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
Second Quarter 2025 Results
Reports All-time Record Patient Visits
Raises Full Year 2025 Guidance
Houston, TX, August 6, 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 three and six months ended June 30, 2025.
FINANCIAL HIGHLIGHTS
| U.S. Physical Therapy Press Release | Page 2 |
| August 6, 2025 |
MANAGEMENT'S COMMENTS
Chris Reading, Chief Executive Officer, said,
"Volumes in our physical therapy business remain at record levels while we execute our plan for cost rationalization and improved efficiencies. Our injury prevention business continues a strong growth path, both organically and through
carefully added acquisitions, which have broadened our service offerings and increased our exposure to new industry verticals. As a result of our efforts and expected progress we have updated our earnings guidance for the year."
2025 Second Quarter Versus 2024 Second Quarter
Additional supplemental tables of financial and performance metrics are presented on page 13 of this release.
Physical Therapy Operations
| Three Months Ended | Variance | |||||||||||||||||||
| June 30, 2025 | June 30, 2024 | $ | % | |||||||||||||||||
| (In thousands, except percentages) | ||||||||||||||||||||
| Revenue related to: | ||||||||||||||||||||
| Mature Clinics (1) | $ | 133,650 | $ | 133,366 | $ | 284 | 0.2 | % | ||||||||||||
| Clinic additions (2) | 30,533 | 3,586 | 26,947 | * | (7) | |||||||||||||||
| Clinics sold or closed (3) | - | 3,319 | (3,319 | ) | * | (7) | ||||||||||||||
| Net Patient Revenue | 164,183 | 140,271 | 23,912 | 17.0 | % | |||||||||||||||
| Other (4) | 4,109 | 3,215 | 894 | 27.8 | % | |||||||||||||||
| Total | 168,292 | 143,486 | 24,806 | 17.3 | % | |||||||||||||||
| Operating costs (5) | 133,059 | 114,703 | 18,356 | 16.0 | % | |||||||||||||||
| Gross profit | $ | 35,233 | $ | 28,783 | $ | 6,450 | 22.4 | % | ||||||||||||
| Financial and operating metrics (not in thousands): | ||||||||||||||||||||
| Net rate per patient visit (1) | $ | 105.33 | $ | 105.05 | $ | 0.28 | 0.3 | % | ||||||||||||
| Patient visits (1) | 1,558,756 | 1,335,335 | 223,421 | 16.7 | % | |||||||||||||||
| Average daily visits per clinic (1) | 32.7 | 30.6 | 2.1 | 6.9 | % | |||||||||||||||
| Adjusted gross profit margin (5)(6) | 21.1 | % | 20.1 | % | ||||||||||||||||
| Salaries and related costs per visit (6) | $ | 60.08 | $ | 59.66 | $ | 0.42 | 0.7 | % | ||||||||||||
| Operating costs per visit (6) | $ | 83.95 | $ | 84.46 | $ | (0.51 | ) | (0.6 | )% | |||||||||||
| (1) See Glossary of Terms - Revenue Metrics for definitions. | ||||||||||||||||||||
| (2)) Includes six clinics added during the 2025 Second Quarter, 14 clinics added during the three months ended March 31, 2025 ("2025 First Quarter") and 96 clinics added during the year ended December 31, 2024. (Owned) | ||||||||||||||||||||
| ( (3) Includes three clinics closed during the 2025 Second Quarter, seven clinics closed in the 2025 First Quarter and 45 clinics closed during the year ended December 31, 2024. (Owned) | ||||||||||||||||||||
| (4) Includes revenues from management contracts. | ||||||||||||||||||||
| (5) Includes costs from management contracts. | ||||||||||||||||||||
| (6) Excludes $0.2 million of certain incentive costs related to the Metro acquisition. Please refer to the reconciliation of non-GAAP measures to the most directly comparable GAAP measure on page 12. | ||||||||||||||||||||
| (7) Not meaningful. |
Net revenue from physical therapy operations increased $24.8 million, or 17.3%, to $168.3 million for the 2025 Second
Quarter from $143.5 million for the 2024 Second Quarter. This growth was due to the increase in visits from the 51 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 and the addition of acquisitions with accretive net rate per patient visit. Net rate per patient visit for the 2025
Second Quarter was $105.33 up from $105.05 for the 2024 Second Quarter, despite the approximate 2.9% Medicare rate reduction which went into effect on January 1, 2025.
Operating costs from physical therapy operations increased $18.4 million, or 16.0%, to $133.1 million for the 2025 Second Quarter from $114.7 million for the 2024 Second Quarter primarily driven by the 51 net
clinics added since the comparable prior year period. Salaries and related costs per visit was $60.08 for the 2025 Second Quarter compared to $59.66 for the 2024 Second Quarter. Total operating costs per visit was $83.95 compared to $84.46 in
the prior year quarter, as higher visit volumes did not result in a proportional increase in fixed costs.
Gross profit from physical therapy operations for the 2025 Second Quarter was $35.2 million with a gross profit margin of 20.9% compared to $28.8 million with a gross profit margin of 20.1% for the 2024 Second Quarter. Excluding certain incentive
costs related to the Metro acquisition of $0.2 million, the adjusted gross profit margin was 21.1% for the 2025 Second Quarter.
| U.S. Physical Therapy Press Release | Page 3 |
| August 6, 2025 |
Industrial Injury Prevention Services
| Three Months Ended | Variance | |||||||||||||||
| June 30, 2025 | June 30, 2024 | $ | % | |||||||||||||
| (In thousands, except percentages) | ||||||||||||||||
| Net revenue | $ | 29,052 | $ | 23,704 | $ | 5,348 | 22.6 | % | ||||||||
| Operating costs | 22,661 | 18,625 | 4,036 | 21.7 | % | |||||||||||
| Gross profit | $ | 6,391 | $ | 5,079 | $ | 1,312 | 25.8 | % | ||||||||
| Gross margin | 22.0 | % | 21.4 | % |
IIP revenue increased $5.3 million, or 22.6%, to $29.1 million for the 2025 Second Quarter as
compared to $23.7 million for the 2024 Second Quarter. Gross profit from IIP operations for the 2025 Second Quarter increased $1.3 million, or 25.8%, to $6.4 million from $5.1 million for the 2024 Second Quarter. Gross profit margin from IIP
operations was 22.0% for the 2025 Second Quarter compared to 21.4% for the 2024 Second Quarter. Excluding the IIP acquisition made in April 2024, IIP revenue increased by $4.0 million or 18.4% in the 2025 Second Quarter and gross profit increased
$1.0 million, or 21.8% in the 2025 Second Quarter over the comparable prior year period.
Corporate Office and Other Expenses
Corporate office costs increased to $17.5 million for the 2025 Second Quarter from $14.2 million for the 2024 Second Quarter, primarily to support the larger number of clinics, as well as acquisition integration
costs and costs associated with the implementation of a new financial and human resources system. Implementation costs associated with the new financial and human resources system are expected to continue through the end of 2026. As a ratio to net
revenue, corporate office costs was 8.9% for the 2025 Second Quarter compared to 8.5% for the 2024 Second Quarter. Excluding the acquisition integration costs and the costs associated with the implementation of the new financial and human resources
system of $0.3 million, corporate office costs was 8.7% of net revenue for the 2025 Second Quarter.
The Company revalued contingent consideration related to certain acquisitions and recognized a
net gain (a decrease in the related liabilities) of $0.8 million for the 2025 Second Quarter compared to a net loss (an increase in the related liabilities) of $4.0 million for the 2024 Second Quarter.
Operating income was $24.9 million for the 2025 Second Quarter compared to $15.6 million for
the 2024 Second Quarter. Excluding the impact of change in value of contingent consideration in the 2025 Second Quarter of $0.8 million, and the 2024 Second Quarter of $4.0 million, operating income increased to $24.1 million for the 2025 Second
Quarter from $19.6 million in the 2024 Fourth Quarter.
Interest expense increased by $0.4 million to $2.4 million for the 2025 Second Quarter
compared to $2.0 million for the 2024 Second Quarter due to a higher average outstanding balance on our revolving credit facility for the 2025 Second Quarter. The interest rate associated with borrowings on the Company's credit facilities was 5.1%
for the 2025 Second Quarter and 4.7% for the 2024 Second Quarter, with an all-in-effective interest rate (including all associated costs), of 5.6% and 5.4% over the same periods, respectively.
Interest income was less than $0.1 million during the 2025 Second Quarter compared to $1.1
million for the 2024 Second Quarter as the cash on the balance sheet at the end of the 2024 Second Quarter has since been deployed to fund acquisitions.
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 $0.3 million for the 2025 Second Quarter compared to $0.2 million for the 2024 Second Quarter (an increase in the related liability).
The provision for income taxes was $4.9 million for the 2025 Second Quarter compared to $3.1
million during the 2024 Second Quarter while the effective tax rate was 28.5% and 29.1% over the same periods, respectively.
USPH Net Income and Non-GAAP Measures
Net income attributable to non-controlling interest (temporary and permanent) was $5.3 million for the 2025 Second Quarter compared to $4.2 million for the 2024 Second Quarter.
USPH Net Income was $12.4 million for the 2025 Second Quarter compared to $7.5 million for the 2024
Second 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 $0.58 for the 2025 Second Quarter compared to $0.47 for the 2024 Second Quarter.
Non-GAAP Adjusted EBITDA (1) was $26.9 million for the 2025 Second Quarter, an increase of $4.7 million or
21.4%, from $22.1 million for the 2024 Second Quarter. Non-GAAP Operating Results (1) was $12.4 million, or $0.81 per share, for the 2025 Second Quarter compared to $11.0 million, or $0.73 per share, for the 2024 Second Quarter.
| U.S. Physical Therapy Press Release | Page 4 |
| August 6, 2025 |
2025 Six Months Versus 2024 Six Months
Total net revenue for the six months ended June 30, 2025 ("2025 Six Months") increased $58.3 million, or 18.0%, to
$381.1 million from $322.9 million for the six months ended June 30, 2024 ("2024 Six Months") while operating costs increased $47.8 million, or 18.4%, to $308.4 million from $260.6 million over the same periods, respectively. Gross profit for
the 2025 Six Months was $72.7 million, or 19.1% of net revenue, compared to $62.3 million for the 2024 Six Months, or 19.3% of net revenue.
Revenues from physical therapy operations increased $46.8 million, or 16.8% in the 2025 Six Months versus the
comparable prior year period due to increased volume from the 51 net new clinics added since the comparable prior year period as well as an increase in net rate per patient visit to $105.49 for 2025 Six Months from $104.23 for 2024 Six Months.
Gross profit from physical therapy operations increased $7.9 million, or 14.9%, to $60.7 million for the 2025 Six Months. Excluding certain incentive costs related to the Metro acquisition of $0.3 million, the adjusted gross profit margin was
18.8% for the 2025 Six Months.
Revenues from IIP increased $11.5 million, or 25.5%, to $56.4 million for the 2025 Six Months
versus the comparable prior year period. Gross profit from IIP operations increased $2.6 million, or 27.3%, to $12.0 million for the 2025 Six Months and the gross profit margin from IIP operations was 21.2% for the 2025 Six Months. Excluding
the IIP acquisition made in April 2024, IIP revenue increased by $7.2 million or 16.7% in the 2025 Six Months and gross profit increased $1.9 million or 21.0% in the 2025 Six Months over the comparable prior year period.
Corporate office costs were $33.7 million for the 2025 Six Months, compared to $28.3 million for the 2024 Six
Months. As a percent of net revenue, corporate office costs were 8.8% for both periods. Excluding the acquisition integration costs and the costs associated with the implementation of the new financial and human resources system of $0.7
million, corporate office costs was 8.7% of net revenue for the 2025 Six Months.
The Company revalued contingent consideration related to certain acquisitions and recognized a net gain (a decrease
in the related liabilities) of $5.6 million for the 2025 Six Months compared to a net loss of $3.4 million for the 2024 Six Months (an increase in the related liabilities).
Operating income was $44.6 million for the 2025 Six Months compared to $30.5 million for the 2024 Six Months.
Excluding the impact of change in value of contingent consideration of $5.6 million for the 2025 Six Months and $3.4 million for the 2024 Six Months, operating income increased to $39.0 million for the 2025 Six Months from $33.9 million for the
2024 Six Months, an increase of 14.9%.
Other expenses were $4.6 million for the 2025 Six Months compared to $0.9 million for the 2024 Six Months, with the
increase primarily due to higher interest expense as a result of increased borrowings and lower interest income as the cash on the balance sheet during the 2024 Six Months has been deployed to fund acquisitions since that time.
The provision for income tax was $8.8 million for the 2025 Six Months and $6.2 million for the 2024 Six Months.
The effective tax rate was 28.3% and 28.6% over the same periods, respectively.
USPH Net Income was $22.3 million for the 2025 Six Months as compared to $15.6 million for the
2024 Six Months while earnings per share was $1.38 for the 2025 Six Months compared to $0.93 for the 2024 Six Months.
Non-GAAP Adjusted EBITDA increased $7.5 million to $46.4 million for the 2025 Six Months from $38.9 million for the
2024 Six Months while non-GAAP Operating Results increased $0.9 million to $19.7 million, or $1.30 per share, for the 2025 Six Months from $18.8 million, or $1.25 per share, for the 2024 Six Months.
See pages 10 to 12 of this release for the definition and reconciliation of Adjusted EBITDA, Operating Results and
other non-GAAP measures to the most directly comparable GAAP measure.
For additional information on 2025 Six Months results, please refer to the Company's Quarterly Report on Form 10-Q
which is expected to be filed with the Securities and Exchange Commission on August 8, 2025.
BALANCE SHEET AND CASH FLOW
Total cash and cash equivalents were $34.1 million as of June 30, 2025, compared to $41.4 million as of December
31, 2024, and $112.9 million as of June 30, 2024. The Company had $159.5 million in outstanding borrowings and $150.5 million in available credit under the Company's revolving facility as of June 30, 2025. This compares to $151.6 million of
outstanding borrowings and $164.0 million in available credit under the Company's revolving facility as of December 31, 2024.
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. MSO Metro LLC. acquired 80% of equity interests of the practice, with the original practice owners retaining 20% of equity interests. The practice currently