Sonida Senior Living (SNDA) Q2 2024 earnings summary

Executive summary

• Achieved strong operational and financial performance in Q2 2024, with record-high same-store occupancy averaging 86.2% and 13 consecutive quarters of occupancy growth.

• Resident revenue increased 10.7% year-over-year to $63.1M, driven by higher occupancy, rent rates, and new community acquisitions.

• Net operating income grew 31% year-over-year, with margin expanding to 28.2% and adjusted EBITDA up 50.6% year-over-year to $11.4M.

• Expanded portfolio by acquiring nine communities, including new joint ventures, increasing market density and entering new markets.

• Strategic acquisitions, disciplined capital management, and operational improvements enhanced financial flexibility and growth.

Financial highlights

• Q2 2024 total revenues were $70.2M, up from $62.9M in Q2 2023; resident revenue for Q2 2024 was $62.7M, up 10% year-over-year.

• Same-store community NOI grew 31.1% year-over-year to $17.7M; margin improved 450 bps to 28.2%.

• Labor costs as a percent of revenue declined to 42.8% in Q2 2024, down 320 bps year-over-year and 240 bps sequentially.

• Year-over-year rate growth of 8.4% and RevPAR up 11.3% to $3,673; RevPOR up 8.4% to $4,263.

• Net loss narrowed to $9.8M from $12.2M in Q2 2023; net income for the six months ended June 30, 2024, was $17.2M, including a $38.1M gain on debt extinguishment.

Outlook and guidance

• Targeting portfolio-wide occupancy of 90% as the next milestone, with expectations for normalized occupancy to exceed 90% in coming years.

• Management expects future liquidity to depend on operating performance, equity offerings, debt refinancings, and asset sales.

• Expects continued growth through acquisitions, joint ventures, and management contracts, leveraging a strong balance sheet and operational platform.

• Anticipates positive all-in cash flow by year-end 2024 and continued deleveraging of the balance sheet.