Brookdale Senior Living Inc.

Welcome to the Brookdale Senior Living first quarter earnings call. My name is Victoria and I will be coordinating your call today. If you'd like to ask a question, please press star followed by one on your telephone keypad. If you wish to withdraw your question, please press star two. If you have joined us online, please press the red flag icon. When preparing to ask your question, please ensure that your line is unmuted locally. I'll now pass over to your host, Cathy McDonald, to begin.

Please go ahead. Thank you and good morning. I'd like to welcome you to the first quarter 2022 earnings call for Brookdale Senior Living. Joining us today are Cindy Beyer, our President and Chief Executive Officer, and Steve Swain, our Executive Vice President and Chief Financial Officer. All statements today, which are not historical facts, may be deemed to be forward-looking statements within the meaning of the federal securities laws. These statements are made as of today's date, and we expressly disclaim any obligation to update these statements in the future. Actual results and performance may differ materially from forward-looking statements. Certain of the factors that could cause actual results to differ are detailed in the earnings release we issued yesterday, as well as in the reports we file with the SEC from time to time, including the risk factors contained in the annual report on Form 10-K and quarterly reports on Form 10-Q. I direct you to the release for the full safe harbor statement. Also, please note that during this call, we will present non-GAAP financial measures. For reconciliations of each non-GAAP measure from the most comparable GAAP measure, I direct you to the release and supplemental information, which may be found at brookdale.com forward slash investor and was furnished on an 8K yesterday. Now, I will turn the call over to Cindy.

Thank you, Kathy. Good morning to all of our shareholders, analysts, and other participants. I hope you and your loved ones are healthy and happy. Welcome to our first quarter 2022 earnings call. We are pleased to report revenue growth in the first quarter, continued strong recovery indicators, and significant achievements against our 2022 priorities. COVID-19 continued to play a role in the first quarter. with the Omicron variant causing the pandemic's highest peak of US cases to date. For Brookdale, thanks to the hard work of our associates and a concerted effort to learn from and advance our mitigation and prevention efforts, we continued our strong infection control. Indeed, over the past two years, we've gone to great lengths to learn how to navigate the challenges of COVID-19 using highly effective tools to help protect our residents, and reduce cases in our communities. With second booster shots approved for seniors, our clinical team diligently and promptly worked to schedule clinics for our residents. We've made good progress and are working to complete these clinics for all of our communities as soon as possible. Moreover, with the increased worldwide awareness of viral infections and the related impact on seniors, coupled with our community's strong infection controls, The impact of seasonal flu has been low in 2022. I am grateful for our associates who continue to go above and beyond to make the health and well-being of our residents their top priority. Our business depends on people taking care of people, and I am so thankful for the leaders within Brookdale who make our caring culture a reality. As I have mentioned, we have already made great strides on our 2022 strategic priorities Our first strategic priority, to get every available room in service at the best profitable rate, is directly linked to our financial highlights for the first quarter. RevPAR increased 11% compared to the prior year quarter and grew 5% on a sequential basis. We were pleased to deliver the best first quarter sequential occupancy results in 10 years. Our lead funnel is robust. With first quarter inquiries exceeding pre-pandemic levels, we continue to refine our programs to build a strong pipeline to attract residents wherever they are in their decision-making journey. Move-in volume accelerated in February, and for the first quarter, we exceeded pre-pandemic averages in lead-to-visit and visit-to-move-in conversions. Our sales, marketing, and operational teams excelled to achieve more than 2,000 move-ins in March, the highest March move-ins in our history. What is truly remarkable about this first quarter's positive occupancy news is that it occurred simultaneously with our implementing rate increases necessary to help mitigate higher labor costs and rising inflation. The credit goes to our executive directors who did all it took to make sure residents and their families understood the rationale of our rate increase. I'll now move to our second strategic priority, to attract, engage, develop, and retain the best associates. When it comes to adding talent, I'm pleased with our progress in the first quarter. Our net hires nearly doubled on a sequential basis. And we grew our workforce by 2.5% during the first quarter, which, with more than 33,000 associates, was and continues to be a sizable undertaking. These results are a testament to our intense recruiting efforts, competitive compensation packages, and, where possible, flexible schedule offerings. We have been aggressively focused on building our team, and I'm pleased to report that we have had net positive hires every month. since last November. That said, we are not done yet, as the competition for talent remains intense. We are continuing to focus on our associate value proposition to retain our talented associates, and we plan to continue increasing the number of Brookdale associates. This focus will help us reduce contract labor and accelerate our profitable growth strategy. Speaking of contract labor, while Omicron put additional pressure on an already difficult labor environment, our first quarter contract labor expenses improved slightly on a sequential basis, all the while ensuring we continue to appropriately staff our communities. As our new hires move through the recruiting process, including accepting an offer, officially joining our team, and completing their training, and we satisfy the contractual requirements for agency staffing, We expect to see contract labor moderate in the second quarter and decline more substantially in the second half of the year. We continue to refine our actions to attract and retain the best associates. I'll now move to our third strategic priority, earning resident and family trust and satisfaction by providing valued, high-quality care and personalized service. In a recent study, a significant percentage of healthcare providers rated Brookdale as having the top COVID-19 response in the industry. And we continue our endeavor to be a learning organization. To deliver continuous improvement through incremental and sometimes breakthrough changes, we request feedback from our residents and their families. To that end, we often pull our residents and their families to better understand their views and needs. Thanks to strong engagement, we have been able to glean meaningful insight, including from a recent survey in which we received more than 22,000 responses. We are hard at work analyzing the results to determine where we can enhance our already strong customer focus. In summary, with exceptionally strong RevPAR growth in the first quarter and tangible progress against our strategic priorities, We expect our momentum to continue to accelerate as the year progresses. We are continuing to make progress and we are reaffirming our previous annual guidance. Brookdale is well positioned to win in this dynamic and competitive market. By helping our residents live their best lives and providing compelling career opportunities for associates, we will continue to deliver long-term value for our shareholders. I will now turn the call over to Steve.