Encompass Health reports results for fourth quarter 2024 and issues 2025 guidance
Encompass Health (NYSE: EHC) reported strong Q4 2024 results with significant growth across key metrics. Net operating revenue increased 12.7% to $1,405.0 million, driven by a 7.8% growth in discharges and 4.2% increase in net patient revenue per discharge. Same-store discharge growth was 5.8%.
The company's income from continuing operations per diluted share rose 25.5% to $1.18, while adjusted earnings per share increased 23.2% to $1.17. Cash flows from operating activities grew 38.7% to $278.8 million, and adjusted EBITDA improved 13.6% to $289.6 million.
For 2025, EHC provided guidance projecting net operating revenue between $5,800 to $5,900 million, adjusted EBITDA of $1,160 to $1,200 million, and adjusted earnings per share from continuing operations of $4.67 to $4.96.
Encompass Health (NYSE: EHC) ha riportato risultati solidi per il quarto trimestre del 2024, con una crescita significativa in diversi indicatori chiave. Il fatturato operativo netto è aumentato del 12,7% raggiungendo i 1.405,0 milioni di dollari, grazie a una crescita del 7,8% nei dimissioni e un incremento del 4,2% nel fatturato netto per dimissione. La crescita delle dimissioni nei negozi esistenti è stata del 5,8%.
Il reddito dell'azienda da operazioni continuative per azione diluita è aumentato del 25,5% raggiungendo 1,18 dollari, mentre gli utili per azione rettificati sono cresciuti del 23,2% a 1,17 dollari. I flussi di cassa dalle attività operative sono aumentati del 38,7% raggiungendo 278,8 milioni di dollari, e l'EBITDA rettificato è migliorato del 13,6% a 289,6 milioni di dollari.
Per il 2025, EHC ha fornito previsioni che indicano un fatturato operativo netto compreso tra 5.800 e 5.900 milioni di dollari, un EBITDA rettificato tra 1.160 e 1.200 milioni di dollari e utili per azione rettificati da operazioni continuative compresi tra 4,67 e 4,96 dollari.
Encompass Health (NYSE: EHC) reportó resultados sólidos para el cuarto trimestre de 2024, con un crecimiento significativo en métricas clave. Los ingresos operativos netos aumentaron un 12,7% hasta $1,405.0 millones, impulsados por un crecimiento del 7,8% en los egresos y un incremento del 4,2% en los ingresos netos por egreso. El crecimiento de egresos en tiendas comparables fue del 5,8%.
El ingreso de la compañía de operaciones continuas por acción diluida creció un 25,5% hasta $1.18, mientras que las ganancias por acción ajustadas aumentaron un 23,2% a $1.17. Los flujos de efectivo de las actividades operativas crecieron un 38,7% hasta $278.8 millones, y el EBITDA ajustado mejoró un 13,6% hasta $289.6 millones.
Para 2025, EHC proporcionó una guía proyectando ingresos operativos netos entre $5,800 y $5,900 millones, EBITDA ajustado de $1,160 a $1,200 millones y ganancias por acción ajustadas de operaciones continuas de $4.67 a $4.96.
Encompass Health (NYSE: EHC)는 2024년 4분기 실적을 발표하며 주요 지표에서 상당한 성장을 기록했습니다. 순 운영 수익은 12.7% 증가하여 14억 5백만 달러에 달했으며, 이는 퇴원 수가 7.8% 증가하고 퇴원당 순 환자가 4.2% 증가한 데 따른 것입니다. 동일 매장 퇴원 성장률은 5.8%였습니다.
지속 사업에서의 희석 주당 수익은 25.5% 상승하여 1.18 달러로, 조정 후 주당 수익은 23.2% 증가하여 1.17 달러가 되었습니다. 운영 활동으로 인한 현금 흐름은 38.7% 증가하여 2억 7,880만 달러에 달했으며, 조정 EBITDA는 13.6% 증가하여 2억 8,960만 달러로 개선되었습니다.
2025년을 위해 EHC는 순 운영 수익이 58억에서 59억 달러 사이일 것으로 예상하며, 조정 EBITDA는 11억 6천만에서 12억 달러 사이, 지속 사업의 조정 주당 수익은 4.67에서 4.96 달러 사이로 예측했습니다.
Encompass Health (NYSE: EHC) a annoncé de solides résultats pour le quatrième trimestre 2024, avec une croissance significative dans des indicateurs clés. Le chiffre d'affaires net d'exploitation a augmenté de 12,7 % pour atteindre 1 405,0 millions de dollars, soutenu par une croissance de 7,8 % des sorties et une augmentation de 4,2 % du chiffre d'affaires net par sortie. La croissance des sorties dans les magasins comparables était de 5,8 %.
Le revenu de la société provenant des opérations continues par action diluée a augmenté de 25,5 % à 1,18 dollar, tandis que les bénéfices par action ajustés ont augmenté de 23,2 % à 1,17 dollar. Les flux de trésorerie provenant des activités opérationnelles ont augmenté de 38,7 % pour atteindre 278,8 millions de dollars, et l'EBITDA ajusté s'est amélioré de 13,6 % à 289,6 millions de dollars.
Pour 2025, EHC a fourni des prévisions projetant un chiffre d'affaires net d'exploitation compris entre 5 800 et 5 900 millions de dollars, un EBITDA ajusté de 1 160 à 1 200 millions de dollars et un bénéfice par action ajusté des opérations continues compris entre 4,67 et 4,96 dollars.
Encompass Health (NYSE: EHC) hat starke Ergebnisse für das vierte Quartal 2024 vermeldet, mit signifikantem Wachstum in den wichtigsten Kennzahlen. Der Nettobetriebsumsatz stieg um 12,7% auf 1.405,0 Millionen US-Dollar, angetrieben durch ein Wachstum der Entlassungen um 7,8% und einen Anstieg des Netto-Patientenumsatzes pro Entlassung um 4,2%. Das Wachstum der Entlassungen in vergleichbaren Einrichtungen betrug 5,8%.
Der Gewinn des Unternehmens aus fortgeführten Betrieben pro verwässerter Aktie stieg um 25,5% auf 1,18 US-Dollar, während der bereinigte Gewinn pro Aktie um 23,2% auf 1,17 US-Dollar zunahm. Die Cashflows aus operativen Aktivitäten wuchsen um 38,7% auf 278,8 Millionen US-Dollar, und das bereinigte EBITDA verbesserte sich um 13,6% auf 289,6 Millionen US-Dollar.
Für 2025 gab EHC eine Prognose ab, die einen Nettobetriebsumsatz von 5.800 bis 5.900 Millionen US-Dollar, ein bereinigtes EBITDA von 1.160 bis 1.200 Millionen US-Dollar und einen bereinigten Gewinn pro Aktie aus fortgeführten Betrieben von 4,67 bis 4,96 US-Dollar prognostiziert.
- Net operating revenue increased 12.7% to $1,405.0 million in Q4 2024
- Discharge growth of 7.8% with same-store growth of 5.8%
- Income from continuing operations per share up 25.5% to $1.18
- Cash flows from operations increased 38.7% to $278.8 million
- Adjusted EBITDA grew 13.6% to $289.6 million
- Added 427 beds capacity through new hospitals and expansions in 2024
- None.
Insights
Encompass Health's Q4 2024 results demonstrate exceptional operational execution and strategic expansion. The
The addition of 427 beds in 2024 through new hospitals and expansions represents a significant capacity increase, positioning the company for sustained growth. This expansion strategy is particularly noteworthy given the growing demand for inpatient rehabilitation services driven by an aging population and increased focus on post-acute care efficiency.
Working capital management has notably improved, as evidenced by the
The 2025 guidance implies continued momentum, with revenue growth of approximately
Summary results
Growth | |||||||
Q4 2024 | Q4 2023 | Dollars | Percent | ||||
(In Millions, Except Per Share Data) | |||||||
Net operating revenue | $ 1,405.0 | $ 1,246.8 | $ 158.2 | 12.7 % | |||
Income from continuing operations attributable to Encompass Health per diluted share | 1.18 | 0.94 | 0.24 | 25.5 % | |||
Adjusted earnings per share | 1.17 | 0.95 | 0.22 | 23.2 % | |||
Cash flows provided by operating activities | 278.8 | 201.0 | 77.8 | 38.7 % | |||
Adjusted EBITDA | 289.6 | 255.0 | 34.6 | 13.6 % | |||
Adjusted free cash flow | 190.5 | 93.5 | 97.0 | 103.7 % | |||
(Actual Amounts) | |||||||
Discharges | 63,839 | 59,247 | 7.8 % | ||||
Same-store discharge growth | 5.8 % | ||||||
Net patient revenue per discharge | $ 21,399 | $ 20,538 | 4.2 % | ||||
See attached supplemental information for calculations of non-GAAP measures and reconciliations to their most comparable GAAP measure.
- Revenue growth of
12.7% resulted primarily from discharge growth of7.8% , including same-store growth of5.8% . Net patient revenue per discharge grew4.2% . - Cash flows provided by operating activities increased
38.7% to$278.8 million - Adjusted EBITDA increased
13.6% , primarily from increased revenue.
"The fourth quarter was a very strong finish to 2024," said President and Chief Executive Officer of Encompass Health Mark Tarr. "Discharge growth of
"In 2024, we increased our capacity by a total of 427 beds through new hospitals and bed additions to existing hospitals. Our value proposition and operating strategy continue to be validated and we remain bullish on the long-term prospects of our business."
2025 Guidance
The Company provided the following guidance for 2025.
2025 Guidance | |
(In Millions, Except Per Share Data) | |
Net operating revenue | |
Adjusted EBITDA | |
Adjusted earnings per share from continuing operations attributable to Encompass Health |
For considerations regarding the Company's 2025 guidance, see the supplemental information posted on the Company's website at http://investor.encompasshealth.com. See also the "Other information" section below for an explanation of why the Company does not provide guidance for comparable GAAP measures for Adjusted EBITDA and adjusted earnings per share.
Earnings conference call and webcast
The Company will host an investor conference call at 10:00 a.m. Eastern Time on Friday, February 7, 2025 to discuss its results for the fourth quarter of 2024. For reference during the call, the Company will post certain supplemental information at http://investor.encompasshealth.com.
The conference call may be accessed by dialing 800 579-2543 and giving the conference ID EHCQ424. International callers should dial 785 424-1789 and give the same conference ID. Please call approximately ten minutes before the start of the call to ensure you are connected. The conference call will also be webcast live and will be available for on-line replay at http://investor.encompasshealth.com by clicking on an available link.
About Encompass Health
Encompass Health (NYSE: EHC) is the largest owner and operator of inpatient rehabilitation hospitals in
1 Fortune © 2025 Fortune Media IP Limited. All rights reserved. Fortune® is a registered trademark and Fortune World's Most Admired Companies™ is a trademark of Fortune Media IP Limited and are used under license. Fortune and Fortune Media IP Limited are not affiliated with, and do not endorse products or services of, Encompass Health. Forbes © 2024 Forbes Media LLC. All rights reserved. Used under license. |
Other information
The information in this press release is summarized and should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended December 31, 2024 (the "2024 Form 10-K"), when filed, as well as the Company's Current Report on Form 8-K filed on February 6, 2025 (the "Q4 Earnings Form 8-K"), to which this press release is attached as Exhibit 99.1. In addition, the Company will post supplemental information today on its website at http://investor.encompasshealth.com for reference during its February 7, 2025 earnings call.
The financial data contained in the press release and supplemental information include non-GAAP financial measures, including the Company's adjusted earnings per share, leverage ratio, Adjusted EBITDA, and adjusted free cash flow. Reconciliations to their most comparable GAAP measure, except with regard to non-GAAP guidance, are included below or in the Q4 Earnings Form 8-K. Readers are encouraged to review the "Note Regarding Presentation of Non-GAAP Financial Measures" included in the Q4 Earnings Form 8-K which provides further explanation and disclosure regarding the Company's use of these non-GAAP financial measures.
Excluding net operating revenues, the Company does not provide guidance on a GAAP basis because it is unable to predict, with reasonable certainty, the future impact of items that are deemed to be outside the control of the Company or otherwise not indicative of its ongoing operating performance. Such items include government, class action, and related settlements; professional fees—accounting, tax, and legal; mark-to-market adjustments for stock appreciation rights; gains or losses related to hedging instruments; loss on early extinguishment of debt; adjustments to its income tax provision (such as valuation allowance adjustments and settlements of income tax claims); items related to corporate and facility restructurings; and certain other items the Company believes to be not indicative of its ongoing operations. These items cannot be reasonably predicted and will depend on several factors, including industry and market conditions, and could be material to the Company's results computed in accordance with GAAP.
However, the following reasonably estimable GAAP measures for 2025 would be included in a reconciliation for Adjusted EBITDA if the other reconciling GAAP measures could be reasonably predicted:
- Interest expense and amortization of debt discounts and fees - approximately
$125 million - Amortization of debt-related items - approximately
$10 million
The Q4 Earnings Form 8-K and, when filed, the 2024 Form 10-K can be found on the Company's website at http://investor.encompasshealth.com and the SEC's website at www.sec.gov.
Encompass Health Corporation and Subsidiaries Condensed Consolidated Statements of Comprehensive Income (Unaudited) | |||||||
For the Three | For the Year Ended | ||||||
2024 | 2023 | 2024 | 2023 | ||||
(In Millions, Except Per Share Data) | |||||||
Net operating revenues | $ 1,405.0 | $ 1,246.8 | $ 5,373.2 | $ 4,801.2 | |||
Operating expenses: | |||||||
Salaries and benefits | 756.8 | 676.3 | 2,901.0 | 2,600.1 | |||
Other operating expenses | 206.4 | 184.8 | 802.6 | 719.1 | |||
Occupancy costs | 14.7 | 14.0 | 57.3 | 56.3 | |||
Supplies | 62.3 | 58.6 | 239.0 | 218.3 | |||
General and administrative expenses | 54.5 | 53.1 | 209.2 | 201.7 | |||
Depreciation and amortization | 78.0 | 70.1 | 299.6 | 273.9 | |||
Total operating expenses | 1,172.7 | 1,056.9 | 4,508.7 | 4,069.4 | |||
Loss on early extinguishment of debt | 0.2 | — | 0.6 | — | |||
Interest expense and amortization of debt discounts and fees | 33.0 | 34.9 | 137.4 | 143.5 | |||
Other income | (2.1) | (8.9) | (20.1) | (15.7) | |||
Equity in net income of nonconsolidated affiliates | (0.2) | (0.9) | (3.0) | (3.2) | |||
Income from continuing operations before income tax expense | 201.4 | 164.8 | 749.6 | 607.2 | |||
Provision for income tax expense | 37.6 | 37.2 | 150.2 | 132.2 | |||
Income from continuing operations | 163.8 | 127.6 | 599.4 | 475.0 | |||
Income (loss) from discontinued operations, net of tax | 0.4 | (8.5) | (2.8) | (12.0) | |||
Net and comprehensive income | 164.2 | 119.1 | 596.6 | 463.0 | |||
Less: Net and comprehensive income attributable to noncontrolling interests | (43.3) | (31.5) | (140.9) | (111.0) | |||
Net and comprehensive income attributable to Encompass Health | $ 120.9 | $ 87.6 | $ 455.7 | $ 352.0 | |||
Weighted average common shares outstanding: | |||||||
Basic | 100.0 | 99.5 | 99.9 | 99.5 | |||
Diluted | 102.3 | 101.5 | 102.2 | 101.3 | |||
Earnings per common share: | |||||||
Basic earnings per share attributable to Encompass Health common shareholders: | |||||||
Continuing operations | $ 1.20 | $ 0.96 | $ 4.56 | $ 3.63 | |||
Discontinued operations | — | (0.09) | (0.03) | (0.12) | |||
Net income | $ 1.20 | $ 0.87 | $ 4.53 | $ 3.51 | |||
Diluted earnings per share attributable to Encompass Health common shareholders: | |||||||
Continuing operations | $ 1.18 | $ 0.94 | $ 4.49 | $ 3.59 | |||
Discontinued operations | — | (0.08) | (0.03) | (0.12) | |||
Net income | $ 1.18 | $ 0.86 | $ 4.46 | $ 3.47 | |||
Amounts attributable to Encompass Health common shareholders: | |||||||
Income from continuing operations | $ 120.5 | $ 96.1 | $ 458.5 | $ 364.0 | |||
Income (loss) from discontinued operations, net of tax | 0.4 | (8.5) | (2.8) | (12.0) | |||
Net income attributable to Encompass Health | $ 120.9 | $ 87.6 | $ 455.7 | $ 352.0 | |||
Encompass Health Corporation and Subsidiaries Condensed Consolidated Balance Sheets (Unaudited) | |||
As of | As of | ||
(In Millions) | |||
Assets | |||
Current assets: | |||
Cash and cash equivalents | $ 85.4 | $ 69.1 | |
Restricted cash | 37.7 | 35.1 | |
Accounts receivable | 598.8 | 611.6 | |
Prepaid expenses | 42.3 | 34.5 | |
Other current assets | 122.7 | 91.5 | |
Total current assets | 886.9 | 841.8 | |
Property and equipment, net | 3,643.1 | 3,301.0 | |
Operating lease right-of-use assets | 203.7 | 208.5 | |
Goodwill | 1,284.0 | 1,281.3 | |
Intangible assets, net | 297.8 | 278.2 | |
Other long-term assets | 219.2 | 191.6 | |
Total assets | $ 6,534.7 | $ 6,102.4 | |
Liabilities and Shareholders' Equity | |||
Current liabilities: | |||
Current portion of long-term debt | $ 138.6 | $ 24.8 | |
Current operating lease liabilities | 26.3 | 24.1 | |
Accounts payable | 171.0 | 170.0 | |
Accrued payroll | 227.9 | 207.5 | |
Accrued interest payable | 38.6 | 42.6 | |
Other current liabilities | 238.6 | 187.4 | |
Total current liabilities | 841.0 | 656.4 | |
Long-term debt, net of current portion | 2,359.2 | 2,687.8 | |
Long-term operating lease liabilities | 189.7 | 196.1 | |
Self-insured risks | 138.6 | 131.8 | |
Deferred income tax liabilities | 105.2 | 87.0 | |
Other long-term liabilities | 51.8 | 46.1 | |
Total liabilities | 3,685.5 | 3,805.2 | |
Commitments and contingencies | |||
Redeemable noncontrolling interests | 56.5 | 42.0 | |
Shareholders' equity: | |||
Encompass Health shareholders' equity | 2,067.0 | 1,647.5 | |
Noncontrolling interests | 725.7 | 607.7 | |
Total shareholders' equity | 2,792.7 | 2,255.2 | |
Total liabilities and shareholders' equity | $ 6,534.7 | $ 6,102.4 | |
Encompass Health Corporation and Subsidiaries Condensed Consolidated Statements of Cash Flows (Unaudited) | |||
For the Year Ended December 31, | |||
2024 | 2023 | ||
(In Millions) | |||
Cash flows from operating activities: | |||
Net income | $ 596.6 | $ 463.0 | |
Loss from discontinued operations, net of tax | 2.8 | 12.0 | |
Adjustments to reconcile net income to net cash provided by operating activities— | |||
Depreciation and amortization | 299.6 | 273.9 | |
Amortization of debt-related items | 9.7 | 9.5 | |
Loss on early extinguishment of debt | 0.6 | — | |
Equity in net income of nonconsolidated affiliates | (3.0) | (3.2) | |
Distributions from nonconsolidated affiliates | 4.0 | 1.6 | |
Stock-based compensation | 48.3 | 50.6 | |
Deferred tax expense | 10.7 | 3.9 | |
Other, net | 14.7 | 5.2 | |
Change in assets and liabilities, net of acquisitions— | |||
Accounts receivable | 3.0 | (22.4) | |
Prepaid expenses and other assets | (57.3) | 6.1 | |
Accounts payable | 3.0 | 11.8 | |
Accrued payroll | 20.4 | 39.2 | |
Other liabilities | 52.8 | 15.6 | |
Net cash used in operating activities of discontinued operations | (3.1) | (16.0) | |
Total adjustments | 403.4 | 375.8 | |
Net cash provided by operating activities | 1,002.8 | 850.8 | |
Cash flows from investing activities: | |||
Purchases of property, equipment, and intangible assets | (642.5) | (583.1) | |
Proceeds from sale of restricted investments | 18.9 | 7.4 | |
Purchase of restricted investments | (22.5) | (23.0) | |
Other, net | (7.2) | (4.1) | |
Net cash used in investing activities | (653.3) | (602.8) | |
Cash flows from financing activities: | |||
Principal borrowings on notes | 15.0 | 20.0 | |
Principal payments on debt, including pre-payments | (255.2) | (7.2) | |
Borrowings on revolving credit facility | 80.0 | 60.0 | |
Payments on revolving credit facility | (60.0) | (115.0) | |
Principal payments under finance lease obligations | (21.8) | (41.1) | |
Debt amendment costs | (0.1) | (0.1) | |
Taxes paid on behalf of employees for shares withheld | (12.1) | (8.2) | |
Contributions from noncontrolling interests of consolidated affiliates | 140.4 | 68.3 | |
Dividends paid on common stock | (62.8) | (60.4) | |
Distributions paid to noncontrolling interests of consolidated affiliates | (125.0) | (114.7) | |
Repurchases of common stock, including fees and expenses | (31.1) | — | |
Other, net | 2.1 | 1.2 | |
Net cash used in financing activities | (330.6) | (197.2) | |
Increase in cash, cash equivalents, and restricted cash | 18.9 | 50.8 | |
Cash, cash equivalents, and restricted cash at beginning of period | 104.2 | 53.4 | |
Cash, cash equivalents, and restricted cash at end of period | $ 123.1 | $ 104.2 | |
Encompass Health Corporation and Subsidiaries Supplemental Information Earnings Per Share | |||||||
Q4 | Year Ended | ||||||
2024 | 2023 | 2024 | 2023 | ||||
(In Millions, Except Per Share Data) | |||||||
Adjusted EBITDA | $ 289.6 | $ 255.0 | $ 1,103.7 | $ 971.1 | |||
Depreciation and amortization | (78.0) | (70.1) | (299.6) | (273.9) | |||
Interest expense and amortization of debt discounts and fees | (33.0) | (34.9) | (137.4) | (143.5) | |||
Stock-based compensation | (12.5) | (13.4) | (48.3) | (50.6) | |||
Loss on disposal or impairment of assets | (6.1) | (6.1) | (17.4) | (9.8) | |||
160.0 | 130.5 | 601.0 | 493.3 | ||||
Items not indicative of ongoing operating performance: | |||||||
Loss on early extinguishment of debt | (0.2) | — | (0.6) | — | |||
State regulatory change impact on noncontrolling interests | — | — | — | 2.2 | |||
Change in fair market value of equity securities | (1.7) | 2.8 | 1.0 | 0.7 | |||
Asset impairment impact on noncontrolling interests | — | — | 7.3 | — | |||
Pre-tax income | 158.1 | 133.3 | 608.7 | 496.2 | |||
Income tax expense | (37.6) | (37.2) | (150.2) | (132.2) | |||
Income from continuing operations (1) | $ 120.5 | $ 96.1 | $ 458.5 | $ 364.0 | |||
Basic shares | 100.0 | 99.5 | 99.9 | 99.5 | |||
Diluted shares | 102.3 | 101.5 | 102.2 | 101.3 | |||
Basic earnings per share (1) | $ 1.20 | $ 0.96 | $ 4.56 | $ 3.63 | |||
Diluted earnings per share (1) | $ 1.18 | $ 0.94 | $ 4.49 | $ 3.59 | |||
(1) | Income from continuing operations attributable to Encompass Health |
Encompass Health Corporation and Subsidiaries Supplemental Information Adjusted Earnings Per Share | |||||||
Q4 | Year Ended | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Earnings per share, as reported | $ 1.18 | $ 0.94 | $ 4.49 | $ 3.59 | |||
Adjustments, net of tax: | |||||||
Asset impairment impact | — | — | 0.02 | — | |||
Income tax adjustments | (0.03) | 0.03 | (0.08) | 0.03 | |||
State regulatory change impact | — | — | — | 0.03 | |||
Change in fair market value of equity securities | 0.01 | (0.02) | (0.01) | — | |||
Adjusted earnings per share* | $ 1.17 | $ 0.95 | $ 4.43 | $ 3.64 | |||
* | Adjusted EPS may not sum due to rounding. |
Encompass Health Corporation and Subsidiaries Supplemental Information Reconciliation of Net Cash Provided by Operating Activities to Adjusted EBITDA | |||||||
Q4 | Year Ended | ||||||
2024 | 2023 | 2024 | 2023 | ||||
(In Millions) | |||||||
Net cash provided by operating activities | $ 278.8 | $ 201.0 | $ 1,002.8 | $ 850.8 | |||
Interest expense and amortization of debt discounts and fees | 33.0 | 34.9 | 137.4 | 143.5 | |||
(Loss) gain on sale of investments, excluding impairments | (3.1) | 5.5 | 2.7 | 4.6 | |||
Equity in net income of nonconsolidated affiliates | 0.2 | 0.9 | 3.0 | 3.2 | |||
Net income attributable to noncontrolling interests in continuing operations | (43.3) | (31.5) | (140.9) | (111.0) | |||
Amortization of debt-related items | (2.4) | (2.4) | (9.7) | (9.5) | |||
Distributions from nonconsolidated affiliates | (0.9) | (1.0) | (4.0) | (1.6) | |||
Current portion of income tax expense | 29.0 | 30.4 | 139.5 | 128.3 | |||
Change in assets and liabilities | (2.8) | 8.6 | (21.9) | (50.3) | |||
Cash (provided by) used in operating activities of discontinued operations | (0.6) | 11.4 | 3.1 | 16.0 | |||
State regulatory change impact on noncontrolling interests | — | — | — | (2.2) | |||
Asset impairment impact on noncontrolling interests | — | — | (7.3) | — | |||
Change in fair market value of equity securities | 1.7 | (2.8) | (1.0) | (0.7) | |||
Adjusted EBITDA | $ 289.6 | $ 255.0 | $ 1,103.7 | $ 971.1 | |||
Encompass Health Corporation and Subsidiaries Supplemental Information Reconciliation of Income from Continuing Operations Attributable to Encompass Health per Diluted Share to Adjusted Earnings Per Share | |||||||||
For the Three Months Ended December 31, 2024 | |||||||||
Adjustments | |||||||||
As | Loss on Early | Income Tax | Change in Fair | As | |||||
(In Millions, Except Per Share Amounts) | |||||||||
Adjusted EBITDA* | $ 289.6 | $ — | $ — | $ — | $ 289.6 | ||||
Depreciation and amortization | (78.0) | — | — | — | (78.0) | ||||
Interest expense and amortization of debt discounts and fees | (33.0) | — | — | — | (33.0) | ||||
Stock-based compensation | (12.5) | — | — | — | (12.5) | ||||
Loss on disposal or impairment of assets | (6.1) | — | — | — | (6.1) | ||||
Loss on early extinguishment of debt | (0.2) | 0.2 | — | — | — | ||||
Change in fair market value of equity securities | (1.7) | — | — | 1.7 | — | ||||
Income from continuing operations before income tax expense | 158.1 | 0.2 | — | 1.7 | 160.0 | ||||
Provision for income tax expense | (37.6) | (0.1) | (2.6) | (0.4) | (40.7) | ||||
Income from continuing operations attributable to Encompass Health | $ 120.5 | $ 0.1 | $ (2.6) | $ 1.3 | $ 119.3 | ||||
Diluted earnings per share from continuing operations** | $ 1.18 | $ — | $ (0.03) | $ 0.01 | $ 1.17 | ||||
Diluted shares used in calculation | 102.3 | ||||||||
* | See reconciliation of net income to Adjusted EBITDA. |
** | Adjusted EPS may not sum across due to rounding. |
Encompass Health Corporation and Subsidiaries Supplemental Information Reconciliation of Income from Continuing Operations Attributable to Encompass Health per Diluted Share to Adjusted Earnings Per Share | |||||||
For the Three Months Ended December 31, 2023 | |||||||
Adjustments | |||||||
As | Income Tax | Change in Fair | As | ||||
(In Millions, Except Per Share Amounts) | |||||||
Adjusted EBITDA* | $ 255.0 | $ — | $ — | $ 255.0 | |||
Depreciation and amortization | (70.1) | — | — | (70.1) | |||
Interest expense and amortization of debt discounts and fees | (34.9) | — | — | (34.9) | |||
Stock-based compensation | (13.4) | — | — | (13.4) | |||
Loss on disposal or impairment of assets | (6.1) | — | — | (6.1) | |||
Change in fair market value of equity securities | 2.8 | — | (2.8) | — | |||
Income from continuing operations before income tax expense | 133.3 | — | (2.8) | 130.5 | |||
Provision for income tax expense | (37.2) | 2.9 | 0.7 | (33.6) | |||
Income from continuing operations attributable to Encompass Health | $ 96.1 | $ 2.9 | $ (2.1) | $ 96.9 | |||
Diluted earnings per share from continuing operations** | $ 0.94 | $ 0.03 | $ (0.02) | $ 0.95 | |||
Diluted shares used in calculation | 101.5 | ||||||
* | See reconciliation of net income to Adjusted EBITDA. |
** | Adjusted EPS may not sum across due to rounding. |
Encompass Health Corporation and Subsidiaries Supplemental Information Reconciliation of Income from Continuing Operations Attributable to Encompass Health per Diluted Share to Adjusted Earnings Per Share | |||||||||||
For the Year Ended December 31, 2024 | |||||||||||
Adjustments | |||||||||||
As | Asset | Loss on Early | Income Tax | Change in Fair | As | ||||||
(In Millions, Except Per Share Amounts) | |||||||||||
Adjusted EBITDA* | $ — | $ — | $ — | $ — | |||||||
Depreciation and amortization | (299.6) | — | — | — | — | (299.6) | |||||
Interest expense and amortization of debt discounts and fees | (137.4) | — | — | — | — | (137.4) | |||||
Stock-based compensation | (48.3) | — | — | — | — | (48.3) | |||||
Loss on disposal or impairment of assets | (17.4) | 10.4 | — | — | — | (7.0) | |||||
Loss on early extinguishment of debt | (0.6) | — | 0.6 | — | — | — | |||||
Change in fair market value of equity securities | 1.0 | — | — | — | (1.0) | — | |||||
Asset impairment impact on noncontrolling interests | 7.3 | (7.3) | — | — | — | — | |||||
Income from continuing operations before income tax expense | 608.7 | 3.1 | 0.6 | — | (1.0) | 611.4 | |||||
Provision for income tax expense | (150.2) | (1.3) | (0.2) | (7.7) | 0.3 | (159.1) | |||||
Income from continuing operations attributable to Encompass Health | $ 458.5 | $ 1.8 | $ 0.4 | $ (7.7) | $ (0.7) | $ 452.3 | |||||
Diluted earnings per share from continuing operations** | $ 4.49 | $ 0.02 | $ — | $ (0.08) | $ (0.01) | $ 4.43 | |||||
Diluted shares used in calculation | 102.2 | ||||||||||
* | See reconciliation of net income to Adjusted EBITDA. |
** | Adjusted EPS may not sum across due to rounding. |
Encompass Health Corporation and Subsidiaries Supplemental Information Reconciliation of Income from Continuing Operations Attributable to Encompass Health per Diluted Share to Adjusted Earnings Per Share | |||||||||
For the Year Ended December 31, 2023 | |||||||||
Adjustments | |||||||||
As | State | Income Tax | Change in | As | |||||
(In Millions, Except Per Share Amounts) | |||||||||
Adjusted EBITDA* | $ 971.1 | $ — | $ — | $ — | $ 971.1 | ||||
Depreciation and amortization | (273.9) | 6.1 | — | — | (267.8) | ||||
Interest expense and amortization of debt discounts and fees | (143.5) | — | — | — | (143.5) | ||||
Stock-based compensation | (50.6) | — | — | — | (50.6) | ||||
Loss on disposal or impairment of assets | (9.8) | — | — | — | (9.8) | ||||
State regulatory change impact on noncontrolling interests | 2.2 | (2.2) | — | — | — | ||||
Change in fair market value of equity securities | 0.7 | — | — | (0.7) | — | ||||
Income from continuing operations before income tax expense | 496.2 | 3.9 | — | (0.7) | 499.4 | ||||
Provision for income tax expense | (132.2) | (1.0) | 2.8 | 0.2 | (130.2) | ||||
Income from continuing operations attributable to Encompass Health | $ 364.0 | $ 2.9 | $ 2.8 | $ (0.5) | $ 369.2 | ||||
Diluted earnings per share from continuing operations** | $ 3.59 | $ 0.03 | $ 0.03 | $ — | $ 3.64 | ||||
Diluted shares used in calculation | 101.3 | ||||||||
* | See reconciliation of net income to Adjusted EBITDA. |
** | Adjusted EPS may not sum across due to rounding. |
Encompass Health Corporation and Subsidiaries Supplemental Information Reconciliation of Net Income to Adjusted EBITDA | |||||||
Q4 | Year Ended | ||||||
2024 | 2023 | 2024 | 2023 | ||||
(In Millions) | |||||||
Net income | $ 164.2 | $ 119.1 | $ 596.6 | $ 463.0 | |||
(Income) loss from discontinued operations, net of tax,attributable to Encompass Health | (0.4) | 8.5 | 2.8 | 12.0 | |||
Net income attributable to noncontrolling interests included in continuing operations | (43.3) | (31.5) | (140.9) | (111.0) | |||
Provision for income tax expense | 37.6 | 37.2 | 150.2 | 132.2 | |||
Interest expense and amortization of debt discounts and fees | 33.0 | 34.9 | 137.4 | 143.5 | |||
Depreciation and amortization | 78.0 | 70.1 | 299.6 | 273.9 | |||
Loss on early extinguishment of debt | 0.2 | — | 0.6 | — | |||
Loss on disposal or impairment of assets | 6.1 | 6.1 | 17.4 | 9.8 | |||
Stock-based compensation | 12.5 | 13.4 | 48.3 | 50.6 | |||
State regulatory change impact on noncontrolling interests | — | — | — | (2.2) | |||
Change in fair market value of equity securities | 1.7 | (2.8) | (1.0) | (0.7) | |||
Asset impairment impact on noncontrolling interests | — | — | (7.3) | — | |||
Adjusted EBITDA | $ 289.6 | $ 255.0 | $ 1,103.7 | $ 971.1 | |||
Encompass Health Corporation and Subsidiaries Supplemental Information Reconciliation of Net Cash Provided by Operating Activities to Adjusted Free Cash Flow | |||||||
Q4 | Year Ended | ||||||
2024 | 2023 | 2024 | 2023 | ||||
(In Millions) | |||||||
Net cash provided by operating activities | $ 278.8 | $ 201.0 | $ 1,002.8 | $ 850.8 | |||
Impact of discontinued operations | (0.6) | 11.4 | 3.1 | 16.0 | |||
Net cash provided by operating activities of continuing operations | 278.2 | 212.4 | 1,005.9 | 866.8 | |||
Capital expenditures for maintenance | (50.8) | (87.1) | (184.6) | (216.9) | |||
Distributions paid to noncontrolling interests of consolidated affiliates | (39.5) | (22.8) | (125.0) | (114.7) | |||
Items not indicative of ongoing operating performance: | |||||||
Transaction costs and related liabilities | 2.6 | (9.0) | (6.0) | (9.5) | |||
Adjusted free cash flow | $ 190.5 | $ 93.5 | $ 690.3 | $ 525.7 | |||
For the three months ended December 31, 2024, net cash used in investing activities was
For the three months ended December 31, 2023, net cash used in investing activities was
For the year ended December 31, 2024, net cash used in investing activities was
For the year ended December 31, 2023, net cash used in investing activities was
Encompass Health Corporation and Subsidiaries
Forward-Looking Statements
Statements contained in this press release and the supplemental information which are not historical facts, such as those relating to the business, strategy, outlook, growth targets and guidance considerations, dividend strategies, effective income tax rates, cost trends, legislative and regulatory developments or their impacts, financial guidance, ability to return value to shareholders, projected capital expenditures, acquisition opportunities, development projects, addressable market size, other balance sheet and cash flow plans, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In addition, Encompass Health, through its senior management, may from time to time make forward-looking public statements concerning the matters described herein. All such estimates, projections, and forward-looking information speak only as of the date hereof, and Encompass Health undertakes no duty to publicly update or revise such forward-looking information, whether as a result of new information, future events, or otherwise. Such forward-looking statements are necessarily estimates based upon current information and involve a number of risks and uncertainties. Actual events or results may differ materially from those anticipated in these forward-looking statements as a result of a variety of factors. While it is impossible to identify all such factors, factors which could cause actual events or results to differ materially from those estimated by Encompass Health include, but are not limited to, an infectious disease outbreak, including the speed, depth, geographic reach and duration of its spread, which could decrease our patient volumes and revenues and lead to staffing and supply shortages and associated cost increases; Encompass Health's infectious disease prevention and control efforts; the demand for Encompass Health's services, including based on any downturns in the economy, consumer confidence, or the capital markets; the price of Encompass Health's common stock as it affects Encompass Health's willingness and ability to repurchase shares and the financial and accounting effects of any repurchases; any adverse outcome of various lawsuits, claims, and legal or regulatory proceedings involving Encompass Health, including any matters related to yet undiscovered issues, if any, in acquired operations; Encompass Health's ability to attract and retain key management personnel; any adverse effects on Encompass Health's stock price resulting from the integration of acquired operations; potential disruptions, breaches, or other incidents affecting the proper operation, availability, or security of Encompass Health's or its vendors' or partners' information systems, including unauthorized access to or theft of patient, business associate, or other sensitive information or inability to provide patient care because of system unavailability as well as unforeseen issues, if any, related to integration of acquired systems; the ability to successfully integrate acquired operations, including realization of anticipated tax benefits, revenues, and cost savings, minimizing the negative impact on margins arising from the changes in staffing and other operating practices, and avoidance of unforeseen exposure to liabilities; Encompass Health's ability to successfully complete and integrate de novo developments, acquisitions, investments, and joint ventures consistent with its growth strategy; Encompass Health's ability to realize construction cost savings from prefabrication of hospitals; increases in Medicare audit activity, including increased use of sampling and extrapolation, resulting in additional unpaid reimbursement claims and an increase in the backlog of appealed claims denials; changes, delays in (including in connection with resolution of Medicare payment reviews or appeals), or suspension of reimbursement for Encompass Health's services by governmental or private payors; changes in the regulation of the healthcare industry at either or both of the federal and state levels, including as part of national healthcare reform and deficit reduction and Encompass Health's ability to adapt operations to those changes, including in connection with the CMS inpatient rehabilitation review choice demonstration project; competitive pressures in the healthcare industry and Encompass Health's response thereto; Encompass Health's ability to obtain and retain favorable arrangements with third-party payors; Encompass Health's ability to control costs, particularly labor and employee benefit costs, including group medical expenses; adverse effects resulting from coverage determinations made by Medicare Administrative Contractors regarding its Medicare reimbursement claims and lengthening delays in Encompass Health's ability to recover improperly denied claims through the administrative appeals process on a timely basis; Encompass Health's ability to adapt to changes in the healthcare delivery system, including value-based purchasing and involvement in coordinated care initiatives or programs that may arise with its referral sources; Encompass Health's ability to attract and retain nurses, therapists, and other healthcare professionals in a highly competitive environment with often severe staffing shortages, which may be worsened by infectious disease outbreaks, and the impact on Encompass Health's labor expenses from potential union activity, staffing shortages, and competitive compensation practices; general conditions in the economy and capital markets, including any instability or uncertainty related to armed conflict or an act of terrorism, governmental impasse over approval of
Media Contact
Polly Manuel, 205 969-4532
polly.manuel@encompasshealth.com
Investor Relations Contact
Mark Miller, 205 970-5860
mark.miller@encompasshealth.com
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SOURCE Encompass Health Corp.
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