Select Medical Holdings Corporation Announces Results For Its Fourth Quarter and Year Ended December 31, 2024, Its 2025 Business Outlook, and Cash Dividend
Select Medical Holdings (NYSE: SEM) announced its Q4 and full-year 2024 results, along with its 2025 outlook and dividend declaration. Key highlights include:
The company completed a tax-free distribution of Concentra shares on November 25, 2024. Q4 2024 revenue increased 7.8% to $1,312.6 million, though the company reported a loss from continuing operations of $10.5 million, impacted by a one-time $45.9 million stock compensation expense and $17.9 million debt refinancing loss.
For full-year 2024, revenue grew 7.5% to $5,187.1 million, with income from continuing operations increasing 17.7% to $130.0 million. The board declared a cash dividend of $0.0625 per share, payable March 13, 2025. The company also maintains a $1.0 billion stock repurchase program through December 31, 2025.
The 2025 business outlook projects revenue between $5.4-5.6 billion and Adjusted EBITDA of $520.0-540.0 million.
Select Medical Holdings (NYSE: SEM) ha annunciato i risultati del quarto trimestre e dell'intero anno 2024, insieme alle previsioni per il 2025 e alla dichiarazione del dividendo. I punti salienti includono:
L'azienda ha completato una distribuzione senza tasse delle azioni Concentra il 25 novembre 2024. Nel quarto trimestre del 2024, i ricavi sono aumentati del 7,8% a 1.312,6 milioni di dollari, sebbene l'azienda abbia riportato una perdita dalle operazioni continuative di 10,5 milioni di dollari, influenzata da una spesa una tantum per compensi azionari di 45,9 milioni di dollari e da una perdita di rifinanziamento del debito di 17,9 milioni di dollari.
Per l'intero anno 2024, i ricavi sono cresciuti del 7,5% a 5.187,1 milioni di dollari, con un aumento del reddito dalle operazioni continuative del 17,7% a 130,0 milioni di dollari. Il consiglio ha dichiarato un dividendo in contante di 0,0625 dollari per azione, pagabile il 13 marzo 2025. L'azienda mantiene anche un programma di riacquisto di azioni da 1,0 miliardo di dollari fino al 31 dicembre 2025.
Le prospettive aziendali per il 2025 prevedono ricavi tra 5,4 e 5,6 miliardi di dollari e un EBITDA rettificato di 520,0-540,0 milioni di dollari.
Select Medical Holdings (NYSE: SEM) anunció sus resultados del cuarto trimestre y del año completo 2024, junto con sus perspectivas para 2025 y la declaración de dividendos. Los aspectos más destacados incluyen:
La compañía completó una distribución libre de impuestos de acciones de Concentra el 25 de noviembre de 2024. Los ingresos del cuarto trimestre de 2024 aumentaron un 7.8% a 1,312.6 millones de dólares, aunque la empresa reportó una pérdida de operaciones continuas de 10.5 millones de dólares, afectada por un gasto único de compensación de acciones de 45.9 millones de dólares y una pérdida por refinanciamiento de deuda de 17.9 millones de dólares.
Para el año completo 2024, los ingresos crecieron un 7.5% a 5,187.1 millones de dólares, con un aumento del ingreso de operaciones continuas del 17.7% a 130.0 millones de dólares. La junta declaró un dividendo en efectivo de 0.0625 dólares por acción, pagadero el 13 de marzo de 2025. La empresa también mantiene un programa de recompra de acciones de 1.0 mil millones de dólares hasta el 31 de diciembre de 2025.
Las perspectivas comerciales para 2025 proyectan ingresos entre 5.4 y 5.6 mil millones de dólares y un EBITDA ajustado de 520.0 a 540.0 millones de dólares.
Select Medical Holdings (NYSE: SEM)는 2024년 4분기 및 연간 실적과 함께 2025년 전망 및 배당금 선언을 발표했습니다. 주요 내용은 다음과 같습니다:
회사는 2024년 11월 25일에 Concentra 주식의 세금 없는 배포를 완료했습니다. 2024년 4분기 매출은 7.8% 증가한 13억 1,260만 달러에 달했지만, 회사는 1회성 주식 보상 비용 4,590만 달러와 1,790만 달러의 부채 재융자 손실로 인해 계속 운영에서 1,050만 달러의 손실을 보고했습니다.
2024년 전체 연도 매출은 7.5% 증가한 51억 8,710만 달러에 달했으며, 계속 운영에서의 수익은 17.7% 증가하여 1억 3,000만 달러에 이르렀습니다. 이사회는 주당 0.0625달러의 현금 배당금을 선언했으며, 이는 2025년 3월 13일에 지급될 예정입니다. 회사는 또한 2025년 12월 31일까지 10억 달러 규모의 자사주 매입 프로그램을 유지하고 있습니다.
2025년 사업 전망은 54억에서 56억 달러 사이의 매출과 5억 2천만에서 5억 4천만 달러의 조정 EBITDA를 예상하고 있습니다.
Select Medical Holdings (NYSE: SEM) a annoncé ses résultats du quatrième trimestre et de l'année complète 2024, ainsi que ses prévisions pour 2025 et la déclaration de dividende. Les faits saillants incluent :
L'entreprise a complété une distribution d'actions Concentra sans impôt le 25 novembre 2024. Les revenus du quatrième trimestre 2024 ont augmenté de 7,8 % pour atteindre 1 312,6 millions de dollars, bien que l'entreprise ait enregistré une perte des opérations continues de 10,5 millions de dollars, affectée par une dépense unique de compensation en actions de 45,9 millions de dollars et une perte de refinancement de la dette de 17,9 millions de dollars.
Pour l'année complète 2024, les revenus ont augmenté de 7,5 % pour atteindre 5 187,1 millions de dollars, avec un revenu des opérations continues en hausse de 17,7 % à 130,0 millions de dollars. Le conseil a déclaré un dividende en espèces de 0,0625 dollar par action, payable le 13 mars 2025. L'entreprise maintient également un programme de rachat d'actions de 1,0 milliard de dollars jusqu'au 31 décembre 2025.
Les prévisions commerciales pour 2025 prévoient des revenus compris entre 5,4 et 5,6 milliards de dollars et un EBITDA ajusté de 520,0 à 540,0 millions de dollars.
Select Medical Holdings (NYSE: SEM) gab die Ergebnisse für das vierte Quartal und das gesamte Jahr 2024 sowie den Ausblick für 2025 und die Dividendenankündigung bekannt. Zu den wichtigsten Punkten gehören:
Das Unternehmen hat am 25. November 2024 eine steuerfreie Verteilung von Concentra-Aktien abgeschlossen. Die Einnahmen im vierten Quartal 2024 stiegen um 7,8 % auf 1.312,6 Millionen Dollar, obwohl das Unternehmen einen Verlust aus fortgeführten Tätigkeiten von 10,5 Millionen Dollar meldete, der durch eine einmalige Aufwandsentschädigung von 45,9 Millionen Dollar und einen Verlust aus Schuldenrefinanzierung von 17,9 Millionen Dollar beeinflusst wurde.
Für das gesamte Jahr 2024 wuchsen die Einnahmen um 7,5 % auf 5.187,1 Millionen Dollar, während das Einkommen aus fortgeführten Tätigkeiten um 17,7 % auf 130,0 Millionen Dollar anstieg. Der Vorstand erklärte eine Bardividende von 0,0625 Dollar pro Aktie, zahlbar am 13. März 2025. Das Unternehmen führt außerdem ein Aktienrückkaufprogramm über 1,0 Milliarden Dollar bis zum 31. Dezember 2025 fort.
Der Geschäftsausblick für 2025 prognostiziert Einnahmen zwischen 5,4 und 5,6 Milliarden Dollar sowie ein bereinigtes EBITDA von 520,0 bis 540,0 Millionen Dollar.
- Revenue increased 7.8% to $1,312.6M in Q4 2024
- Full-year 2024 revenue grew 7.5% to $5,187.1M
- Annual income from continuing operations up 17.7% to $130.0M
- Adjusted EBITDA increased 14.4% to $510.4M for 2024
- Board authorized $1.0B stock repurchase program
- Q4 2024 loss from continuing operations of $10.5M
- One-time acceleration of $45.9M stock compensation expense
- $17.9M loss on early retirement of debt in Q4 2024
- Outpatient rehabilitation segment Adjusted EBITDA margin declined to 8.7% from 9.4% YoY
On November 25, 2024, we completed a tax-free distribution of 104,093,503 shares of common stock of Concentra Group Holdings Parent, Inc. ("Concentra") to our stockholders. Holders of our common stock received 0.806971 shares of Concentra common stock for each outstanding share of our common stock owned as of November 18, 2024. Following the completion of the distribution, we no longer own any shares of Concentra's common stock. The results of Concentra, and related transaction costs, have been reflected as discontinued operations in the consolidated statements of operations, and prior periods have been recast to reflect this presentation.
For the fourth quarter ended December 31, 2024, revenue increased
For the year ended December 31, 2024, revenue increased
Company Overview
Select Medical is one of the largest operators of critical illness recovery hospitals, rehabilitation hospitals, and outpatient rehabilitation clinics in
Critical Illness Recovery Hospital Segment
For the fourth quarter ended December 31, 2024, revenue for the critical illness recovery hospital segment increased
For the year ended December 31, 2024, revenue for the critical illness recovery hospital segment increased
Rehabilitation Hospital Segment
For the fourth quarter ended December 31, 2024, revenue for the rehabilitation hospital segment increased
For the year ended December 31, 2024, revenue for the rehabilitation hospital segment increased
Outpatient Rehabilitation Segment
For the fourth quarter ended December 31, 2024, revenue for the outpatient rehabilitation segment increased
For the year ended December 31, 2024, revenue for the outpatient rehabilitation segment increased
Dividend
On February 13, 2025, Select Medical's board of directors declared a cash dividend of
There is no assurance that future dividends will be declared. The declaration and payment of dividends in the future are at the discretion of Select Medical's board of directors after taking into account various factors, including, but not limited to, Select Medical's financial condition, operating results, available cash and current and anticipated cash needs, the terms of Select Medical's indebtedness, and other factors Select Medical's board of directors may deem to be relevant.
Stock Repurchase Program
The board of directors of Select Medical has authorized a common stock repurchase program to repurchase up to
Select Medical did not repurchase shares under its authorized stock repurchase program during the year ended December 31, 2024. Since the inception of the common stock repurchase program through December 31, 2024, Select Medical has repurchased 48,234,823 shares at a cost of approximately
Financing Transactions
On December 3, 2024, we entered into Amendment No. 11 to our credit agreement. Amendment No. 11 established a new incremental term loan in the aggregate amount of
On December 3, 2024, Select issued and sold
Business Outlook
Select Medical is issuing its business outlook for 2025. Select Medical expects revenue to be in the range of
Conference Call
Select Medical will host a conference call regarding its results for the fourth quarter and full year ended December 31, 2024, and its business outlook on Friday, February 21, 2025, 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.
* * * * *
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), including statements related to Select Medical's 2025 long-term business outlook. 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:
- changes in government reimbursement for our services and/or new payment policies may result in a reduction in revenue, an increase in costs, and a reduction in profitability;
- adverse economic conditions including an inflationary environment could cause us to continue to experience increases in the prices of labor and other costs of doing business resulting in a negative impact on our business, operating results, cash flows, and financial condition;
- shortages in qualified nurses, therapists, physicians, or other licensed providers, and/or the inability to attract or retain qualified healthcare professionals could limit our ability to staff our facilities;
- shortages in qualified health professionals could cause us to increase our dependence on contract labor, increase our efforts to recruit and train new employees, and expand upon our initiatives to retain existing staff, which could increase our operating costs significantly;
- 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 failure of our Medicare-certified long term care hospitals or inpatient rehabilitation facilities to maintain their Medicare certifications may cause our revenue and profitability to decline;
- the failure of our Medicare-certified long term care hospitals and inpatient rehabilitation facilities operated as "hospitals within hospitals" to qualify as hospitals separate from their host hospitals may cause our revenue and profitability to decline;
- a government investigation or assertion that we have violated applicable regulations may result in sanctions or reputational harm and increased costs;
- acquisitions or joint ventures may prove difficult or unsuccessful, use significant resources, or expose us to unforeseen liabilities;
- our plans and expectations related to our acquisitions and our ability to realize anticipated synergies;
- failure to complete or achieve some or all the expected benefits of the potential separation of Concentra;
- private third-party payors for our services may adopt payment policies that could limit our future revenue and profitability;
- the failure to maintain established relationships with the physicians in the areas we serve could reduce our revenue and profitability;
- competition may limit our ability to grow and result in a decrease in our revenue and profitability;
- the loss of key members of our management team could significantly disrupt our operations;
- the effect of claims asserted against us could subject us to substantial uninsured liabilities;
- a security breach of our or our third-party vendors' information technology systems may subject us to potential legal and reputational harm and may result in a violation of the Health Insurance Portability and Accountability Act of 1996 or the Health Information Technology for Economic and Clinical Health Act; and
- other factors discussed from time to time in our filings with the Securities and Exchange Commission (the "SEC"), including factors discussed under the heading "Risk Factors" of the annual report on Form 10-K for the year ended December 31, 2024.
Except as required by applicable law, including the securities laws of
Investor inquiries:
Joel T. Veit
Senior Vice President and Treasurer
717-972-1100
ir@selectmedical.com
I. Condensed Consolidated Statements of Operations For the Three Months Ended December 31, 2023 and 2024 (In thousands, except per share amounts, unaudited) | ||||||
2023 | 2024 | % Change | ||||
Revenue | $ 1,218,116 | $ 1,312,564 | 7.8 % | |||
Costs and expenses: | ||||||
Cost of services, exclusive of depreciation and amortization | 1,074,062 | 1,175,099 | 9.4 | |||
General and administrative | 44,090 | 80,197 | 81.9 | |||
Depreciation and amortization | 35,485 | 36,283 | 2.2 | |||
Total costs and expenses | 1,153,637 | 1,291,579 | 12.0 | |||
Other operating income | 458 | 106 | (76.9) | |||
Income from continuing operations before other income and | 64,937 | 21,091 | (67.5) | |||
Other income and expense: | ||||||
Loss on early retirement of debt | — | (17,906) | N/M | |||
Equity in earnings of unconsolidated subsidiaries | 10,195 | 10,423 | 2.2 | |||
Interest expense | (40,263) | (28,551) | (29.1) | |||
Income (loss) from continuing operations before income taxes | 34,869 | (14,943) | N/M | |||
Income tax expense (benefit) from continuing operations | 4,618 | (4,487) | N/M | |||
Income (loss) from continuing operations, net of tax | 30,251 | (10,456) | N/M | |||
Discontinued operations: | ||||||
Income from discontinued business | 38,779 | 24,669 | (36.4) | |||
Income tax expense from discontinued business | 7,232 | 10,457 | 44.6 | |||
Income from discontinued operations, net of tax | 31,547 | 14,212 | (54.9) | |||
Net income | 61,798 | 3,756 | (93.9) | |||
Less: Net income attributable to non-controlling interests | 15,529 | 19,806 | 27.5 | |||
Net income (loss) attributable to Select Medical | $ 46,269 | $ (16,050) | N/M | |||
Net income (loss) attributable to Select Medical's common | ||||||
Income (loss) from continuing operations, net of tax | $ 15,743 | $ (23,664) | ||||
Income from discontinued operations, net of tax | 30,526 | 7,614 | ||||
Net income (loss) attributable to Select Medical's common | $ 46,269 | $ (16,050) | ||||
Basic earnings (loss) per common share: | ||||||
Continuing operations | $ 0.12 | $ (0.18) | ||||
Discontinued operations | 0.24 | 0.06 | ||||
Total basic earnings (loss) per common share | $ 0.36 | $ (0.12) | ||||
Diluted earnings (loss) per common share: | ||||||
Continuing operations | $ 0.12 | $ (0.19) | ||||
Discontinued operations | 0.24 | 0.06 | ||||
Total diluted earnings (loss) per common share | $ 0.36 | $ (0.13) | ||||
_______________________________________________________________________________ |
(1) Refer to table III for calculation of earnings per common share. |
N/M Not meaningful. |
II. Condensed Consolidated Statements of Operations For the Years Ended December 31, 2023 and 2024 (In thousands, except per share amounts, unaudited) | ||||||
2023 | 2024 | % Change | ||||
Revenue | $ 4,825,977 | $ 5,187,105 | 7.5 % | |||
Costs and expenses: | ||||||
Cost of services, exclusive of depreciation and amortization | 4,254,369 | 4,553,461 | 7.0 | |||
General and administrative | 170,193 | 225,869 | 32.7 | |||
Depreciation and amortization | 135,691 | 142,866 | 5.3 | |||
Total costs and expenses | 4,560,253 | 4,922,196 | 7.9 | |||
Other operating income | 1,518 | 3,406 | 124.4 | |||
Income from continuing operations before other income and | 267,242 | 268,315 | 0.4 | |||
Other income and expense: | ||||||
Loss on early retirement of debt | (14,692) | (28,845) | 96.3 | |||
Equity in earnings of unconsolidated subsidiaries | 41,339 | 63,904 | 54.6 | |||
Interest expense | (154,165) | (128,605) | (16.6) | |||
Income from continuing operations before income taxes | 139,724 | 174,769 | 25.1 | |||
Income tax expense from continuing operations | 29,253 | 44,782 | 53.1 | |||
Income from continuing operations, net of tax | 110,471 | 129,987 | 17.7 | |||
Discontinued operations: | ||||||
Income from discontinued business | 242,632 | 223,414 | (7.9) | |||
Income tax expense from discontinued business | 53,372 | 56,697 | 6.2 | |||
Income from discontinued operations, net of tax | 189,260 | 166,717 | (11.9) | |||
Net income | 299,731 | 296,704 | (1.0) | |||
Less: Net income attributable to non-controlling interests | 56,240 | 82,666 | 47.0 | |||
Net income attributable to Select Medical | $ 243,491 | $ 214,038 | (12.1) % | |||
Net income attributable to Select Medical's common | ||||||
Income from continuing operations, net of tax | $ 59,027 | $ 65,473 | ||||
Income from discontinued operations, net of tax | 184,464 | 148,565 | ||||
Net income attributable to Select Medical's common | $ 243,491 | $ 214,038 | ||||
Earnings per common share: | ||||||
Continuing operations - basic and diluted | $ 0.46 | $ 0.51 | ||||
Discontinued operations - basic and diluted | 1.44 | 1.15 | ||||
Basic and diluted earnings per common share:(1) | $ 1.91 | (2) | $ 1.66 | |||
_______________________________________________________________________________ |
(1) Refer to table III for calculation of earnings per common share. |
(2) Does not total due to rounding. |
N/M Not meaningful. |
III. Earnings per Share |
Select Medical's capital structure includes common stock and unvested restricted stock awards. To compute earnings per share ("EPS"), Select Medical applies the two-class method because its unvested restricted stock awards are participating securities which are entitled to participate equally with its common stock in undistributed earnings. Select Medical applies the treasury stock method when computing diluted EPS.
The following table sets forth the income from continuing operations, net of tax, attributable to Select Medical's common stockholders, its common shares outstanding, and its participating securities outstanding for the three months and years ended December 31, 2023 and 2024:
Basic EPS | ||||||||
Three Months Ended | Years Ended December 31, | |||||||
2023 | 2024 | 2023 | 2024 | |||||
Income (loss) from continuing operations, net of tax | $ 30,251 | $ (10,456) | $ 110,471 | $ 129,987 | ||||
Less: Net income attributable to non-controlling interests | 14,508 | 13,208 | 51,444 | 64,514 | ||||
Income (loss) from continuing operations, net of tax, | 15,743 | (23,664) | 59,027 | 65,473 | ||||
Less: distributed and undistributed net income (loss) | 556 | (597) | 2,127 | 2,319 | ||||
Income (loss) from continuing operations, net of tax, | $ 15,187 | $ (23,067) | $ 56,900 | $ 63,154 | ||||
The following tables set forth the computation of EPS for the three months and years ended December 31, 2023 and 2024:
Three Months Ended December 31, | ||||||
2023 | ||||||
Income from | Shares(1) | Basic and Diluted | ||||
(in thousands, except for per share amounts) | ||||||
Common shares | $ 15,187 | 123,817 | $ 0.12 | |||
Participating securities | 556 | 4,530 | $ 0.12 | |||
Total | $ 15,743 | |||||
Three Months Ended December 31, | |||||||||||||
2024 | |||||||||||||
Loss from | Basic | Basic EPS | Loss from | Diluted | Diluted EPS | ||||||||
(in thousands, except for per share amounts) | |||||||||||||
Common shares | $ (23,067) | 125,923 | $ (0.18) | $ (23,664) | 127,535 | $ (0.19) | |||||||
Participating securities | (597) | 3,261 | $ (0.18) | ||||||||||
Total | $ (23,664) | ||||||||||||
Year Ended December 31, | |||||||||||||
2023 | 2024 | ||||||||||||
Income from | Shares(1) | Basic and | Income from | Shares(1) | Basic and | ||||||||
(in thousands, except for per share amounts) | |||||||||||||
Common shares | $ 56,900 | 123,105 | $ 0.46 | $ 63,154 | 124,614 | $ 0.51 | |||||||
Participating securities | 2,127 | 4,601 | $ 0.46 | 2,319 | 4,576 | $ 0.51 | |||||||
Total | $ 59,027 | $ 65,473 | |||||||||||
_______________________________________________________________________________ |
(1) Represents the weighted average share count outstanding during the period. |
IV. Condensed Consolidated Balance Sheets (In thousands, unaudited) | ||||
December 31, | ||||
2023 | 2024 | |||
Assets | ||||
Current Assets: | ||||
Cash and cash equivalents | $ 52,632 | $ 59,694 | ||
Accounts receivable | 724,141 | 821,385 | ||
Current assets of discontinued operations | 291,064 | — | ||
Other current assets | 189,809 | 138,698 | ||
Total Current Assets | 1,257,646 | 1,019,777 | ||
Operating lease right-of-use assets | 790,764 | 908,095 | ||
Property and equipment, net | 845,191 | 872,185 | ||
Goodwill | 2,283,425 | 2,331,898 | ||
Identifiable intangible assets, net | 105,147 | 103,183 | ||
Non-current assets of discontinued operations | 2,039,142 | — | ||
Other assets | 368,316 | 372,813 | ||
Total Assets | $ 7,689,631 | $ 5,607,951 | ||
Liabilities and Equity | ||||
Current Liabilities: | ||||
Payables and accruals | $ 735,857 | $ 777,781 | ||
Current operating lease liabilities | 172,454 | 179,601 | ||
Current portion of long-term debt and notes payable | 68,874 | 20,269 | ||
Current liabilities of discontinued operations | 271,280 | — | ||
Total Current Liabilities | 1,248,465 | 977,651 | ||
Non-current operating lease liabilities | 668,557 | 787,124 | ||
Long-term debt, net of current portion | 3,584,384 | 1,691,546 | ||
Non-current deferred tax liability | 119,942 | 81,497 | ||
Non-current liabilities of discontinued operations | 411,487 | — | ||
Other non-current liabilities | 82,781 | 73,038 | ||
Total Liabilities | 6,115,616 | 3,610,856 | ||
Redeemable non-controlling interests | 26,297 | 10,167 | ||
Total Equity | 1,547,718 | 1,986,928 | ||
Total Liabilities and Equity | $ 7,689,631 | $ 5,607,951 | ||
V. Condensed Consolidated Statements of Cash Flows For the Three Months Ended December 31, 2023 and 2024 (In thousands, unaudited) | ||||
2023 | 2024 | |||
Operating activities | ||||
Net income | $ 61,798 | $ 3,756 | ||
Adjustments to reconcile net income to net cash provided by operating | ||||
Distributions from unconsolidated subsidiaries | 13,521 | 8,742 | ||
Depreciation and amortization | 53,984 | 45,743 | ||
Provision for expected credit losses | (71) | 2,620 | ||
Equity in earnings of unconsolidated subsidiaries | (10,195) | (10,423) | ||
Loss on extinguishment of debt | — | 8,099 | ||
(Gain) loss on sale of assets and businesses | (50) | 48 | ||
Stock compensation expense | 11,818 | 61,271 | ||
Amortization of debt discount, premium and issuance costs | 748 | 684 | ||
Deferred income taxes | 930 | 2,507 | ||
Changes in operating assets and liabilities, net of effects of business | ||||
Accounts receivable | 4,170 | 20,916 | ||
Other current assets | (12,098) | 10,216 | ||
Other assets | 3,003 | (1,009) | ||
Accounts payable and accrued expenses | 51,884 | (27,738) | ||
Net cash provided by operating activities | 179,442 | 125,432 | ||
Investing activities | ||||
Business combinations, net of cash acquired | (9,085) | (10,786) | ||
Purchases of property and equipment | (60,603) | (63,429) | ||
Proceeds from sale of assets and businesses | 104 | 22 | ||
Net cash used in investing activities | (69,584) | (74,193) | ||
Financing activities | ||||
Borrowings on revolving facilities | 270,000 | 290,000 | ||
Payments on revolving facilities | (330,000) | (195,000) | ||
Proceeds from term loans, net of issuance costs | — | 1,043,355 | ||
Payments on term loans | (5,258) | (372,982) | ||
Payment on senior notes, including call premium | — | (1,237,764) | ||
Proceeds from senior notes, net of issuance costs | — | 539,261 | ||
Borrowings of other debt | 550 | 4,086 | ||
Principal payments on other debt | (8,648) | (29,498) | ||
Dividends paid to common stockholders | (16,048) | (16,124) | ||
Repurchase of common stock | (1,709) | (19,981) | ||
Increase in overdrafts | 280 | 11,630 | ||
Proceeds from issuance of non-controlling interests | 2,472 | 6,300 | ||
Distributions to and purchases of non-controlling interests | (14,931) | (24,201) | ||
Cash transferred to Concentra at separation | — | (182,095) | ||
Net cash used in financing activities | (103,292) | (183,013) | ||
Net increase (decrease) in cash and cash equivalents | 6,566 | (131,774) | ||
Cash and cash equivalents at beginning of period | 77,440 | 191,468 | ||
Cash and cash equivalents at end of period(1) | $ 84,006 | $ 59,694 | ||
Supplemental information: | ||||
Cash paid for interest, excluding amounts received of | $ 50,564 | $ 39,472 | ||
Cash paid for taxes | 10,008 | 30,491 | ||
__________________________________________ |
(1) Discontinued operations at December 31, 2023, includes |
VI. Condensed Consolidated Statements of Cash Flows For the Years Ended December 31, 2023 and 2024 (In thousands, unaudited) | ||||
2023 | 2024 | |||
Operating activities | ||||
Net income | $ 299,731 | $ 296,704 | ||
Adjustments to reconcile net income to net cash provided by operating | ||||
Distributions from unconsolidated subsidiaries | 23,417 | 39,178 | ||
Depreciation and amortization | 208,742 | 203,894 | ||
Provision for expected credit losses | 1,030 | 4,279 | ||
Equity in earnings of unconsolidated subsidiaries | (40,813) | (60,228) | ||
Loss on extinguishment of debt | 175 | 19,038 | ||
Gain on sale of assets and businesses | (57) | (1,063) | ||
Stock compensation expense | 43,809 | 100,670 | ||
Amortization of debt discount, premium and issuance costs | 2,647 | 2,963 | ||
Deferred income taxes | (16,119) | (32,434) | ||
Changes in operating assets and liabilities, net of effects of business | ||||
Accounts receivable | 1,156 | (95,845) | ||
Other current assets | (29,374) | 18,072 | ||
Other assets | 10,031 | 12,933 | ||
Accounts payable and accrued expenses | 77,683 | 9,703 | ||
Net cash provided by operating activities | 582,058 | 517,864 | ||
Investing activities | ||||
Business combinations, net of cash acquired | (29,567) | (13,097) | ||
Purchases of property, equipment, and other assets | (229,200) | (222,177) | ||
Investment in businesses | (9,873) | — | ||
Proceeds from sale of assets and businesses | 163 | 4,263 | ||
Net cash used in investing activities | (268,477) | (231,011) | ||
Financing activities | ||||
Borrowings on revolving facilities | 905,000 | 1,240,000 | ||
Payments on revolving facilities | (1,070,000) | (1,415,000) | ||
Proceeds from term loans, net of issuance costs | 2,092,232 | 1,880,052 | ||
Payments on term loans | (2,113,952) | (2,092,485) | ||
Payment on senior notes | — | (1,237,764) | ||
Proceeds from senior notes, net of issuance costs | — | 1,176,598 | ||
Borrowings of other debt | 31,399 | 24,892 | ||
Principal payments on other debt | (46,946) | (65,280) | ||
Dividends paid to common stockholders | (63,904) | (64,617) | ||
Repurchase of common stock | (12,759) | (37,905) | ||
Decrease in overdrafts | (1,687) | (4,471) | ||
Proceeds from issuance of non-controlling interests | 22,935 | 15,713 | ||
Distributions to and purchases of non-controlling interests | (63,531) | (60,001) | ||
Purchase of membership interests of Concentra Group Holdings Parent | (6,268) | — | ||
Proceeds from Concentra initial public offering | — | 511,198 | ||
Cash transferred to Concentra at separation | — | (182,095) | ||
Net cash used in financing activities | (327,481) | (311,165) | ||
Net decrease in cash and cash equivalents | (13,900) | (24,312) | ||
Cash and cash equivalents at beginning of period | 97,906 | 84,006 | ||
Cash and cash equivalents at end of period(1) | $ 84,006 | $ 59,694 | ||
Supplemental information: | ||||
Cash paid for interest, excluding amounts received of | $ 272,261 | $ 256,229 | ||
Cash paid for taxes | 88,510 | 133,187 | ||
______________________________________________________________ |
(1) Discontinued operations at December 31, 2023, includes |
VII. Key Statistics (unaudited) | ||||||
2023 | 2024 | % Change | ||||
Critical Illness Recovery Hospital | ||||||
Number of hospitals operated – end of period(a) | 107 | 104 | ||||
Revenue (,000) | $ 567,128 | $ 600,445 | 5.9 % | |||
Number of patient days(b)(c) | 277,470 | 274,134 | (1.2) % | |||
Number of admissions(b)(d) | 9,126 | 8,691 | (4.8) % | |||
Revenue per patient day(b)(e) | $ 2,037 | $ 2,183 | 7.2 % | |||
Occupancy rate(b)(f) | 66 % | 67 % | 1.5 % | |||
Adjusted EBITDA (,000) | $ 57,384 | $ 63,098 | 10.0 % | |||
Adjusted EBITDA margin | 10.1 % | 10.5 % | ||||
Rehabilitation Hospital | ||||||
Number of hospitals operated – end of period(a) | 33 | 35 | ||||
Revenue (,000) | $ 260,166 | $ 294,352 | 13.1 % | |||
Number of patient days(b)(c) | 116,003 | 119,870 | 3.3 % | |||
Number of admissions(b)(d) | 8,264 | 8,626 | 4.4 % | |||
Revenue per patient day(b)(e) | $ 2,063 | $ 2,177 | 5.5 % | |||
Occupancy rate(b)(f) | 85 % | 81 % | (4.7) % | |||
Adjusted EBITDA (,000) | $ 66,344 | $ 62,277 | (6.1) % | |||
Adjusted EBITDA margin | 25.5 % | 21.2 % | ||||
Outpatient Rehabilitation | ||||||
Number of clinics operated – end of period(a) | 1,933 | 1,914 | ||||
Working days(g) | 63 | 64 | ||||
Revenue (,000) | $ 298,235 | $ 319,598 | 7.2 % | |||
Number of visits(b)(h) | 2,672,936 | 2,811,704 | 5.2 % | |||
Revenue per visit(b)(i) | $ 100 | $ 102 | 2.0 % | |||
Adjusted EBITDA (,000) | $ 22,473 | $ 26,561 | 18.2 % | |||
Adjusted EBITDA margin | 7.5 % | 8.3 % | ||||
_______________________________________________________________________________ | |
(a) | Includes managed locations. |
(b) | Excludes managed locations. |
(c) | Each patient day represents one patient occupying one bed for one day during the periods presented. |
(d) | Represents the number of patients admitted to Select Medical's hospitals during the periods presented. |
(e) | Represents the average amount of revenue recognized for each patient day. Revenue per patient day is calculated by dividing patient service revenues, excluding revenues from certain other ancillary and outpatient services provided at Select Medical's hospitals, by the total number of patient days. |
(f) | Represents the portion of our hospitals being utilized for patient care during the periods presented. Occupancy rate is calculated using the number of patient days, as presented above, divided by the total number of bed days available during the period. Bed days available is derived by adding the daily number of available licensed beds for each of the periods presented. |
(g) | Represents the number of days in which normal business operations were conducted during the periods presented. |
(h) | Represents the number of visits in which patients were treated at Select Medical's outpatient rehabilitation clinics during the periods presented. |
(i) | Represents the average amount of revenue recognized for each patient visit. Revenue per visit is calculated by dividing patient service revenue, excluding revenues from certain other ancillary services, by the total number of visits. |
VIII. Key Statistics (unaudited) | ||||||
2023 | 2024 | % Change | ||||
Critical Illness Recovery Hospital | ||||||
Number of hospitals operated – end of period(a) | 107 | 104 | ||||
Revenue (,000) | $ 2,299,773 | $ 2,444,196 | 6.3 % | |||
Number of patient days(b)(c) | 1,108,492 | 1,118,757 | 0.9 % | |||
Number of admissions(b)(d) | 36,225 | 35,784 | (1.2) % | |||
Revenue per patient day(b)(e) | $ 2,067 | $ 2,177 | 5.3 % | |||
Occupancy rate(b)(f) | 68 % | 68 % | 0.0 % | |||
Adjusted EBITDA (,000) | $ 246,015 | $ 301,634 | 22.6 % | |||
Adjusted EBITDA margin | 10.7 % | 12.3 % | ||||
Rehabilitation Hospital | ||||||
Number of hospitals operated – end of period(a) | 33 | 35 | ||||
Revenue (,000) | $ 979,585 | $ 1,110,592 | 13.4 % | |||
Number of patient days(b)(c) | 446,145 | 470,594 | 5.5 % | |||
Number of admissions(b)(d) | 31,627 | 33,665 | 6.4 % | |||
Revenue per patient day(b)(e) | $ 2,017 | $ 2,134 | 5.8 % | |||
Occupancy rate(b)(f) | 85 % | 84 % | (1.2) % | |||
Adjusted EBITDA (,000) | $ 221,875 | $ 245,748 | 10.8 % | |||
Adjusted EBITDA margin | 22.6 % | 22.1 % | ||||
Outpatient Rehabilitation | ||||||
Number of clinics operated – end of period(a) | 1,933 | 1,914 | ||||
Working days(g) | 254 | 256 | ||||
Revenue (,000) | $ 1,188,914 | $ 1,250,294 | 5.2 % | |||
Number of visits(b)(h) | 10,657,558 | 11,147,920 | 4.6 % | |||
Revenue per visit(b)(i) | $ 100 | $ 101 | 1.0 % | |||
Adjusted EBITDA (,000) | $ 111,868 | $ 108,577 | (2.9) % | |||
Adjusted EBITDA margin | 9.4 % | 8.7 % | ||||
_______________________________________________________________________________ | |
(a) | Includes managed locations. |
(b) | Excludes managed locations. |
(c) | Each patient day represents one patient occupying one bed for one day during the periods presented. |
(d) | Represents the number of patients admitted to Select Medical's hospitals during the periods presented. |
(e) | Represents the average amount of revenue recognized for each patient day. Revenue per patient day is calculated by dividing patient service revenues, excluding revenues from certain other ancillary and outpatient services provided at Select Medical's hospitals, by the total number of patient days. |
(f) | Represents the portion of our hospitals being utilized for patient care during the periods presented. Occupancy rate is calculated using the number of patient days, as presented above, divided by the total number of bed days available during the period. Bed days available is derived by adding the daily number of available licensed beds for each of the periods presented. |
(g) | Represents the number of days in which normal business operations were conducted during the periods presented. |
(h) | Represents the number of visits in which patients were treated at Select Medical's outpatient rehabilitation clinics during the periods presented. |
(i) | Represents the average amount of revenue recognized for each patient visit. Revenue per visit is calculated by dividing patient service revenue, excluding revenues from certain other ancillary services, by the total number of visits. |
IX. Income from Continuing Operations, Net of Tax, to Adjusted EBITDA Reconciliation |
The presentation of Adjusted EBITDA is important to investors because Adjusted EBITDA is commonly used as an analytical indicator of performance by investors within the healthcare industry. Adjusted EBITDA is used by management to evaluate financial performance and determine resource allocation for each of Select Medical's segments. Adjusted EBITDA is not a measure of financial performance under accounting principles generally accepted in
The following table reconciles income from continuing operations, net of tax, to Adjusted EBITDA for Select Medical. Adjusted EBITDA is used by Select Medical to report its segment performance. Adjusted EBITDA is defined as earnings from continuing operations excluding interest, income taxes, depreciation and amortization, gain (loss) on early retirement of debt, stock compensation expense, transaction costs associated with the Concentra separation, gain (loss) on sale of businesses, and equity in earnings (losses) of unconsolidated subsidiaries.
Three Months Ended December 31, | Years Ended December 31, | |||||||
2023 | 2024 | 2023 | 2024 | |||||
Income (loss) from continuing operations, net of tax | $ 30,251 | $ (10,456) | $ 110,471 | $ 129,987 | ||||
Income tax expense (benefit) | 4,618 | (4,487) | 29,253 | 44,782 | ||||
Interest expense | 40,263 | 28,551 | 154,165 | 128,605 | ||||
Equity in earnings of unconsolidated subsidiaries | (10,195) | (10,423) | (41,339) | (63,904) | ||||
Loss on early retirement of debt | — | 17,906 | 14,692 | 28,845 | ||||
Income from continuing operations before other income | $ 64,937 | $ 21,091 | $ 267,242 | $ 268,315 | ||||
Stock compensation expense: | ||||||||
Included in general and administrative | 9,658 | 47,414 | 36,041 | 79,931 | ||||
Included in cost of services | 1,688 | 12,902 | 7,117 | 19,283 | ||||
Depreciation and amortization | 35,485 | 36,283 | 135,691 | 142,866 | ||||
Concentra separation transaction costs(b) | — | (1,698) | — | — | ||||
Adjusted EBITDA | $ 111,768 | $ 115,992 | $ 446,091 | $ 510,395 | ||||
Critical illness recovery hospital | $ 57,384 | $ 63,098 | $ 246,015 | $ 301,634 | ||||
Rehabilitation hospital | 66,344 | 62,277 | 221,875 | 245,748 | ||||
Outpatient rehabilitation | 22,473 | 26,561 | 111,868 | 108,577 | ||||
Other(a) | (34,433) | (35,944) | (133,667) | (145,564) | ||||
Adjusted EBITDA | $ 111,768 | $ 115,992 | $ 446,091 | $ 510,395 | ||||
_______________________________________________________________________________ | |
(a) | Other primarily includes general and administrative costs and other operating income, as discussed further above. |
(b) | During the three months ended December 31, 2024, transaction costs of |
X. Reconciliation of Earnings per Common Share from Continuing Operations, Net of Tax, to Adjusted Earnings per Common Share from Continuing Operations, Net of Tax |
Adjusted income from continuing operations, net of tax, attributable to common shares and adjusted earnings per common share from continuing operations are not measures of financial performance under GAAP. Items excluded from adjusted income from continuing operations, net of tax, attributable to common shares and adjusted earnings per common share from continuing operations are significant components in understanding and assessing financial performance. Select Medical believes that the presentation of adjusted income from continuing operations, net of tax, attributable to common shares and adjusted earnings per common share from continuing operations are important to investors because they are reflective of the financial performance of Select Medical's ongoing operations and provide better comparability of its results of operations between periods. Adjusted income from continuing operations, net of tax, attributable to common shares and adjusted earnings per common share from continuing operations should not be considered in isolation or as alternatives to, or substitutes for, income from continuing operations, net of tax, cash flows generated by operations, investing or financing activities, or other financial statement data presented in the consolidated financial statements as indicators of financial performance or liquidity. Because adjusted income from continuing operations, net of tax, attributable to common shares and adjusted earnings per common share are not measurements determined in accordance with GAAP and are thus susceptible to varying calculations, adjusted income from continuing operations, net of tax, attributable to common shares and adjusted earnings per common share from continuing operations as presented may not be comparable to other similarly titled measures of other companies.
The following tables reconcile income from continuing operations, net of tax, attributable to common shares and earnings per common share from continuing operations on a fully diluted basis to adjusted income from continuing operations, net of tax, attributable to common shares and adjusted earnings per common share from continuing operations on a fully diluted basis.
Three Months Ended December 31, | |||||||
2023 | Per Share(a) | 2024 | Per Share(a) | ||||
Income from continuing operations, net of tax, | $ 15,187 | $ 0.12 | $ (23,664) | (0.19) | |||
Adjustments:(b) | |||||||
Loss on early retirement of debt, net of tax | — | — | 12,885 | 0.10 | |||
Concentra separation transaction costs, net of tax | — | — | (1,241) | (0.01) | |||
Stock compensation expense due to accelerated | — | — | 34,645 | 0.28 | |||
Adjusted income from continuing operations, net of | $ 15,187 | $ 0.12 | $ 22,625 | $ 0.18 | |||
Years Ended December 31, | |||||||
2023 | Per Share(a) | 2024 | Per Share(a) | ||||
Income from continuing operations, net of tax, | $ 56,900 | $ 0.46 | $ 63,154 | $ 0.51 | |||
Adjustments:(b) | |||||||
Loss on early retirement of debt, net of tax | 10,019 | 0.08 | 20,311 | 0.16 | |||
Stock compensation expense due to accelerated | — | — | 33,846 | 0.27 | |||
Adjusted income from continuing operations, net of | $ 0.54 | $ 117,311 | $ 0.94 | ||||
_______________________________________________________________________________ | |
(a) | Income from continuing operations, net of tax, attributable to common shares and earnings per common share from continuing operations are calculated based on the diluted weighted average common shares outstanding, as presented in table III. |
(b) | Adjustments to income from continuing operations, net of tax, attributable to common shares include estimated income tax and non-controlling interest impacts and are calculated based on the diluted weighted average common shares outstanding. The estimated income tax impact, which is determined using tax rates based on the nature of the adjustment and the jurisdiction in which the adjustment occurred, includes both current and deferred income tax expense or benefit. |
XI. Income from Continuing Operations, Net of Tax, to Adjusted EBITDA Reconciliation |
The following is a reconciliation of full year 2025 Adjusted EBITDA expectations as computed at the low and high points of the range to the closest comparable GAAP financial measure. Refer to table IX for the definition of Adjusted EBITDA and a discussion of Select Medical's use of Adjusted EBITDA in evaluating financial performance. Each item presented in the below table is an estimation of full year 2025 expectations.
Range | |||
Non-GAAP Measure Reconciliation | Low | High | |
Income from continuing operations, net of tax, attributable to Select Medical | $ 142 | $ 155 | |
Net income attributable to non-controlling interests | 75 | 78 | |
Income from continuing operations, net of tax | 217 | 233 | |
Income tax expense | 79 | 84 | |
Interest expense | 107 | 107 | |
Equity in earnings of unconsolidated subsidiaries | (47) | (48) | |
Income from continuing operations before other income and expense | 356 | 376 | |
Stock compensation expense | 18 | 18 | |
Depreciation and amortization | 146 | 146 | |
Adjusted EBITDA | $ 520 | $ 540 | |
View original content:SOURCE Select Medical Holdings Corporation
FAQ
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