Sonida Senior Living (SNDA) 8-K Reports First Quarter 2014 Results

Capital Senior Living

Company Presentation

Exhibit 99.2

2

Forward-Looking Statements

•

The forward-looking statements in this presentation are subject to certain risks

and

uncertainties

that

could

cause

results

to

differ

materially,

including,

but

not without limitation to, the Company’s ability to complete the refinancing of

certain

of

our

wholly

owned

communities,

realize

the

anticipated

savings

related to such financing, find suitable acquisition properties at favorable

terms, financing, licensing, business conditions, risks of downturns in

economic conditions generally, satisfaction of closing conditions such as

those pertaining to licensures, availability of insurance at commercially

reasonable rates and changes in accounting principles and interpretations

among others, and other risks and factors identified from time to time in our

reports filed with the Securities and Exchange Commission

•

The Company assumes no obligation to update or supplement forward-looking

statements in this presentation that become untrue because of new

information, subsequent events or otherwise.                   

2

Investment Highlights

•

Value leader in providing quality seniors housing and care at

reasonable prices

•

Well positioned to make meaningful gains in shareholder value

•

Substantially all private pay with strong cash flow generation

•

Industry benefits from need-driven demand, limited new supply and

improving housing market and economy

•

Achieving solid growth in revenue, EBITDAR and CFFO

•

Executing on disciplined accretive growth initiatives through

acquisitions and conversions to higher levels of care

•

Solid balance sheet

3

4

Company Overview

•

Capital Senior Living operates 113 communities in geographically

concentrated regions with the capacity to serve 14,700 residents

AR. 

173

CT. 

178

FL.

226

IA. 

122

IL. 

650

IN. 

2,247

KS. 

165

LA. 

133

MI.

429

MN.

173

MO. 

662

MS.

143

NC.

593

SC.

669

NE. 

668

NJ. 

98

NY. 

387

OH. 

2,060

OK. 

143

TX. 

3,720

VA.

153

Resident Capacity

CA. 

408

AZ. 

189

GA. 

70

WI. 

150

As of March 31, 2014

MA.

87

5

Resident Demographics at CSU Communities

•

Average age of resident: 85 years

•

Average age of resident moving in: 82 years

•

Average stay period:

-3 years

•

Percent of female residents: 80%

•

Resident turnover is primarily attributed to death or need for

higher care

2 

The Capital Advantage: Senior Living Options

Independent Living –

52% of Resident Capacity

•

Average 113 units per IL community with large common areas and

amenities

•

Supportive services, wellness programs, social, recreational and

educational events

•

Average monthly rate of $2,437

•

100% private pay

•

Average length of resident stay is 31 months

6

7

The Capital Advantage: Senior Living Options

Assisted Living-

48% of Resident Capacity

•

Average 64 units per community

•

74% of communities offer AL

•

Assistance with activities of daily living including medication

reminders, bathing, dressing and grooming

•

Average monthly rate of $3,955

•

Substantially all private pay

•

Average length of resident stay is 24 months

8

The Capital Advantage: Need Driven Demand

U.S. population 75+ years old is estimated to grow by 3.5 million from

2009 through 2015

U.S. Seniors Population Trends (75+ years old)

(Population in

millions)

Implied demand growth of

40,000 units per year

Source: NIC Investment

Guide 2010 and U.S.

Census Bureau

0.0

5.0

10.0

15.0

20.0

25.0

2009

2015

18.9

22.4

Only 1.3 million units serving a population of 18.9 million seniors

Current 6.9% penetration rate implies demand growth of 40,000 units

per year

•

•

The Capital Advantage: Limited New Supply

Source: NIC MAP Trends All Markets Q1 14

9

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

Absorption

Inventory Growth

10

The Capital Advantage: Senior Housing Occupancy Trends

Source: NIC MAP Trends All Markets Q1 14

92.0%

91.0%

90.0%

89.0%

88.0%

87.0%

86.0%

IL Communities

AL Communities

The Capital Advantage: Competitive Strengths

•

Value leader in geographically concentrated regions

•

Experienced on-site, regional and corporate management

•

Larger company economies of scale and proprietary systems

that yield operating efficiencies in highly fragmented industry

•

Solid reputation in industry and 95% resident satisfaction

•

Employer of choice

•

Solid balance sheet

•

Strong Board of Directors

11

12

The Capital Advantage: Strategy

•

Focus on our core strengths

•

Capitalize on competitive strengths within each of our regions

to maximize the cash flow generated by our communities and

our operations

•

Capitalize on the fragmented nature of the senior living

industry to strategically aggregate local and regional operators

in geographically concentrated regions

•

Increase levels of care through conversions to Assisted Living

or Memory Care units

•

Attract and retain the best talent in the senior living industry

2014 Business Plan

•

Focused on Operations, marketing and growth to enhance

shareholder value through:

•

Organic growth

•

Proactive expense Management

•

Accretive acquisitions, unit conversions and community

refurbishment projects

•

Utilization of technology

13

2014 Business Plan: Organic Growth

•

Increase average rents

•

Each 3% increase generates $10.8M of revenue

•

Improve occupancies

•

Each 1% generates $4.0M of revenue, $2.8M of EBITDAR and $0.06 per

share of CFFO

•

Convert units to higher levels of care

•

Cash flow enhancing renovations and refurbishments

•

New branding strategy, eMarketing and website enhancements

•

Implement software programs to optimize care plans and level of

care charges

14

Solving to Achieve 90% Occupancy

Q1 2014

IL

AL

Total

Total Units

5,927

5,206

11,133

Occupied Units

5,050

4,654

9,704

Occupancy %

85.2%

89.4%

87.1%

Planned IL to AL Conversions

IL

AL

Units

(360)

360 

At 90% Stabilized

Occupancy

324

Note: Conversions are subject to customary approvals

Occupancy After Conversions

Stabilize

IL

AL

Total

Total Units

5,567

5,566

11,133

Occupied Units

5,050

4,978

10,028

Occupancy %

90.7%

89.4%

90.1%

15

(in millions except number of communities and units)

2011

2012  

2013    

Combined  

Purchase Price

$83.4

$181.3

$150.4

$415.1

Communities

7

17

11

35

Units

551

1,367

881

2,799

Debt

$59.3

$129.5

$112.3

$301.1

Equity

$24.1

$51.8

$38.1

$114.0

First Year Revenue

$21.3

$49.1

$35.1

$105.5

First Year EBITDAR

$7.3

$19.1

$14.1

$40.5

First Year Cash Flow

from Operations

(CFFO)

$3.4

$9.1

$5.8

$18.3

First Year CFFO per

share

$0.13

$0.34

$0.20

$0.67

16

2014 Business Plan: External Growth

•

Strategic acquisitions of high quality senior living communities

to

enhance

geographic

concentrations

–

16.1%

cash

on

cash

returns

17

Operating Performance

•

Revenue and EBITDAR growth

•

EBITDAR increased 107.7% on an 85.6% increase in revenue

•

EBITDAR margin increased from 29.9% in Q1 2010 to 34.6% in Q4

2013

*

As adjusted in Q4 2013 earnings release

$100.0

$90.0

$80.0

$70.0

$60.0

$50.0

$40.0

$30.0

$20.0

$10.0

$0.0

38.0%

36.0%

34.0%

32.0%

30.0%

28.0%

26.0%

24.0%

Revenue

EBITDAR

EBITDAR Margin %

Comparative Operating Metrics

As adjusted in press releases

2013

2012

% Increase

Total Revenues

$ 350.4

$ 310.5

12.8%

EBITDAR

$ 119.6

$ 110.0

8.7%

% Margin

34.9%

35.4%

CFFO

$ 42.6

$ 37.3

14.2%

CFFO Per Share

$1.53

$1.36

18

Balance Sheet

•

As of December 31, 2013 (in millions)

ASSETS

Cash and Securities

$ 25.0

Other Current Assets

27.8

Total Current Assets

52.8

Fixed Assets

650.0

Other Assets

42.7

TOTAL ASSETS

$ 745.5

LIABILITIES & EQUITY

Current Liabilities

$ 58.7

Long-Term Debt

467.4

Other Liabilities

61.4

Total Liabilities

587.5

Stockholders’

Equity

158.0

TOTAL LIABILITIES &

EQUITY

$ 745.5

19

Investment Highlights

•

Value

leader

in

geographically

concentrated

regions

•

Substantially

all

private

pay

•

Need-driven

demand,

limited

new

supply

and

improving

housing

market

•

Experienced

management

team

with

demonstrated

ability

to

operate, acquire and create shareholder value

•

Accretive

acquisitions

in

highly

fragmented

industry

•

Conversions

to

higher

levels

of

care

with

significant

revenue

and

cash flow growth

•

Strong

cash

flow

generation

•

Solid

balance

sheet

20

Capital Senior Living

Company Presentation