8-K

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) May 6, 2014

Capital Senior Living Corporation

(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.)

14160 Dallas Parkway
Suite 300
Dallas, Texas	75254
(Address of principal executive offices)	(Zip Code)

(972) 770-5600

(Registrant’s telephone number, including area code)

Not applicable

(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):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

On May 6, 2014, Capital Senior Living Corporation (the “Company”) announced its financial results for the first quarter ended March 31, 2014 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.

In the press release and the presentation referenced below, the Company’s management utilizes financial measures, including adjusted EBITDAR, adjusted EBITDAR margin, adjusted net income and adjusted CFFO, that are not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). Non-GAAP financial measures may have material limitations in that they do not reflect all of the amounts associated with the Company’s results of operations as determined in accordance with GAAP. As a result, these non-GAAP financial measures should not be considered a substitute for, nor superior to, financial results and measures determined or calculated in accordance with GAAP. The Company believes that these non-GAAP measures are useful in identifying trends in day-to-day performance because they exclude items that are of little or no significance to operations and provide indicators to management of progress in achieving optimal operating performance. In addition, these measures are used by many research analysts and investors to evaluate the performance and the value of companies in the senior living industry. The Company strongly urges you to review the reconciliation of net income from operations to adjusted EBITDAR and adjusted EBITDAR margin and the reconciliation of net loss to adjusted net income and adjusted CFFO, along with the Company’s consolidated balance sheets, statements of operations, and statements of cash flows, each of which is included in the Company’s press release.

Item 7.01 Regulation FD Disclosure.

Attached hereto as Exhibit 99.2 is an updated slideshow 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.

(a) Not applicable.

(b) Not applicable.

(c) Not applicable.

(d) Exhibits.

*99.1	Press Release dated May 6, 2014.
*99.2	Capital Senior Living Corporation Updated Slideshow Presentation.

* 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: May 6, 2014	Capital Senior Living Corporation
	By:	/s/ Ralph A. Beattie
	Name:	Ralph A. Beattie
	Title:	Executive Vice President and Chief Financial Officer

EXHIBIT INDEX

*99.1	Press Release dated May 6, 2014.
*99.2	Capital Senior Living Corporation Updated Slideshow Presentation.

* These exhibits to this Current Report on Form 8-K are not being filed but are being furnished pursuant to Item 9.01.

EX-99.1

Exhibit 99.1

	PRESS CONTACT:
	Ralph A. Beattie, Chief Financial Officer
	Phone: 1-972-770-5600

FOR IMMEDIATE RELEASE

CAPITAL SENIOR LIVING CORPORATION

REPORTS FIRST QUARTER 2014 RESULTS

DALLAS – (BUSINESS WIRE) – May 6, 2014 – Capital Senior Living Corporation (the “Company”) (NYSE:CSU), one of the country’s largest operators of senior living communities, today announced operating and financial results for the first quarter of 2014. Company highlights for the first quarter include:

Operating and Financial Summary (see Non-GAAP Financial Measures below)

• Revenue in the first quarter of 2014 increased 6.5% to $91.9 million, an increase of $5.6 million from the first quarter of 2013.

• Average monthly rent for the consolidated communities increased 2.1% to $3,126 per occupied unit in the first quarter of 2014, an increase of $64 per occupied unit from the first quarter of 2013.

• Adjusted net income for the first quarter of 2014 was $0.2 million or $0.01 per share, excluding non-recurring or non-economic items reconciled on the final page of this release. This compares to a net loss of $4.6 million, or $0.16 per share, before adjusting for these non-recurring or non-economic items.

• Adjusted EBITDAR increased 1.7% to $31.0 million in the first quarter of 2014, excluding two continuing care retirement communities (“CCRC’s”) that are being re-positioned.

• Adjusted Cash From Facility Operations (“CFFO”) was $7.9 million or $0.28 per share in the first quarter of 2014, excluding the two CCRC’s that are being re-positioned. Adjusted CFFO would have been approximately $0.35 per share if not for the unusual weather-related costs, real estate taxes and referral fees discussed later in this release.

• The Company completed the acquisition of one senior living community in the first quarter for a purchase price of approximately $14.6 million.

CAPITAL/Page 2

“We are pleased to report positive results for the first quarter as we continue to recover from high levels of attrition in 2013, with growth in revenue, EBITDAR and occupancy,” said Lawrence A. Cohen, Chief Executive Officer of the Company. “These improvements were achieved despite harsh winter weather; however, winter related expenses negatively impacted first quarter financial results. We are focused on reducing attrition and increasing occupancy by converting approximately 360 vacant independent living units to assisted living and memory care units. Once these converted units are stabilized, we expect overall occupancy to increase by approximately 300 basis points, to 90%.”

“Complementing this organic growth is a robust pipeline that allows us to continue our disciplined and strategic acquisition program that increases our ownership of high-quality senior living communities in geographically concentrated regions and generates meaningful increases in CFFO, earnings and real estate value. We differentiate Capital Senior Living as the value leader in providing quality seniors housing and care at reasonable prices. We believe that we are well positioned to make meaningful gains in shareholder value as a substantially all private-pay business in an industry that benefits from need-driven demand, limited new supply, and an improving economy and housing market.”

Recent Investment Activity

• In the first quarter of 2014, the Company completed the acquisition of a senior living community for a purchase price of approximately $14.6 million. This community enhances the Company’s geographic concentration around Ohio and is comprised of 78 units offering assisted living and memory care.

Highlights of this transaction include:

• Incremental earnings of $0.2 million, or $0.01 per share.

• Additional Adjusted CFFO of $0.5 million, or $0.02 per share.

• Increases annual revenue by $4.5 million.

• Average occupancy above 95%.

• Average monthly rents are approximately $4,700.

• The community was financed with approximately $11.0 million of non-recourse 12-year mortgage debt with a fixed interest rate of 5.43%.

• The Company is expected to acquire approximately $84 million of high-quality senior living communities in regions with extensive operations in the second quarter of 2014, subject to customary closing conditions. In addition, the Company is conducting due diligence on approximately $34 million of additional transactions consisting of high-quality senior living communities in regions with extensive existing operations. Subject to completion of due diligence and customary closing conditions, these transactions are expected to close in the third quarter of 2014.

CAPITAL/Page 3

Financial Results - First Quarter

For the first quarter of 2014, the Company reported revenue of $91.9 million, compared to revenue of $86.2 million in the first quarter of 2013. Resident and healthcare revenue increased from the first quarter of the prior year by approximately $5.4 million, or 6.4%, largely as a result of acquiring 11 communities since the first quarter of 2013. The number of consolidated communities increased from 99 in the first quarter of 2013 to 110 in the first quarter of 2014.

During 2013, the Company decided to close the skilled nursing units in its two CCRC’s and convert this space to private-pay use. Excluding the two CCRC’s that are being re-positioned, average monthly rent for the consolidated communities was $3,126 per occupied unit in the first quarter of 2014, an increase of $64, or 2.1%, over the first quarter of 2013. Financial occupancy of the consolidated portfolio averaged 87.1% in the first quarter of 2014.

As a percentage of resident and healthcare revenue, operating expenses were 61.8% in the first quarter of 2014, compared to 59.1% in the first quarter of 2013. Margins were negatively impacted by a particularly harsh winter, including higher costs for utilities and snow removal. Margins were also negatively impacted by higher real estate taxes compared to the prior period which reflected multi-year tax adjustments from successful appeals coupled with higher tax assessments in the current quarter that are now under appeal. Higher move-ins during the quarter resulted in higher referral fees to third parties. The unusual weather-related costs, along with higher real estate taxes and higher referral fees totaled approximately $1.6 million and increased operating expenses by 1.8% of revenue. Operating expenses for the first quarter of 2014 were $55.7 million, an increase of $5.6 million from the first quarter of 2013, primarily due to 11 additional communities now being consolidated.

General and administrative expenses as a percentage of revenues under management were 4.9% in the first quarter of 2014, excluding transaction costs of approximately $0.5 million.

Adjusted EBITDAR for the first quarter of 2014 was approximately $31.0 million, an increase of $0.5 million, or 1.7%, from the first quarter of 2013. Excluding the two CCRC’s being re-positioned, EBITDAR margin for the first quarter of 2014 was 34.7%. EBITDAR margin would have been 36.5% if not for the unusual weather-related costs, real estate taxes and referral fees discussed above.

Adjusted net income for the first quarter of 2014 was $0.2 million, excluding non-recurring or non-economic items reconciled on the final page of this release. This compares to a net loss of $4.6 million, or $0.16 per share, before adjusting for these non-recurring or non-economic items. Adjusted CFFO was $7.9 million or $0.28 per share in the first quarter of 2014. Adjusted CFFO would have been approximately $0.07 per share higher if not for the unusual weather-related costs, real estate taxes and referral fees discussed above.

CAPITAL/Page 4

Operating Activities

The Company is well positioned as a substantially all private-pay business and intends to further differentiate itself by enhancing its private-pay revenues. Two CCRC’s are being re-positioned with formerly skilled nursing space being converted to private-pay use. While these communities are being re-positioned, same-community results for these two communities will be excluded.

At communities under management, excluding the communities referenced above, same-community revenue in the first quarter of 2014 increased 0.8% versus the first quarter of 2013. Same-community expenses increased 5.1% from the first quarter of the prior year. The increase in expenses was primarily due to higher costs from the harsh winter, including heating costs and snow removal, along with real estate taxes and referral fees. Excluding these unusual items, same community expenses increased 1.0% and net operating income increased 0.8% from the fourth quarter of 2013. Same-community occupancies were 86.9%, a 20 basis point sequential improvement from the fourth quarter of 2013. Average rents were $3,115 per occupied unit, or 1.2%, higher than the first quarter of the prior year.

Capital expenditures for the first quarter of 2014 were approximately $3.1 million, representing $2.2 million of investment spending and $0.9 million of recurring capital expenditures. If annualized, spending for recurring capital expenditures was approximately $325 per unit.

Balance Sheet

The Company ended the quarter with $23.0 million of cash and cash equivalents, including restricted cash. During the quarter, the Company invested $3.6 million of cash as equity to complete an acquisition and spent $3.1 million on capital improvements.

As of March 31, 2014, the Company financed its 60 owned communities with mortgages totaling $485.0 million at interest rates averaging 5.25%. All of the Company’s debt is at fixed interest rates, except three bridge loans totaling approximately $22.5 million at variable rates averaging 4.24%. The Company has no mortgage maturities before the third quarter of 2015.

The Company’s mortgage debt includes a loan portfolio of 15 assets totaling approximately $112.7 million as of March 31, 2014. Originally structured as 10-year fixed rate mortgages with a maturity date of July 2015, this loan portfolio has a blended fixed rate of 5.96%. The Company is pursuing a refinance of this loan portfolio to take advantage of lower interest rates and the appreciation in value of the Company’s owned communities. Based on current rates, the Company expects to lower the interest rate on this portfolio approximately 150 basis points. This anticipated refinancing is expected to close at the end of the second quarter of 2014, generating approximately $30 million in additional proceeds and lowering the Company’s overall borrowing costs. Additional cash is expected to be generated upon the planned sale of certain non-core owned communities in the third quarter of 2014. Cash on hand, cash flow from operations, net proceeds from this anticipated refinancing and community sales are expected to be sufficient for working capital, prudent reserves and equity needed to fund the Company’s acquisition program.

CAPITAL/Page 5

Q1 2014 Conference Call Information

The Company will host a conference call with senior management to discuss the Company’s first quarter financial results. The call will be held on Tuesday, May 6, 2014 at 5:00 p.m. Eastern Time. The call-in number is 913-312-1227, confirmation code 3998352. A link to a simultaneous webcast of the teleconference will be available at www.capitalsenior.com through Windows Media Player or RealPlayer.

For the convenience of the Company’s shareholders and the public, the conference call will be recorded and available for replay starting May 6, 2014 at 8:00 p.m. Eastern Time, until May 13, 2014 at 8:00 p.m. Eastern Time. To access the conference call replay, call 719-457-0820, confirmation code 3998352. The conference call will also be made available for playback via the Company’s corporate website, www.capitalsenior.com, beginning May 7, 2014.

Non-GAAP Financial Measures

Adjusted EBITDAR, Adjusted EBITDAR Margin, Adjusted Net Income and Adjusted CFFO are financial measures of operating performance that are not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). Non-GAAP financial measures may have material limitations in that they do not reflect all of the amounts associated with our results of operations as determined in accordance with GAAP. As a result, these non-GAAP financial measures should not be considered a substitute for, nor superior to, financial results and measures determined or calculated in accordance with GAAP. The Company believes that these non-GAAP measures are useful in identifying trends in day-to-day performance because they exclude items that are of little or no significance to operations and provide indicators to management of progress in achieving optimal operating performance. In addition, these measures are used by many research analysts and investors to evaluate the performance and the value of companies in the senior living industry. The Company strongly urges you to review the reconciliation of net income from operations to Adjusted EBITDAR and Adjusted EBITDAR Margin and the reconciliation of net loss to Adjusted Net Income and Adjusted CFFO, along with the Company’s consolidated balance sheets, statements of operations, and statements of cash flows.

About the Company

Capital Senior Living Corporation is one of the nation’s largest operators of residential communities for senior adults. The Company’s operating strategy is to provide value to residents by providing quality senior living services at reasonable prices. The Company’s communities emphasize a continuum of care, which integrates independent living, assisted living, and home care services, to provide residents the opportunity to age in place. The Company operates 113 senior living communities in geographically concentrated regions with an aggregate capacity of approximately 14,700 residents.

CAPITAL/Page 6

Safe Harbor

The forward-looking statements in this release are subject to certain risks and uncertainties that could cause results to differ materially, including, but not without limitation to, the Company’s ability to find suitable acquisition properties at favorable terms, financing, refinancing, community sales, licensing, business conditions, risks of downturns in economic conditions generally, satisfaction of closing conditions such as those pertaining to licensure, availability of insurance at commercially reasonable rates, and changes in accounting principles and interpretations among others, and other risks and factors identified from time to time in our reports filed with the Securities and Exchange Commission.

For information about Capital Senior Living, visit www.capitalsenior.com.

Contact Ralph A. Beattie, Chief Financial Officer, at 972-770-5600 for more information.

CAPITAL/Page 7

CAPITAL SENIOR LIVING CORPORATION

CONSOLIDATED BALANCE SHEETS

(in thousands)

	March 31,			December 31,
	2014			2013
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	11,601		$	13,611
Restricted cash		11,431			11,425
Accounts receivable, net		5,277			3,752
Accounts receivable from affiliates		197			416
Federal and state income taxes receivable		4,941			5,123
Deferred taxes		708			845
Property tax and insurance deposits		7,587			11,036
Prepaid expenses and other		4,372			6,605
Total current assets		46,114			52,813
Property and equipment, net		659,460			649,967
Investments in unconsolidated joint ventures		1,009			1,010
Other assets, net		38,099			41,759
Total assets	$	744,682		$	745,549
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	3,356		$	3,813
Accounts payable to affiliates		3			1
Accrued expenses		25,996			29,321
Current portion of notes payable		9,974			11,918
Current portion of deferred income		11,418			11,215
Current portion of capital lease and financing obligations		959			948
Customer deposits		1,691			1,489
Total current liabilities		53,397			58,705
Deferred income		17,502			18,021
Capital lease and financing obligations, net of current portion		40,926			41,093
Deferred taxes		708			845
Other long-term liabilities		1,526			1,559
Notes payable, net of current portion		475,888			467,376
Commitments and contingencies
Shareholders’ equity:
Preferred stock, $.01 par value: Authorized shares — 15,000; no shares issued or outstanding		—			—
Common stock, $.01 par value: Authorized shares — 65,000; issued and outstanding shares 29,006 and 28,845 in 2014 and 2013, respectively		294			292
Additional paid-in capital		145,151			143,721
Retained earnings		10,224			14,871
Treasury stock, at cost – 350 shares		(934	)		(934	)
Total shareholders’ equity		154,735			157,950
Total liabilities and shareholders’ equity	$	744,682		$	745,549

CAPITAL/Page 8

CAPITAL SENIOR LIVING CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(unaudited, in thousands, except per share data)

	Three Months Ended March 31,
	2014			2013
Revenues:
Resident and health care revenue	$	90,174		$	84,775
Affiliated management services revenue		208			185
Community reimbursement revenue		1,475			1,265
Total revenues		91,857			86,225
Expenses:
Operating expenses (exclusive of facility lease expense and depreciation and amortization expense shown below)		55,691			50,120
General and administrative expenses		4,971			4,922
Facility lease expense		14,794			14,270
Stock-based compensation expense		1,360			996
Depreciation and amortization expense		10,951			11,889
Community reimbursement expense		1,475			1,265
Total expenses		89,242			83,462
Income from operations		2,615			2,763
Other income (expense):
Interest income		12			104
Interest expense		(7,137	)		(5,684	)
Gain on disposition of assets, net		4			1
Equity in earnings of unconsolidated joint ventures, net		41			3
Other income		8			12
Loss before (provision) benefit for income taxes		(4,457	)		(2,801	)
(Provision) Benefit for income taxes		(190	)		725
Net loss	$	(4,647	)	$	(2,076	)
Per share data:
Basic net loss per share	$	(0.16	)	$	(0.07	)
Diluted net loss per share	$	(0.16	)	$	(0.07	)
Weighted average shares outstanding — basic		28,146			27,584
Weighted average shares outstanding — diluted		28,146			27,584
Comprehensive loss	$	(4,647	)	$	(2,076	)

CAPITAL/Page 9

CAPITAL SENIOR LIVING CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, in thousands)

	Three Months Ended March 31,
	2014			2013
Operating Activities
Net loss	$	(4,647	)	$	(2,076	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		10,951			11,889
Amortization of deferred financing charges		320			365
Amortization of deferred lease costs and lease intangibles		308			325
Deferred income		(316	)		(1,070	)
Deferred income taxes		—			(175	)
Gain on disposition of assets, net		(4	)		(1	)
Equity in earnings of unconsolidated joint ventures, net		(41	)		(3	)
Provision for bad debts		238			20
Stock based compensation expense		1,360			996
Changes in operating assets and liabilities:
Accounts receivable		(1,763	)		(2,514	)
Accounts receivable from affiliates		219			360
Property tax and insurance deposits		3,449			2,559
Prepaid expenses and other		2,233			2,292
Other assets		438			(493	)
Accounts payable		(455	)		(4,885	)
Accrued expenses		(3,325	)		(1,480	)
Federal and state income taxes receivable		182			(564	)
Customer deposits		202			3
Net cash provided by operating activities		9,349			5,548
Investing Activities
Capital expenditures		(3,106	)		(2,135	)
Cash paid for acquisitions		(14,600	)		(6,741	)
Proceeds from disposition of assets		4			—
Distributions from joint ventures		42			42
Net cash used in investing activities		(17,660	)		(8,834	)
Financing Activities
Proceeds from notes payable		11,000			16,381
Repayments of notes payable		(4,432	)		(14,447	)
Increase in restricted cash		(6	)		(6	)
Cash payments for capital lease obligations		(156	)		(143	)
Cash proceeds from the issuance of common stock		135			1,271
Excess tax benefits on stock options exercised		(63	)		(652	)
Deferred financing charges paid		(177	)		(132	)
Net cash provided by financing activities		6,301			2,272
Decrease in cash and cash equivalents		(2,010	)		(1,014	)
Cash and cash equivalents at beginning of period		13,611			18,737
Cash and cash equivalents at end of period	$	11,601		$	17,723
Supplemental Disclosures
Cash paid during the period for:
Interest	$	6,429		$	5,150
Income taxes	$	44		$	23

CAPITAL/Page 10

Capital Senior Living Corporation

Supplemental Information

	Communities						Average Resident Capacity						Average Units
	Q1 14			Q1 13			Q1 14			Q1 13			Q1 14			Q1 13
Portfolio Data
I. Community Ownership / Management
Consolidated communities
Owned		60			49			7,689			6,744			6,124			5,417
Leased		50			50			6,333			6,298			5,024			5,029
Joint Venture communities (equity method)		3			3			674			674			434			433
Total		113			103			14,696			13,716			11,582			10,879
Independent living								7,597			7,185			6,220			6,180
Assisted living								7,099			5,816			5,362			4,531
Continuing Care Retirement Communities								—			715			—			168
Total								14,696			13,716			11,582			10,879
II. Percentage of Operating Portfolio
Consolidated communities
Owned		53.1	%		48.0	%		52.3	%		49.2	%		52.9	%		49.8	%
Leased		44.2	%		49.0	%		43.1	%		45.9	%		43.4	%		46.2	%
Joint Venture communities (equity method)		2.7	%		3.0	%		4.6	%		4.9	%		3.7	%		4.0	%
Total		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%
Independent living								51.7	%		52.4	%		53.7	%		56.8	%
Assisted living								48.3	%		42.4	%		46.3	%		41.7	%
Continuing Care Retirement Communities								—			5.2	%		—			1.5	%
Total								100.0	%		100.0	%		100.0	%		100.0	%

CAPITAL/Page 11

Capital Senior Living Corporation

Supplemental Information (excludes 2 communities being re-positioned)

	Q1 14			Q1 13
Selected Operating Results
I. Owned communities
Number of communities		58			47
Resident capacity		7,144			6,029
Unit capacity		5,675			4,800
Financial occupancy (1)		87.9	%		88.4	%
Revenue (in millions)		42.9			34.9
Operating expenses (in millions) (2)		24.7			19.1
Operating margin		43	%		45	%
Average monthly rent		2,865			2,744
II. Leased communities
Number of communities		50			50
Resident capacity		6,333			6,298
Unit capacity		5,024			5,029
Financial occupancy (1)		86.1	%		86.6	%
Revenue (in millions)		44.5			44.1
Operating expenses (in millions) (2)		22.6			21.7
Operating margin		49	%		51	%
Average monthly rent		3,428			3,372
III. Consolidated communities
Number of communities		108			97
Resident capacity		13,477			12,327
Unit capacity		10,700			9,829
Financial occupancy (1)		87.1	%		87.5	%
Revenue (in millions)		87.4			79.0
Operating expenses (in millions) (2)		47.3			40.8
Operating margin		46	%		48	%
Average monthly rent		3,126			3,062
IV. Communities under management
Number of communities		111			100
Resident capacity		14,151			13,001
Unit capacity		11,133			10,262
Financial occupancy (1)		87.1	%		87.2	%
Revenue (in millions)		91.5			82.7
Operating expenses (in millions) (2)		49.6			42.9
Operating margin		46	%		48	%
Average monthly rent		3,145			3,079
V. Same communities under management
Number of communities		99			99
Resident capacity		12,962			12,932
Unit capacity		10,244			10,245
Financial occupancy (1)		86.9	%		87.2	%
Revenue (in millions)		83.2			82.5
Operating expenses (in millions) (2)		44.6			42.8
Operating margin		46	%		48	%
Average monthly rent		3,115			3,077
VI. General and Administrative expenses as a percent of Total Revenues under Management
First Quarter (3)		4.9	%		5.1	%
VII. Consolidated Mortgage Debt Information (in thousands, except interest rates) (excludes insurance premium and auto financing)
Total fixed rate mortgage debt		462,445			363,956
Total variable rate mortgage debt		22,522			—
Weighted average interest rate		5.25	%		5.24	%

(1) Financial occupancy represents actual days occupied divided by total number of available days during the month of the quarter.

(2) Excludes management fees, insurance and property taxes.

(3) Excludes transaction costs incurred by the Company.

CAPITAL/Page 12

CAPITAL SENIOR LIVING CORPORATION

NON-GAAP RECONCILIATIONS

(in thousands, except per share data)

	Three Months Ended March 31,
	2014			2013
Adjusted EBITDAR
Net income from operations	$	2,615		$	2,763
Depreciation and amortization expense		10,951			11,889
Stock-based compensation expense		1,360			996
Facility lease expense		14,794			14,270
Provision for bad debts		238			20
Casualty losses		314			88
Transaction costs		487			424
CCRC’s being repositioned		208			—
Adjusted EBITDAR	$	30,967		$	30,450
Adjusted EBITDAR Margin
Adjusted EBITDAR	$	30,967		$	30,450
Total revenues	$	91,857		$	86,225
CCRC’s being repositioned		(2,709	)		—
Adjusted revenues	$	89,148		$	86,225
Adjusted EBITDAR margin		34.7	%		35.3	%
Adjusted net income and net income per share
Net loss	$	(4,647	)	$	(2,076	)
Casualty losses, net of tax		198			55
Transaction costs, net of tax		307			267
Resident lease amortization, net of tax		2,205			3,602
Gain on disposition of assets, net of tax		(3	)		(1	)
Deferred tax asset valuation allowance		1,692			—
CCRC’s being repositioned, net of tax		503			—
Adjusted net income	$	255		$	1,847
Adjusted net income per share	$	0.01		$	0.07
Diluted shares outstanding		28,153			27,708
Adjusted CFFO and Adjusted CFFO per share
Net loss	$	(4,647	)	$	(2,076	)
Non-cash charges, net		12,816			12,346
Recurring capital expenditures		(1,028	)		(948	)
Casualty losses, net of tax		198			55
Transaction costs		487			424
Tax impact of Spring Meadows Transaction		(106	)		(106	)
Tax impact of lease modification		—			—
CCRC’s being repositioned, net of tax		179			—
Adjusted CFFO	$	7,899		$	9,695
Adjusted CFFO per share	$	0.28		$	0.35

****

EX-99.2

Capital Senior Living

Company Presentation

Exhibit 99.2

2

Forward-Looking Statements

•

The forward-looking statements in this presentation are subject to certain risks

and

uncertainties

that

could

cause

results

to

differ

materially,

including,

but

not without limitation to, the Company’s ability to complete the refinancing of

certain

of

our

wholly

owned

communities,

realize

the

anticipated

savings

related to such financing, find suitable acquisition properties at favorable

terms, financing, licensing, business conditions, risks of downturns in

economic conditions generally, satisfaction of closing conditions such as

those pertaining to licensures, availability of insurance at commercially

reasonable rates and changes in accounting principles and interpretations

among others, and other risks and factors identified from time to time in our

reports filed with the Securities and Exchange Commission

•

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.                   

2

Investment Highlights

•

Value leader in providing quality seniors housing and care at

reasonable prices

•

Well positioned to make meaningful gains in shareholder value

•

Substantially all private pay with strong cash flow generation

•

Industry benefits from need-driven demand, limited new supply and

improving housing market and economy

•

Achieving solid growth in revenue, EBITDAR and CFFO

•

Executing on disciplined accretive growth initiatives through

acquisitions and conversions to higher levels of care

•

Solid balance sheet

3

4

Company Overview

•

Capital Senior Living operates 113 communities in geographically

concentrated regions with the capacity to serve 14,700 residents

AR. 

173

CT. 

178

FL.

226

IA. 

122

IL. 

650

IN. 

2,247

KS. 

165

LA. 

133

MI.

429

MN.

173

MO. 

662

MS.

143

NC.

593

SC.

669

NE. 

668

NJ. 

98

NY. 

387

OH. 

2,060

OK. 

143

TX. 

3,720

VA.

153

Resident Capacity

CA. 

408

AZ. 

189

GA. 

70

WI. 

150

As of March 31, 2014

MA.

87

5

Resident Demographics at CSU Communities

•

Average age of resident: 85 years

•

Average age of resident moving in: 82 years

•

Average stay period:

-3 years

•

Percent of female residents: 80%

•

Resident turnover is primarily attributed to death or need for

higher care

2 

The Capital Advantage: Senior Living Options

Independent Living –

52% of Resident Capacity

•

Average 113 units per IL community with large common areas and

amenities

•

Supportive services, wellness programs, social, recreational and

educational events

•

Average monthly rate of $2,437

•

100% private pay

•

Average length of resident stay is 31 months

6

7

The Capital Advantage: Senior Living Options

Assisted Living-

48% of Resident Capacity

•

Average 64 units per community

•

74% of communities offer AL

•

Assistance with activities of daily living including medication

reminders, bathing, dressing and grooming

•

Average monthly rate of $3,955

•

Substantially all private pay

•

Average length of resident stay is 24 months

8

The Capital Advantage: Need Driven Demand

U.S. population 75+ years old is estimated to grow by 3.5 million from

2009 through 2015

U.S. Seniors Population Trends (75+ years old)

(Population in

millions)

Implied demand growth of

40,000 units per year

Source: NIC Investment

Guide 2010 and U.S.

Census Bureau

0.0

5.0

10.0

15.0

20.0

25.0

2009

2015

18.9

22.4

Only 1.3 million units serving a population of 18.9 million seniors

Current 6.9% penetration rate implies demand growth of 40,000 units

per year

•

•

The Capital Advantage: Limited New Supply

Source: NIC MAP Trends All Markets Q1 14

9

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

Absorption

Inventory Growth

10

The Capital Advantage: Senior Housing Occupancy Trends

Source: NIC MAP Trends All Markets Q1 14

92.0%

91.0%

90.0%

89.0%

88.0%

87.0%

86.0%

IL Communities

AL Communities

The Capital Advantage: Competitive Strengths

•

Value leader in geographically concentrated regions

•

Experienced on-site, regional and corporate management

•

Larger company economies of scale and proprietary systems

that yield operating efficiencies in highly fragmented industry

•

Solid reputation in industry and 95% resident satisfaction

•

Employer of choice

•

Solid balance sheet

•

Strong Board of Directors

11

12

The Capital Advantage: Strategy

•

Focus on our core strengths

•

Capitalize on competitive strengths within each of our regions

to maximize the cash flow generated by our communities and

our operations

•

Capitalize on the fragmented nature of the senior living

industry to strategically aggregate local and regional operators

in geographically concentrated regions

•

Increase levels of care through conversions to Assisted Living

or Memory Care units

•

Attract and retain the best talent in the senior living industry

2014 Business Plan

•

Focused on Operations, marketing and growth to enhance

shareholder value through:

•

Organic growth

•

Proactive expense Management

•

Accretive acquisitions, unit conversions and community

refurbishment projects

•

Utilization of technology

13

2014 Business Plan: Organic Growth

•

Increase average rents

•

Each 3% increase generates $10.8M of revenue

•

Improve occupancies

•

Each 1% generates $4.0M of revenue, $2.8M of EBITDAR and $0.06 per

share of CFFO

•

Convert units to higher levels of care

•

Cash flow enhancing renovations and refurbishments

•

New branding strategy, eMarketing and website enhancements

•

Implement software programs to optimize care plans and level of

care charges

14

Solving to Achieve 90% Occupancy

Q1 2014

IL

AL

Total

Total Units

5,927

5,206

11,133

Occupied Units

5,050

4,654

9,704

Occupancy %

85.2%

89.4%

87.1%

Planned IL to AL Conversions

IL

AL

Units

(360)

360 

At 90% Stabilized

Occupancy

324

Note: Conversions are subject to customary approvals

Occupancy After Conversions

Stabilize

IL

AL

Total

Total Units

5,567

5,566

11,133

Occupied Units

5,050

4,978

10,028

Occupancy %

90.7%

89.4%

90.1%

15

(in millions except number of communities and units)

2011

2012  

2013    

Combined  

Purchase Price

$83.4

$181.3

$150.4

$415.1

Communities

7

17

11

35

Units

551

1,367

881

2,799

Debt

$59.3

$129.5

$112.3

$301.1

Equity

$24.1

$51.8

$38.1

$114.0

First Year Revenue

$21.3

$49.1

$35.1

$105.5

First Year EBITDAR

$7.3

$19.1

$14.1

$40.5

First Year Cash Flow

from Operations

(CFFO)

$3.4

$9.1

$5.8

$18.3

First Year CFFO per

share

$0.13

$0.34

$0.20

$0.67

16

2014 Business Plan: External Growth

•

Strategic acquisitions of high quality senior living communities

to

enhance

geographic

concentrations

–

16.1%

cash

on

cash

returns

17

Operating Performance

•

Revenue and EBITDAR growth

•

EBITDAR increased 107.7% on an 85.6% increase in revenue

•

EBITDAR margin increased from 29.9% in Q1 2010 to 34.6% in Q4

2013

*

As adjusted in Q4 2013 earnings release

$100.0

$90.0

$80.0

$70.0

$60.0

$50.0

$40.0

$30.0

$20.0

$10.0

$0.0

38.0%

36.0%

34.0%

32.0%

30.0%

28.0%

26.0%

24.0%

Revenue

EBITDAR

EBITDAR Margin %

Comparative Operating Metrics

As adjusted in press releases

2013

2012

% Increase

Total Revenues

$ 350.4

$ 310.5

12.8%

EBITDAR

$ 119.6

$ 110.0

8.7%

% Margin

34.9%

35.4%

CFFO

$ 42.6

$ 37.3

14.2%

CFFO Per Share

$1.53

$1.36

18

Balance Sheet

•

As of December 31, 2013 (in millions)

ASSETS

Cash and Securities

$ 25.0

Other Current Assets

27.8

Total Current Assets

52.8

Fixed Assets

650.0

Other Assets

42.7

TOTAL ASSETS

$ 745.5

LIABILITIES & EQUITY

Current Liabilities

$ 58.7

Long-Term Debt

467.4

Other Liabilities

61.4

Total Liabilities

587.5

Stockholders’

Equity

158.0

TOTAL LIABILITIES &

EQUITY

$ 745.5

19

Investment Highlights

•

Value

leader

in

geographically

concentrated

regions

•

Substantially

all

private

pay

•

Need-driven

demand,

limited

new

supply

and

improving

housing

market

•

Experienced

management

team

with

demonstrated

ability

to

operate, acquire and create shareholder value

•

Accretive

acquisitions

in

highly

fragmented

industry

•

Conversions

to

higher

levels

of

care

with

significant

revenue

and

cash flow growth

•

Strong

cash

flow

generation

•

Solid

balance

sheet

20

Capital Senior Living

Company Presentation