Brookdale Announces Fourth Quarter and Full Year 20...(Expenses 0.03 0.04 0.04 ...),Health

Facility Operating Income

Facility Operating Income is not a measurement of operating performance calculated in accordance with GAAP and should not be considered in isolation as a substitute for net income, income from operations, or cash flows provided by or used in operations, as determined in accordance with GAAP. We define Facility Operating Income as net income (loss) before provision (benefit) for income taxes, non-operating (income) loss items, depreciation and amortization, facility lease expense, general and administrative expense, including non-cash stock compensation expense, amortization of deferred entrance fee revenue and management fees.

We believe Facility Operating Income is useful to investors in evaluating our facility operating performance for the following reasons:
-- It is helpful in identifying trends in our day-to-day facility

performance;

-- It provides an assessment of our revenue generation and expense

management; and

-- It provides an indicator to determine if adjustments to current

spending decisions are needed.

The table below reconciles Facility Operating Income from net loss for the three and twelve months ended December 31, 2007 and 2006 (in thousands):

Three Months Ended Twelve Months Ended

December 31, December 31,

2007(1) 2006 2007(1) 2006

Net loss $(49,237) $(37,357) $(161,979) $(108,087)

Minority interest 113 233 (393) 671

Benefit for income taxes (32,852) (25,004) (101,260) (38,491)

Equity in loss of unconsolidated

ventures 1,024 1,419 3,386 3,705

Loss (gain) on extinguishment of

debt
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