Brookdale Senior Living Inc. - FORM 8-K - EX-99.2 - SUPPLEMENTAL INFORMATION

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Brookdale Senior Living Inc. Reports

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8-K - FORM 8-K - Brookdale Senior Living Inc.	form8-k.htm
EX-99.1 - PRESS RELEASE - Brookdale Senior Living Inc.	exhibit99_1.htm

Brookdale Senior Living Inc.
Corporate Overview - selected financial information
As of September 30, 2013

Corporate Overview

Brookdale Senior Living Inc. ("BKD") is a leading owner and operator of senior living communities throughout the United States. The Company is committed to providing an exceptional living experience through properties that are designed, purpose-built and operated to provide the highest-quality service, care and living accommodations for residents. As of September 30, 2013, the Company operates independent living, assisted living, and dementia-care communities and continuing care retirement centers, with 651 communities in 36 states and the ability to serve approximately 67,000 residents. Through its Innovative Senior Care program, the Company also offers a range of outpatient therapy, home health and hospice services, primarily to residents of its communities.

Stock Listing

Common Stock
NYSE: BKD

Community Information

Ownership Type	Number of Communities			Number of Units			Percentage of Q3 2013 Resident and Management Fees			Percentage of Q3 2013 Facility Operating Income			Percentage of YTD 2013 Resident and Management Fees			Percentage of YTD 2013 Facility Operating Income
Owned		220			22,958			41.9	%		41.0	%		42.1	%		41.3	%
Leased		329			25,771			47.3	%		50.1	%		47.2	%		49.6	%
Innovative Senior Care ("ISC")		N/	A		N/	A		9.6	%		5.4	%		9.5	%		5.6	%
Managed		102			18,340			1.2	%		3.5	%		1.2	%		3.5	%
Total		651			67,069			100.0	%		100.0	%		100.0	%		100.0	%

Operating Type - By Segment
Retirement Centers		76			14,548			20.8	%		26.0	%		20.7	%		25.3	%
Assisted Living		432			21,562			41.1	%		44.3	%		41.2	%		44.5	%
CCRCs - Rental		27			6,744			15.7	%		12.4	%		15.7	%		12.6	%
CCRCs - Entry Fee		14			5,875			11.6	%		8.4	%		11.7	%		8.5	%
Innovative Senior Care ("ISC")		N/	A		N/	A		9.6	%		5.4	%		9.5	%		5.6	%
Managed		102			18,340			1.2	%		3.5	%		1.2	%		3.5	%
Total		651			67,069			100.0	%		100.0	%		100.0	%		100.0	%

CFFO Per Share

($ except where indicated)	FY 2012										FY 2013
		Q1		Q2		Q3		Q4	Full Year (1)			Q1		Q2		Q3
Reported CFFO	$	0.45	$	0.51	$	0.50	$	0.50	$	1.96	$	0.55	$	0.58	$	0.57
Add: integration, transaction-related and EMR roll-out costs		0.03		0.06		0.04		0.06		0.19		0.02		0.03		0.04
Adjusted CFFO	$	0.48	$	0.57	$	0.54	$	0.56	$	2.15	$	0.57	$	0.61	$	0.61

Weighted average shares (000's)		121,145		121,708		122,493		122,608				122,823		123,405		124,128
Period end outstanding shares (excluding unvested restricted shares) (000's)		121,197		122,474		122,575		122,738				123,040		124,061		124,285

^{(1) Full year CFFO for all periods is calculated as the sum of the quarterly amounts for the year.}

Investor Relations

Ross Roadman
SVP, Investor Relations
Brookdale Senior Living Inc.
111 Westwood Place, Suite 400
Brentwood, TN 37027
Phone (615) 564-8104
rroadman@brookdaleliving.com

Note: See accompanying third quarter earnings release for non-GAAP financial measure definitions and reconciliations.

Brookdale Senior Living Inc.
Segment Operating Information
As of September 30, 2013

Senior Housing Operating Information

	FY 2012															FY 2013
		Q1			Q2			Q3			Q4		Full Year				Q1			Q2			Q3
Retirement Centers
Number of communities (period end)		76			76			76			76			76			76			76			76
Total average units(1)		14,452			14,451			14,445			14,433			14,445			14,429			14,429			14,444
Weighted average unit occupancy		88.8	%		88.8	%		89.1	%		89.7	%		89.1	%		89.5	%		89.4	%		90.2	%
Senior Housing average monthly revenue per unit(2)	$	3,235		$	3,268		$	3,275		$	3,276		$	3,263		$	3,328		$	3,362		$	3,408

Assisted Living
Number of communities (period end)		434			434			434			433			433			431			432			432
Total average units(1)		21,635			21,637			21,652			21,577			21,625			21,556			21,499			21,513
Weighted average unit occupancy		88.5	%		88.6	%		89.1	%		89.7	%		88.9	%		89.1	%		89.4	%		90.0	%
Senior Housing average monthly revenue per unit(2)	$	4,379		$	4,390		$	4,393		$	4,401		$	4,390		$	4,523		$	4,519		$	4,518

CCRCs - Rental
Number of communities (period end)		26			27			27			27			27			27			27			27
Total average units(1)		6,626			6,659			6,691			6,691			6,667			6,687			6,684			6,687
Weighted average unit occupancy		86.5	%		85.8	%		85.8	%		87.0	%		86.3	%		87.6	%		86.2	%		86.7	%
Senior Housing average monthly revenue per unit(2)	$	5,536		$	5,561		$	5,619		$	5,639		$	5,588		$	5,709		$	5,649		$	5,759

CCRCs - Entry Fee
Number of communities (period end)		14			14			14			14			14			14			14			14
Total average units(1)		5,171			5,199			5,221			5,249			5,210			5,281			5,295			5,308
Weighted average unit occupancy		83.7	%		83.4	%		83.4	%		84.1	%		83.7	%		84.6	%		83.8	%		84.1	%
Senior Housing average monthly revenue per unit(2)	$	5,055		$	4,963		$	4,975		$	4,921		$	4,978		$	5,011		$	5,025		$	4,994

Senior Housing Totals
Number of communities (period end)		550			551			551			550			550			548			549			549
Total average units(1)		47,884			47,946			48,009			47,950			47,947			47,953			47,907			47,952
Weighted average unit occupancy		87.8	%		87.7	%		88.0	%		88.7	%		88.0	%		88.5	%		88.3	%		89.0	%
Senior Housing average monthly revenue per unit(2)	$	4,257		$	4,266		$	4,279		$	4,282		$	4,271		$	4,375		$	4,373		$	4,397

Management Services - Total
Number of communities (period end)		96			96			97			97			97			101			101			102
Total average units(1)		18,253			18,144			18,081			18,141			18,155			18,114			18,310			18,291
Weighted average occupancy		84.3	%		84.0	%		84.3	%		85.4	%		84.5	%		84.9	%		84.9	%		85.7	%
Average monthly revenue per unit(2)	$	3,373		$	3,369		$	3,386		$	3,399		$	3,382		$	3,460		$	3,505		$	3,499

Innovative Senior Care Operating Information

	FY 2012					FY 2013
		Q1	Q2	Q3	Q4		Q1	Q2	Q3
Innovative Senior Care
Brookdale units served:
Outpatient Therapy consolidated		35,909	36,844	38,016	37,961		38,017	38,075	38,253
Home Health consolidated		32,655	31,944	32,650	32,242		32,389	32,864	33,940
Outpatient Therapy non-consolidated		9,685	9,861	12,540	13,448		13,502	14,177	14,733
Home Health non-consolidated		4,735	10,667	12,597	13,569		13,326	13,232	13,601
Total Brookdale units served:
Outpatient Therapy		45,594	46,705	50,556	51,409		51,519	52,252	52,986
Home Health		37,390	42,611	45,247	45,811		45,715	46,096	47,541

Outpatient Therapy treatment codes		907,816	957,364	939,241	762,233		821,308	840,076	818,758
Home Health average census		3,448	3,554	3,651	4,187		4,289	4,366	4,574

⁽¹⁾	Total average units operated represent the average units operated during the period, excluding equity homes.
⁽²⁾	Average monthly revenue per unit represents the average of the total monthly revenues, excluding amortization of entrance fees and ISC segment revenue, divided by average occupied units.

Brookdale Senior Living Inc.
Senior Housing Data by Ownership Type
As of September 30, 2013

Senior Housing Operating Information

	FY 2012												FY 2013
		Q1			Q2			Q3			Q4 (1)			Q1			Q2			Q3 (2)

Owned Properties
Number of communities (period end)		209			210			210			221			219			220			220
Total average units(3)		21,281			21,350			21,425			22,243			22,243			22,153			22,190
Weighted average unit occupancy		87.2	%		87.4	%		87.6	%		89.0	%		88.8	%		88.7	%		89.1	%
Senior Housing average monthly revenue per unit(4)	$	4,302		$	4,297		$	4,318		$	4,323		$	4,416		$	4,416		$	4,438

Leased Properties with Bargain Purchase Options
Number of communities (period end)		18			18			18			9			9			9			9
Total average units(3)		3,263			3,263			3,261			2,948			2,949			2,945			2,944
Weighted average unit occupancy		88.4	%		87.6	%		88.0	%		88.3	%		88.2	%		88.0	%		88.6	%
Senior Housing average monthly revenue per unit(4)	$	3,878		$	3,874		$	3,903		$	3,802		$	3,891		$	3,896		$	3,929

Leased Properties with Fair Market Value Purchase Options
Number of communities (period end)		77			77			77			74			74			74			75
Total average units(3)		3,929			3,927			3,927			3,364			3,364			3,364			3,413
Weighted average unit occupancy		91.1	%		91.2	%		92.0	%		91.8	%		90.8	%		90.6	%		90.9	%
Senior Housing average monthly revenue per unit(4)	$	4,384		$	4,423		$	4,482		$	4,549		$	4,675		$	4,638		$	4,645

Leased Properties without Purchase Options
Number of communities (period end)		246			246			246			246			246			246			245
Total average units(3)		19,411			19,406			19,396			19,395			19,397			19,445			19,405
Weighted average unit occupancy		87.6	%		87.3	%		87.6	%		87.9	%		87.9	%		87.6	%		88.5	%
Senior Housing average monthly revenue per unit(4)	$	4,241		$	4,264		$	4,256		$	4,256		$	4,344		$	4,348		$	4,381

Senior Housing Totals
Number of communities (period end)		550			551			551			550			548			549			549
Total average units(3)		47,884			47,946			48,009			47,950			47,953			47,907			47,952
Weighted average unit occupancy		87.8	%		87.7	%		88.0	%		88.7	%		88.5	%		88.3	%		89.0	%
Senior Housing average monthly revenue per unit(4)	$	4,257		$	4,266		$	4,279		$	4,282		$	4,375		$	4,373		$	4,397

⁽¹⁾	During the three months ended December 31, 2012, the Company acquired the underlying real estate interest in 12 communities that the Company previously leased. The results of operations of the previously leased communities are included within Owned Properties beginning in the fourth quarter of FY 2012. Prior quarters have not been recast.
⁽²⁾	During the three months ended September 30, 2013, the Company amended a lease agreement for one community and, in connection therewith, obtained a fair market value purchase option. The results of operations of the community are included within Leased Properties with Fair Market Value Purchase Options beginning in the third quarter of FY 2013. Prior quarters have not been recast.
⁽³⁾	Total average units operated represent the average units operated during the period, excluding equity homes.
⁽⁴⁾	Average monthly revenue per unit represents the average of the total monthly revenues, excluding amortization of entrance fees and ISC segment revenue, divided by average occupied units.

Brookdale Senior Living Inc.
Segment Financial Data
As of September 30, 2013

Financial Data

($ in 000s)

Retirement Centers	FY 2012					FY 2013
	Q1	Q2	Q3	Q4	Full Year	Q1	Q2	Q3	YTD
Revenue	124,512	125,813	126,401	127,176	503,902	128,922	130,170	133,272	392,364
Expenses	73,521	73,138	75,679	75,979	298,317	75,588	75,993	76,452	228,033
Segment Operating Income	50,991	52,675	50,722	51,197	205,585	53,334	54,177	56,820	164,331
Segment Operating Margin	41.0%	41.9%	40.1%	40.3%	40.8%	41.4%	41.6%	42.6%	41.9%

Assisted Living	FY 2012					FY 2013
	Q1	Q2	Q3	Q4	Full Year	Q1	Q2	Q3	YTD
Revenue	251,352	252,399	254,179	255,407	1,013,337	260,615	260,497	262,524	783,636
Expenses	160,789	162,233	163,017	166,114	652,153	164,330	164,316	165,774	494,420
Segment Operating Income	90,563	90,166	91,162	89,293	361,184	96,285	96,181	96,750	289,216
Segment Operating Margin	36.0%	35.7%	35.9%	35.0%	35.6%	36.9%	36.9%	36.9%	36.9%

CCRCs - Rental	FY 2012					FY 2013
	Q1	Q2	Q3	Q4	Full Year	Q1	Q2	Q3	YTD
Revenue	95,112	95,258	96,681	98,428	385,479	100,327	97,562	100,076	297,965
Expenses	67,093	68,494	71,581	72,248	279,416	71,250	71,995	73,063	216,308
Segment Operating Income	28,019	26,764	25,100	26,180	106,063	29,077	25,567	27,013	81,657
Segment Operating Margin	29.5%	28.1%	26.0%	26.6%	27.5%	29.0%	26.2%	27.0%	27.4%

CCRCs - Entry Fee	FY 2012					FY 2013
	Q1	Q2	Q3	Q4	Full Year	Q1	Q2	Q3	YTD
Revenue	71,719	70,858	71,413	71,711	285,701	74,308	74,016	74,110	222,434
Expenses	54,914	55,341	56,249	57,792	224,296	54,737	56,244	55,892	166,873
Segment Operating Income	16,805	15,517	15,164	13,919	61,405	19,571	17,772	18,218	55,561
Segment Operating Margin	23.4%	21.9%	21.2%	19.4%	21.5%	26.3%	24.0%	24.6%	25.0%

Bridge to Cash Basis for CCRCs - Entry Fee segment
Revenue	71,719	70,858	71,413	71,711	285,701	74,308	74,016	74,110	222,434
Less: revenue amortization (non-cash)	(6,066)	(6,310)	(6,459)	(6,527)	(25,362)	(7,133)	(7,032)	(7,013)	(21,178)
Add: net entrance fees (cash)	6,887	14,265	19,108	15,089	55,349	7,553	16,422	11,370	35,345
Adjusted revenue	72,540	78,813	84,062	80,273	315,688	74,728	83,406	78,467	236,601
Expenses	54,914	55,341	56,249	57,792	224,296	54,737	56,244	55,892	166,873
Adjusted Segment Operating Income	17,626	23,472	27,813	22,481	91,392	19,991	27,162	22,575	69,728
Adjusted Segment Operating Margin	24.3%	29.8%	33.1%	28.0%	29.0%	26.8%	32.6%	28.8%	29.5%

Total Senior Housing	FY 2012					FY 2013
(GAAP Basis)	Q1	Q2	Q3	Q4	Full Year	Q1	Q2	Q3	YTD
Revenue	542,695	544,328	548,674	552,722	2,188,419	564,172	562,245	569,982	1,696,399
Expenses	356,317	359,206	366,526	372,133	1,454,182	365,905	368,548	371,181	1,105,634
Operating Income	186,378	185,122	182,148	180,589	734,237	198,267	193,697	198,801	590,765
Operating Margin	34.3%	34.0%	33.2%	32.7%	33.6%	35.1%	34.5%	34.9%	34.8%
G&A Allocation (1)	22,751	20,876	21,402	20,374	85,403	25,526	23,224	22,647	71,397
G&A Allocation as a % of revenue	4.2%	3.8%	3.9%	3.7%	3.9%	4.5%	4.1%	4.0%	4.2%
Adjusted Operating Income	163,627	164,246	160,746	160,215	648,834	172,741	170,473	176,154	519,368
Adjusted Operating Margin	30.2%	30.2%	29.3%	29.0%	29.6%	30.6%	30.3%	30.9%	30.6%

Brookdale Senior Living Inc.

Segment Financial Data

As of September 30, 2013

Financial Data (continued)

($ in 000s)

Innovative Senior Care ("ISC")	FY 2012					FY 2013
	Q1	Q2	Q3	Q4	Full Year	Q1	Q2	Q3	YTD
Revenue	53,854	57,722	56,856	56,085	224,517	60,198	58,693	61,162	180,053
Expenses	42,452	44,309	44,941	45,035	176,737	47,098	47,479	49,398	143,975
Segment Operating Income	11,402	13,413	11,915	11,050	47,780	13,100	11,214	11,764	36,078
Segment Operating Margin	21.2%	23.2%	21.0%	19.7%	21.3%	21.8%	19.1%	19.2%	20.0%
G&A Allocation (1)	5,954	5,453	5,467	5,358	22,232	6,055	6,005	5,516	17,576
G&A Allocation as a % of revenue	11.1%	9.4%	9.6%	9.6%	9.9%	10.1%	10.2%	9.0%	9.8%
Adjusted Segment Operating Income	5,448	7,960	6,448	5,692	25,548	7,045	5,209	6,248	18,502
Adjusted Segment Operating Margin	10.1%	13.8%	11.3%	10.1%	11.4%	11.7%	8.9%	10.2%	10.3%

Total Senior Housing and ISC	FY 2012					FY 2013
(GAAP Basis)	Q1	Q2	Q3	Q4	Full Year	Q1	Q2	Q3	YTD
Revenue	596,549	602,050	605,530	608,807	2,412,936	624,370	620,938	631,144	1,876,452
Expenses	398,769	403,515	411,467	417,168	1,630,919	413,003	416,027	420,579	1,249,609
Operating Income	197,780	198,535	194,063	191,639	782,017	211,367	204,911	210,565	626,843
Operating Margin	33.2%	33.0%	32.0%	31.5%	32.4%	33.9%	33.0%	33.4%	33.4%
G&A Allocation (1)	28,705	26,329	26,869	25,732	107,635	31,581	29,229	28,163	88,973
G&A Allocation as a % of revenue	4.8%	4.4%	4.4%	4.2%	4.5%	5.1%	4.7%	4.5%	4.7%
Adjusted Operating Income	169,075	172,206	167,194	165,907	674,382	179,786	175,682	182,402	537,870
Adjusted Operating Margin	28.3%	28.6%	27.6%	27.3%	27.9%	28.8%	28.3%	28.9%	28.7%

Management Services	FY 2012					FY 2013
	Q1	Q2	Q3	Q4	Full Year	Q1	Q2	Q3	YTD
Revenue (Management Fees)	7,444	7,499	7,407	8,436	30,786	7,609	7,744	7,622	22,975
Expenses (G&A Allocation) (1)	5,929	5,325	5,644	5,311	22,209	6,031	6,192	6,106	18,329
Segment Operating Income	1,515	2,174	1,763	3,125	8,577	1,578	1,552	1,516	4,646
Segment Operating Margin	20.4%	29.0%	23.8%	37.0%	27.9%	20.7%	20.0%	19.9%	20.2%

Total Senior Housing, ISC and Management Services
	FY 2012					FY 2013
(GAAP Basis)	Q1	Q2	Q3	Q4	Full Year	Q1	Q2	Q3	YTD
Revenue	603,993	609,549	612,937	617,243	2,443,722	631,979	628,682	638,766	1,899,427
Expenses	398,769	403,515	411,467	417,168	1,630,919	413,003	416,027	420,579	1,249,609
Operating Income	205,224	206,034	201,470	200,075	812,803	218,976	212,655	218,187	649,818
Operating Margin	34.0%	33.8%	32.9%	32.4%	33.3%	34.6%	33.8%	34.2%	34.2%
G&A Allocation (1)	34,634	31,654	32,513	31,043	129,844	37,612	35,421	34,269	107,302
G&A Allocation as a % of revenue	5.7%	5.2%	5.3%	5.0%	5.3%	6.0%	5.6%	5.4%	5.6%
Adjusted Operating Income	170,590	174,380	168,957	169,032	682,959	181,364	177,234	183,918	542,516
Adjusted Operating Margin	28.2%	28.6%	27.6%	27.4%	27.9%	28.7%	28.2%	28.8%	28.6%

(1) Excludes non-cash stock-based compensation expense and integration, transaction-related and EMR roll-out costs.

Brookdale Senior Living Inc.
Senior Housing Data by Ownership Type
As of September 30, 2013

Financial Data

($ in 000s)

Owned Properties	FY 2012					FY 2013
	Q1	Q2	Q3	Q4 (1)	Full Year	Q1	Q2	Q3	YTD
Revenue	243,302	244,720	247,473	260,980	996,475	266,322	265,139	267,922	799,383
Expenses	163,822	165,862	171,356	177,350	678,390	175,672	176,623	178,382	530,677
Segment Operating Income	79,480	78,858	76,117	83,630	318,085	90,650	88,516	89,540	268,706
Segment Operating Margin	32.7%	32.2%	30.8%	32.0%	31.9%	34.0%	33.4%	33.4%	33.6%

Bridge to Cash Basis for CCRCs - Entry Fee
Revenue	243,302	244,720	247,473	260,980	996,475	266,322	265,139	267,922	799,383
Less: revenue amortization (non-cash)	(3,692)	(4,208)	(4,294)	(4,265)	(16,459)	(4,664)	(4,821)	(4,660)	(14,145)
Add: net entrance fees (cash)	5,802	10,487	14,234	11,481	42,004	5,449	10,936	8,014	24,399
Adjusted revenue	245,412	250,999	257,413	268,196	1,022,020	267,107	271,254	271,276	809,637
Expenses	163,822	165,862	171,356	177,350	678,390	175,672	176,623	178,382	530,677
Adjusted Segment Operating Income	81,590	85,137	86,057	90,846	343,630	91,435	94,631	92,894	278,960
Adjusted Segment Operating Margin	33.2%	33.9%	33.4%	33.9%	33.6%	34.2%	34.9%	34.2%	34.5%

Leased Properties with Bargain Purchase Options
	FY 2012					FY 2013
	Q1	Q2	Q3	Q4 (1)	Full Year	Q1	Q2	Q3	YTD
Revenue	35,394	34,853	35,362	31,494	137,103	32,254	32,096	32,667	97,017
Expenses	23,287	23,433	24,264	21,334	92,318	20,766	21,308	21,230	63,304
Segment Operating Income	12,107	11,420	11,098	10,160	44,785	11,488	10,788	11,437	33,713
Segment Operating Margin	34.2%	32.8%	31.4%	32.3%	32.7%	35.6%	33.6%	35.0%	34.7%

Leased Properties with Fair Market Value Purchase Options
	FY 2012					FY 2013
	Q1	Q2	Q3	Q4 (1)	Full Year	Q1	Q2	Q3 (2)	YTD
Revenue	47,104	47,534	48,560	42,140	185,338	42,842	42,408	43,235	128,485
Expenses	29,974	30,192	28,999	27,443	116,608	26,940	27,011	27,228	81,179
Segment Operating Income	17,130	17,342	19,561	14,697	68,730	15,902	15,397	16,007	47,306
Segment Operating Margin	36.4%	36.5%	40.3%	34.9%	37.1%	37.1%	36.3%	37.0%	36.8%

Leased Properties without Purchase Options
	FY 2012					FY 2013
	Q1	Q2	Q3	Q4	Full Year	Q1	Q2	Q3 (2)	YTD
Revenue	216,895	217,221	217,279	218,108	869,503	222,754	222,602	226,158	671,514
Expenses	139,234	139,719	141,907	146,006	566,866	142,527	143,606	144,341	430,474
Segment Operating Income	77,661	77,502	75,372	72,102	302,637	80,227	78,996	81,817	241,040
Segment Operating Margin	35.8%	35.7%	34.7%	33.1%	34.8%	36.0%	35.5%	36.2%	35.9%

Total Senior Housing	FY 2012					FY 2013
(GAAP Basis)	Q1	Q2	Q3	Q4	Full Year	Q1	Q2	Q3	YTD
Revenue	542,695	544,328	548,674	552,722	2,188,419	564,172	562,245	569,982	1,696,399
Expenses	356,317	359,206	366,526	372,133	1,454,182	365,905	368,548	371,181	1,105,634
Operating Income	186,378	185,122	182,148	180,589	734,237	198,267	193,697	198,801	590,765
Operating Margin	34.3%	34.0%	33.2%	32.7%	33.6%	35.1%	34.5%	34.9%	34.8%

(1) During the three months ended December 31, 2012, the Company acquired the underlying real estate interest in 12 communities that the Company previously leased. The results of operations of the previously leased communities are included within Owned Properties beginning in the fourth quarter of FY 2012. Prior quarters have not been recast.

(2) During the three months ended September 30, 2013, the Company amended a lease agreement for one community and, in connection therewith, obtained a fair market value purchase option. The results of operations of the community are included within Leased Properties with Fair Market Value Purchase Options beginning in the third quarter of FY 2013. Prior quarters have not been recast.

Brookdale Senior Living Inc.
Same Community and Capital Expenditure Information
As of September 30, 2013

Same Community Information

($ in 000s, except Avg. Mo. Revenue/Unit)	Senior Housing									Senior Housing
	Three Months Ended September 30,									Twelve Months Ended September 30,
	2013			2012			% Change			2013			2012			% Change
Revenue	$	553,713		$	533,545			3.8	%	$	2,186,321		$	2,107,992			3.7	%
Operating Expense		366,188			360,143			1.7	%		1,454,611			1,408,845			3.2	%
Facility Operating Income	$	187,525		$	173,402			8.1	%	$	731,710		$	699,147			4.7	%
Facility Operating Margin		33.9	%		32.5	%		1.4	%		33.5	%		33.2	%		0.3	%

# Communities		541			541						541			541
Avg. Period Occupancy		89.0	%		88.0	%		1.0	%		88.7	%		87.8	%		0.9	%
Avg. Mo. Revenue/Unit	$	4,405		$	4,297			2.5	%	$	4,366		$	4,255			2.6	%


	Innovative Senior Care									Innovative Senior Care
	Three Months Ended September 30,									Twelve Months Ended September 30,
	2013			2012			% Change			2013			2012			% Change
Revenue	$	31,800		$	34,594			-8.1	%	$	129,164		$	145,250			-11.1	%
Operating Expense		25,673			27,091			-5.2	%		103,298			111,916			-7.7	%
Facility Operating Income	$	6,127		$	7,503			-18.3	%	$	25,866		$	33,334			-22.4	%
Facility Operating Margin		19.3	%		21.7	%		-2.4	%		20.0	%		22.9	%		-2.9	%

# Units served (1)		26,306			26,306						26,306			26,306

(1) Units are included in same store calculation where either the therapy or home health, whichever came later, has stabilized or produced revenue for twenty-four months.

Schedule of Capital Expenditures

($ in 000s)


	Three Months Ended September 30,
Type	2013		2012
Recurring	$	12,127	$	11,975
Reimbursements		-		(500	)
Net Recurring		12,127		11,475
Corporate (2)		4,135		6,711
EBITDA-enhancing / Major Projects (3)		28,940		27,641
Program Max / Development, net (4)		12,666		10,700
Net Total Capital Expenditures (5)	$	57,868	$	56,527

Brookdale Senior Living Inc.

Capital Structure - selected financial information

As of September 30, 2013

($ in 000s)

Debt Maturities and Scheduled Principal Repayments

	Maturities
	Mortgage		weighted			Line of		weighted			Capital		weighted			Total
	Debt (1)		rate (2)			Credit		rate (2)			Leases		rate (2)			Debt

2013	$	10,577		3.52	%	$	-		-		$	8,135		8.27	%	$	18,712
2014		174,719		5.28	%		-		-			33,152		8.29	%		207,871
2015		54,468		4.97	%		-		-			34,078		8.31	%		88,546
2016		56,821		4.53	%		-		-			29,465		8.41	%		86,286
2017		319,354		5.20	%		-		-			47,042		9.10	%		366,396
Thereafter		1,647,023		3.53	%		45,000		3.75	%		147,447		7.72	%		1,839,470
Total	$	2,262,962		3.96	%	$	45,000		3.75	%	$	299,319		8.15	%	$	2,607,281

Coverage Ratios

	Nine months ended September 30, 2013
							Interest/Cash Lease
	Units		FOI		Adj. FOI **		Payments		Coverage
Owned communities		22,958	$	283,755	$	234,393	$	71,291		3.3	x
Leased communities *		25,771	$	338,675	$	283,028	$	237,555		1.2	x

* The leased communities include the capital leases.

** Adjusted for 5% management fee and capital expenditures @ $350/unit.

Debt Amortization

	Nine months ended September 30,
	2013		2012
Scheduled debt amortization	$	37,096	$	34,275
Lease financing debt amortization - FMV or no purchase option (3)		10,332		8,987
Lease financing debt amortization - bargain purchase option		12,586		10,592
Total debt amortization	$	60,014	$	53,854

Line Availability

($000s)	09/30/12		12/31/12		03/31/13		06/30/13		09/30/13

Total line commitment	$	230,000	$	230,000	$	230,000	$	250,000	$	250,000

Line availability (6)	$	189,978	$	191,436	$	198,563	$	225,331	$	238,565
Ending line balance		80,000		80,000		45,000		70,000		45,000
Available to draw	$	109,978	$	111,436	$	153,563	$	155,331	$	193,565
Cash and cash equivalents		42,504		69,240		28,242		30,946		42,690
Total liquidity (available to draw + cash)	$	152,482	$	180,676	$	181,805	$	186,277	$	236,255

Total letters of credit outstanding	$	78,127	$	78,112	$	77,952	$	75,031	$	71,762

Leverage Ratios

				Annualized
	Balance			Leverage
Debt (1)	$	2,262,962
Capital leases		299,319
Total Debt	$	2,562,281			5.7	x

Plus: Line of credit (cash borrowings)		45,000
Less: Unrestricted cash		(42,690	)
Less: Cash held as collateral against existing debt		(6,397	)
Subtotal	$	2,558,194			5.7	x

2013 YTD annualized Adjusted EBITDA	$	450,979

Annual cash lease expense multiplied by 8		2,219,275
Total adjusted debt	$	4,777,469			6.6	x

2013 YTD annualized Adjusted EBITDAR	$	728,388

Debt Structure

			Weighted
	Balance		rate (2)
Fixed rate debt (1)	$	1,264,084		4.77	%
Variable rate debt (1)		998,878		2.88	%
Capital leases		299,319		8.15	%
Line of credit (cash borrowings)		45,000		3.75	%
Total debt	$	2,607,281

	Balance		% of total
Variable rate debt with interest rate swaps (1) (4)	$	27,078		2.7	%
Variable rate debt with interest rate caps (1) (5)		700,204		70.1	%
Variable rate debt - unhedged (1)		271,596		27.2	%
Total variable rate debt (1)	$	998,878		100.0	%

(1) Includes mortgage debt and convertible notes, but excludes capital leases and line of credit.

(2) Pertaining to variable rate debt, reflects a) market rates for stated reporting period and b) applicable swap rates / cap rates for hedged debt.

(3) Payments are included in CFFO.

(4) Weighted swap rate for stated reporting period is 5.49%.

(5) Weighted cap rate for stated reporting period of 4.69% is materially above current market rates, therefore caps have no impact on consolidated interest expense for given period.

(6) The actual amount available to borrow under the line may vary from time to time as it is based on borrowing base calculations related to the value and performance of the communities securing the facility.

Brookdale Senior Living Inc.
CFFO Reconciliation
As of September 30, 2013

CFFO Calculation

($ in 000s)

	Three Months Ended September 30,
	2013			2012

Net cash provided by operating activities (includes non-refundable entrance fees)	$	104,247		$	79,431
Changes in operating assets and liabilities (eliminates cash flow effect)		(21,464	)		(10,731	)
Add: Refundable entrance fees received		9,875			12,206
Less: Entrance fee refunds disbursed		(7,728	)		(6,024	)
Less: Recurring capital expenditures, net		(12,127	)		(11,475	)
Less: Lease financing debt amortization with fair market value or no purchase options		(3,518	)		(3,066	)
Less: Distributions from unconsolidated ventures from cumulative share of net earnings		(648	)		(420	)
Add: CFFO from unconsolidated ventures		1,922			1,559
Cash From Facility Operations	$	70,559		$	61,480

Add: Integration, transaction-related and EMR roll-out costs		4,661			4,624
Adjusted Cash From Facility Operations	$	75,220		$	66,104

Revenue Reconciliation (1)

($ in 000s except average monthly revenue per quarter)
	FY 2012															FY 2013
		Q1			Q2			Q3			Q4		Full Year				Q1			Q2			Q3
Revenue reconciliation excl. entrance fee amortization
Average monthly revenue per quarter		4,257			4,266			4,279			4,282			4,271			4,375			4,373			4,397
Average monthly units (excluding equity homes) available		47,858			47,935			47,998			47,935			47,959			47,956			47,929			47,953
Average occupancy for the quarter		87.8	%		87.7	%		88.0	%		88.7	%		88.0	%		88.5	%		88.3	%		89.0	%
Senior Housing resident fee revenue	$	536,629		$	538,018		$	542,215		$	546,195		$	2,163,057		$	557,039		$	555,213		$	562,969

Add: ISC segment revenue		53,854			57,722			56,856			56,085			224,517			60,198			58,693			61,162
Add: management fee revenue		7,444			7,499			7,407			8,436			30,786			7,609			7,744			7,622
Total revenues excluding entrance fee amortization	$	597,927		$	603,239		$	606,478		$	610,716		$	2,418,360		$	624,846		$	621,650		$	631,753

CFFO Reconciliation to the Income Statement

Resident and management fee revenue	$	603,993		$	609,549		$	612,937		$	617,243		$	2,443,722		$	631,979		$	628,682		$	638,766
Less: Entrance fee amortization		(6,066	)		(6,310	)		(6,459	)		(6,527	)		(25,362	)		(7,133	)		(7,032	)		(7,013	)
Adjusted revenues		597,927			603,239			606,478			610,716			2,418,360			624,846			621,650			631,753

Less: Facility operating expenses		(398,769	)		(403,515	)		(411,467	)		(417,168	)		(1,630,919	)		(413,003	)		(416,027	)		(420,579	)
Add: Change in future service obligation		-			-			-			2,188			2,188			-			-			-
Adjusted facility operating expenses		(398,769	)		(403,515	)		(411,467	)		(414,980	)		(1,628,731	)		(413,003	)		(416,027	)		(420,579	)

Less: G&A including non-cash stock-based compensation expense		(44,973	)		(46,071	)		(43,158	)		(44,627	)		(178,829	)		(46,611	)		(46,035	)		(45,824	)
Add: G&A non-cash stock-based compensation expense		6,435			6,729			6,021			6,335			25,520			6,894			6,988			6,894
Net G&A		(38,538	)		(39,342	)		(37,137	)		(38,292	)		(153,309	)		(39,717	)		(39,047	)		(38,930	)

Less: Facility lease expense		(71,445	)		(70,628	)		(71,167	)		(70,785	)		(284,025	)		(69,019	)		(68,777	)		(69,232	)
Add: Straight-line lease expense		1,642			1,564			2,118			1,344			6,668			748			684			818
Less: Amortization of deferred gain		(1,093	)		(1,093	)		(1,093	)		(1,093	)		(4,372	)		(1,093	)		(1,093	)		(1,093	)
Net lease expense		(70,896	)		(70,157	)		(70,142	)		(70,534	)		(281,729	)		(69,364	)		(69,186	)		(69,507	)

Add: Entrance fee receipts		14,989			19,694			25,132			22,890			82,705			16,873			23,878			19,098
Less: Entrance fee disbursements		(8,102	)		(5,429	)		(6,024	)		(7,801	)		(27,356	)		(9,320	)		(7,456	)		(7,728	)
Net entrance fees		6,887			14,265			19,108			15,089			55,349			7,553			16,422			11,370

Adjusted EBITDA		96,611			104,490			106,840			101,999			409,940			110,315			113,812			114,107

Less: Recurring capital expenditures, net		(8,064	)		(8,599	)		(11,475	)		(10,168	)		(38,306	)		(9,324	)		(10,664	)		(12,127	)
Less: Interest expense, net		(31,198	)		(31,739	)		(31,586	)		(29,803	)		(124,326	)		(30,668	)		(29,591	)		(29,170	)
Less: Lease financing debt amortization with fair market value or no purchase options		(2,929	)		(2,993	)		(3,066	)		(3,132	)		(12,120	)		(3,371	)		(3,444	)		(3,518	)
Add: CFFO from unconsolidated ventures		1,228			1,310			1,559			1,279			5,376			1,958			2,099			1,922
Less: Other		(1,062	)		(990	)		(792	)		1,238			(1,606	)		(1,068	)		(1,060	)		(655	)

Reported CFFO	$	54,586		$	61,479		$	61,480		$	61,413		$	238,958		$	67,842		$	71,152		$	70,559

Add: integration, transaction-related and EMR roll-out costs		3,904			7,688			4,624			7,249			23,465			2,105			3,626			4,661
Adjusted CFFO	$	58,490		$	69,167		$	66,104		$	68,662		$	262,423		$	69,947		$	74,778		$	75,220

CFFO Per Share

($ except where indicated)	FY 2012										FY 2013
		Q1		Q2		Q3		Q4	Full Year(2)			Q1		Q2		Q3
Reported CFFO	$	0.45	$	0.51	$	0.50	$	0.50	$	1.96	$	0.55	$	0.58	$	0.57
Add: integration, transaction-related and EMR roll-out costs		0.03		0.06		0.04		0.06		0.19		0.02		0.03		0.04
Adjusted CFFO	$	0.48	$	0.57	$	0.54	$	0.56	$	2.15	$	0.57	$	0.61	$	0.61

Shares used in calculation of CFFO (000's)		121,145		121,708		122,493		122,608				122,823		123,405		124,128

(1) Revenue excludes reimbursed costs incurred on behalf of managed communities.

(2) Full year CFFO for all periods is calculated as the sum of the quarterly amounts for the year.

Note: CFFO is a measurement of liquidity that is not calculated in accordance with GAAP and should not be considered in isolation as a substitute for any GAAP financial measure. CFFO is not a measure of financial performance under GAAP. We strongly urge you to review the reconciliation of CFFO to GAAP net cash provided by operating activities, along with our consolidated financial statements, included in the accompanying earnings release.

Brookdale Senior Living Inc.

Quarterly Entry Fee Information

As of September 30, 2013

Cash Basis ($ in 000's except average resale and refund)

	FY 2012				FY 2013
	Q1	Q2	Q3	Q4	Q1	Q2	Q3
# Closings	94	106	147	121	91	128	100
# of Refunds	92	62	66	79	87	88	86

Resale Receipts:
Proceeds from non-refundable entrance fees (1)	7,000	10,377	12,926	9,802	9,237	12,124	9,223
Proceeds from refundable entrance fees (2)	7,989	9,317	12,206	13,088	7,636	11,754	9,875
Total Cash Proceeds	14,989	19,694	25,132	22,890	16,873	23,878	19,098
Refunds of entrance fees (3)	(8,102)	(5,429)	(6,024)	(7,801)	(9,320)	(7,456)	(7,728)
Net Resale Cash Flow	6,887	14,265	19,108	15,089	7,553	16,422	11,370

MyChoice proceeds included in refundable resale receipts above	2,363	3,602	2,466	4,881	1,768	4,041	3,205

Average Resale $ (excluding MyChoice proceeds)	134,319	151,811	154,190	148,835	165,989	154,977	158,930
Average Refund $ (excluding MyChoice refunds)	(84,283)	(77,500)	(87,273)	(95,025)	(98,540)	(80,773)	(86,372)

Value of Unsold Inventory ($ in 000's except average resale price)

Gross Value @ Average Resale Price of $155,000								93,620
Refund Attachments								(14,162)
Net Cash Value								79,458

Income Statement Impact ($ in 000's)

On BKD's income statement, non-refundable entrance fees are amortized into revenue based on the unamortized balance per contract divided by the actuarial life of the resident. The following are the non-cash amortized non-refundable entrance fees for each quarter:

	FY 2012				FY 2013
	Q1	Q2	Q3	Q4	Q1	Q2	Q3
Amortization of entrance fees (incl. gains on terminations)	(6,066)	(6,310)	(6,459)	(6,527)	(7,133)	(7,032)	(7,013)

Principles of Entry Fee Accounting

Certain of BKD's communities have residency agreements which require the resident to pay an upfront fee prior to occupying the community and in return for a reduced monthly service fee and certain healthcare benefits. BKD has a number of options for residents that give a choice of the amount of refundability of the upfront fee, the amount of entry fee for the unit and the amount of health care benefit in the community's various levels of care. The non-refundable portion of the entrance fee is recorded as deferred revenue and amortized over the estimated stay of the resident based on an actuarial valuation. The refundable portion of a resident's entrance fee is generally refundable within a certain time period following contract termination or in certain agreements, upon the resale of a comparable unit or 12 months after the resident vacates the unit and is not amortized.

BKD adopted the provisions of ASU 2012-01 as of January 1, 2013 and incorporated the provisions of this update to its consolidated financial statements through retrospective application to all periods presented. The prior period amortization of entrance fees have been revised to reflect this change in accounting. Refer to the Company's Form 10-Q filings for further details.

Notes:
(1) From Statement of Cash Flows (Operating Activities section) with line description: Proceeds from deferred entrance fee revenue.
(2) From Statement of Cash Flows (Financing Activities section) with line description: Proceeds from refundable entrance fees (which includes MyChoice proceeds).
(3) From Statement of Cash Flows (Financing Activities section) with line description: Refunds of entrance fees.

Brookdale Senior Living Inc.

Quarterly Cash Flow Statements

As of September 30, 2013

($ in 000s)

Cash Flow Statements

		Q1 2012			Q2 2012			Q3 2012			Q4 2012		FY 2012				Q1 2013			Q2 2013			Q3 2013
Cash Flows from Operating Activities
Net (loss) income	$	(10,544	)	$	(19,015	)	$	(12,216	)	$	(24,692	)	$	(66,467	)	$	3,558		$	(5,200	)	$	(967	)
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Loss on extinguishment of debt		221			-			-			-			221			-			893			53
Depreciation and amortization		67,817			68,147			67,419			66,979			270,362			69,228			71,602			72,744
Asset impairment		1,083			7,246			-			19,348			27,677			-			2,154			504
Equity in (earnings) loss of unconsolidated ventures		(99	)		61			249			3,277			3,488			(115	)		(445	)		(431	)
Distributions from unconsolidated ventures from cumulative share of net earnings		206			809			420			72			1,507			668			773			648
Amortization of deferred gain		(1,093	)		(1,093	)		(1,093	)		(1,093	)		(4,372	)		(1,093	)		(1,093	)		(1,093	)
Amortization of entrance fees		(6,066	)		(6,310	)		(6,459	)		(6,527	)		(25,362	)		(7,133	)		(7,032	)		(7,013	)
Proceeds from deferred entrance fee revenue		7,000			10,377			12,926			9,802			40,105			9,237			12,124			9,223
Deferred income tax benefit		(135	)		(169	)		(131	)		(90	)		(525	)		-			-			-
Change in deferred lease liability		1,642			1,564			2,118			1,344			6,668			748			684			818
Change in fair value of derivatives and amortization		233			278			(140	)		(7	)		364			(135	)		(1,836	)		1,377
Loss (gain) on sale of assets		114			58			73			87			332			(926	)		24			26
Loss on acquisition		636			-			-			-			636			-			-			-
Gain on facility lease termination		(2,780	)		-			-			(8,804	)		(11,584	)		-			-			-
Change in future service obligation		-			-			-			2,188			2,188			-			-			-
Non-cash stock-based compensation		6,435			6,729			6,021			6,335			25,520			6,894			6,988			6,894
Other		-			-			(487	)		-			(487	)		-			-			-
Changes in operating assets and liabilities:
Accounts receivable, net		(5,317	)		(3,484	)		709			4,677			(3,415	)		(9,064	)		1,736			(2,154	)
Prepaid expenses and other assets, net		(1,681	)		7,622			(2,793	)		5,539			8,687			9,140			(12,679	)		734
Accounts payable and accrued expenses		(23,705	)		14,410			17,352			(3,203	)		4,854			(10,871	)		12,926			18,540
Tenant refundable fees and security deposits		(442	)		(675	)		(439	)		9			(1,547	)		(335	)		(258	)		(235	)
Deferred revenue		12,168			(3,701	)		(4,098	)		7,750			12,119			(5,316	)		(1,018	)		4,579
Net cash provided by operating activities		45,693			82,854			79,431			82,991			290,969			64,485			80,343			104,247
Cash Flows from Investing Activities
(Increase) decrease in lease security deposits and lease acquisition deposits, net		(2,217	)		(4,119	)		(431	)		(1,232	)		(7,999	)		(1,952	)		(1,066	)		972
Decrease (increase) in cash and escrow deposits — restricted		8,442			(3,038	)		(7,806	)		(2,408	)		(4,810	)		826			2,195			(537	)
Purchase of marketable securities — restricted		(761	)		(341	)		(351	)		(104	)		(1,557	)		-			-			-
Sale of marketable securities — restricted		-			-			-			35,124			35,124			-			-			-
Additions to property, plant and equipment and leasehold intangibles, net		(41,533	)		(50,433	)		(59,415	)		(57,031	)		(208,412	)		(51,614	)		(48,677	)		(61,231	)
Acquisition of assets, net of related payables and cash received		(104,984	)		(4,975	)		(1,349	)		(161,215	)		(272,523	)		(2	)		(4,833	)		(2,559	)
Issuance of (payment on) notes receivable, net		(439	)		-			(152	)		722			131			(17	)		(47	)		159
Investment in unconsolidated ventures		-			(571	)		-			(4,797	)		(5,368	)		(5,843	)		(2,149	)		(9,180	)
Distributions received from unconsolidated ventures		100			84			72			94			350			-			-			100
Proceeds from sale of assets, net		-			325			-			8,918			9,243			440			7,114			-
Other		-			-			487			-			487			-			-			-
Net cash used in investing activities		(141,392	)		(63,068	)		(68,945	)		(181,929	)		(455,334	)		(58,162	)		(47,463	)		(72,276	)
Cash Flows from Financing Activities
Proceeds from debt		175,838			17,178			591			178,684			372,291			8,955			418,667			170,230
Repayment of debt and capital lease obligations		(86,068	)		(32,585	)		(18,304	)		(54,878	)		(191,835	)		(17,707	)		(470,825	)		(163,209	)
Proceeds from line of credit		130,000			75,000			75,000			95,000			375,000			105,000			85,000			130,000
Repayment of line of credit		(110,000	)		(85,000	)		(70,000	)		(95,000	)		(360,000	)		(140,000	)		(60,000	)		(155,000	)
Payment of financing costs, net of related payables		(2,378	)		(336	)		(96	)		(2,753	)		(5,563	)		(2,200	)		(5,695	)		(3,299	)
Refundable entrance fees:
Proceeds from refundable entrance fees		7,989			9,317			12,206			13,088			42,600			7,636			11,754			9,875
Refunds of entrance fees		(8,102	)		(5,429	)		(6,024	)		(7,801	)		(27,356	)		(9,320	)		(7,456	)		(7,728	)
Cash portion of loss on extinguishment of debt		(118	)		-			-			-			(118	)		-			(453	)		(49	)
Purchase of derivatives and payment of swap termination		(99	)		(1,190	)		-			(619	)		(1,908	)		-			(1,489	)		(1,374	)
Other		(86	)		(178	)		(31	)		(47	)		(342	)		315			321			327
Net cash provided by (used in) financing activities		106,976			(23,223	)		(6,658	)		125,674			202,769			(47,321	)		(30,176	)		(20,227	)
Net increase (decrease) in cash and cash equivalents		11,277			(3,437	)		3,828			26,736			38,404			(40,998	)		2,704			11,744
Cash and cash equivalents at beginning of period		30,836			42,113			38,676			42,504			30,836			69,240			28,242			30,946
Cash and cash equivalents at end of period	$	42,113		$	38,676		$	42,504		$	69,240		$	69,240		$	28,242		$	30,946		$	42,690

(2) Corporate includes capital expenditures for information technology systems and equipment and expenditures supporting the expansion of our support platform and ancillary services programs.

(3) Includes EBITDA-enhancing projects (primarily community renovations and apartment upgrades) and other major building infrastructure projects.

(4) Includes community expansions and major repositioning or upgrade projects. Also includes de novo community developments. Amounts shown are amounts invested, net of third party lender or lessor funding received of $3.4 million and $2.4 million for the three months ended September 30, 2013 and 2012, respectively.

(5) Approximately $10.5 million and $11.2 million of expense was recognized during the three months ended September 30, 2013 and 2012, respectively, for normal repairs and maintenance and capital spend under $1,500 per invoice, except for unit turnovers.