0001332349-25-000129
SEC filingRevenue grew 4.9% on RevPAR and occupancy gains; Adjusted EBITDA increased 19.7% despite higher facility costs and restructuring charges.
For the three months ended June 30, 2025, Brookdale's total resident fees increased 4.9% to $775.6 million compared to the same period in 2024. This growth was driven by a 4.8% increase in same community RevPAR, comprising a 2.4% rise in RevPOR (average rate per occupied unit) and a 190 basis point improvement in weighted average occupancy to 80.7%. Facility operating expense grew 4.6% to $562.3 million, primarily due to higher wage rates, repairs and maintenance, incentive compensation, and advertising costs. Net loss widened to $43.0 million from $37.7 million, mainly because of a $10.4 million increase in transaction, legal, and organizational restructuring costs and higher depreciation and amortization. However, Adjusted EBITDA rose 19.7% to $117.1 million, reflecting the revenue growth and a decrease in cash facility operating lease payments.
All three senior housing segments contributed to the top-line improvement. Independent Living revenue grew 5.7% to $158.1 million, driven by a 4.7% same community RevPAR increase (3.1% RevPOR plus 130bps occupancy). The Assisted Living and Memory Care segment, the largest, posted a 4.8% revenue increase to $531.3 million, with same community RevPAR up 5.0% on 200bps occupancy improvement and 2.4% RevPOR growth. CCRCs revenue rose 3.8% to $86.2 million, with same community RevPAR up 3.8% driven entirely by a 260bps occupancy gain as RevPOR was flat due to mix shift and lower skilled nursing revenue. Segment facility operating expenses increased at similar rates, reflecting wage pressures and investments in maintenance and marketing.
Brookdale expects to continue focusing on RevPAR growth, expense discipline, and strategic portfolio optimization. The company guided full-year 2025 non-development capital expenditures of $175-180 million, to be funded from cash flows and lessor reimbursements. Management highlighted the successful acquisition of 36 previously leased communities (from Diversified Healthcare Trust and Welltower) in February 2025, funded by mortgage financings and cash. The company also amended its master lease with Ventas, resulting in a reduction of leased communities from 120 to 65 starting 2026. Ongoing capital recycling includes planned dispositions of 12 owned communities classified as held for sale. Brookdale remains highly leveraged with $4.3 billion debt, but 88% is non-recourse property-level mortgage debt, and it has $350 million total liquidity. The company is in compliance with debt and lease covenants and expects to meet near-term obligations through operational cash flows and available credit.
CFO of $107M significantly exceeded net loss of -$108M, indicating strong cash generation from operations after non-cash adjustments. The improvement from $55M in prior year was largely due to favorable changes in operating assets and liabilities, particularly a $7.8M increase in trade payables vs. a $14.4M decrease in 2024, and a $11.3M lessor capex reimbursement benefit. Depreciation and amortization of $191M was the largest non-cash add-back.
Capex of $96M remained elevated, representing 90% of CFO, highlighting high capital intensity. The company did not report free cash flow, but capex nearly consumed all operating cash. The $311M acquisition in investing activities drove a large negative investing cash flow, partly offset by $20M in marketable securities sales.
Financing activities provided $214M, primarily from $321M in debt proceeds, offset by $95M in debt repayments and $5M in share withholdings. No share repurchases or dividends were disclosed. Overall, cash decreased by $56M, ending at $324M.
Working capital swings included a $15M increase in prepaid insurance financed with notes payable, a $8.5M increase in prepaid expenses, and a $4.2M increase in receivables, which tempered CFO growth. The company's reliance on debt for acquisitions may warrant attention to liquidity.