Select Medical Holdings Corporation Announces Estimate of Certain Financial Results of its Wholly-Owned Subsidiary Concentra Group Holdings Parent, Inc. for the Second Quarter Ended June 30, 2024
Select Medical Holdings (NYSE: SEM) announced preliminary financial results for its subsidiary, Concentra Group Holdings Parent, Inc., for Q2 2024.
Concentra's net operating revenue is estimated at $477.9 million, while income from operations is expected to be around $83.9 million. These figures are management estimates based on current information and may change after final financial reviews.
Select Medical will release its full Q2 results on August 1, 2024, after market close and will host a conference call on August 2, 2024, at 9:00am ET.
Select Medical operates numerous facilities across the U.S., including critical illness recovery hospitals, rehabilitation hospitals, outpatient rehabilitation clinics, and occupational health centers.
- Estimated net operating revenue of $477.9 million for Concentra in Q2 2024.
- Estimated income from operations for Concentra of $83.9 million in Q2 2024.
- Concentra's financial estimates are preliminary and may change after final reviews, posing uncertainty.
Insights
Analyzing the financial estimates provided, Concentra Group Holdings Parent, Inc. expects net operating revenue of
The projected financials for Concentra are indicative of the market positioning and competitive standing within the healthcare sector. Concentra operates in a diversified portfolio with a significant number of occupational health centers, which can be less susceptible to economic downturns due to the essential nature of their services. The expected figures suggest that Concentra is holding a stable market position. For investors, understanding the sector's dynamics such as demand for occupational health services and rehabilitation clinics is essential. Given that healthcare services generally have consistent demand, these estimates may reflect a stable growth trajectory for Concentra within the broader Select Medical portfolio. Investors should also keep an eye on broader economic indicators that might impact Concentra's operational environment.
The anticipated financial results underscore Concentra's role in Select Medical's business structure. By breaking down the revenue and income from operations, it allows investors to see the substantial contribution Concentra makes to the parent company's overall financial performance. Given the broad spectrum of services provided by Select Medical, the stability and growth of Concentra can significantly affect the company's valuation and stock performance. Understanding the operational divisions within healthcare providers and how each segment's performance interacts with overall profitability can provide deeper insights into the company's financial health and future prospects. Moreover, the diversification across different types of healthcare facilities ensures a balanced risk profile, which is beneficial for long-term investors.
Select Medical expects Concentra's net operating revenue for its second quarter of 2024 to be approximately
The expectations regarding Concentra's financial results for the second quarter of 2024 are management estimates based on currently available information and these estimates are subject to change upon completion of Select Medical's financial statement closing procedures. Our actual results remain subject to the completion of management's final review and our other closing procedures, or subsequent events, as well as the completion of the review of our financial statements. Accordingly, investors should not place undue reliance on our preliminary results set out below, which may differ from actual results.
As previously announced, Select Medical will host a conference call regarding its second quarter results, as well as its business outlook, on Friday, August 2, 2024, at 9:00am ET. The conference call will be a live webcast and can be accessed at Select Medical Holdings Corporation's website at www.selectmedicalholdings.com. A replay of the webcast will be available shortly after the call through the same link. For listeners wishing to dial-in via telephone, or participate in the question and answer session, you may pre-register for the call at Select Medical Earnings Call Registration to obtain your dial-in number and unique passcode for the call.
Company Overview
Select Medical is one of the largest operators of critical illness recovery hospitals, rehabilitation hospitals, outpatient rehabilitation clinics, and occupational health centers in
Forward-Looking Statements
Certain statements contained herein that are not descriptions of historical facts are "forward-looking" statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Forward-looking statements use words such as "expect," "estimate," "anticipate," "outlook," "intend," "plan," "confident," "believe," "will," "should," "would" "potential," "positioning," "proposed," "planned," "objective," "likely," "could," "may," and words of similar meaning, as well as other words or expressions referencing future events, conditions or circumstances. Statements regarding our estimated financial results are examples of forward-looking statements. Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements due to factors including the following:
- The effect of closing procedures and final review with respect to our estimated preliminary results;
- The frequency of work-related injuries and illnesses;
- The adverse changes to our relationships with employer customers, third-party payors, workers' compensation provider networks or employer services networks;
- Changes to regulations, new interpretations of existing regulations, or violations of regulations;
- Cost containment initiatives or state fee schedule changes undertaken by state workers' compensation boards or commissions and other third-party payors;
- Our ability to realize reimbursement increases at rates sufficient to keep pace with the inflation of our costs;
- Labor shortages, increased employee turnover or costs, and union activity could significantly increase our operating costs;
- Our ability to compete effectively with other occupational health centers, onsite health clinics at employer worksites, and healthcare providers;
- A security breach of our, or our third-party vendors', information technology systems which may cause a violation of HIPAA and subject us to potential legal and reputational harm;
- Negative publicity which can result in increased governmental and regulatory scrutiny and possibly adverse regulatory changes;
- Significant legal actions could subject us to substantial uninsured liabilities;
- Litigation and other legal and regulatory proceedings in the course of our business that could adversely affect our business and financial statements;
- Insurance coverage may not be sufficient to cover losses we may incur;
- Acquisitions may use significant resources, may be unsuccessful, and could expose us to unforeseen liabilities;
- Our exposure to additional risk due to our reliance on third parties in many aspects of our business;
- Compliance with applicable laws regarding the corporate practice of medicine and therapy and fee- splitting;
- Our facilities are subject to extensive federal and state laws and regulations relating to the privacy of individually identifiable information;
- Compliance with applicable data interoperability and information blocking rule;
- Facility licensure requirements in some states are costly and time-consuming, limiting or delaying our operations;
- Our ability to adequately protect and enforce our intellectual property and other proprietary rights;
- Adverse economic conditions in the
U.S. or globally; - Any negative impact on the global economy and capital markets resulting from other geopolitical tensions;
- The impact of impairment of our goodwill and other intangible assets;
- Our ability to maintain satisfactory credit ratings;
- Failure to complete or achieve some or all the expected benefits of the potential separation of Concentra;
- The negative impact of public threats such as a global pandemic or widespread outbreak of an infectious disease similar to the COVID-19 pandemic;
- The loss of key members of our management team;
- Our ability to attract and retain talented, highly skilled employees and a diverse workforce, and on the succession of our senior management;
- Climate change, or legal, regulatory or market measures to address climate change;
- Increasing scrutiny and rapidly evolving expectations from stakeholders regarding ESG matters
- Changes in tax laws or exposures to additional tax liabilities; and
- Other factors discussed under the heading "Risk Factors" in Concentra's preliminary prospectus filed on June 14, 2024, with the Securities and Exchange Commission (the "SEC"), relating to Concentra's Registration Statement on Form S-1.
Except as required by applicable law, including the securities laws of the United States and the rules and regulations of the SEC, we are under no obligation to publicly update or revise any forward-looking statements, whether as a result of any new information, future events, or otherwise. You should not place undue reliance on our forward-looking statements. Although we believe that the expectations reflected in forward-looking statements are reasonable, we cannot guarantee future results or performance.
Investor inquiries:
Joel T. Veit
Senior Vice President and Treasurer
717-972-1100
ir@selectmedical.com
I. Summary Financial Results(1) | |||
Unaudited | |||
Three months ended June 30, | |||
2024 | 2023 | ||
(in millions) | (estimated) | (actual) | |
Revenue | $ 477,915 | $ 467,079 | |
Cost and expenses: | |||
Cost of services, exclusive of depreciation and amortization | 339,273 | 329,836 | |
General and administrative, exclusive of depreciation and amortization | 36,828 | 37,003 | |
Depreciation and amortization | 17,870 | 18,283 | |
Total costs and expenses | 393,971 | 385,122 | |
Other operating income | — | 151 | |
Income from Operations | $ 83,944 | $ 82,108 | |
(1) These amounts are subject to change upon completion of Select Medical's financial statement closing procedures. | |||
II. Key Statistics
| |||
2024 | 2023 | ||
Number of occupational health centers – start of period | 547 | 539 | |
Number of occupational health centers acquired | — | 1 | |
Number of occupational health centers de novos | 1 | — | |
Number of occupational health centers closed/sold | (1) | — | |
Number of occupational health centers – end of period | 547 | 540 | |
Number of onsite health clinics operated – end of period | 154 | 141 | |
Number of patient visits(2) | |||
Workers' Compensation | 1,455,254 | 1,429,035 | |
Employer Services | 1,702,399 | 1,781,012 | |
Consumer Health | 56,602 | 57,847 | |
Total | 3,214,255 | 3,267,894 | |
Visits per day volume | |||
Workers' Compensation | 22,738 | 22,329 | |
Employer Services | 26,600 | 27,828 | |
Consumer Health | 884 | 904 | |
Total | 50,223 | 51,061 | |
Revenue per visit(2) | |||
Workers' Compensation | $ 198.18 | $ 194.92 | |
Employer Services | 90.05 | 86.00 | |
Consumer Health | 135.49 | 134.88 | |
Total | $ 139.81 | $ 134.50 | |
(2) Represents operating statistics for the Occupational Health Centers only. Revenue per visit for the three months ended June 30, 2024 is calculated using estimated net operating revenue. |
View original content:SOURCE Select Medical Holdings Corporation
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