to certain risks and uncertainties that could cause our
actual results and financial condition to differ materially from
those indicated in the forward-looking statements, including, among
others, the risks, uncertainties and factors set forth under “Item.
1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal
year ended December 31, 2024, filed with the Securities and
Exchange Commission (the “SEC”) on March 17, 2025, and also include
the following: the Company’s ability to generate sufficient cash
flows from operations, proceeds from equity issuances and debt
financings, and proceeds from the sale of assets to satisfy its
short and long-term debt obligations and to fund the Company’s
acquisitions and capital improvement projects to expand, redevelop,
and/or reposition its senior living communities; elevated market
interest rates that increase the cost of certain of our debt
obligations; increased competition for, or a shortage of, skilled
workers, including due to general labor market conditions, along
with wage pressures resulting from such increased competition, low
unemployment levels, use of contract labor, minimum wage increases
and/or changes in immigration or overtime laws; the Company’s
ability to obtain additional capital on terms acceptable to it; the
Company’s ability to extend or refinance its existing debt as such
debt matures; the Company’s compliance with its debt agreements,
including certain financial covenants and the risk of cross-default
in the event such non-compliance occurs; the Company’s ability to
complete acquisitions and dispositions upon favorable terms or at
all, including the possibility that the expected benefits and the
Company’s projections related to such acquisitions may not
materialize as expected; the risk of oversupply and increased
competition in the markets which the Company operates; the
Company’s ability to maintain effective internal controls over
financial reporting; the cost and difficulty of complying with
applicable licensure, legislative oversight, or regulatory changes;
risks associated with current global economic conditions and
general economic factors such as elevated labor costs due to
shortages of medical and non-medical staff, competition in the
labor market, increased costs of salaries, wages and benefits, and
immigration laws, the consumer price index, commodity costs, fuel
and other energy costs, supply chain disruptions, increased
insurance costs, tariffs, elevated interest rates and tax rates;
the impact from or the potential emergence and effects of a future
epidemic, pandemic, outbreak of infectious disease or other health
crisis; the Company’s ability to maintain the security and
functionality of its information systems, to prevent a
cybersecurity attack or breach, and to comply with applicable
privacy and consumer protection laws, including HIPAA; and changes
in accounting principles and interpretations.
For information about Sonida Senior Living, visit
www.sonidaseniorliving.com or connect with the Company on Facebook,
X or LinkedIn.
SONIDA SENIOR LIVING,
INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(in thousands, except per
share data)
Quarters Ended December
31,
Years Ended December
31,
2024
2023
2024
2023
Revenues:
Resident revenue
$
77,053
$
59,349
$
267,849
$
232,032
Management fees
916
586
3,381
2,191
Managed community reimbursement
revenue
13,962
5,785
33,096
21,099
Total revenues
91,931
65,720
304,326
255,322
Expenses:
Operating expense
59,225
44,367
202,015
177,323
General and administrative expense
11,815
9,946
39,997
32,198
Depreciation and amortization expense
13,320
10,137
44,051
39,888
Long-lived asset impairment
—
—
—
5,965
Managed community reimbursement
revenue
13,962
5,785
33,096
21,099
Total expenses
98,322
70,235
319,159
276,473
Other income (expense):
Interest income
302
87
1,681
608
Interest expense
(9,596
)
(9,673
)
(36,990
)
(36,118
)
Gain on extinguishment of debt, net
10,388
—
48,536
36,339
Loss from equity method investment
(714
)
—
(895
)
—
Other expense, net
(161
)
(480
)
(540
)
(532
)
Loss before provision for income
taxes
(6,172
)
(14,581
)
(3,041
)
(20,854
)
Provision for income taxes
(46
)
(48
)
(239
)
(253
)
Net loss
(6,218
)
(14,629
)
(3,280
)
(21,107
)
Less: Net loss attributable to
noncontrolling interests
714
—
1,221
—
Net loss attributable to Sonida
shareholders
(5,504
)
(14,629
)
(2,059
)
(21,107
)
Dividends on Series A convertible
preferred stock
(1,409
)
—
(2,818
)
—
Undeclared dividends on Series A
convertible preferred
—
(1,299
)
(2,707
)
(4,992
)
Net loss attributable to common
stockholders
$
(6,913
)
$
(15,928
)
$
(7,584
)
$
(26,099
)
Per share data:
Basic net loss per share
$
(0.38
)
$
(2.17
)
$
(0.54
)
$
(3.85
)
Diluted net loss per share
$
(0.38
)
$
(2.17
)
$
(0.54
)
$
(3.85
)
Weighted average common shares outstanding
— basic
18,048
7,331
14,109
6,786
Weighted average common shares outstanding
— diluted
18,048
7,331
14,109
6,786
SONIDA SENIOR LIVING,
INC.
CONSOLIDATED BALANCE
SHEET
(in thousands)
December 31, 2024
December 31, 2023
Assets:
Current assets:
Cash and cash equivalents
$
16,992
$
4,082
Restricted cash
22,095
13,668
Accounts receivable, net of allowance for
credit losses of $7.9 million and $5.3 million, respectively
18,965
8,017
Prepaid expenses and other assets
4,634
4,475
Derivative assets
1,403
2,103
Total current assets
64,089
32,345
Property and equipment, net
739,884
588,179
Investment in unconsolidated entity
10,943
—
Intangible assets, net
24,526
622
Other assets, net
2,479
314
Total assets
$
841,921
$
621,460
Liabilities:
Current liabilities:
Accounts payable
$
9,031
$
11,375
Accrued expenses
45,024
42,388
Current portion of debt, net of deferred
loan costs
15,486
42,323
Deferred income
5,361
4,041
Federal and state income taxes payable
243
215
Other current liabilities
470
519
Total current liabilities
75,615
100,861
Long-term debt, net of deferred loan
costs
635,904
587,099
Other long-term liabilities
793
49
Total liabilities
712,312
688,009
Commitments and contingencies
Redeemable preferred stock:
Series A convertible preferred stock,
$0.01 par value; 41 shares authorized, 41 shares issued and
outstanding as of December 31, 2024 and 2023
51,249
48,542
Equity:
Sonida’s shareholders’ equity
(deficit):
Preferred stock, $0.01 par value:
Authorized shares — 15,000 as of December
31, 2024 and 2023; none issued or outstanding, except Series A
convertible preferred stock as noted above
—
—
Common stock, $0.01 par value:
Authorized shares — 30,000 and 15,000 as
of December 31, 2024 and 2023, respectively; 18,992 and 8,178
shares issued and outstanding as of December 31, 2024 and 2023,
respectively
190
82
Additional paid-in capital
491,819
302,992
Retained deficit
(420,224
)
(418,165
)
Total Sonida shareholders’ equity
(deficit)
71,785
(115,091
)
Noncontrolling interest:
6,575
—
Total equity (deficit)
78,360
(115,091
)
Total liabilities, redeemable preferred
stock and equity (deficit)
$
841,921
$
621,460
SONIDA SENIOR LIVING,
INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(in thousands)
Years Ended December
31,
(In thousands)
2024
2023
Operating Activities
Net loss
$
(3,280
)
$
(21,107
)
Adjustments to reconcile net loss to net
cash provided by (used in) operating activities:
Depreciation and amortization
44,051
39,888
Amortization of deferred loan costs
1,619
1,552
Loss on derivative instruments, net
3,950
2,981
(Gain) loss on sale of assets, net
(192
)
118
Long-lived asset impairment
—
5,965
Gain on extinguishment of debt
(48,536
)
(36,339
)
Loss from equity method investment
895
—
Provision for bad debt
2,596
1,151
Non-cash stock-based compensation
expense
4,369
2,749
Other non-cash items
(35
)
(53
)
Changes in operating assets and
liabilities:
Accounts receivable, net
(13,543
)
(3,249
)
Prepaid expenses and other assets
(156
)
2,918
Other assets, net
—
276
Accounts payable and accrued expenses
5,151
13,013
Federal and state income taxes
receivable/payable
28
217
Deferred income
1,320
622
Customer deposits
(19
)
(19
)
Net cash provided by (used in) operating
activities
(1,782
)
10,683
Investing Activities
Investments in unconsolidated entities
(22,409
)
—
Return of investment in unconsolidated
entities
10,571
—
Acquisition of new communities
(172,546
)
—
Capital expenditures
(25,170
)
(17,938
)
Proceeds from sale of assets
631
1,376
Net cash used in investing activities
(208,923
)
(16,562
)
Financing Activities
Proceeds from issuance of common stock,
net of issuance costs
190,537
10,000
Proceeds from notes payable
56,040
—
Repayments of notes payable
(72,026
)
(13,802
)
Proceeds from credit facility
68,705
—
Repayment of credit facility
(8,705
)
—
Proceeds from noncontrolling investors in
joint ventures
7,796
—
Dividends paid on Series A convertible
preferred stock
(2,818
)
—
Deferred loan costs paid
(3,726
)
(825
)
Purchase of derivative assets
(3,312
)
(2,362
)
Other financing costs
(449
)
(124
)
Net cash provided by (used in) financing
activities
232,042
(7,113
)
Increase (decrease) in cash and cash
equivalents
21,337
(12,992
)
Cash and cash equivalents and restricted
cash at beginning of year
17,750
30,742
Cash and cash equivalents and restricted
cash at end of year
$
39,087
$
17,750
DEFINITIONS
RevPAR, or average monthly revenue per available unit, is
defined by the Company as resident revenue for the period, divided
by the weighted average number of available units in the
corresponding portfolio for the period, divided by the number of
months in the period.
RevPOR, or average monthly revenue per occupied unit, is
defined by the Company as resident revenue for the period, divided
by the weighted average number of occupied units in the
corresponding portfolio for the period, divided by the number of
months in the period.
Same-Store Community is defined by the Company as
communities that are consolidated, wholly owned, and operational
for the full period in both comparison years. Consolidated
communities excluded from the same-store community portfolio
include communities acquired or disposed of since the beginning of
the prior year and certain communities that have experienced a
casualty event that has significantly impacted their
operations.
NON-GAAP FINANCIAL MEASURES
This earnings release contains the financial measures (1) Net
Operating Income and Adjusted Net Operating Income, (2) Net
Operating Income Margin and Adjusted Net Operating Income Margin,
(3) Adjusted EBITDA, and (4) Same-store amounts for these metrics,
each of which is not calculated in accordance with U.S. Generally
Accepted Accounting Principles (“GAAP”). Presentations of these
non-GAAP financial measures are intended to aid investors in better
understanding the factors and trends affecting the Company’s
performance and liquidity. However, investors should not consider
these non-GAAP financial measures as a substitute for financial
measures determined in accordance with GAAP, including net income
(loss), income (loss) from operations, net cash provided by (used
in) operating activities, or revenue. Investors are cautioned that
amounts presented in accordance with the Company’s definitions of
these non-GAAP financial measures may not be comparable to similar
measures disclosed by other companies because not all companies
calculate non-GAAP measures in the same manner. Investors are urged
to review the reconciliations of these non-GAAP financial measures
from the most comparable financial measures determined in
accordance with GAAP, which are included below.
The Company believes that presentation of Net Operating Income,
Net Operating Income Margin, Adjusted Net Operating Income, and
Adjusted Net Operating Income Margin as performance measures is
useful to investors because such measures are some of the metrics
used by the Company’s management to evaluate the performance of the
Company’s owned portfolio of communities, to review the Company’s
comparable historic and prospective core operating performance of
the Company’s owned communities, and to make day-to-day operating
decisions. The Company also believes that the presentation of such
non-GAAP financial measures and Adjusted EBITDA is useful to
investors because such measures provide an assessment of
operational factors that management can impact in the short-term,
primarily revenues and the controllable cost structure of the
organization, by eliminating items related to the Company’s
financing and capital structure and other items that management
does not consider as part of the Company’s underlying core
operating performance and that management believes impact the
comparability of performance between periods.
Net Operating Income, Net Operating Income Margin, Adjusted Net
Operating Income and Adjusted Net Operating Income Margin have
material limitations as performance measures, including the
exclusion of general and administrative expenses that are necessary
to operate the Company and oversee its communities. Furthermore,
such non-GAAP financial measures and Adjusted EBITDA exclude (i)
interest that is necessary to operate the Company’s business under
its current financing and capital structure, and (ii) depreciation,
amortization, and impairment charges that may represent the wear
and tear and/or reduction in value of the Company’s communities and
other assets and may be indicative of future needs for capital
expenditures. The Company may also incur income/expense similar to
those for which adjustments may be made and such income/expense may
significantly affect the Company’s operating results.
Net Operating Income and Net Operating Income Margin
Net Operating Income and Net Operating Income Margin are
non-GAAP performance measures that the Company defines as net
income (loss) excluding: general and administrative expenses
(inclusive of stock-based compensation expense), interest income,
interest expense, other expense, provision for income taxes,
management fees, and further adjusted to exclude income/expense
associated with non-cash, non-operational, transactional, or
organizational restructuring items that management does not
consider as part of the Company’s underlying core operating
performance and that management believes impact the comparability
of performance between periods. For the periods presented herein,
such other items include depreciation and amortization expense,
long-lived asset impairment, gain on extinguishment of debt, loss
from equity method investment, casualty loss, non-recurring
settlement fees, non-income tax, and non-property tax. Net
Operating Income Margin is calculated by dividing Net Operating
Income by resident revenue. Adjusted Net Operating Income and
Adjusted Net Operating Income Margin are further adjusted to
exclude the impact from any non-recurring state grant funds
received by the Company. The Company presents these non-GAAP
measures on a consolidated community and same-store community
basis
The following table presents a reconciliation of the Non-GAAP
Financial Measures of Net Operating Income, Adjusted Net Operating
Income, Net Operating Income Margin and Adjusted Net Operating
Income Margin, in each case, on a consolidated community and
same-store community basis to the most directly comparable GAAP
financial measure of net loss for the periods indicated:
(in thousands)
Three Months Ended
December 31,
Three Months Ended September
30,
Years Ended December
31,
2024
2023
2024
2024
2023
Same-store community net operating
income (1)
Net loss
$
(6,218
)
$
(14,629
)
$
(14,265
)
$
(3,280
)
$
(21,107
)
General and administrative expense
11,815
9,946
11,793
39,997
32,198
Depreciation and amortization expense
13,320
10,137
10,729
44,051
39,888
Long-lived asset impairment
—
—
—
—
5,965
Interest income
(302
)
(87
)
(853
)
(1,681
)
(608
)
Interest expense
9,596
9,673
9,839
36,990
36,118
Gain on extinguishment of debt, net
(10,388
)
—
—
(48,536
)
(36,339
)
Loss from equity method investment
714
—
146
895
—
Other expense, net
161
480
153
540
532
Provision for income taxes
46
48
68
239
253
Management fees
(916
)
(586
)
(1,151
)
(3,381
)
(2,191
)
Other operating expenses (2)
1,220
1,279
630
2,834
3,193
Consolidated community net operating
income
19,048
16,261
17,089
68,668
57,902
Net operating (income)loss for non
same-store communities (1)
(3,020
)
—
(277
)
(3,232
)
—
Same-store community net operating
income
16,028
16,261
16,812
65,436
57,902
Resident revenue
$
77,053
$
59,349
$
66,951
$
267,849
$
232,032
Resident revenue for non same-store
communities (1)
14,125
—
3,915
18,409
—
Same-store community resident
revenue
62,928
59,349
63,036
249,440
232,032
Same-store community net operating
income margin
25.5
%
27.4
%
26.7
%
26.2
%
25.0
%
State relief grants (3)
—
—
—
—
2,926
Adjusted resident revenue
62,928
59,349
63,036
249,440
229,106
Adjusted community net operating
income
$
16,028
$
16,261
$
16,812
$
65,436
$
54,976
Adjusted community net operating income
margin
25.5
%
27.4
%
26.7
%
26.2
%
24.0
%
(1) Q4 2024 excludes 16 senior living
consolidated communities acquired by the Company in 2024 (including
one unoccupied community acquired on December 31, 2024). Q3 2024
excludes five senior living consolidated communities acquired by
the Company.
(2) Includes casualty loss, non-recurring
settlement fees, non-income tax, and non-property tax.
(3) State relief revenue are grants and
other funding received from third parties due to the financial
distress impacts of the pandemic and includes state relief funds
received.
ADJUSTED EBITDA (UNAUDITED)
Adjusted EBITDA is a non-GAAP performance measure that the
Company defines as net income (loss) excluding: depreciation and
amortization expense, interest income, interest expense, other
expense/income, provision for income taxes; and further adjusted to
exclude income/expense associated with non-cash, non-operational,
transactional, or organizational restructuring items that
management does not consider as part of the Company’s underlying
core operating performance and that management believes impact the
comparability of performance between periods. For the periods
presented herein, such other items include stock-based compensation
expense, provision for bad debt, long-lived asset impairment, gain
on extinguishment of debt, executive transition costs, casualty
losses, and transaction and conversion costs.
The following table presents a reconciliation of the Non-GAAP
Financial Measures of Adjusted EBITDA to the most directly
comparable GAAP financial measure of net loss for the periods
indicated:
(In thousands)
Three Months Ended
December 31,
Three Months Ended September
30,
Years Ended December
31,
2024
2023
2024
2024
2023
Adjusted EBITDA
Net loss
$
(6,218
)
$
(14,629
)
$
(14,265
)
$
(3,280
)
$
(21,107
)
Depreciation and amortization expense
13,320
10,137
10,729
44,051
39,888
Stock-based compensation expense
1,175
605
1,408
4,369
2,749
Provision for bad debt
1,086
568
629
2,596
1,151
Interest income
(302
)
(87
)
(853
)
(1,681
)
(608
)
Interest expense
9,596
9,673
9,839
36,990
36,118
Long-lived asset impairment
—
—
—
—
5,965
Gain on extinguishment of debt, net
(10,388
)
—
—
(48,536
)
(36,339
)
Executive transition costs
2,157
—
—
2,157
—
Other expense, net
161
480
153
540
532
Provision for income taxes
46
48
68
239
253
Casualty losses (1)
947
348
267
2,069
1,008
Transaction and conversion costs (2)
768
2,159
2,098
3,730
4,294
Adjusted EBITDA
$
12,348
$
9,302
$
10,073
$
43,244
$
33,904
(1) Casualty losses relate to
non-recurring insured claims for unexpected events.
(2) Transaction and conversion costs
relate to legal and professional fees incurred for transactions,
restructuring projects, or related projects.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250317320436/en/
Investor Relations Jason Finkelstein Ignition IR
ir@sonidaliving.com
Sonida Senior Living (NYSE:SNDA)
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