SONIDA SENIOR LIVING, INC. Q3 FY2024 earnings call

• Capital allocation events: Completed acquisitions of fourteen new communities with over $160 million in total asset value; put in place a new $150 million secured line of credit; successfully accessed public capital in a broad overnight equity offering resulting in $130 million of new capital; reached an agreement with Fannie Mae to extend $220 million of outstanding mortgages covering eighteen communities to a new maturity date. - Operating performance: Same-store portfolio continued to grow in occupancy and margin; occupancy growth concentrated in independent living care level; positive momentum in second half of the year; continued positive trends in retention at community leadership and staff level; resident programming advancements contributed to stability in average resident length of stay and enhanced reputation score; sales and marketing saw increased organic leads and move-ins, with organic channels representing 56% of total lead volume in 2024; investments targeted to stabilize at a double-digit cap rate delivering significant earnings accretion; investment pipeline remains robust with various sourcing strategies.

For the same-store portfolio, occupancy achieved a new weighted average quarterly high at 87%, growing 210 basis points against Q3 of last year and 80 basis points from Q2 this year. The community net operating income increased more than 18% when removing prior year non-recurring grant income. Revenue contribution details weren't explicitly broken down by specific product segments beyond the same-store portfolio's overall performance.

• 2024 remaining two months: Consistent year-over-year growth in in-place portfolio remains a primary focus, expecting to achieve positive recurring cash flow by year-end including benefit of recent acquisitions. - 2025 outlook: Confident in deep opportunity set and ability to find outside return opportunities; investment pipeline has a clear line of sight to additional opportunities consistent with targeted transaction profile.

• Increased competition and pricing for high-quality and fully stabilized assets. - Wider bid-ask spread for value-add situations. - Industry still suffers from limited capital availability.

Q: Moreover, we are accessing off-market transactions.

A: By leveraging our industry relationships under the leadership of our CIO, Max Levy, who was appointed earlier this summer. We believe our corporate structure as a pure-play senior housing owner, operator, and investor uniquely positions Sunita to access differentiated acquisitions and to deliver significant benefit to shareholders by fully controlling our operations and reinvesting cash flow into high-return investments.