Full Press Release Details
U.S. Physical Therapy, Inc.
Carey Hendrickson, Chief Financial Officer
Email: Chendrickson@usph.com
Chris Reading, Chief Executive Officer
U.S. Physical Therapy Reports
First Quarter 2025 Results
Reports Record First Quarter Patient Volume
Houston, TX, May 7, 2025 - U.S. Physical Therapy,
Inc. ("USPH" or the "Company") (NYSE: USPH), a national operator of outpatient physical therapy clinics and provider of industrial injury prevention services, today reported results for the first quarter ended March 31, 2025.
FINANCIAL HIGHLIGHTS
| U.S. Physical Therapy Press Release | Page 2 |
| May 7, 2025 |
MANAGEMENT'S COMMENTS
Chris Reading, Chief Executive Officer, said,
"Despite our weather-impacted start, we had strong referral and visit demand which accelerated nicely as the quarter progressed. Importantly, our insurance renegotiations and workers compensation efforts are giving us a lift as we enter one of
the busiest seasonal periods of the year. While we have more work to do, we are encouraged by our start and committed to further progress."
2025 First Quarter Versus 2024 First Quarter
Additional supplemental tables of financial and performance metrics are presented on page 14 of this release.
Physical Therapy Operations
| Three Months Ended | Variance | |||||||||||||||||||
| March 31, 2025 | March 31, 2024 | $ | % | |||||||||||||||||
| (In thousands, except percentages) | ||||||||||||||||||||
| Revenue related to: | ||||||||||||||||||||
| Mature Clinics (1) | $ | 126,620 | $ | 128,501 | $ | (1,881 | ) | (1.5 | )% | |||||||||||
| Clinic additions (2) | 25,667 | 44 | 25,623 | * | (7) | |||||||||||||||
| Clinics sold or closed (3) | 260 | 2,530 | (2,270 | ) | * | (7) | ||||||||||||||
| Net patient revenue | 152,547 | 131,075 | 21,472 | 16.4 | % | |||||||||||||||
| Other (4) | 3,861 | 3,350 | 511 | 15.3 | % | |||||||||||||||
| Total | 156,408 | 134,425 | 21,983 | 16.4 | % | |||||||||||||||
| Operating costs (5) | 130,940 | 110,361 | 20,579 | 18.6 | % | |||||||||||||||
| Gross profit | $ | 25,468 | $ | 24,064 | $ | 1,404 | 5.8 | % | ||||||||||||
| Financial and operating metrics (not in thousands): | ||||||||||||||||||||
| Net rate per patient visit (1) | $ | 105.66 | $ | 103.37 | $ | 2.29 | 2.2 | % | ||||||||||||
| Patient visits (1) | 1,443,805 | 1,268,002 | 175,803 | 13.9 | % | |||||||||||||||
| Average daily visits per clinic (1) | 31.4 | 29.5 | 1.9 | 6.4 | % | |||||||||||||||
| Gross margin | 16.3 | % | 17.9 | % | ||||||||||||||||
| Salaries and related costs per visit, clinics (6) | $ | 63.53 | $ | 61.42 | $ | 2.11 | 3.4 | % | ||||||||||||
| Operating costs per visit, clinics (6) | $ | 89.28 | $ | 85.50 | $ | 3.78 | 4.4 | % | ||||||||||||
| (1) See Glossary of Terms - Revenue Metrics for definition. | ||||||||||||||||||||
| (2) Includes 14 clinics added during the 2025 First Quarter and 103 added during the year ended December 31, 2024. | ||||||||||||||||||||
| (3) Includes 7 clinics closed during the 2025 First Quarter and 45 clinics closed during the year ended December 31, 2024. | ||||||||||||||||||||
| (4) Includes revenues from management contracts. | ||||||||||||||||||||
| (5) Includes costs from management contracts. | ||||||||||||||||||||
| (6) Excludes costs from management contracts and $0.1 million of certain incentive costs related to the Metro acquisition. Please refer to the reconcilliation of non-GAAP measures to the most comparable GAAP measure on page 13. | ||||||||||||||||||||
| (7) Not meaningful. |
| U.S. Physical Therapy Press Release | Page 3 |
| May 7, 2025 |
Net revenue from physical therapy operations increased $22.0 million, or 16.4%, to $156.4 million for the 2025 First Quarter from $134.4 million
for the 2024 First Quarter. This increase was due to the increase in visits from the 53 net clinics added since the comparable prior year period and an increase in net rate per patient visit, which reflects the Company's strategic priority of
increasing reimbursement rates through contract negotiations with commercial and other payors as well as growing workers compensation as a percent of the Company's overall mix of business. Net rate per patient visit for the 2025 First Quarter was
$105.66, increasing $2.29 per visit from $103.37 for the 2024 First Quarter, despite the approximate 2.9% Medicare rate reduction which went into effect on January 1, 2025. Net rate per patient visit also increased sequentially by $0.93 from $104.73
for the three months ended December 31, 2024.
Operating costs from physical therapy operations increased $20.6 million, or 18.6%, to $130.9 million in the 2025 First Quarter from $110.4 million in the 2024 First Quarter primarily driven by the 53 net clinics added since the comparable prior year
period. Salaries and related costs per visit was $63.53 in the 2025 First Quarter compared to $61.42 in the 2024 First Quarter while total operating costs per visit was $89.28 compared to $85.50 over the same periods, respectively.
Gross profit from physical therapy operations in the 2025 First Quarter was $25.5 million with a gross profit margin of 16.3% compared to $24.1 million with a gross profit margin of 17.9% in the 2024 First Quarter.
Industrial Injury Prevention Services
| Three Months Ended | Variance | |||||||||||||||
| March 31, 2025 | March 31, 2024 | $ | % | |||||||||||||
| (In thousands, except percentages) | ||||||||||||||||
| Net revenue | $ | 27,380 | $ | 21,250 | $ | 6,130 | 28.8 | % | ||||||||
| Operating costs | 21,783 | 16,913 | 4,870 | 28.8 | % | |||||||||||
| Gross profit | $ | 5,597 | $ | 4,337 | $ | 1,260 | 29.1 | % | ||||||||
| Gross margin | 20.4 | % | 20.4 | % |
IIP revenue increased $6.1 million, or 28.8%, to $27.4 million for the 2025 First Quarter as
compared to $21.3 million for the 2024 First Quarter. Gross profit from IIP operations in the 2025 First Quarter increased $1.3 million, or 29.1%, to $5.6 million from $4.3 million in the 2024 First Quarter. The gross profit margin from IIP
operations was 20.4% in each of the 2025 First Quarter and 2024 First Quarter. Excluding the IIP acquisition made in April 2024, IIP revenue increased by $3.2 million or 15.1% in the 2025 First Quarter and gross profit increased $0.6 million or
13.1% in the 2025 First Quarter over the comparable prior year period.
Corporate Office and Other Expenses
Corporate office costs increased to $16.2 million in the 2025 First Quarter from $14.1 million in the 2024 First
Quarter. This increase was primarily to support the larger number of clinics as well as expenses related to the integration of the Company's recent acquisitions. As a ratio to net revenue, corporate office costs improved to 8.8% in the 2025
First Quarter compared to 9.0% in the 2024 Fourth Quarter.
The Company revalued contingent consideration related to certain acquisitions and recognized a
net non-cash gain (a decrease in the related liabilities) of $4.8 million in the 2025 First Quarter compared to $0.6 million in the 2024 First Quarter.
Operating income was $19.6 million for the 2025 First Quarter compared to $14.9 million for the 2024 First Quarter,
an increase of 31.6% over the comparable period.
Interest expense increased by $0.3 million to $2.3 million for the 2025 First Quarter compared to $2.0 million in the
2024 First Quarter due to a higher average outstanding balance on our revolving credit facility in the 2025 First Quarter. The interest rate associated with borrowings on the Company's credit facility was 4.9% for the 2025 First Quarter and
4.7% for the 2024 First Quarter, with an all-in effective interest rate, including all associated costs of 5.5% and 5.3% over the same periods, respectively.
Interest income was less than $0.1 million during the 2025 First Quarter compared to $1.5 million in the 2024 First
Quarter as the cash on the balance sheet at the end of the 2024 First Quarter has been deployed into acquisitions since that time.
The Company revalued a put-right liability related to the future purchase of an IIP business and recognized a net non-cash expense (an increase in the related liability) of $0.4 million in the 2025 First Quarter compared to $0.1 million in the
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| May 7, 2025 |
The provision for income taxes was $3.9 million in the 2025 First Quarter compared to $3.1 million during the 2024 First Quarter while the
effective tax rate was 28.1% in each of the same periods, respectively.
USPH Net Income and Non-GAAP Measures
Net income attributable to non-controlling interest (temporary and permanent) was $3.6 million in both the 2025 First Quarter and the 2024 First
USPH Net Income was $9.9 million for the 2025 First Quarter compared to $8.0 million in the 2024 First Quarter. In accordance
with GAAP, the revaluation of redeemable noncontrolling interest, net of taxes, is not included in net income but is charged directly to retained earnings; however, this change is included in the computation of earnings per share. Earnings per share
was $0.80 for the 2025 First Quarter compared to $0.46 for the 2024 First Quarter.
Non-GAAP Adjusted EBITDA (1) was $19.5 million for the 2025 First Quarter, an increase of $2.8 million or 16.5%, from $16.8 million
for the 2024 First Quarter. Non-GAAP Operating Results (1) was $7.3 million, or $0.48 per share, in the 2025 First Quarter compared to $7.7 million, or $0.51 per share, in the 2024 First Quarter.
BALANCE SHEET AND CASH FLOW
Total cash and cash equivalents were $39.2 million as of March 31, 2025, compared to $41.4 million as of December 31, 2024, and $132.3 million as of March 31, 2024. The Company
had $164.9 million in outstanding borrowings and $147.0 million in available credit under its credit facilities as of March 31, 2025. This compares to $151.6 million of outstanding borrowings and $164.0 million in available credit under its
credit facilities as of December 31, 2024.
On February 28, 2025, the Company acquired a 65% equity interest in a three-clinic practice with the original practice owners retaining 35% equity interest. The business currently generates $4.3 million in annual
revenue and 23,000 in annual visits.
On April 30, 2025, the Company announced the acquisition of an outpatient home care physical
and speech therapy practice through its 50%-owned subsidiary, MSO Metro, LLC. The practice currently generates approximately $2.1 million in annual revenue.
The Company's strategy is to continue acquiring multi-clinic outpatient physical therapy practices, to develop
outpatient physical therapy clinics as satellites in existing partnerships and to continue acquiring companies that provide industrial injury prevention services.
The Company's Board of Directors declared a quarterly dividend of $0.45 per share payable on
June 13, 2025, to shareholders of record on May 23, 2025.
CONFERENCE CALL INFORMATION
U.S. Physical Therapy's management will host
a conference call at 10:30 a.m. ET / 9:30 a.m. CT, on May 8, 2025, to discuss the Company's financial results for the first quarter ended March 31, 2025. Interested parties may participate in the call by dialing (800) 274-8461 (Primary) or
(203) 518-9814 (Alternate) and conference ID of USPHQ125. Please call approximately 10 minutes before the call is scheduled to begin. To listen to the live call, go to the Company's website at www.usph.com at least 15 minutes early to register, download and
install any necessary audio software. If you are unable to listen live, a playback of the conference call can be accessed until August 7, 2025, on the Company's website.
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| May 7, 2025 |
FORWARD LOOKING STATEMENTS
This press release contains statements that are considered to be forward-looking within the meaning under Section
21E of the Securities Exchange Act of 1934, as amended. These statements contain forward-looking information relating to the financial condition, results of operations, plans, objectives, future performance and business of our Company. These
statements (often using words such as "believes", "expects", "intends", "plans", "appear", "should" and similar words) involve risks and uncertainties that could cause actual results to differ materially from those we expect. Included among
such statements may be those relating to new clinics, availability of personnel and the reimbursement environment. The forward-looking statements are based on our current
views and assumptions and actual results could differ materially from those anticipated in such forward-looking statements as a result of certain risks, uncertainties, and factors, which include, but are not limited to:
Many factors are beyond our control. Given these uncertainties, you should not place undue reliance on our
forward-looking statements. For additional information regarding these and other risks and uncertainties, that could cause actual results to differ materially from those contained in our forward-looking statements, please refer to "Risk
Factors" in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the Securities and Exchange Commission ("SEC") on March 3, 3025 and any risk factors contained in subsequent quarterly and annual reports we file
with the SEC. Our forward-looking statements represent our estimates and assumptions only as of the date of this report. Except as required by law, we are under no obligation to update any forward-looking statement as a result of new
information, future events, or otherwise, except as required by law.
GLOSSARY OF TERMS - REVENUE METRICS
Mature clinics are clinics opened or acquired prior to January 1, 2024, and are still operating as of the balance sheet date.
Net rate per patient
visit is net patient revenue related to our physical therapy operations divided by total number of patient visits (defined below) during the periods presented.
Patient visits is the number of unique patient visits during the periods presented.
Average daily visits per
clinic is patient visits divided by the number of days in which normal business operations were conducted during the periods presented and further divided by the average number of clinics in
operation during the periods presented.
ABOUT U.S. PHYSICAL THERAPY, INC.
Founded in 1990, U.S. Physical Therapy, Inc. owns and/or manages 773 outpatient
physical therapy clinics in 44 states. USPH clinics provide preventative and post-operative care for a variety of orthopedic-related disorders and sports-related injuries, treatment for neurologically-related injuries and
rehabilitation of injured workers. USPH also has an industrial injury prevention business which provides onsite services for clients' employees including injury prevention and rehabilitation, performance optimization, post-offer
employment testing, functional capacity evaluations, and ergonomic assessments.