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0001043000FALSE00010430002023-11-142023-11-14

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) November 14, 2023
_________________________________
Sonida Senior Living, Inc.
(Exact name of registrant as specified in its charter)
_________________________________
Delaware
(State or other jurisdiction of incorporation) 
1-13445 75-2678809
(Commission File Number) (IRS Employer Identification No.)
14755 Preston Road
Suite 810
Dallas, Texas 75254
(Address of principal executive offices) (Zip Code)
(972) 770-5600
(Registrant’s telephone number, including area code)

(Former name or former address, if changed since last report)
_________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company  ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Securities registered pursuant to Section 12(b) of the Act: 
Title of each class
Trading
symbol(s)
Name of each exchange
on which registered
Common Stock, par value $0.01 per share SNDA New York Stock Exchange



Item 2.02 Results of Operations and Financial Condition.

On November 14, 2023, Sonida Senior Living, Inc. (the “Company”) announced its financial results for the third quarter ended September 30, 2023 by issuing a press release. The full text of the press release issued in connection with the announcement is attached hereto as Exhibit 99.1.

The information being furnished under Item 2.02, Item 7.01, Exhibit 99.1 and Exhibit 99.2 shall not be deemed “filed” for purposes of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as may be expressly set forth by specific reference in such a filing. The press release and the presentation referenced below contain, and may implicate, forward-looking statements regarding the Company and include cautionary statements identifying important factors that could cause actual results to differ materially from those anticipated.
Item 7.01    Regulation FD Disclosure.

Attached hereto as Exhibit 99.2 is an updated presentation of the Company.

By filing this Current Report on Form 8-K, the Company does not acknowledge that disclosure of this information is required by Regulation FD or that the information was material or non-public before the disclosure. 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.
Item 9.01    Financial Statements and Exhibits.
(d)Exhibits.
*99.1
*99.2
104 Cover Page Interactive Date File-formatted as Inline XBRL.
*These exhibits to this Current Report on Form 8-K are not being filed but are being furnished pursuant to Item 9.01.



SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: November 14, 2023
Sonida Senior Living, Inc.
By: /s/ KEVIN J. DETZ
Name: Kevin J. Detz
Title: Executive Vice President and Chief Financial Officer

EX-99.1 2 snda-20230930xex991.htm EX-99.1 Document
Exhibit 99.1

Sonida Senior Living, Inc. Announces Third Quarter 2023 Results

DALLAS, Texas – November 14, 2023 – Sonida Senior Living, Inc. (the “Company,” “we,” “our,” or “us”) (NYSE: SNDA) announced results for the third quarter ended September 30, 2023.

“We continue to see growth in both year-over-year occupancy and revenue that is surpassing industry trends. This strong financial performance combined with our improved debt structure has Sonida firmly positioned for strategic expansion within the marketplace,” said Brandon Ribar, President and CEO. “As we close out the year and prepare for 2024, we look forward to bringing our signature programs and services to more seniors and to pursuing new avenues of growth and shareholder value creation.”


Third Quarter Highlights
•Weighted average occupancy for the Company’s consolidated portfolio increased 150 basis points to 84.9% year-over-year.
•Resident revenue increased $6.6 million, or 12.6% year-over-year.
•Net loss for the third quarter was $18.4 million.
•Adjusted EBITDA, a non-GAAP measure, was $9.3 million for Q3 2023, an increase of $4.8 million year-over-year.
•Net cash provided by operating activities was $10.6 million year-to-date as compared to $2.9 million for the same period in 2022.
•Results for the Company’s consolidated portfolio of communities:
◦Q3 2023 vs. Q3 2022:
▪Revenue Per Available Unit (“RevPAR”) increased 13.7% to $3,446.
▪Revenue Per Occupied Unit (“RevPOR”) increased 11.7% to $4,061.
▪Community Net Operating Income, a non-GAAP measure, increased $4.7 million. Adjusted Community Net Operating Income, a non-GAAP measure, which excludes $0.5 million of state grant revenue received in Q3 2023 (none recognized in Q3 2022) was $14.2 million and $10.0 million for Q3 2023 and Q3 2022, respectively.
▪Community Net Operating Income Margin and Adjusted Community Net Operating Income Margin (non-GAAP measures with the latter adjusted for non-recurring state grant revenue) were 24.8% and 24.2%, for Q3 2023, respectively, and 19.0% and 19.0% for Q3 2022, respectively.
◦Q3 2023 vs. Q2 2023:
▪RevPAR increased 4.4% to $3,446.
▪RevPOR increased 3.3% to $4,061.
▪Community Net Operating Income increased $1.1 million. Adjusted Community Net Operating Income, excluding $0.5 million and $0.4 million of state grant revenue received in Q3 2023 and Q2 2023, respectively, was $14.2 million and $13.1 million for Q3 2023 and Q2 2023, respectively.
▪Community Net Operating Income Margin and Adjusted Community Net Operating Income Margin (adjusted for non-recurring state grant revenue) were 24.8% and 24.2% for Q3 2023, respectively, and 23.8% and 23.2% for Q2 2023, respectively.





SONIDA SENIOR LIVING, INC.
SUMMARY OF CONSOLIDATED FINANCIAL RESULTS
THREE MONTHS ENDED SEPTEMBER 30, 2023
(in thousands)
Three Months Ended September 30, Three Months Ended June 30,
2023 2022 2023
Consolidated results
Resident revenue (1)
$ 59,117  $ 52,485  $ 56,960 
Management fees 569  608  531 
Operating expenses 44,486  43,123  44,662 
General and administrative expenses 8,615  5,851  6,574 
Long-lived asset impairment 5,965  —  — 
Loss before provision for income taxes (1)
(18,328) (13,739) (12,159)
Net loss (1)
(18,411) (13,739) (12,212)
Adjusted EBITDA (1) (2)
9,270  4,446  7,538 
Community net operating income (NOI) (2)
14,690  9,995  13,549 
Community net operating income margin (2)
24.8% 19.0% 23.8%
Weighted average occupancy 84.9% 83.4% 83.9%
(1) Includes $0.5 million, $0.0 million, and $0.4 million of state grant revenue received in Q3 2023, Q3 2022, and Q2 2023, respectively.
(2) Adjusted EBITDA, Community Net Operating Income, and Community Net Operating Income Margin are financial measures that are not calculated in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). See “Reconciliation of Non-GAAP Financial Measures” for the Company's definition of such measures, reconciliations to the most comparable GAAP financial measures, and other information regarding the use of the Company's non-GAAP financial measures.

Results of Operations
Three months ended September 30, 2023 as compared to three months ended September 30, 2022
Revenues
Resident revenue for the three months ended September 30, 2023 was $59.1 million as compared to $52.5 million for the three months ended September 30, 2022, an increase of $6.6 million, or 12.6%. The increase in revenue was primarily due to increased occupancy and increased average rent rates.
Expenses
Operating expenses for the three months ended September 30, 2023 were $44.5 million as compared to $43.1 million for the three months ended September 30, 2022, an increase of $1.4 million, or 3.2%. The increase is primarily due to a $2.2 million increase in labor and employee-related expenses and a $0.3 million increase in computer software/ internet costs, partially offset by a reduction in real estate taxes of $0.4 million and $0.7 million in other expenses.
General and administrative expenses for the three months ended September 30, 2023 were $8.6 million as compared to $5.9 million for the three months ended September 30, 2022, representing an increase of $2.7 million. This increase is primarily due to a $1.4 million increase in transaction costs due to our loan modification and a $1.2 million increase in stock-based compensation expense from prior quarter due to forfeiture credits in connection with executive personnel changes.
The Company reported a net loss of $18.4 million for the three months ended September 30, 2023, compared to a net loss of $13.7 million for the three months ended September 30, 2022. A major factor impacting the comparison of net loss for the three months ended September 30, 2023 and September 30, 2022 relates to a non-cash impairment charge of $6.0 million related to one owned community.
Adjusted EBITDA for the three months ended September 30, 2023 was $9.3 million compared to $4.4 million for the three months ended September 30, 2022. See “Reconciliation of Non-GAAP Financial Measures” below.
2


Nine months ended September 30, 2023 as compared to nine months ended September 30, 2022
Revenues
Resident revenue for the nine months ended September 30, 2023 was $172.7 million as compared to $155.3 million for the nine months ended September 30, 2022, an increase of $17.4 million, or 11.2%. The increase in revenue was primarily due to increased occupancy and increased average rent rates.
Expenses
Operating expenses for the nine months ended September 30, 2023 were $133.0 million as compared to $126.6 million for the nine months ended September 30, 2022, an increase of $6.4 million, or 5.1%. The increase is primarily due to a $5.8 million increase in labor and employee-related expenses, a $0.4 million increase in service contracts, a $0.8 million increase in computer software/ internet costs, partially offset by a $0.6 million decrease in food costs and a $0.2 million decrease in real estate taxes.
General and administrative expenses for the nine months ended September 30, 2023 were $22.3 million as compared to $23.6 million for the nine months ended September 30, 2022, representing a decrease of $1.3 million. This decrease is primarily due to a $1.9 million decrease in recurring general and administrative expenses and a $1.3 million decrease in stock-based compensation expense as a result of prior year forfeiture credits in connection with executive personnel changes. Partially offsetting the decrease in general and administrative expense is an increase of $1.9 million related to transaction costs associated with our 2023 loan modifications.
The Company reported a net loss of $6.5 million for the nine months ended September 30, 2023 compared to a net loss of $37.8 million for the nine months ended September 30, 2022, primarily due to a $36.3 million gain on extinguishment of debt, partially offset by a non-cash impairment charge of $6.0 million during the nine months ended September 30, 2023.
Significant Transactions
Fannie Mae Loan Modification
On June 29, 2023, the Company entered into a binding forbearance agreement (“Fannie Forbearance”) with the Federal National Mortgage Association (“Fannie Mae”) for all 37 of its encumbered communities, effective as of June 1, 2023 (“Fannie Forbearance Effective Date”). Under the Fannie Forbearance, Fannie Mae agreed to forbear on its remedies otherwise available under the community mortgages and Master Credit Facility (“MCF”) in connection with reduced debt service payments made by the Company during the forbearance period. In connection with the Fannie Forbearance, the Company made a $5.0 million principal payment in July 2023. The Fannie Forbearance was the first of a two-step process to modify all existing mortgage agreements with Fannie Mae by October 1, 2023 under proposed loan modification agreements, as defined in the Fannie Forbearance (“Loan Modification Agreements”). Terms outlined in an agreed upon term sheet accompanying the Fannie Forbearance were included in the Loan Modification Agreements as the final step to modify the various 37 Fannie Mae community mortgages and MCF prior to the expiration of the Fannie Forbearance, which was subsequently extended to October 6, 2023. The Company entered into Loan Modification Agreements with Fannie Mae on October 2, 2023. The forbearance and subsequent loan modification provide the Company with additional financial flexibility and increases its liquidity position.
Under the terms of the Loan Modification Agreements, the mortgage principal payments on 18 community mortgages, ranging from July 2024 to December 2026, will be extended to December 2026. The remaining 19 communities under the MCF have existing maturities in December 2028. The Company will not be required to make scheduled principal payments due under the 18 community mortgages and 19 communities under the MCF through (the revised maturity date) December 2026 and June 1, 2026, respectively. The monthly interest rate was reduced by a 1.5% weighted average on all 37 communities for 12 months, resulting in a projected cash savings of $6.1 million over the period of June 1, 2023 through June 1, 2024.
Ally Loan Amendment

On June 29, 2023 and concurrent with the Fannie Forbearance, the Company executed a second amendment (“Ally Amendment”) to its refinance facility (“Ally Term Loan”) and amended limited payment guaranty with Ally Bank (“Second Amended and Restated Limited Payment Guaranty”) with terms that include a waiver of its current $13.0 million liquid assets requirement through June 30, 2024. During the waiver period (June 30, 2023 through July 1, 2024 under the Ally Amendment, the “Waiver Period”), a new and temporary liquid assets minimum threshold will be established at $6.0 million and measured weekly.
3


Beginning on July 1, 2024, a new liquid assets requirement of $7.0 million will be effective, with such threshold increasing $1.0 million per month rising to $13.0 million by the earlier of the release of the Waiver Period or December 31, 2024. In addition, the Company must replace its interest rate cap (“IRC”) on the $88.1 million notional value and a 2.25% SOFR strike rate when the current IRC expires on November 30, 2023. In July 2023, the Company funded a $2.3 million interest rate cap reserve to Ally Bank with an additional $0.1 million added during the remainder of Q3.
Conversant Equity Commitment
In connection with the Fannie Forbearance and Ally Amendment signed on June 29, 2023, the Company entered into a $13.5 million equity commitment agreement (“Equity Commitment”) with Conversant Dallas Parkway (A) LP and Conversant Dallas Parkway (B) LP, (together “Conversant”) for a term of 18 months. The Equity Commitment had a commitment fee of $675,000 payable through the issuance of 67,500 shares of common stock of the Company. Sonida shall have the right, but not the obligation, to utilize Conversant’s equity commitment and may draw on the commitment in whole or in part. The Company made a $6.0 million equity draw in July 2023 in exchange for 600,000 shares of common stock of the Company. Subsequent to September 30, 2023, the Company elected to draw down an additional $4.0 million of the Conversant Equity Commitment in October which was received on November 1, 2023. The Company issued 400,000 shares of common stock to Conversant on November 1, 2023.
The foregoing description of the Fannie Forbearance, the Ally Amendment, Second Amended & Restated Limited Payment Guaranty, Loan Modification Agreements, and Equity Commitment and related transactions contemplated do not purport to be complete and are subject to, and qualified in their entirety by, the full text of the Fannie Forbearance, the Ally Amendment, Second Amended and Restated Limited Payment Guaranty, and Equity Commitment which are filed as Exhibits 10.1, 10.2, 10.3 and 10.4, respectively, to the Company’s Form 8-K filed on July 5, 2023, incorporated herein by reference. In addition, the full text of the Loan Modification Agreements are filed as Exhibits 10.2 and 10.3 to the Company’s Form 8-K filed on October 6, 2023, incorporated herein by reference.
Liquidity and Capital Resources
Cash flows
The table below presents a summary of the Company’s net cash provided by (used in) operating, investing, and financing activities (in thousands):
Nine months ended September 30,
2023 2022
Net cash provided by operating activities $ 10,643  $ 2,903 
Net cash used in investing activities (12,792) (30,659)
Net cash used in financing activities (7,441) (24,304)
Decrease in cash and cash equivalents $ (9,590) $ (52,060)
In addition to $3.6 million of unrestricted cash on hand as of September 30, 2023, our future liquidity will depend in part upon our operating performance, which will be affected by prevailing economic conditions, including those related to the COVID-19 pandemic, and financial, business and other factors, some of which are beyond our control. Principal sources of liquidity are expected to be cash flows from operations, proceeds from debt refinancings or loan modifications, proceeds from the issuance of common or preferred stock, COVID-19 or related relief grants from various state agencies, and/or proceeds from the sale of owned assets. In June 2023, the Company entered into the Fannie Forbearance, the Ally Amendment, Second Amended and Restated Limited Payment Guaranty, and the Equity Commitment, as disclosed above. The Company entered into Loan Modification Agreements with Fannie Mae on October 2, 2023. These transactions are expected to provide additional financial flexibility to the Company and increase its liquidity position. In March 2022, the Company completed the refinancing of certain existing mortgage debt, which was further amended in December 2022 and June 2023.
The Company has implemented plans, which include strategic and cash-preservation initiatives, designed to provide the Company with adequate liquidity to meet its obligations for at least the 12-month period following the date its third quarter 2023 financial statements are issued. While the Company’s plans are designed to provide it with adequate liquidity to meet its obligations for at least the 12-month period following the date its financial statements are issued, the remediation plan is dependent on conditions and matters that may be outside of the Company’s control, and no assurance can be given that certain options will be available on terms acceptable to the Company, or at all.
4


If the Company is unable to successfully execute all of the planned initiatives or if the plan does not fully mitigate the Company’s liquidity challenges, the Company’s operating plans and resulting cash flows along with its cash and cash equivalents and other sources of liquidity may not be sufficient to fund operations for the 12-month period following the date the financial statements are issued.
The Company, from time to time, considers and evaluates financial and capital raising transactions related to its portfolio, including debt refinancings and modifications, purchases and sales of assets and other transactions. There can be no assurance that the Company will continue to generate cash flows at or above current levels, or that the Company will be able to obtain the capital necessary to meet the Company’s short and long-term capital requirements.
Recent changes in the current economic environment, and other future changes, could result in decreases in the fair value of assets, slowing of transactions, and the tightening of liquidity and credit markets. These impacts could make securing debt or refinancings for the Company or buyers of the Company’s properties more difficult or on terms not acceptable to the Company. The Company’s actual liquidity and capital funding requirements depend on numerous factors, including its operating results, its capital expenditures for community investment, and general economic conditions, as well as other factors described in “Item 1A. Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on March 30, 2023.
Conference Call Information
The Company will host a conference call with senior management to discuss the Company’s financial results for the three months ended September 30, 2023, on Tuesday November 14, 2023, at 4:00 p.m. Eastern Time. To participate, dial 877-407-0989 (no passcode required). A link to the simultaneous webcast of the teleconference will be available at: https://www.webcast-eqs.com/register/sonidaseniorliving_q32023_en/en.
For the convenience of the Company’s shareholders and the public, the conference call will be recorded and available for replay starting November 15, 2023 through November 29, 2023. To access the conference call replay, call 877-660-6853, passcode 13742296. A transcript of the call will be posted in the Investor Relations section of the Company’s website.
About the Company

Dallas-based Sonida Senior Living, Inc. is a leading owner-operator of independent living, assisted living and memory care communities and services for senior adults. As of September 30, 2023, the Company operated 71 communities, with capacity for approximately 8,000 residents across 18 states, which provide comfortable, safe, affordable environment where residents can form friendships, enjoy new experiences and receive personalized care from dedicated team members who treat them like family. For more information, visit www.sonidaseniorliving.com or connect with the Company on Facebook, Twitter or LinkedIn.
Definitions of RevPAR and RevPOR
RevPAR, or average monthly revenue per available unit, is defined by the Company as resident revenue for the period, divided by the weighted average number of available units in the corresponding portfolio for the period, divided by the number of months in the period.
RevPOR, or average monthly revenue per occupied unit, is defined by the Company as resident revenue for the period, divided by the weighted average number of occupied units in the corresponding portfolio for the period, divided by the number of months in the period.

5


Safe Harbor
This release contains forward-looking statements which are subject to certain risks and uncertainties that could cause our actual results and financial condition of Sonida Senior Living, Inc. (the “Company,” “we,” “our” or “us”) to differ materially from those indicated in the forward-looking statements, including, among others, the risks, uncertainties and factors set forth under “Item. 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the Securities and Exchange Commission (the “SEC”) on March 30, 2023, and also include the following: the impact of COVID-19, including the actions taken to prevent or contain the spread of COVID-19, the transmission of its highly contagious variants and sub-lineages and the development and availability of vaccinations and other related treatments, or another epidemic, pandemic or other health crisis; the Company’s ability to generate sufficient cash flows from operations, additional proceeds from debt financings or refinancings, and proceeds from the sale of assets to satisfy its short- and long-term debt obligations and to make capital improvements to the Company’s communities; increases in market interest rates that increase the cost of certain of our debt obligations; increased competition for, or a shortage of, skilled workers, including due to the COVID-19 pandemic or general labor market conditions, along with wage pressures resulting from such increased competition, low unemployment levels, use of contract labor, minimum wage increases and/or changes in overtime laws; the Company’s ability to obtain additional capital on terms acceptable to it; the Company’s ability to extend or refinance its existing debt as such debt matures, including the Company’s ability to complete the modifications to its loan agreements; the Company’s compliance with its debt agreements, including certain financial covenants and the risk of cross-default in the event such non-compliance occurs; the Company’s ability to complete acquisitions and dispositions upon favorable terms or at all; the risk of oversupply and increased competition in the markets which the Company operates; the Company’s ability to improve and maintain controls over financial reporting and remediate the identified material weakness discussed in its recent Quarterly and Annual Reports filed with the SEC; the departure of the Company’s key officers and personnel; the cost and difficulty of complying with applicable licensure, legislative oversight, or regulatory changes; risks associated with current global economic conditions and general economic factors such as inflation, the consumer price index, commodity costs, fuel and other energy costs, competition in the labor market, costs of salaries, wages, benefits, and insurance, interest rates, and tax rates; and changes in accounting principles and interpretations.
For information about Sonida Senior Living, visit www.sonidaseniorliving.com
Investor Contact: Kevin J. Detz, Chief Financial Officer, at 972-308-8343
Press Contact: media@sonidaliving.com.
6


Sonida Senior Living, Inc.
Condensed Consolidated Statements of Operations (Unaudited)
(in thousands, except per share data)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2023 2022 2023 2022
Revenues:
Resident revenue $ 59,117  $ 52,485  $ 172,683  $ 155,315 
Management fees 569  608  1,605  1,836 
Managed community reimbursement revenue 4,989  7,694  15,314  21,757 
Total revenues 64,675  60,787  189,602  178,908 
Expenses:
Operating expense 44,486  43,123  132,956  126,562 
General and administrative expense 8,615  5,851  22,252  23,563 
Depreciation and amortization expense 9,943  9,691  29,751  28,940 
Long-lived asset impairment 5,965  —  5,965  — 
Managed community reimbursement expense 4,989  7,694  15,314  21,757 
Total expenses 73,998  66,359  206,238  200,822 
Other income (expense):
Interest income 139  44  521  47 
Interest expense (9,020) (8,205) (26,445) (23,728)
Gain (loss) on extinguishment of debt, net —  —  36,339  (641)
Gain (loss) on sale of assets, net (34) —  217  — 
Other income (expense), net (90) (6) (269) 8,663 
Loss before provision for income taxes (18,328) (13,739) (6,273) (37,573)
Provision for income taxes (83) —  (205) (254)
Net loss (18,411) (13,739) (6,478) (37,827)
Dividends on Series A convertible preferred stock —  —  —  (2,267)
Undeclared dividends on Series A convertible preferred stock (1,265) (1,134) (3,693) (1,134)
Undistributed net income allocated to participating securities —  —  —  — 
Net loss attributable to common stockholders $ (19,676) $ (14,873) $ (10,171) $ (41,228)
Weighted average common shares outstanding — basic 7,050  6,364  6,602  6,357 
Weighted average common shares outstanding — diluted 7,050  6,364  6,602  6,357 
Basic net loss per common share $ (2.79) $ (2.34) $ (1.54) $ (6.49)
Diluted net loss per common share $ (2.79) $ (2.34) $ (1.54) $ (6.49)
7


Sonida Senior Living, Inc.
Condensed Consolidated Balance Sheets (Unaudited)
(in thousands, except per share amounts)

September 30,
2023
December 31,
2022
Assets
Current assets:
Cash and cash equivalents $ 3,562  $ 16,913 
Restricted cash 17,590  13,829 
Accounts receivable, net 8,124  6,114 
Prepaid expenses and other assets 3,540  4,099 
Derivative assets 745  2,611 
Total current assets 33,561  43,566 
Property and equipment, net 594,116  615,754 
Other assets, net 1,412  1,948 
Total assets $ 629,089  $ 661,268 
Liabilities and Equity
Current liabilities:
Accounts payable $ 10,067  $ 7,272 
Accrued expenses 41,532  36,944 
Current portion of notes payable, net of deferred loan costs 64,309  46,029 
Deferred income 3,790  3,419 
Federal and state income taxes payable 158  — 
Other current liabilities 548  653 
Total current liabilities 120,404  94,317 
Notes payable, net of deferred loan costs and current portion 565,149  625,002 
Other liabilities 61  113 
Total liabilities 685,614  719,432 
Commitments and contingencies
Redeemable preferred stock:
Series A convertible preferred stock, $0.01 par value; 41 shares authorized, 41 shares issued and outstanding as of September 30, 2023 and December 31, 2022 47,243  43,550 
Shareholders’ deficit:
Authorized shares - 15,000 as of September 30, 2023 and December 31, 2022; none issued or outstanding, except Series A convertible preferred stock as noted above —  — 
Authorized shares - 15,000 as of September 30, 2023 and December 31, 2022; 7,778 and 6,670 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively 78  67 
Additional paid-in capital 299,690  295,277 
Retained deficit (403,536) (397,058)
Total shareholders’ deficit (103,768) (101,714)
Total liabilities, redeemable preferred stock and shareholders’ deficit $ 629,089  $ 661,268 








8


Sonida Senior Living, Inc.
Condensed Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
  Nine Months Ended September 30,
  2023 2022
Cash flows from operating activities:    
Net loss $ (6,478) $ (37,827)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization 29,751  28,940 
Amortization of deferred loan costs 1,130  946 
Gain on sale of assets, net (217) — 
Long-lived asset impairment 5,965  — 
Write-off of other assets —  535 
Unrealized (gain) loss on interest rate cap, net 1,958  (206)
(Gain) loss on extinguishment of debt (36,339) 641 
Provision for bad debt 582  908 
Non-cash stock-based compensation expense 2,144  3,479 
Other non-cash items (7)
Changes in operating assets and liabilities:
Accounts receivable, net (2,592) (1,760)
Prepaid expenses and other assets 2,997  6,755 
Other assets, net (45) (115)
Accounts payable and accrued expense 11,276  566 
Federal and state income taxes payable 158  (423)
Deferred income 371  414 
Other current liabilities (11) 43 
Net cash provided by operating activities 10,643  2,903 
Cash flows from investing activities:
Acquisition of new communities —  (12,342)
Capital expenditures (14,168) (18,317)
Proceeds from sale of assets 1,376  — 
Net cash used in investing activities (12,792) (30,659)
Cash flows from financing activities:
Proceeds from notes payable —  80,000 
Repayments of notes payable (12,508) (98,535)
Proceeds from issuance of common stock 6,000  (263)
Dividends paid on Series A convertible preferred stock —  (2,987)
Purchase of interest rate cap —  (258)
Deferred loan costs paid (825) (2,180)
Other financing costs (108)   (81)
Net cash used in financing activities (7,441) (24,304)
Decrease in cash and cash equivalents and restricted cash (9,590) (52,060)
Cash, cash equivalents, and restricted cash at beginning of period 30,742  92,876 
Cash, cash equivalents, and restricted cash at end of period $ 21,152  $ 40,816 
9


RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (UNAUDITED)

This earnings release contains the financial measures (1) Community Net Operating Income and Adjusted Community Net Operating Income, (2) Community Net Operating Income Margin and Adjusted Community Net Operating Income Margin, (3) Adjusted EBITDA, (4) Revenue per Occupied Unit (RevPOR) and (5) Revenue per Available Unit (RevPAR), all of which are not calculated in accordance with U.S. GAAP. Presentations of these non-GAAP financial measures are intended to aid investors in better understanding the factors and trends affecting the Company’s performance and liquidity. However, investors should not consider these non-GAAP financial measures as a substitute for financial measures determined in accordance with GAAP, including net income (loss), income (loss) from operations, net cash provided by (used in) operating activities, or revenue. Investors are cautioned that amounts presented in accordance with the Company’s definitions of these non-GAAP financial measures may not be comparable to similar measures disclosed by other companies because not all companies calculate non-GAAP measures in the same manner. Investors are urged to review the following reconciliations of these non-GAAP financial measures from the most comparable financial measures determined in accordance with GAAP.

Community Net Operating Income and Consolidated Community Net Operating Income Margin are non-GAAP performance measures for the Company’s consolidated owned portfolio of communities that the Company defines as net income (loss) excluding: general and administrative expenses (inclusive of stock-based compensation expense), interest income, interest expense, other income/expense, provision for income taxes, settlement fees and expenses, revenue and operating expenses from the Company’s disposed properties; and further adjusted to exclude income/expense associated with non-cash, non-operational, transactional, or organizational restructuring items that management does not consider as part of the Company’s underlying core operating performance and impacts the comparability of performance between periods. For the periods presented herein, such other items include depreciation and amortization expense, gain(loss) on extinguishment of debt, gain(loss) on disposition of assets, long-lived asset impairment, and loss on non-recurring settlements with third parties. The Community Net Operating Income Margin is calculated by dividing Community Net Operating Income by community resident revenue. Adjusted Community Net Operating Income and Adjusted Community Net Operating Income Margin are further adjusted to exclude the impact from non-recurring state grant funds received.

The Company believes that presentation of Community Net Operating Income, Community Net Operating Income Margin, Adjusted Community Net Operating Income, and Adjusted Community Net Operating Income Margin as performance measures are useful to investors because (i) they are one of the metrics used by the Company’s management to evaluate the performance of our core consolidated owed portfolio of communities, to review the Company’s comparable historic and prospective core operating performance of the consolidated owned communities, and to make day-to-day operating decisions; (ii) they provide an assessment of operational factors that management can impact in the short-term, namely revenues and the controllable cost structure of the organization, by eliminating items related to the Company’s financing and capital structure and other items that management does not consider as part of the Company’s underlying core operating performance, and impacts the comparability of performance between periods.

Community Net Operating Income, Net Community Operating Income Margin, Adjusted Community Net Operating Income, and Adjusted Community Net Operating Income Margin have material limitations as a performance measure, including: (i) excluded general and administrative expenses are necessary to operate the Company and oversee its communities; (ii) excluded interest is necessary to operate the Company’s business under its current financing and capital structure; (iii) excluded depreciation, amortization, and impairment charges may represent the wear and tear and/or reduction in value of the Company’s communities, and other assets and may be indicative of future needs for capital expenditures; and (iv) the Company may incur income/expense similar to those for which adjustments are made, such as gain (loss) on debt extinguishment, gain(loss) on disposition of assets, loss on settlements, non-cash stock-based compensation expense, and transaction and other costs, and such income/expense may significantly affect the Company’s operating results.

10


(in thousands) Three Months Ended
September 30,
Three Months Ended June 30,
2023 2022 2023
Consolidated Community Net Operating Income
Net loss $ (18,411) $ (13,739) $ (12,212)
General and administrative expense 8,615  5,851  6,574 
Depreciation and amortization expense 9,943  9,691  9,927 
Long-lived asset impairment 5,965  —  — 
Interest income (139) (44) (188)
Interest expense 9,020  8,205  8,558 
Loss on sale of assets, net 34  —  — 
Other expense
90  117 
Provision for income taxes 83  —  53 
Settlement (income) fees and expense, net (1)
(510) 25  559 
Other taxes —  —  161 
Consolidated community net operating income 14,690  9,995  13,549 
Resident revenue $ 59,117  $ 52,485  $ 56,960 
Consolidated community net operating income margin 24.8  % 19.0  % 23.8  %
COVID-19 state relief grants (2)
478  —  411 
Adjusted resident revenue 58,639  52,485  56,549 
Adjusted community net operating income $ 14,212  $ 9,995  $ 13,138 
Adjusted community net operating income margin 24.2  % 19.0  % 23.2  %
(1) Settlement fees and expenses relate to non-recurring settlements with third parties for contract terminations, insurance claims, and related fees.
(2) COVID-19 relief revenue are grants and other funding received from third parties to aid in the COVID-19 response and includes state relief funds received.
11


ADJUSTED EBITDA (UNAUDITED)

Adjusted EBITDA is a non-GAAP performance measures that the Company defines as net income (loss) excluding: depreciation and amortization expense, interest income, interest expense, other expense/income, provision for income taxes; and further adjusted to exclude income/expense associated with non-cash, non-operational, transactional, or organizational restructuring items that management does not consider as part of the Company’s underlying core operating performance and impacts the comparability of performance between periods. For the periods presented herein, such other items include stock-based compensation expense, provision for bad debts, gain (loss) on extinguishment of debt, gain on sale of assets, long-lived asset impairment, casualty losses, and transaction and conversion costs.

The Company believes that presentation of Adjusted EBITDA’s impact as a performance measure is useful to investors because it provides an assessment of operational factors that management can impact in the short-term, namely revenues and the controllable cost structure of the organization, by eliminating items related to the Company’s financing and capital structure and other items that management does not consider as part of the Company’s underlying core operating performance and that management believes impact the comparability of performance between periods.

Adjusted EBITDA has material limitations as a performance measure, including: (i) excluded interest is necessary to operate the Company’s business under its current financing and capital structure; (ii) excluded depreciation, amortization and impairment charges may represent the wear and tear and/or reduction in value of the Company’s communities and other assets and may be indicative of future needs for capital expenditures; and (iii) the Company may incur income/expense similar to those for which adjustments are made, such as bad debts, gain(loss) on sale of assets, or gain(loss) on debt extinguishment, non-cash stock-based compensation expense and transaction and other costs, and such income/expense may significantly affect the Company’s operating results.
(In thousands) Three Months Ended
September 30,
Three Months Ended
June 30,
2023 2022 2023
Adjusted EBITDA
Net loss $ (18,411) $ (13,739) $ (12,212)
Depreciation and amortization expense 9,943  9,691  9,927 
Stock-based compensation expense, net 641  (588) 601 
Provision for bad debt 249  386  96 
Interest income (139) (44) (188)
Interest expense 9,020  8,205  8,558 
Long-lived asset impairment 5,965  —  — 
Loss on sale of assets, net 34  —  — 
Other expense, net
90  117 
Provision for income taxes 83  —  53 
Casualty losses (1)
204  372  456 
Transaction and conversion costs (2)
1,591  157  130 
Adjusted EBITDA $ 9,270  $ 4,446  $ 7,538 
(1) Casualty losses relate to non-recurring insured claims for unexpected events.
(2) Transaction and conversion costs relate to legal and professional fees incurred for transactions, restructure projects, or related projects.





12


SUPPLEMENTAL INFORMATION
Third Quarter
(Dollars in thousands) 2023 2022 Increase (decrease) Second Quarter 2023 Sequential increase (decrease)
Selected Operating Results
I. Consolidated community portfolio
Number of communities 61 62 (1) 62 (1)
Unit capacity 5,718 5,771 (53) 5,753 (35)
Weighted average occupancy (1)
84.9% 83.4% 1.5% 83.9% 1.0%
RevPAR $3,446 $3,032 $414 $3,300 $146
RevPOR $4,061 $3,636 $425 $3,932 $129
Consolidated community net operating income $14,690 $9,995 $4,695 $13,549 $1,141
Consolidated community net operating income margin (3)
24.8% 19.0% 5.8% 23.8% 1.0%
Consolidated community net operating income, net of general and administrative expenses (2)
$6,716 $3,556 $3,160 $7,576 $(860)
Consolidated community net operating income margin, net of general and administrative expenses (2)
11.4% 6.8% 4.6% 13.3% (1.9)%
II. Consolidated Debt Information
(Excludes insurance premium financing)
Total variable rate mortgage debt (4)
$137,320 $129,727 N/A $137,253 N/A
Total fixed rate debt $493,436 $538,128 N/A $499,078 N/A
(1) Weighted average occupancy represents actual days occupied divided by total number of available days during the quarter.
(2) General and administrative expenses exclude stock-based compensation expense in order to remove the fluctuation in fair value due to market volatility.
(3) Includes $0.5 million, $0.0 million, and $0.4 million of state grant revenue received in Q3 2023, Q3 2022, and Q2 2023, respectively. Excluding the grant revenue, Q3 2023 consolidated community NOI margin was 24.2%.
(4) As of September 30, 2023, the entire balance of our outstanding variable-rate debt obligations were covered by interest rate cap agreements.



13
EX-99.2 3 sndaq32023-investordecka.htm EX-99.2 sndaq32023-investordecka
A Leading Owner-Operator of Senior Living Communities and Services Investor Presentation – November 14, 2023


 
Forward-Looking Statements 2 This presentation contains forward-looking statements which are subject to certain risks and uncertainties that could cause our actual results and financial condition of Sonida Senior Living, Inc. (the “Company,” “we,” “our” or “us”) to differ materially from those indicated in the forward-looking statements, including, among others, the risks, uncertainties and factors set forth under “Item. 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the Securities and Exchange Commission (the “SEC”) on March 30, 2023, and also include the following: The impact of COVID-19, including the actions taken to prevent or contain the spread of COVID-19, the transmission of its highly contagious variants and sub-lineages and the development and availability of vaccinations and other related treatments, or another epidemic, pandemic or other health crisis; the Company’s ability to generate sufficient cash flows from operations, additional proceeds from debt financings or refinancings, and proceeds from the sale of assets to satisfy its short and long-term debt obligations and to fund the Company’s capital improvement projects to expand, redevelop, and/or reposition its senior living communities; increases in market interest rates that increase the cost of certain of our debt obligations; increased competition for, or a shortage of, skilled workers, including due to the COVID-19 pandemic or general labor market conditions, along with wage pressures resulting from such increased competition, low unemployment levels, use of contract labor, minimum wage increases and/or changes in overtime laws; the Company’s ability to obtain additional capital on terms acceptable to it; the Company’s ability to extend or refinance its existing debt as such debt matures; the Company’s compliance with its debt agreements, including certain financial covenants, and the risk of cross-default in the event such non-compliance occurs; the Company’s ability to complete acquisitions and dispositions upon favorable terms or at all; the risk of oversupply and increased competition in the markets which the Company operates; the Company’s ability to improve and maintain controls over financial reporting and remediate the identified material weakness discussed in Item 9 of the Annual Report on Form 10-K; the departure of certain of the Company’s key officers and personnel; the cost and difficulty of complying with applicable licensure, legislative oversight, or regulatory changes; risks associated with current global economic conditions and general economic factors such as inflation, the consumer price index, commodity costs, fuel and other energy costs, competition in the labor market, costs of salaries, wages, benefits, and insurance, interest rates, and tax rates; and changes in accounting principles and interpretations. We caution you that the risks, uncertainties and other factors referenced above may not contain all of the risks, uncertainties and other factors that are important to you. In addition, we cannot assure you that we will realize the results, benefits or outcomes that we expect or anticipate or, even if substantially realized, that they will result in the consequences or affect us or our business in the way expected. For information about the Company, visit www.sonidaseniorliving.com.


 
Non-GAAP Financial Measures 3 This presentation contains financial measures: (1) Adjusted Operating Expenses, (2) Community Net Operating Income, (3) Community Net Operating Income Margin, (4) Adjusted Community Net Operating Income, (5) Adjusted Community Net Operating Income Margin, (6) Revenue per Occupied Unit (RevPOR),(7) Revenue per Available Unit (RevPAR) and (8) Adjusted EBITDA, which are not calculated in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"). Presentations of these non-GAAP financial measures are intended to aid investors in better understanding the factors and trends affecting the Company’s performance and liquidity. However, investors should not consider these non-GAAP financial measures as a substitute for financial measures determined in accordance with GAAP, including net income (loss), income (loss) from operations, or net cash provided by (used in) operating activities. Investors are cautioned that amounts presented in accordance with the Company’s definitions of these non-GAAP financial measures may not be comparable to similar measures disclosed by other companies because not all companies calculate non-GAAP measures in the same manner. Investors are urged to review the reconciliations of these non-GAAP financial measures contained in the Company’s most recent earnings release from the most comparable financial measures determined in accordance with GAAP. Adjusted Operating Expenses, Community Net Operating Income, Community Net Operating Income Margin, Adjusted Community Net Operating Income, and Adjusted Community Net Operating Income Margin or Operating Margin are non-GAAP performance measures for the Company’s consolidated owned portfolio of communities that the Company defines as net income (loss) excluding: general and administrative expenses, interest income, interest expense, other income/expense, provision for income taxes, settlement fees and expenses, revenue and operating expenses from the Company’s disposed properties; and further adjusted to exclude income/expense associated with non-cash, non-operational, transactional, or organizational restructuring items that management does not consider as part of the Company’s underlying core operating performance and that management believes impact the comparability of performance between periods. For the periods presented herein, such other items include depreciation and amortization expense, gain(loss) on extinguishment of debt, gain(loss) on disposition of assets, long-lived asset impairment, and loss on non-recurring settlements with third parties. Both Adjusted Community Net Operating Income and Adjusted Community Net Operating Income Margin both exclude the impact from non-recurring state grant funds received. RevPAR, or average monthly revenue per available unit, is defined by the Company as resident revenue for the period, divided by the weighted average number of available units in the corresponding portfolio for the period, divided by the number of months in the period. RevPOR, or average monthly revenue per occupied unit, is defined by the Company as resident revenue for the period, divided by the weighted average number of occupied units in the corresponding portfolio for the period, divided by the number of months in the period. Same-store Weighted Average Occupancy and Same-store End of Period Spot Occupancy excludes occupancy from non-same-store communities acquired and divested in the presented periods. The Company believes that presentation of Adjusted Operating Expenses, Community Net Operating Income, Community Net Operating Income Margin, Adjusted Community Net Operating Income and Adjusted Community Net Operating Income Margin or Operating Margin as performance measures are useful to investors because (i) they are some of the metrics used by the Company’s management to evaluate the performance of our core portfolio of communities, to review the Company’s comparable historic and prospective core operating performance of the consolidated owned communities, and to make day-to-day operating decisions; (ii) they provide an assessment of operational factors that management can impact in the short-term, namely revenues and the controllable cost structure of the organization, by eliminating items related to the Company’s financing and capital structure and other items that management does not consider as part of the Company’s underlying core operating performance and that management believes impact the comparability of performance between periods. Adjusted Operating Expenses, Net Operating Income, Community Net Operating Income Margin, Adjusted Community Net Operating Income, and Adjusted Community Net Operating Income Margin or Operating Margin have material limitations as a performance measure, including: (i) excluded interest is necessary to operate the Company’s business under its current financing and capital structure; (ii) excluded depreciation, amortization and impairment charges may represent the wear and tear and/or reduction in value of the Company’s communities, and other assets and may be indicative of future needs for capital expenditures; and (iii) the Company may incur income/expense similar to those for which adjustments are made, such as gain/loss on sale of assets, facility lease termination, or debt extinguishment, non-cash stock-based compensation expense, and transaction and other costs, and such income/expense may significantly affect the Company’s operating results. Adjusted EBITDA is a non-GAAP performance measures that the Company defines as net income (loss) excluding: depreciation and amortization expense, interest income, interest expense, other expense/income, provision for income taxes; and further adjusted to exclude income/expense associated with non-cash, non-operational, transactional, or organizational restructuring items that management does not consider as part of the Company’s underlying core operating performance and impacts the comparability of performance between periods. For the periods presented herein, such other items include stock-based compensation expense, provision for bad debts, gain (loss) on extinguishment of debt, gain on sale of assets, long-lived asset impairment, casualty losses, and transaction and conversion costs.


 
23% 20% 19% 10% 28% Texas Ohio Wisconsin Indiana Other 11% 89% Medicaid Private Pay 71 Communities 61 Owned 10 Managed ~8,000 Resident Capacity 3,700+ Employees 84.9% Q3 2023 Weighted Average Occupancy for Owned Communities (1) Leading Operator of Senior Housing and Services 4 71 Communities 11% - 799 Units 42% - 2,912 Units 47% - 3,301 Units Assisted Living Independent Living Memory Care Attractive Markets and Resident Demographics (1) Balanced Unit Mix Supports Target Market Profile Attractive Private Pay Revenue Mix (1) 15+ Communities 5 - 14 Communities < 5 Communities 7,012 Units 18 States OwnedManaged Data through and as of September 30, 2023. (1) Data presented for the Company’s weighted-average owned communities.


 
Q3 2023 Operating Highlights 5 RevPOR excluding state grants increased 10.8% YoY and 3.2% QoQ YoY Q3 Resident Revenue increased 12.6% Adjusted Community NOI(1) up 42.2% YoY and 7.6% QoQ (1) Adjusted Community NOI is a non-GAAP measure and does not include non-recurring state grant revenue earned and received throughout the period. Ten consecutive quarters of revenue growth Operating Margin(1) up 520 bps YoY and 90 bps QoQ


 
Q3 2023 Capitalization Highlights 6 Fannie Mae Key Terms ➢ All maturities extended to December 2026 or beyond ➢ All contractually required principal payments under the 37 Fannie Mae loans were deferred for three years or waived until maturity, resulting in $33.0M of cash savings through maturity ➢ Sonida received near-term interest rate reduction on all 37 assets, resulting in $6.1M in cash interest savings over the next 12 months Ally Bank Key Terms ➢ Granted Sonida a waiver of its minimum liquidity requirement of $13.0M under its Guaranty for 12 months Completed debt restructuring covering 49 assets financed by Fannie Mae and Ally Bank Received $13.5M equity commitment from Conversant Capital, the Company’s largest shareholder


 
Q3 2023 Capitalization Highlights (continued) 7 Other Key Highlights ➢ Weighted average maturities extended 1+ year with nearest maturity coming in December 2026 (previously July 2024) ➢ Total cost of debt is 3.4% and 5.5% in the first and second year following the debt restructuring ➢ Total debt service decreases $15.5M and $8.9M in the first and second year following the debt restructuring ➢ Strengthens relationships with its institutional lending group ➢ Allows for the swift pivot to pursuit of strategic growth opportunities Completed debt restructuring covering 49 assets financed by Fannie Mae and Ally Bank Received $13.5M equity commitment from Conversant Capital, the Company’s largest shareholder


 
Q3 2023 Financial Comparisons – Owned Communities 8 Q3 2023 Q3 2022 Q2 2023 Weighted Average Occupancy 84.9% 83.4% 83.9% RevPAR(1,2) 3,446 $3,032 $3,300 RevPOR(1,2) 4,061 $3,636 $3,932 Resident Revenue(2) $59.1 $52.5 $57.0 Adjusted Operating Expenses(1,3) $44.4 $42.5 $43.4 Community NOI(1,2) $14.7 $10.0 $13.6 Community NOI Margin(1,2) 24.9% 19.0% 23.9% Adjusted Community NOI(4) $14.2 $10.0 $13.2 Adjusted Community NOI Margin(4) 24.2% 19.0% 23.3% (1) Amounts are not calculated in accordance with GAAP. See page 3 for the Company’s disclosure regarding non-GAAP financial measures. (2) Includes non-recurring state grant revenue earned and received of $0.5 million, $0.0 million and $0.4 million in Q3 2023, Q3 2022 and Q2 2023, respectively. (3) Adjusted Operating Expenses exclude professional fees, settlement expense, non-income tax, non-property tax, casualty gains and losses, operating expense for non-continuing communities and other expenses. Other expenses include corporate operating expenses not allocated to the communities. (4) Excludes non-recurring state grant revenue earned and received of $0.5 million, $0.0 million and $0.4 million in Q3 2023, Q3 2022 and Q2 2023, respectively. Adjusted Community NOI Margin increased 90bps from 23.3% in Q2 2023 to 24.2% in Q3 2023 $ in Millions except RevPAR and RevPOR


 
8 4 .4 % 7 5 .5 % 7 8 .1 % 8 1 .0 % 8 1 .3 % 8 2 .3 % 8 3 .2 % 8 3 .7 % 8 4 .2 % 8 4 .2 % 8 4 .2 % 8 5 .0 % 8 4 .0 % 7 6 .7 % 7 9 .7 % 8 2 .2 % 8 2 .2 % 8 3 .5 % 8 4 .2 % 8 4 .9 % 8 5 .0 % 8 5 .0 % 8 5 .4 % 8 6 .9 % Q4 '19 Q1 '21 Q2 '21 Q3 '21 Q4 '21 Q1 '22 Q2 '22 Q3 '22 Q4 '22 Q1' 23 Q2' 23 Q3' 23 Weighted Average Occupancy End of Period Spot Occupancy Ten Consecutive Quarters of Occupancy Growth (Same-Store) 9 Pandemic occupancy low pointPre-pandemic Data presented for the Company’s 60 same-store owned communities.


 
Q3 Revenue Highlights 10 Level of Care “LoC” Program Impact • Simplified 4 level system with clear requirements • New monitoring tools implemented to reinforce timely LoC reviews based on company and state-specific requirements • Leveraged new monitoring technology to facilitate more accurate resident assessments 97% of Current Residents Converted 16% YoY Increase of LoC Revenue 26.7% YoY Q3 Increase in Medicaid Revenue per Occupied Unit 2.0% Q3 Releasing Spread Resident Rent Rate(1) Increases • Sequentially, Q3 2023 was 3.3% higher than Q2 2023, largely due to planned private and state paid rent increases. • Positive rate growth in 7 of the last 8 quarters. 9.2% Q3 Rent Renewal Increase Percentage (1) Includes Private Pay and Medicaid rent only Resident rent rates(1) increased $353 or 10.4% YoY compared to Q3 2022 $2.25M YoY Q3 Annualized LoC Impact


 
Revenue Growth Continues to Outpace Labor Costs 11 Labor Costs (1) Trend as a Percent of Revenue(2) Dollars in 000s (1) Represents 62 Owned Communities (inclusive of Shaker Heights through its 8/4/2023 sale), excludes Benefits (2) Represents 62 Owned Communities (inclusive of Shaker Heights through its 8/4/2023 sale), amounts calculated as a percentage of revenues exclude non-recurring state grants in all periods. • 3 consecutive quarters of stabilized Labor Costs (1) at 46% of revenue. • YTD September 2023 Labor Costs (1) as a percentage of revenue are down 140 basis points compared to YTD September 2022 broken out as: • YTD September 2023 contract labor decreased $4.7M YoY compared to YTD September 2022. • YTD September 2023 premium bonus incentives decreased $149K YoY compared to YTD September 2022.


 
Non-Labor Operating Cost Holding Steady 12 Total Operating Expense Excluding Labor Costs(1) Trend Dollars in 000s (1) Represents 62 Owned Communities (inclusive of Shaker Heights through its 8/4/2023 sale), amounts calculated as a percentage of revenues exclude non-recurring state grants in all periods. • Q3 2023 expense, at 27.2% of revenue, was 313 basis points lower than the previous 8-quarter average. • Food costs per financial occupied day for Q3 2023 decreased 4.3% YoY compared to Q3 2022. • YTD September 2023 utility cost as a percent of revenue is down 38 basis points YoY compared to YTD September 2022. • YTD September 2023 real estate tax cost as a percent of revenue is down 51 basis points YoY compared to YTD September 2022.


 
Debt Structure as of September 30, 2023 13 (1) Represents three community mortgages (not crossed with the remaining four Protective Life mortgages) that were not in compliance with their loan agreements as a result of the Company’s failure to make debt service payments beginning in February 2023. Fixed Rate 69.0% Protective Life Non-Compliant Fixed Rate 8.8% Variable Rate 21.6% Insurance and Other 0.6% 4.9% Effective weighted average interest rate As of September 30,2023 ($ in millions) Fixed Rate $ 437.6 Protective Life Non-Compliant Fixed Rate(1) 55.8 Variable Rate (fully hedged) 137.3 Insurance and Other 3.5 Total Notes Payable $ 634.2


 
Supplemental Investor Information Q3 2023


 
2 Table of Contents Forward Looking Statements Disclosure3 Non-GAAP Financial Measures4 Financial Overview5 Community NOI6 Net Income (Loss) Walk Forward7 Adjusted EBITDA Walk Forward8 Capitalization9 Geographical Breakdown10 Financial and Key Metrics11 Market Fundamentals12


 
Forward-Looking Statements 3 This presentation contains forward-looking statements which are subject to certain risks and uncertainties that could cause our actual results and financial condition of Sonida Senior Living, Inc. (the “Company,” “we,” “our” or “us”) to differ materially from those indicated in the forward-looking statements, including, among others, the risks, uncertainties and factors set forth under “Item. 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the Securities and Exchange Commission (the “SEC”) on March 30, 2023, and also include the following: The impact of COVID-19, including the actions taken to prevent or contain the spread of COVID-19, the transmission of its highly contagious variants and sub-lineages and the development and availability of vaccinations and other related treatments, or another epidemic, pandemic or other health crisis; the Company’s ability to generate sufficient cash flows from operations, additional proceeds from debt financings or refinancings, and proceeds from the sale of assets to satisfy its short and long-term debt obligations and to fund the Company’s capital improvement projects to expand, redevelop, and/or reposition its senior living communities; increases in market interest rates that increase the cost of certain of our debt obligations; increased competition for, or a shortage of, skilled workers, including due to the COVID-19 pandemic or general labor market conditions, along with wage pressures resulting from such increased competition, low unemployment levels, use of contract labor, minimum wage increases and/or changes in overtime laws; the Company’s ability to obtain additional capital on terms acceptable to it; the Company’s ability to extend or refinance its existing debt as such debt matures; the Company’s compliance with its debt agreements, including certain financial covenants, and the risk of cross-default in the event such non-compliance occurs; the Company’s ability to complete acquisitions and dispositions upon favorable terms or at all; the risk of oversupply and increased competition in the markets which the Company operates; the Company’s ability to improve and maintain controls over financial reporting and remediate the identified material weakness discussed in Item 9 of the Annual Report on Form 10-K; the departure of certain of the Company’s key officers and personnel; the cost and difficulty of complying with applicable licensure, legislative oversight, or regulatory changes; risks associated with current global economic conditions and general economic factors such as inflation, the consumer price index, commodity costs, fuel and other energy costs, competition in the labor market, costs of salaries, wages, benefits, and insurance, interest rates, and tax rates; and changes in accounting principles and interpretations. We caution you that the risks, uncertainties and other factors referenced above may not contain all of the risks, uncertainties and other factors that are important to you. In addition, we cannot assure you that we will realize the results, benefits or outcomes that we expect or anticipate or, even if substantially realized, that they will result in the consequences or affect us or our business in the way expected. For information about the Company, visit www.sonidaseniorliving.com.


 
Non-GAAP Financial Measures 4 This presentation contains financial measures: (1) Adjusted Operating Expenses, (2) Community Net Operating Income, (3) Community Net Operating Income Margin, (4) Adjusted Community Net Operating Income, (5) Adjusted Community Net Operating Income Margin, (6) Revenue per Occupied Unit (RevPOR),(7) Revenue per Available Unit (RevPAR) and (8) Adjusted EBITDA, which are not calculated in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"). Presentations of these non-GAAP financial measures are intended to aid investors in better understanding the factors and trends affecting the Company’s performance and liquidity. However, investors should not consider these non-GAAP financial measures as a substitute for financial measures determined in accordance with GAAP, including net income (loss), income (loss) from operations, or net cash provided by (used in) operating activities. Investors are cautioned that amounts presented in accordance with the Company’s definitions of these non-GAAP financial measures may not be comparable to similar measures disclosed by other companies because not all companies calculate non-GAAP measures in the same manner. Investors are urged to review the reconciliations of these non-GAAP financial measures contained in the Company’s most recent earnings release from the most comparable financial measures determined in accordance with GAAP. Adjusted Operating Expenses, Community Net Operating Income, Community Net Operating Income Margin, Adjusted Community Net Operating Income, and Adjusted Community Net Operating Income Margin or Operating Margin are non- GAAP performance measures for the Company’s consolidated owned portfolio of communities that the Company defines as net income (loss) excluding: general and administrative expenses, interest income, interest expense, other income/expense, provision for income taxes, settlement fees and expenses, revenue and operating expenses from the Company’s disposed properties; and further adjusted to exclude income/expense associated with non-cash, non- operational, transactional, or organizational restructuring items that management does not consider as part of the Company’s underlying core operating performance and that management believes impact the comparability of performance between periods. For the periods presented herein, such other items include depreciation and amortization expense, gain(loss) on extinguishment of debt, gain(loss) on disposition of assets, long-lived asset impairment, and loss on non- recurring settlements with third parties. Both Adjusted Community Net Operating Income and Adjusted Community Net Operating Income Margin both exclude the impact from non-recurring state grant funds received. RevPAR, or average monthly revenue per available unit, is defined by the Company as resident revenue for the period, divided by the weighted average number of available units in the corresponding portfolio for the period, divided by the number of months in the period. RevPOR, or average monthly revenue per occupied unit, is defined by the Company as resident revenue for the period, divided by the weighted average number of occupied units in the corresponding portfolio for the period, divided by the number of months in the period. Same-store Weighted Average Occupancy and Same-store End of Period Spot Occupancy excludes occupancy from non-same-store communities acquired and divested in the presented periods. The Company believes that presentation of Adjusted Operating Expenses, Community Net Operating Income, Community Net Operating Income Margin, Adjusted Community Net Operating Income and Adjusted Community Net Operating Income Margin or Operating Margin as performance measures are useful to investors because (i) they are some of the metrics used by the Company’s management to evaluate the performance of our core portfolio of communities, to review the Company’s comparable historic and prospective core operating performance of the consolidated owned communities, and to make day-to-day operating decisions; (ii) they provide an assessment of operational factors that management can impact in the short-term, namely revenues and the controllable cost structure of the organization, by eliminating items related to the Company’s financing and capital structure and other items that management does not consider as part of the Company’s underlying core operating performance and that management believes impact the comparability of performance between periods. Adjusted Operating Expenses, Net Operating Income, Community Net Operating Income Margin, Adjusted Community Net Operating Income, and Adjusted Community Net Operating Income Margin or Operating Margin have material limitations as a performance measure, including: (i) excluded interest is necessary to operate the Company’s business under its current financing and capital structure; (ii) excluded depreciation, amortization and impairment charges may represent the wear and tear and/or reduction in value of the Company’s communities, and other assets and may be indicative of future needs for capital expenditures; and (iii) the Company may incur income/expense similar to those for which adjustments are made, such as gain/loss on sale of assets, facility lease termination, or debt extinguishment, non-cash stock-based compensation expense, and transaction and other costs, and such income/expense may significantly affect the Company’s operating results. Adjusted EBITDA is a non-GAAP performance measures that the Company defines as net income (loss) excluding: depreciation and amortization expense, interest income, interest expense, other expense/income, provision for income taxes; and further adjusted to exclude income/expense associated with non-cash, non-operational, transactional, or organizational restructuring items that management does not consider as part of the Company’s underlying core operating performance and impacts the comparability of performance between periods. For the periods presented herein, such other items include stock-based compensation expense, provision for bad debts, gain (loss) on extinguishment of debt, gain on sale of assets, long-lived asset impairment, casualty losses, and transaction and conversion costs.


 
Financial Overview – Owned Communities 5 Note: Dollars in 000s. Numbers may vary due to rounding. (1) Resident Revenue, Community NOI, Community NOI Margin %, Net Income (loss), Adjusted EBITDA, REVPOR, and REVPAR include the impact of non-recurring state grants earned and received in the period, as follows: Q1 2022: $0.7mm, Q2 2022: $0.5mm, Q1 2023: $2.0mm, Q2 2023: $0.4mm, and Q3 2023: $0.5mm.


 
Community NOI – Owned Communities 6 Note: Dollars in 000s. Numbers may vary due to rounding. (1) Includes Second Person and Level of care fees. (2) Community NOI and Other Income include the impact of non-recurring state grants earned and received in the period. (3) Includes benefits, overtime, payroll taxes, and related labor costs, excluding contract labor. (4) Adjusted Operating Expense excludes professional fees, settlement expense, non-income tax, non-property tax, casualty gains and losses, operating expense for non-continuing communities and other expenses.


 
Net Income (Loss) Walk Forward 7 Note: Dollars in 000s. Numbers may vary due to rounding. (1) Amounts are not calculated in accordance with GAAP. See page 4 for the Company’s disclosure regarding non-GAAP financial measures. . (2) Non-Operating Expenses include professional fees, settlement expense, non-income tax, non-property tax, casualty gains and losses, operating expense for non-continuing communities and other expenses.


 
Adjusted EBITDA Walk Forward 8 Note: Dollars in 000s. Numbers may vary due to rounding. (1) Casualty losses relate to non-recurring insured claims for unexpected events. (2) Transaction and conversion costs relate to legal and professional fees incurred for transactions, restructure projects, or related projects. (3) Employee placement and separation costs include severance and other employment costs of organizational changes. (4) COVID-19 relief revenue are grants and other funding received from third parties in aid to the COVID-19 response and includes federal and state relief funds received. (5) COVID-19 expenses are expenses for supplies and personal protective equipment, testing of the Company’s residents and employees, labor and specialized disinfecting, and cleaning services.


 
Capitalization as of September 30, 2023 9 Note: Dollars in 000s except for share price and strike price. Numbers may vary due to rounding. (1) Weighted average interest rate (2) Variable exposure is synthetically limited with interest rate caps on all of the debt. Rates reflect all-in interest rate (3) Includes unrestricted and restricted cash Common Equity (9.6%) Preferred Equity (6.4%) Net Debt (84.0%) Components of Total Capital


 
Geographical Breakdown – Owned Communities 10 South/Southwest 18 Communities Midwest 35 Communities East 8 Communities (1) Data based on Q3 2023 average and excludes the Shaker Heights community, which was sold in August of 2023.


 
T3M: Financial and Key Metrics – Owned Communities 11 Note: Dollars in 000s. Numbers may vary due to rounding. Financial data presented is September 2023 trailing 3-month results. (1) Includes Second Person Fees and Level of care fees. (2) Revenue includes non-recurring state grant revenue earned and received in Q2 2023 of $0.4M (3) Adjusted Operating Expense excludes professional fees, settlement expense, non-income tax, non-property tax, casualty gains and losses, operating expense for non-continuing communities and other expenses. (4) Includes benefits, overtime, payroll taxes, and related labor costs, excluding contract labor.


 
Market Fundamentals 12 Note: Dollars in 000s. Numbers may vary due to rounding. (1) Based on a 5-mile radius from Sonida community. (2) Adult child reflects population between the ages of 45-64. (3) Amounts are not calculated in accordance with GAAP. See page 4 for the Company’s disclosure regarding non-GAAP financial measures. (4) Includes independent living, assisted living, and memory care units in stand-alone and continuum communities. (5) 140 Metropolitan Statistica Area ("MSA") across the country are classified by NIC MAP Vision into three market classes based on the Total Population. largest of these markets are the Primary Markets, where NIC MAP has been tracking data since 4Q2005. These are sometimes referred to as the MAP31 as there are 31 of these markets. The next largest are the Secondary Markets, where NIC MAP has been tracking data since 1Q2008. These markets are the next 68 largest markets. Finally, Additional Markets are 41 markets located in close proximity to the 99 Primary and Secondary Markets and help to fill gaps between these Primary and Secondary Markets. NIC MAP has tracked data in Additional Markets since 1Q2015. Primary Markets (28%) Secondary Markets (38%) Tertiary Markets (34%) Market Type Classification(5) Source: NIC MAP Vision as of November 8, 2023. Demographics data is current as of January 1, 2023. NIC MAP Vision Seniors Housing Inventory data is current as of the 3Q2023 Market Fundamentals update.