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

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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

Exhibit 99.2

Brookdale Senior Living Inc.
Corporate Overview - selected financial information
As of March 31, 2015

Corporate Overview

Brookdale Senior Living Inc. ("Brookdale") is the leading operator of senior living communities throughout the United States. The Company is committed to providing senior living solutions primarily within properties that are designed, purpose-built and operated to provide the highest quality service, care and living accommodations for residents. As of March 31, 2015, the Company operates independent living, assisted living and dementia-care communities and continuing care retirement centers ("CCRCs"), with 1,141 communities in 46 states and the ability to serve approximately 111,000 residents. Through its ancillary services program, the Company also offers a range of outpatient therapy, home health, personalized living and hospice services.

Stock Listing

Common Stock
NYSE: BKD

Community Information

Ownership Type	Number of Communities		Number of Units		Percentage of Q1 2015 Resident and Management Fees			Percentage of Q1 2015 Facility Operating Income
Owned		422		37,116		38.7	%		36.7	%
Leased		559		46,004		49.1	%		53.0	%
Brookdale Ancillary Services		N/A		N/A		10.8	%		6.2	%
Managed		160		27,458		1.4	%		4.1	%
Total		1,141		110,578		100.0	%		100.0	%

Operating Type - By Segment
Retirement Centers		99		17,423		15.3	%		19.0	%
Assisted Living		837		55,115		57.9	%		60.3	%
CCRCs - Rental		45		10,582		14.6	%		10.4	%
Brookdale Ancillary Services		N/A		N/A		10.8	%		6.2	%
Management Services		160		27,458		1.4	%		4.1	%
Total		1,141		110,578		100.0	%		100.0	%

CFFO Per Share

($ except where indicated)	FY 2014										FY 2015
		Q1		Q2		Q3		Q4	Full Year⁽²⁾			Q1
Reported CFFO	$	0.54	$	0.61	$	0.14	$	0.28	$	1.57	$	0.48
Add: integration, transaction-related and EMR roll-out costs ⁽¹⁾		0.10		0.10		0.49		0.25		0.94		0.15
Adjusted CFFO	$	0.64	$	0.71	$	0.63	$	0.53	$	2.51	$	0.63

Weighted average shares (000's)		124,478		125,058		159,003		183,432				183,678
Period end outstanding shares (excluding unvested restricted shares) (000's)		124,816		125,408		183,410		183,486				184,143

(1) Integration, transaction-related and EMR roll-out costs include third party expenses directly related to the integration of Emeritus and corporate capital structure assessment activities (including shareholder relations advisory matters), as well as internal costs such as labor reflecting time spent by Company personnel on integration and transaction-related activity. Transaction costs include third party costs directly related to the acquisition of Emeritus and other acquisition and community leasing activity and are primarily comprised of legal, finance, consulting, professional fees and other third party costs.

(2) 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@brookdale.com

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

Brookdale Senior Living Inc.
Segment Financial Data
As of March 31, 2015

Financial Data and Operating Information

($ in 000s, except Senior Housing average monthly revenue per unit)

Retirement Centers	FY 2014 (1) (2)															FY 2015
		Q1			Q2			Q3			Q4		Full Year				Q1
Revenue		132,349			133,441			155,227			161,295			582,312			163,486
Expenses		76,119			76,550			88,022			92,738			333,429			94,077
Segment Operating Income		56,230			56,891			67,205			68,557			248,883			69,409
Segment Operating Margin		42.5	%		42.6	%		43.3	%		42.5	%		42.7	%		42.5	%

Number of communities (period end)		74			74			100			99			99			99
Total average units(4)		14,161			14,162			16,594			17,315			15,558			17,369
Weighted average unit occupancy		89.3	%		88.9	%		89.8	%		89.9	%		89.5	%		88.8	%
Senior Housing average monthly revenue per unit(5)	$	3,490		$	3,532		$	3,472		$	3,454		$	3,485		$	3,533

Assisted Living	FY 2014 (2)															FY 2015
		Q1			Q2			Q3			Q4		Full Year				Q1
Revenue		277,431			277,230			516,640			614,262			1,685,563			617,344
Expenses		172,439			172,984			328,486			403,165			1,077,074			397,361
Segment Operating Income		104,992			104,246			188,154			211,097			608,489			219,983
Segment Operating Margin		37.8	%		37.6	%		36.4	%		34.4	%		36.1	%		35.6	%

Number of communities (period end)		440			440			841			838			838			837
Total average units(4)		22,435			22,463			45,260			55,241			36,350			55,073
Weighted average unit occupancy		89.6	%		89.0	%		88.8	%		88.2	%		88.7	%		87.2	%
Senior Housing average monthly revenue per unit(5)	$	4,599		$	4,622		$	4,286		$	4,203		$	4,356		$	4,283

CCRCs - Rental	FY 2014 (1) (2) (3)															FY 2015
		Q1			Q2			Q3			Q4		Full Year				Q1
Revenue		97,944			98,212			144,074			152,943			493,173			155,991
Expenses		71,114			72,519			109,582			118,297			371,512			118,108
Segment Operating Income		26,830			25,693			34,492			34,646			121,661			37,883
Segment Operating Margin		27.4	%		26.2	%		23.9	%		22.7	%		24.7	%		24.3	%

Number of communities (period end)		26			26			45			45			45			45
Total average units(4)		6,457			6,469			9,783			10,483			8,298			10,480
Weighted average unit occupancy		86.6	%		85.9	%		85.1	%		85.9	%		85.8	%		86.0	%
Senior Housing average monthly revenue per unit(5)	$	5,839		$	5,894		$	5,740		$	5,637		$	5,757		$	5,744

CCRCs - Entry Fee	FY 2014 (2) (3)															FY 2015
		Q1			Q2			Q3			Q4		Full Year				Q1
Revenue		79,169			79,100			44,145			-			202,414			-
Expenses		59,534			60,733			33,714			-			153,981			-
Segment Operating Income		19,635			18,367			10,431			-			48,433			-
Segment Operating Margin		24.8	%		23.2	%		23.6	%		-			23.9	%		-

Number of communities (period end)		15			15			-			-			-			-
Total average units(4)		5,527			5,534			2,954			-			3,504			-
Weighted average unit occupancy		84.7	%		84.7	%		87.0	%		-			85.2	%		-
Senior Housing average monthly revenue per unit(5)	$	5,124		$	5,091		$	5,085		$	-		$	5,103		$	-

Total Senior Housing	FY 2014 (2)															FY 2015
		Q1			Q2			Q3			Q4		Full Year				Q1
Revenue		586,893			587,983			860,086			928,500			2,963,462			936,821
Expenses		379,206			382,786			559,804			614,200			1,935,996			609,546
Operating Income		207,687			205,197			300,282			314,300			1,027,466			327,275
Operating Margin		35.4	%		34.9	%		34.9	%		33.9	%		34.7	%		34.9	%
G&A Allocation(6)		24,396			22,589			33,912			35,365			116,262			36,767
Adjusted Operating Income		183,291			182,608			266,370			278,935			911,204			290,508
Adjusted Operating Margin		31.2	%		31.1	%		31.0	%		30.0	%		30.7	%		31.0	%

Number of communities (period end)		555			555			986			982			982			981
Total average units(4)		48,580			48,628			74,591			83,039			63,710			82,922
Weighted average unit occupancy		88.6	%		88.1	%		88.5	%		88.3	%		88.3	%		87.4	%
Senior Housing average monthly revenue per unit(5)	$	4,491		$	4,518		$	4,317		$	4,220		$	4,357		$	4,305

Brookdale Senior Living Inc.
Segment Financial Data
As of March 31, 2015

Financial Data and Operating Information (continued)
($ in 000s, except Senior Housing average monthly revenue per unit)

Brookdale Ancillary Services	FY 2014 (2)												FY 2015
		Q1		Q2		Q3		Q4		Full Year				Q1
Revenue		63,417		65,534		95,426		113,458			337,835			115,411
Expenses		50,664		52,629		77,280		93,799			274,372			92,669
Segment Operating Income		12,753		12,905		18,146		19,659			63,463			22,742
Segment Operating Margin		20.1	%	19.7	%	19.0	%	17.3	%		18.8	%		19.7	%
G&A Allocation(6)		5,642		5,908		5,709		9,050			26,309			8,251
Adjusted Segment Operating Income		7,111		6,997		12,437		10,609			37,154			14,491
Adjusted Segment Operating Margin		11.2	%	10.7	%	13.0	%	9.4	%		11.0	%		12.6	%

Brookdale units served:
Outpatient Therapy consolidated		37,974		38,328		37,899		36,843						40,740
Home Health consolidated		34,518		35,061		33,254		37,006						44,239
Outpatient Therapy non-consolidated		14,138		13,942		18,716		17,164						18,920
Home Health non-consolidated		12,819		12,336		16,036		18,954						19,258
Total Brookdale units served:
Outpatient Therapy		52,112		52,270		56,615		54,007						59,660
Home Health		47,337		47,397		49,290		55,960						63,497

Outpatient Therapy treatment codes		812,632		798,754		762,993		679,057						636,413
Home Health average census		5,084		5,257		10,314		12,723						13,767

Total Senior Housing and Brookdale Ancillary Services	FY 2014 (2)												FY 2015
		Q1		Q2		Q3		Q4		Full Year				Q1
Revenue		650,310		653,517		955,512		1,041,958			3,301,297			1,052,232
Expenses		429,870		435,415		637,084		707,999			2,210,368			702,215
Operating Income		220,440		218,102		318,428		333,959			1,090,929			350,017
Operating Margin		33.9	%	33.4	%	33.3	%	32.1	%		33.0	%		33.3	%
G&A Allocation(6)		30,038		28,497		39,621		44,415			142,571			45,018
Adjusted Operating Income		190,402		189,605		278,807		289,544			948,358			304,999
Adjusted Operating Margin		29.3	%	29.0	%	29.2	%	27.8	%		28.7	%		29.0	%

Management Services	FY 2014 (2)															FY 2015
		Q1			Q2			Q3			Q4		Full Year				Q1
Revenue (Management Fees)		7,402			7,489			10,428			16,920			42,239			15,097
Expenses (G&A Allocation)(6)		6,116			5,649			7,453			10,732			29,950			9,755
Segment Operating Income		1,286			1,840			2,975			6,188			12,289			5,342
Segment Operating Margin		17.4	%		24.6	%		28.5	%		36.6	%		29.1	%		35.4	%

Number of communities (period end)		92			92			161			161			161			160
Total average units(4)		17,140			16,978			20,919			27,318			20,589			27,185
Weighted average occupancy		86.3	%		86.8	%		86.3	%		86.4	%		86.5	%		86.5	%
Senior Housing average monthly revenue per unit(5)	$	3,706		$	3,701		$	3,949		$	4,236		$	3,943		$	4,277

Total Senior Housing, Brookdale Ancillary and Management Services	FY 2014 (2)												FY 2015
		Q1		Q2		Q3		Q4		Full Year				Q1
Revenue		657,712		661,006		965,940		1,058,878			3,343,536			1,067,329
Expenses		429,870		435,415		637,084		707,999			2,210,368			702,215
Operating Income		227,842		225,591		328,856		350,879			1,133,168			365,114
Operating Margin		34.6	%	34.1	%	34.0	%	33.1	%		33.9	%		34.2	%
G&A Allocation (6)		36,154		34,146		47,074		55,147			172,521			54,773
Adjusted Operating Income		191,688		191,445		281,782		295,732			960,647			310,341
Adjusted Operating Margin		29.1	%	29.0	%	29.2	%	27.9	%		28.7	%		29.1	%

Brookdale Senior Living Inc.
Segment Financial Data
As of March 31, 2015

Financial Data and Operating Information (continued)
($ in 000s, except Senior Housing average monthly revenue per unit)

(1) During the quarter ended December 31, 2014, one community was moved from the Retirement Centers segment to the CCRCs - Rental segment to more accurately reflect the underlying product offering of the community. The movement did not change the Company's reportable segments, but it did impact the financial data and operating information reported within the Retirement Centers and CCRCs - Rental segments. Prior quarters have not been recast.

(2) The third quarter of 2014 represents the first quarter of results that include the operations of Emeritus, which the Company acquired on July 31, 2014, as well as the impact from the transactions with HCP, Inc., which closed on August 29, 2014. Results from the third and fourth quarter of 2014 reflect the impact of those transactions, and results from the first and second quarter of 2014 reflect legacy Brookdale on a stand-alone basis.

(3) In connection with the transactions completed with HCP on August 29, 2014, the Company contributed all but two of its entry fee CCRCs to the entry fee CCRC venture with HCP, at which time the communities were deconsolidated. The results of the entry fee CCRCs contributed to the venture are reported in the Company's CCRCs - Entry Fee segment for the time periods prior to being contributed to the venture. The results of the two remaining entry fee CCRCs are reported in the Company's CCRCs - Rental segment beginning with the third quarter of 2014. The Company no longer reports operating results for a CCRCs – Entry Fee segment.

(4) Senior Housing total average units operated represents the average number of units operated during the period, excluding equity homes.

(5) Average monthly revenue per unit represents the average of total monthly revenues, excluding amortization of entrance fees and Brookdale Ancillary Services segment revenue, divided by average occupied units.

(6) 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 March 31, 2015

Financial Data and Operating Information
($ in 000s, except Senior Housing average monthly revenue per unit)

Owned Properties	FY 2014 (1)															FY 2015
		Q1			Q2			Q3			Q4		Full Year				Q1
Revenue		277,700			277,748			369,078			385,654			1,310,180			412,555
Expenses		182,706			184,773			247,359			260,901			875,739			278,658
Segment Operating Income		94,994			92,975			121,719			124,753			434,441			133,897
Segment Operating Margin		34.2	%		33.5	%		33.0	%		32.3	%		33.2	%		32.5	%

Number of communities (period end)		226			226			403			399						422
Total average units(2)		22,775			22,799			32,079			34,904						36,923
Weighted average unit occupancy		88.5	%		88.0	%		88.2	%		87.6	%					86.5	%
Senior Housing average monthly revenue per unit(3)	$	4,516		$	4,532		$	4,302		$	4,202					$	4,305

Leased Properties with Purchase Options	FY 2014 (1)															FY 2015
		Q1			Q2			Q3			Q4		Full Year				Q1
Revenue		77,863			77,418			87,008			86,441			328,730			82,064
Expenses		49,497			49,719			57,026			57,839			214,081			52,876
Segment Operating Income		28,366			27,699			29,982			28,602			114,649			29,188
Segment Operating Margin		36.4	%		35.8	%		34.5	%		33.1	%		34.9	%		35.6	%

Number of communities (period end)		84			84			111			112						103
Total average units(2)		6,391			6,391			7,347			7,555						7,027
Weighted average unit occupancy		89.0	%		88.4	%		88.6	%		88.5	%					87.8	%
Senior Housing average monthly revenue per unit(3)	$	4,447		$	4,440		$	4,394		$	4,312					$	4,433

Leased Properties without Purchase Options	FY 2014 (1)															FY 2015
		Q1			Q2			Q3			Q4		Full Year				Q1
Revenue		231,330			232,817			404,000			456,405			1,324,552			442,202
Expenses		147,003			148,294			255,419			295,460			846,176			278,012
Segment Operating Income		84,327			84,523			148,581			160,945			478,376			164,190
Segment Operating Margin		36.5	%		36.3	%		36.8	%		35.3	%		36.1	%		37.1	%

Number of communities (period end)		245			245			472			471						456
Total average units(2)		19,414			19,438			35,165			40,580						38,972
Weighted average unit occupancy		88.2	%		87.9	%		88.6	%		88.8	%					88.2	%
Senior Housing average monthly revenue per unit(3)	$	4,491		$	4,533		$	4,314		$	4,218					$	4,282

Total Senior Housing	FY 2014 (1)												FY 2015
		Q1		Q2		Q3		Q4		Full Year				Q1
Revenue		586,893		587,983		860,086		928,500			2,963,462			936,821
Expenses		379,206		382,786		559,804		614,200			1,935,996			609,546
Operating Income		207,687		205,197		300,282		314,300			1,027,466			327,275
Operating Margin		35.4	%	34.9	%	34.9	%	33.9	%		34.7	%		34.9	%

Number of communities (period end)		555			555			986			982			981
Total average units(2)		48,580			48,628			74,591			83,039			82,922
Weighted average unit occupancy		88.6	%		88.1	%		88.5	%		88.3	%		87.4	%
Senior Housing average monthly revenue per unit(3)	$	4,491		$	4,518		$	4,317		$	4,220		$	4,305

(1) The third quarter of 2014 represents the first quarter of results that include the operations of Emeritus, which the Company acquired on July 31, 2014, as well as the impact from the transactions with HCP, Inc., which closed on August 29, 2014. Results from the third and fourth quarter of 2014 reflect the impact of those transactions, and results from the first and second quarter of 2014 reflect legacy Brookdale on a stand-alone basis.

(2) Senior Housing total average units operated represents the average number of units operated during the period, excluding equity homes.

(3) Average monthly revenue per unit represents the average of total monthly revenues, excluding amortization of entrance fees and Brookdale Ancillary Services segment revenue, divided by average occupied units.

Brookdale Senior Living Inc.
Same Community and Capital Expenditure Information
As of March 31, 2015

Same Community Information

($ in 000s, except Avg. Mo. Revenue/Unit)	Legacy Brookdale Senior Housing
	Three Months Ended March 31,
	2015			2014			% Change
Revenue	$	495,556		$	481,324			3.0	%
Operating Expense		320,901			308,192			4.1	%
Facility Operating Income	$	174,655		$	173,132			0.9	%
Facility Operating Margin		35.2	%		36.0	%		-0.8	%

# Communities		509			509
Avg. Period Occupancy		88.0	%		89.1	%		-1.1	%
Avg. Mo. Revenue/Unit	$	4,648		$	4,459			4.2	%

	Legacy Emeritus Senior Housing
	Three Months Ended March 31,
		2015			2014		% Change
Revenue	$	399,228		$	400,269			-0.3	%
Operating Expense		261,889			266,816			-1.8	%
Facility Operating Income	$	137,339		$	133,453			2.9	%
Facility Operating Margin		34.4	%		33.3	%		1.1	%

# Communities		443			443
Avg. Period Occupancy		87.0	%		89.0	%		-2.0	%
Avg. Mo. Revenue/Unit	$	3,936		$	3,860			2.0	%

	Combined Brookdale and Emeritus Senior Housing
	Three Months Ended March 31,
		2015			2014		% Change
Revenue	$	894,784		$	881,593			1.5	%
Operating Expense		582,790			575,008			1.4	%
Facility Operating Income	$	311,994		$	306,585			1.8	%
Facility Operating Margin		34.9	%		34.8	%		0.1	%

# Communities		952			952
Avg. Period Occupancy		87.5	%		89.0	%		-1.5	%
Avg. Mo. Revenue/Unit	$	4,301		$	4,165			3.3	%

Same Community Information reflects historical results from operations for same store communities (utilizing the Company's methodology for determining same store communities).

Schedule of Capital Expenditures

($ in 000s)
	Three Months Ended March 31,
Type	2015			2014
Recurring	$	16,762		$	9,369
Reimbursements		(1,759	)		-
Net Recurring		15,003			9,369
EBITDA-enhancing / Major Projects (1)		26,136			22,881
Program Max, net (2)		9,139			11,465
Corporate, integration and other (3)		13,555			4,386
Net Total Capital Expenditures (4)	$	63,833		$	48,101

(1) Includes EBITDA-enhancing projects (primarily community renovations and apartment upgrades) and other major building infrastructure projects. Amounts shown are amounts invested, net of third party lessor funding received of $2.8 million for the three months ended March 31, 2015.

(2) Includes community expansions and major repositioning or upgrade projects. Also includes de novo community developments. Amounts shown are amounts invested, net of third party lessor funding received of $10.7 million and $11.6 million for the three months ended March 31, 2015 and 2014, respectively.

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

(4) Approximately $14.9 million and $10.0 million of expense was recognized during the three months ended March 31, 2015 and 2014, respectively, for normal repairs and maintenance and capital spend under $1,500 per invoice, except for unit turnovers.

Brookdale Senior Living Inc.

Capital Structure - selected financial information

As of March 31, 2015

($ in 000s)

Debt Maturities and Scheduled Principal Repayments

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

2015	$	125,932		4.64	%	$	-		-		$	54,872		7.27	%	$	180,804
2016		67,251		4.99	%		-		-			135,379		9.68	%		202,630
2017		561,683		5.84	%		-		-			86,981		8.56	%		648,664
2018		1,306,995		4.57	%		-		-			112,972		7.31	%		1,419,967
2019		159,534		6.20	%		-		-			122,830		8.05	%		282,364
Thereafter		1,359,955		4.08	%		300,000		3.76	%		2,079,099		8.23	%		3,739,054
Total	$	3,581,350		4.67	%	$	300,000		3.76	%	$	2,592,133		8.25	%	$	6,473,483

Coverage Ratios

	Three months ended March 31, 2015 (3)
			Senior Housing				Interest/Cash Lease
	Units		FOI		Adj. FOI **		Payments		Coverage
Owned communities		37,116	$	133,897	$	110,021	$	42,348		2.6x
Leased communities *		46,004	$	193,378	$	163,139	$	154,664		1.1x

* Leased communities include capital leases.

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

Debt Amortization

	Three months ended March 31,
	2015		2014
Scheduled debt amortization	$	22,384	$	13,842
Lease financing debt amortization - FMV or no purchase option (4)		12,439		3,897
Lease financing debt amortization - bargain purchase option		1,158		4,662
Total debt amortization	$	35,981	$	22,401

Line Availability

	03/31/14		06/30/14		09/30/14		12/31/14		03/31/15

Total line commitment	$	250,000	$	250,000	$	250,000	$	500,000	$	500,000

Line availability (6)	$	250,000	$	250,000	$	202,860	$	488,389	$	466,746
Ending line balance		25,000		12,000		-		100,000		300,000
Available to draw	$	225,000	$	238,000	$	202,860	$	388,389	$	166,746
Cash and cash equivalents		45,701		50,934		238,324		104,083		115,182
Total liquidity (available to draw + cash)	$	270,701	$	288,934	$	441,184	$	492,472	$	281,928

Total letters of credit outstanding	$	71,675	$	71,650	$	74,488	$	72,730	$	83,935

Leverage Ratios

				Annualized
				Leverage
Three months ended March 31, 2015 annualized Adjusted EBITDAR	$	1,301,796
Less: cash lease expense		(378,888	)
Three months ended March 31, 2015 annualized Adjusted EBITDA		922,908
Less: cash capital and financing lease payments		(239,768	)
Three months ended March 31, 2015 annualized Adjusted EBITDA after capital and financing lease payments		683,140

Debt (1)		3,581,350			5.2x
Line of credit		300,000
Less: unrestricted cash		(115,182	)
Less: cash held as collateral against existing debt		(2,953	)
Total net debt		3,763,215			5.5x

Plus: Three months ended March 31, 2015 annualized cash capital and financing		1,918,144
lease payments multiplied by 8
Total net debt after capital and financing leases		5,681,359			6.2x

Three months ended March 31, 2015 annualized cash lease expense multiplied by 8		3,031,104
Total adjusted net debt	$	8,712,463			6.7x

Debt Structure

			Weighted
	Balance		rate (2)
Fixed rate debt (1)	$	2,564,274		5.31	%
Variable rate debt (1)		1,017,076		3.05	%
Capital and financing leases		2,592,133		8.25	%
Line of credit (cash borrowings)		300,000		3.76	%
Total debt	$	6,473,483

	Balance		% of total
Variable rate debt with interest rate caps (1) (5)	$	822,492		80.9	%
Variable rate debt - unhedged (1)		194,584		19.1	%
Total variable rate debt (1)	$	1,017,076		100.0	%

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

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

(3) Senior housing FOI and adjusted FOI exclude Brookdale Ancillary Services segment operating income.

(4) Payments are included in CFFO.

(5) Weighted cap rate for stated reporting period of 4.31% 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 March 31, 2015

CFFO Calculation
($ in 000s)

	Three Months Ended March 31,
	2015			2014

Net cash provided by operating activities (includes non-refundable entrance fees)	$	10,057		$	52,696
Changes in operating assets and liabilities (eliminates cash flow effect)		16,425			28,558
Add: Refundable entrance fees received		36			5,924
Less: Entrance fee refunds disbursed		(829	)		(8,446	)
Less: Recurring capital expenditures, net		(15,003	)		(9,369	)
Less: Lease financing debt amortization with fair market value or no purchase options		(12,439	)		(3,897	)
Add: Loss on facility lease termination		76,143			-
Less: Distributions from unconsolidated ventures from cumulative share of net earnings		(500	)		(245	)
Add: CFFO from unconsolidated ventures		14,213			2,241
Cash From Facility Operations	$	88,103		$	67,462

Add: Integration, transaction-related and EMR roll-out costs		27,300			11,783
Adjusted Cash From Facility Operations	$	115,403		$	79,245

Revenue Reconciliation (1)
($ in 000s except average monthly revenue per quarter)
	FY 2014															FY 2015			Q1 2015 CFFO Distribution
		Q1			Q2			Q3			Q4		Full Year				Q1		Owned			Other (3)			Transaction/ Integration
Revenue reconciliation excl. entrance fee amortization
Average monthly revenue per quarter	$	4,491		$	4,518		$	4,317		$	4,220		$	4,357		$	4,305		$	4,305		$	4,306		$	-
Average monthly units (excluding equity homes) available		48,562			48,608			74,538			82,995			254,923			82,927			36,929			45,950			-
Average occupancy for the quarter		88.6	%		88.1	%		88.5	%		88.3	%		88.3	%		87.4	%		86.5	%		88.2	%		-
Senior Housing resident fee revenue	$	579,691		$	580,436		$	854,329		$	927,786		$	2,942,242		$	936,054		$	412,555		$	523,499		$	-

Add: Brookdale Ancillary Services segment revenue		63,417			65,534			95,426			113,458			337,835			115,411			-			115,411			-
Add: Management fee revenue		7,402			7,489			10,428			16,920			42,239			15,097			-			15,097			-
Total revenues excluding entrance fee amortization	$	650,510		$	653,459		$	960,183		$	1,058,164		$	3,322,316		$	1,066,562		$	412,555		$	654,007		$	-

CFFO Reconciliation to the Income Statement

Resident and management fee revenue	$	657,712		$	661,006		$	965,940		$	1,058,878		$	3,343,536		$	1,067,329		$	412,555		$	654,774		$	-
Less: Entrance fee amortization		(7,202	)		(7,547	)		(5,757	)		(714	)		(21,220	)		(767	)		-			(767	)		-
Adjusted revenues		650,510			653,459			960,183			1,058,164			3,322,316			1,066,562			412,555			654,007			-

Less: Facility operating expenses		(429,870	)		(435,415	)		(637,084	)		(707,999	)		(2,210,368	)		(702,215	)		(278,658	)		(423,557	)		-
Add: Change in future service obligation		-			-			-			670			670			-			-			-			-
Adjusted facility operating expenses		(429,870	)		(435,415	)		(637,084	)		(707,329	)		(2,209,698	)		(702,215	)		(278,658	)		(423,557	)		-

Less: G&A including non-cash stock-based compensation expense		(44,665	)		(47,008	)		(90,020	)		(98,574	)		(280,267	)		(84,204	)		(18,814	)		(44,832	)		(20,558	)
Less: Transaction costs		(10,844	)		(6,808	)		(41,572	)		(7,725	)		(66,949	)		(6,742	)		-			-			(6,742	)
Add: G&A non-cash stock-based compensation expense		7,572			7,729			7,869			5,129			28,299			8,873			2,623			6,250			-
Net G&A (4)		(47,937	)		(46,087	)		(123,723	)		(101,170	)		(318,917	)		(82,073	)		(16,191	)		(38,582	)		(27,300	)

Less: Facility lease expense		(69,869	)		(70,030	)		(91,462	)		(92,469	)		(323,830	)		(94,471	)		-			(94,471	)		-
Add: Straight-line lease expense		(223	)		(217	)		2,840			(961	)		1,439			2,801			-			2,801			-
Add: Amortization of (above) below market lease, net		-			-			(1,377	)		(2,067	)		(3,444	)		(1,959	)		-			(1,959	)		-
Less: Amortization of deferred gain		(1,093	)		(1,093	)		(1,093	)		(1,093	)		(4,372	)		(1,093	)		-			(1,093	)		-
Net lease expense		(71,185	)		(71,340	)		(91,092	)		(96,590	)		(330,207	)		(94,722	)		-			(94,722	)		-

Add: Entrance fee receipts		14,959			25,924			9,576			2,587			53,046			2,491			-			2,491			-
Less: Entrance fee disbursements		(8,446	)		(9,213	)		(7,668	)		(538	)		(25,865	)		(829	)		-			(829	)		-
Net entrance fees		6,513			16,711			1,908			2,049			27,181			1,662			-			1,662			-

Add: CFFO from unconsolidated ventures		2,241			1,996			9,435			11,662			25,334			14,213			-			14,213			-

Adjusted EBITDA		110,272			119,324			119,627			166,786			516,009			203,427			117,706			113,021			(27,300	)

Less: Recurring capital expenditures, net		(9,369	)		(11,841	)		(13,199	)		(16,353	)		(50,762	)		(15,003	)		(7,286	)		(7,717	)		-
Less: Interest expense, net		(29,677	)		(29,372	)		(73,030	)		(91,933	)		(224,012	)		(89,424	)		(41,921	)		(47,503	)		-
Less: Lease financing debt amortization with fair market value or no purchase options		(3,897	)		(3,983	)		(10,710	)		(10,028	)		(28,618	)		(12,439	)		-			(12,439	)		-
Less: Other		133			2,528			217			2,847			5,725			1,542			-			1,542			-

Reported CFFO	$	67,462		$	76,656		$	22,905		$	51,319		$	218,342		$	88,103		$	68,499		$	46,904		$	(27,300	)

Add: integration, transaction-related and EMR roll-out costs		11,783			11,941			76,649			46,023			146,396			27,300			-			-			-
Adjusted CFFO	$	79,245		$	88,597		$	99,554		$	97,342		$	364,738		$	115,403		$	68,499		$	46,904		$	(27,300	)

CFFO Per Share
($ except where indicated)

	FY 2014															FY 2015			Q4 2014 Distribution
		Q1			Q2			Q3			Q4		Full Year(2)				Q1		Owned			Other			Transaction/ Integration
Reported CFFO	$	0.54		$	0.61		$	0.14		$	0.28		$	1.57		$	0.48		$	0.37		$	0.26		$	(0.15	)
Add: integration, transaction-related and EMR roll-out costs		0.10			0.10			0.49			0.25			0.94			0.15			-			-			0.15
Adjusted CFFO	$	0.64		$	0.71		$	0.63		$	0.53		$	2.51		$	0.63		$	0.37		$	0.26		$	-

Shares used in calculation of CFFO (000's)		124,478			125,058			159,003			183,432						183,678			183,678			183,678			183,678

(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.

(3) Other includes financial data and operating information from leased communities, Brookdale Ancillary Services, and Management Services.

(4) Allocation of G&A to Owned and Other is based upon a percentage of revenue and excludes non-cash stock-based compensation expense and integration, transaction-related and EMR roll-out costs.

Note: CFFO is a measurement of liquidity that is not calculated in accordance with GAAP and should not be viewed in isolation or 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.
CFFO from Unconsolidated Ventures
As of March 31, 2015

CFFO from Unconsolidated Ventures reconciliation

($ in 000s)	Entrance Fee Ventures									Senior Housing Rental Ventures
	FY 2014						FY 2015			FY 2014						FY 2015
		Q3			Q4			Q1			Q3			Q4			Q1

Resident revenue	$	33,257		$	85,546		$	87,473		$	80,862		$	125,970		$	127,513
Less: Entrance fee amortization		(638	)		(554	)		(1,141	)		-			-			-
Adjusted revenues		32,619			84,992			86,332			80,862			125,970			127,513

Less: Facility operating expenses		(25,040	)		(68,288	)		(67,451	)		(51,698	)		(84,306	)		(83,469	)
Add: Change in future service obligation		-			-			-			-			-			-
Adjusted facility operating expenses		(25,040	)		(68,288	)		(67,451	)		(51,698	)		(84,306	)		(83,469	)

Less: G&A including non-cash stock-based compensation expense		(6,015	)		(4,948	)		(4,707	)		(3,925	)		(6,077	)		(6,153	)
Add: G&A non-cash stock-based compensation expense		-			-						-			-			-
Net G&A		(6,015	)		(4,948	)		(4,707	)		(3,925	)		(6,077	)		(6,153	)

Add: Entrance fee receipts		16,112			26,210			23,251			-			-			-
Less: Entrance fee disbursements		(4,780	)		(13,888	)		(9,181	)		-			-			-
Net entrance fees		11,332			12,322			14,070			-			-			-

Adjusted EBITDA		12,896			24,078			28,244			25,239			35,587			37,891

Less: Recurring capital expenditures, net		(193	)		(1,347	)		(1,159	)		(974	)		(2,431	)		(2,336	)
Less: Interest expense, net		(1,161	)		(1,575	)		(1,530	)		(15,648	)		(26,447	)		(25,845	)
Less: Other		-			-			-			-			(276	)		(613	)

Reported Cash From Facility Operations for Unconsolidated Ventures	$	11,542		$	21,156		$	25,555		$	8,617		$	6,433		$	9,097

Add: integration, transaction-related and EMR roll-out costs		4,088			210			-			738			-			-
Adjusted Cash From Facility Operations for Unconsolidated Ventures	$	15,630		$	21,366		$	25,555		$	9,355		$	6,433		$	9,097


Brookdale Weighted Average Ownership %		51.7	%		51.0	%		51.0	%		14.5	%		11.9	%		13.0	%
CFFO from Unconsolidated Ventures	$	8,081		$	10,896		$	13,033		$	1,354		$	766		$	1,180

Leverage Ratio for Unconsolidated Ventures
Debt Principal as of March 31, 2015	$	195,800		$	1,328,908
Annualized Adjusted EBITDA		112,976			151,564
Annualized Leverage		1.7	x		8.8	x

Unconsolidated Ventures Schedule of Capital Expenditures

($ in 000s)	FY 2014				FY 2015
Type		Q3		Q4		Q1
Recurring	$	1,167	$	3,778	$	3,495
EBITDA-enhancing / Major Projects		5,247		17,199		13,243
Program Max, net		2,758		3,665		4,340
Net Total Capital Expenditures	$	9,172	$	24,642	$	21,078

Brookdale Senior Living Inc.
Cash Lease and Interest Expense
As of March 31, 2015

Cash Lease and Interest Expense

($ in 000s)	FY 2014						FY 2015
		Q3			Q4			Q1

Facility Lease Payments

Facility lease expense	$	91,462		$	92,469		$	94,471
Less: Straight-line lease expense, net		(1,463	)		3,028			(842	)
Add: Amortization of deferred gain		1,093			1,093			1,093
Cash lease payments - Operating Leases	$	91,092		$	96,590		$	94,722
Supplemental breakout:
Communities with purchase options	$	5,590		$	6,320		$	6,343
Communities without purchase options		85,502			90,270			88,379
	$	91,092		$	96,590		$	94,722

Capital Lease Interest	$	40,916		$	56,873		$	53,203
Capital Lease Interest - noncash		(5,947	)		(6,700	)		(5,700	)
Capital lease principal (1)		10,710			10,028			12,439
Net lease payments - Capital and Financing Leases	$	45,679		$	60,201		$	59,942
Supplemental breakout:
Communities with purchase options	$	13,571		$	14,755		$	14,205
Communities without purchase options		32,108			45,446			45,737
	$	45,679		$	60,201		$	59,942

Total net lease payments	$	136,771		$	156,791		$	154,664

Interest Expense

Property level debt interest expense	$	36,278		$	39,930		$	40,174
Convertible debt interest expense		2,174			2,174			2,174
Total debt interest payments		38,452			42,104			42,348
Less: interest income		(392	)		(345	)		(427	)
Interest expense, net	$	38,060		$	41,759		$	41,921

(1) Includes lease financing debt amortization on communities with FMV or no purchase option. Payments are included in CFFO.

Brookdale Senior Living Inc.

Quarterly Cash Flow Statements

As of March 31, 2015

($ in 000s)

Cash Flow Statements

		Q1 2014			Q2 2014			Q3 2014			Q4 2014		FY 2014				Q1 2015
Cash Flows from Operating Activities
Net loss	$	(2,299	)	$	(3,295	)	$	(37,036	)	$	(106,796	)	$	(149,426	)	$	(130,709	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Debt modification and extinguishment costs		-			3,197			569			2,621			6,387			44
Depreciation and amortization, net		74,334			75,166			178,810			216,202			544,512			220,808
Asset impairment		-			-			-			9,992			9,992			-
Equity in (earnings) loss of unconsolidated ventures		(636	)		(1,523	)		1,246			742			(171	)		(1,484	)
Distributions from unconsolidated ventures from cumulative share of net earnings		245			370			595			630			1,840			500
Amortization of deferred gain		(1,093	)		(1,093	)		(1,093	)		(1,093	)		(4,372	)		(1,093	)
Amortization of entrance fees		(7,202	)		(7,547	)		(5,757	)		(714	)		(21,220	)		(767	)
Proceeds from deferred entrance fee revenue		9,035			14,906			6,188			2,575			32,704			2,455
Deferred income tax provision (benefit)		598			(5	)		(116,757	)		(66,207	)		(182,371	)		(79,237	)
Change in deferred lease liability		(223	)		(217	)		2,840			(961	)		1,439			2,801
Change in fair value of derivatives		847			1,322			10			532			2,711			550
Loss (gain) on sale of assets		76			39			200			(761	)		(446	)		-
Change in future service obligation		-			-			-			670			670			-
Non-cash stock-based compensation		7,572			7,729			7,869			5,129			28,299			8,873
Non-cash interest expense on financing leases		-			-			5,947			6,700			12,647			5,700
Amortization of (above) below market rents, net		-			-			(1,377	)		(2,067	)		(3,444	)		(1,959	)
Changes in operating assets and liabilities:
Accounts receivable, net		(2,499	)		3,914			23,671			(21,576	)		3,510			(13,140	)
Prepaid expenses and other assets, net		(5,816	)		(8,369	)		(53,861	)		15,178			(52,868	)		24,504
Accounts payable and accrued expenses		(27,561	)		14,245			6,222			23,906			16,812			(38,773	)
Tenant refundable fees and security deposits		(615	)		138			(674	)		(32	)		(1,183	)		(510	)
Deferred revenue		7,933			(7,459	)		(4,978	)		1,134			(3,370	)		11,494
Net cash provided by operating activities		52,696			91,518			12,634			85,804			242,652			10,057
Cash Flows from Investing Activities
Decrease (increase) in lease security deposits and lease acquisition deposits, net		7			(73	)		3,326			(52,204	)		(48,944	)		13,037
Decrease (increase) in cash and escrow deposits — restricted		6,627			(6,039	)		14,052			42,295			56,935			12,289
Additions to property, plant and equipment and leasehold intangibles, net		(59,717	)		(73,712	)		(79,104	)		(91,712	)		(304,245	)		(79,129	)
Acquisition of assets, net of related payables and cash received		(515	)		-			(39,303	)		(623	)		(40,441	)		(174,305	)
Acquisition of Emeritus Corporation, cash acquired		-			-			28,429			-			28,429			-
Payment on notes receivable, net		76			2,564			73			556			3,269			740
Investment in unconsolidated ventures		-			-			(25,532	)		(967	)		(26,499	)		(3,923	)
Distributions received from unconsolidated ventures		-			2,643			9,414			218			12,275			-
Proceeds from sale of assets, net		-			-			-			4,339			4,339			-
Net cash used in investing activities		(53,522	)		(74,617	)		(88,645	)		(98,098	)		(314,882	)		(231,291	)
Cash Flows from Financing Activities
Proceeds from debt		20,516			159,638			46,356			100,129			326,639			85,365
Repayment of debt and capital and financing lease obligations		(22,401	)		(159,412	)		(92,568	)		(309,964	)		(584,345	)		(47,555	)
Proceeds from line of credit		70,000			12,000			160,000			200,000			442,000			445,000
Repayment of line of credit		(75,000	)		(25,000	)		(172,000	)		(100,000	)		(372,000	)		(245,000	)
Proceeds from public equity offering, net		-			-			330,405			(19	)		330,386			-
Payment of financing costs, net of related payables		(2,905	)		2,087			(202	)		(8,373	)		(9,393	)		(1,481	)
Refundable entrance fees:
Proceeds from refundable entrance fees		5,924			11,018			3,388			12			20,342			36
Refunds of entrance fees		(8,446	)		(9,213	)		(7,668	)		(538	)		(25,865	)		(829	)
Cash portion of loss on extinguishment of debt, net		-			(3,180	)		(921	)		-			(4,101	)		(44	)
Payment on lease termination		-			-			(3,875	)		(3,875	)		(7,750	)		(3,875	)
Other		328			394			486			681			1,889			716
Net cash (used in) provided by financing activities		(11,984	)		(11,668	)		263,401			(121,947	)		117,802			232,333
Net (decrease) increase in cash and cash equivalents		(12,810	)		5,233			187,390			(134,241	)		45,572			11,099
Cash and cash equivalents at beginning of period		58,511			45,701			50,934			238,324			58,511			104,083
Cash and cash equivalents at end of period	$	45,701		$	50,934		$	238,324		$	104,083		$	104,083		$	115,182

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Brookdale Senior Living Inc. Reports