NHC Q1 2025 Earnings Release [Financial Highlights](index=1&type=section&id=Financial%20Highlights) National HealthCare Corporation (NHC) reported strong financial results for the first quarter of 2025, with net operating revenues increasing **25.7%** year-over-year to **$373.7 million**, driven by the August 2024 acquisition of White Oak Management, Inc. and an **8.5%** increase in same-facility revenues, leading to significant increases in both GAAP and adjusted net income, with adjusted net income growing by **61.4%** to **$24.8 million** Q1 2025 vs Q1 2024 Key Financial Metrics | Metric | Q1 2025 ($ millions) | Q1 2024 ($ millions) | Change | | :--- | :--- | :--- | :--- | | Net Operating Revenues | $373.7 | $297.2 | +25.7% | | GAAP Net Income | $32.2 | $26.2 | +22.9% | | Adjusted Net Income | $24.8 | $15.4 | +61.4% | | GAAP Diluted EPS | $2.07 | $1.69 | +22.5% | | Adjusted Diluted EPS | $1.59 | $0.99 | +60.6% | - Revenue growth was fueled by two main factors: an **8.5%** increase in same-facility net operating revenues and the acquisition of White Oak Management, Inc. on August 1, 2024[1](index=1&type=chunk) - The White Oak acquisition added **22** healthcare operations, including **15** skilled nursing facilities, **2** assisted living facilities, **4** independent living facilities, and a long-term care pharmacy[1](index=1&type=chunk) [Consolidated Financial Statements](index=2&type=section&id=Consolidated%20Financial%20Statements) The Consolidated Statements of Operations for Q1 2025 show a significant increase in income from operations to **$30.8 million**, nearly double the **$15.7 million** from Q1 2024, driven by a **$76.5 million** increase in net patient revenues, partially offset by higher operating costs, particularly a **$45 million** rise in salaries, wages, and benefits, while balance sheet data indicates growth in total assets to **$1.55 billion** and NHC stockholders' equity to over **$1 billion** as of March 31, 2025 Consolidated Statement of Operations Highlights (in thousands) | Account | Q1 2025 ($ thousands) | Q1 2024 ($ thousands) | | :--- | :--- | :--- | | Net Patient Revenues | $361,607 | $285,823 | | Net Operating Revenues | $373,697 | $297,176 | | Total Costs and Expenses | $342,930 | $281,501 | | Income from Operations | $30,767 | $15,675 | | Net Income Attributable to NHC | $32,205 | $26,213 | | Diluted EPS | $2.07 | $1.69 | Selected Balance Sheet Data (in thousands) | Account | March 31, 2025 ($ thousands) | December 31, 2024 ($ thousands) | | :--- | :--- | :--- | | Cash, cash equivalents and marketable securities | $243,171 | $216,185 | | Total Assets | $1,548,821 | $1,524,429 | | NHC Stockholders' Equity | $1,004,895 | $980,161 | - Dividends declared per common share increased to **$0.61** in Q1 2025 from **$0.59** in Q1 2024[7](index=7&type=chunk) [Selected Operating Statistics](index=3&type=section&id=Selected%20Operating%20Statistics) Operating statistics for Q1 2025 reflect broad improvements in the skilled nursing segment, with the average skilled nursing per diem rate rising to **$360.14** from **$343.48** in the prior year, and total skilled nursing patient days increasing significantly to **718,136** from **585,851**, showing notable growth in Medicaid and Managed Care patient days, influenced by both organic growth and acquisitions Skilled Nursing Per Diems (YoY) | Payor Type | Q1 2025 ($) | Q1 2024 ($) | | :--- | :--- | :--- | | Medicare | $612.13 | $581.75 | | Managed Care | $492.40 | $470.56 | | Medicaid | $281.67 | $265.27 | | **Average** | **$360.14** | **$343.48** | Total Skilled Nursing Patient Days (YoY) | Payor Type | Q1 2025 (days) | Q1 2024 (days) | | :--- | :--- | :--- | | Medicare | 86,254 | 81,156 | | Managed Care | 83,646 | 65,431 | | Medicaid | 363,642 | 281,821 | | **Total** | **718,136** | **585,851** | - The year-over-year comparison is impacted by NHC's exit from three skilled nursing facilities in Missouri on March 1, 2024, which accounted for **20,267** patient days in Q1 2024[8](index=8&type=chunk) [GAAP to Non-GAAP Reconciliation](index=3&type=section&id=GAAP%20to%20Non-GAAP%20Reconciliation) The company provides a reconciliation of GAAP to non-GAAP financial measures to offer a clearer view of ongoing operational performance, where for Q1 2025, GAAP net income of **$32.2 million** was adjusted to a non-GAAP net income of **$24.8 million**, primarily by excluding **$11.0 million** in unrealized gains on marketable equity securities and adding back **$1.0 million** in stock-based compensation expense Reconciliation of Net Income (in thousands) | Description | Q1 2025 ($ thousands) | Q1 2024 ($ thousands) | | :--- | :--- | :--- | | **GAAP Net Income** | **$32,205** | **$26,213** | | Unrealized gains on marketable equity securities | ($10,982) | ($14,399) | | Stock-based compensation expense | $1,027 | $793 | | Income tax provision on non-GAAP adjustments | $2,588 | $3,804 | | **Non-GAAP Net Income** | **$24,838** | **$15,386** | Reconciliation of Diluted EPS | Description | Q1 2025 ($) | Q1 2024 ($) | | :--- | :--- | :--- | | **GAAP Diluted EPS** | **$2.07** | **$1.69** | | Unrealized gains on marketable equity securities | ($0.71) | ($0.93) | | Stock-based compensation expense | $0.06 | $0.05 | | Income tax provision on non-GAAP adjustments | $0.17 | $0.25 | | **Non-GAAP Diluted EPS** | **$1.59** | **$0.99** | [Company Overview and Disclosures](index=1&type=section&id=Company%20Overview%20and%20Disclosures) NHC and its affiliates operate a broad portfolio of senior care facilities, including **80** skilled nursing facilities, **26** assisted living communities, and **9** independent living communities, alongside homecare, hospice, and pharmacy services, with the report including standard disclosures explaining the use of non-GAAP financial measures to help investors assess performance consistently and a caution on forward-looking statements, which are subject to risks and uncertainties - NHC affiliates operate **80** skilled nursing facilities (**10,329** beds), **26** assisted living communities (**1,413** units), **9** independent living communities (**777** units), and numerous other healthcare services[3](index=3&type=chunk) - The company presents non-GAAP financial measures because it believes they help investors more accurately assess the ongoing nature of its operations and performance across periods[4](index=4&type=chunk) - The press release contains forward-looking statements that are not guarantees of future performance and involve risks and uncertainties detailed in SEC filings[5](index=5&type=chunk)

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section details the company's financial statements, management's analysis, market risks, and internal controls [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited interim condensed consolidated financial statements, providing a comprehensive view of the company's financial position and performance [Interim Condensed Consolidated Statements of Operations](index=4&type=section&id=Interim%20Condensed%20Consolidated%20Statements%20of%20Operations) NHC reported significant year-over-year growth in Q1 2025, with net operating revenues increasing by 25.7% and income from operations nearly doubling Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Net Operating Revenues | $373,697 | $297,176 | 25.7% | | Income from Operations | $30,767 | $15,675 | 96.3% | | Net Income Attributable to NHC | $32,205 | $26,213 | 22.9% | | Diluted EPS | $2.07 | $1.69 | 22.5% | [Interim Condensed Consolidated Balance Sheets](index=6&type=section&id=Interim%20Condensed%20Consolidated%20Balance%20Sheets) NHC's balance sheet as of March 31, 2025, shows a slight increase in total assets, stable liabilities, and growth in total equity Consolidated Balance Sheet Summary (in thousands) | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Current Assets | $455,204 | $424,408 | | Total Assets | $1,548,821 | $1,524,429 | | Total Current Liabilities | $239,225 | $234,797 | | Total Liabilities | $540,839 | $541,266 | | Total Equity | $1,007,982 | $983,163 | [Interim Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Interim%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities surged in Q1 2025, while cash was primarily used for investing and financing activities, including dividends and debt repayment Cash Flow Summary (in thousands) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $39,255 | $9,646 | | Net Cash used in Investing Activities | ($7,323) | ($2,415) | | Net Cash used in Financing Activities | ($12,693) | ($12,067) | | Net Increase/(Decrease) in Cash | $19,239 | ($4,836) | [Notes to Interim Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Interim%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed explanations of NHC's business operations, accounting policies, and financial statement components, including revenue breakdowns and contingencies - As of March 31, 2025, NHC operates or manages 80 skilled nursing facilities, 26 assisted living facilities, 34 homecare agencies, and 33 hospice agencies, primarily in the southeastern U.S[25](index=25&type=chunk) Net Patient Revenue by Service Type (in thousands) | Service Type | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Inpatient services | $325,478 | $252,254 | | Homecare and hospice services | $36,129 | $33,569 | | **Total** | **$361,607** | **$285,823** | Net Patient Revenue by Payor Source (%) | Payor | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Medicare | 31% | 34% | | Managed Care | 11% | 10% | | Medicaid | 31% | 28% | | Private Pay and Other | 27% | 28% | - The company's subsidiary, Caris Healthcare, L.P., received a Civil Investigative Demand (CID) from the U.S. Attorney's Office in May 2024 related to billing for hospice services from January 1, 2019, and the company is cooperating with the request[118](index=118&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the strong Q1 2025 performance, attributing it to revenue growth, operational improvements, and a robust liquidity position - Net operating revenues grew **25.7%** year-over-year, primarily due to the White Oak acquisition and an **8.5%** increase in same-facility revenues[158](index=158&type=chunk) - Non-GAAP adjusted net income increased **61.4%** to **$24.8 million** in Q1 2025 from **$15.4 million** in Q1 2024, excluding unrealized gains and other adjustments[159](index=159&type=chunk)[174](index=174&type=chunk) - Agency nurse staffing expense was significantly reduced to **$1.5 million** in Q1 2025 from **$5.3 million** in Q1 2024, indicating improved labor management[165](index=165&type=chunk) - The overall census in owned and leased skilled nursing facilities increased to **89.3%** in Q1 2025 from **88.5%** in Q1 2024[129](index=129&type=chunk) [Results of Operations](index=36&type=section&id=Results%20of%20Operations) Net patient revenues significantly increased in Q1 2025, driven by acquisitions and higher per diem rates, while cost growth was slower, improving operating margins - The White Oak acquisition added **$56.7 million** in net patient revenues and **$37.0 million** in salary expenses in Q1 2025[162](index=162&type=chunk)[166](index=166&type=chunk) Per Diem Rate Increases (Q1 2025 vs. Q1 2024) | Payor | Per Diem Increase (%) | | :--- | :--- | | Medicare | 5.2% | | Managed Care | 4.6% | | Medicaid | 6.2% | | Private Pay | 9.5% | - Other operating expenses increased **19.4%**, but decreased as a percentage of revenue to **24.7%** from **26.1%** in the prior year, indicating improved cost control[167](index=167&type=chunk) [Segment Performance](index=34&type=section&id=Segment%20Performance) The Inpatient Services segment drove significant revenue and income growth, while Homecare and Hospice showed modest growth, and the 'All Other' category reported a larger operating loss Segment Performance (in thousands) | Segment | Net Operating Revenues (Q1 2025) | Income from Operations (Q1 2025) | Net Operating Revenues (Q1 2024) | Income from Operations (Q1 2024) | | :--- | :--- | :--- | :--- | :--- | | Inpatient Services | $325,851 | $32,648 | $252,269 | $14,954 | | Homecare and Hospice | $36,129 | $5,729 | $33,569 | $5,835 | | All Other | $11,717 | ($7,610) | $11,338 | ($5,114) | [Liquidity and Capital Resources](index=39&type=section&id=Liquidity%20and%20Capital%20Resources) NHC maintains a strong liquidity position with substantial cash, marketable securities, and an undrawn credit facility, sufficient to meet obligations and fund growth - Primary sources of cash are from operations, management services, rental income, and investment income[175](index=175&type=chunk) - The company has a **$200 million** credit facility (**$150 million** term, **$50 million** revolver) entered into on August 1, 2024, with no amounts outstanding on the revolver as of March 31, 2025[109](index=109&type=chunk) - Management expects to meet liquidity requirements through cash flow from operations, current cash of **$90.4 million**, unrestricted marketable securities of **$152.8 million**, and borrowing capacity[181](index=181&type=chunk)[182](index=182&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=41&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risks are interest rate risk affecting its debt and fixed-income portfolio, and equity price risk, particularly due to a concentrated investment in NHI - The company is exposed to interest rate risk on its **$120.2 million** in available-for-sale marketable debt securities and its variable-rate credit facility tied to SOFR[186](index=186&type=chunk)[188](index=188&type=chunk) - The company faces significant equity price and concentration risk, with **69%** of its **$174.5 million** equity portfolio invested in a single related-party entity, NHI[191](index=191&type=chunk) [Controls and Procedures](index=41&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective, with no material changes to internal control over financial reporting during the quarter - Management concluded that the Company's disclosure controls and procedures were effective as of March 31, 2025[192](index=192&type=chunk) - No material changes in internal control over financial reporting occurred during the quarter[193](index=193&type=chunk) [PART II. OTHER INFORMATION](index=42&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section provides additional disclosures on legal proceedings, risk factors, and required exhibits [Legal Proceedings](index=42&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 16 for details on material legal proceedings, including a Civil Investigative Demand related to hospice billing practices - For details on legal proceedings, the report directs readers to Note 16 of the Form 10-Q[195](index=195&type=chunk) [Risk Factors](index=42&type=section&id=Item%201A.%20Risk%20Factors) There were no material changes to the risk factors disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes to risk factors were reported for the quarter ended March 31, 2025[196](index=196&type=chunk) [Exhibits](index=43&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including certifications by the CEO and CFO, and XBRL data files - The report includes standard exhibits such as CEO/CFO certifications (31.1, 31.2, 32) and Inline XBRL documents (101 series)[200](index=200&type=chunk)

Operations Overview - As of December 31, 2024, the company operates or manages 80 skilled nursing facilities with a total of 10,341 licensed beds, 26 assisted living facilities with 1,413 units, and various other healthcare services across 9 states[184]. - The company expanded its operations by acquiring the White Oak portfolio, which includes 15 skilled nursing facilities and 2 assisted living facilities, adding 1,928 licensed skilled nursing beds[193]. - The company opened several new facilities, including a 135-unit assisted living facility in Vero Beach, FL, and a 66-bed skilled nursing facility in Nashville, TN, in 2023[192]. Financial Performance - For the year ended December 31, 2024, net patient revenues reached $1,111.3 million, an increase from $956.1 million in 2023, representing a growth of approximately 16.2%[199]. - Total costs and expenses for 2024 were $1,221.6 million, leading to an income before income taxes of $136.4 million, compared to $88.7 million in 2023[199]. - GAAP net income attributable to the company was $101,927,000 for 2024, up from $66,798,000 in 2023, while non-GAAP adjusted net income increased to $76,862,000 from $54,934,000[213]. - Net patient revenues reached $1,251,759,000 in 2024, reflecting a $164,145,000 increase, or 15.1%, compared to 2023[215]. - Total net operating revenues and grant income rose to $1,307,382, up 14.56% from $1,141,544 in 2023[288]. - Net income for 2024 reached $102,086 thousand, a significant increase of 56.3% compared to $65,288 thousand in 2023[300]. Revenue Sources - The company recognized $3,266,000 in acquisition-related expenses for the White Oak acquisition in 2024[361]. - Medicare accounted for 33% of the company's net patient revenues in 2024, a decrease from 34% in 2023[370]. - The Company recorded net patient revenues from supplemental Medicaid payments of $12,749,000, $20,214,000, and $19,442,000 for the years ended December 31, 2024, 2023, and 2022, respectively[377]. Cost Management - Salaries, wages, and benefits increased by $98,586,000, or 13.8%, to $810,930,000, representing 62.0% of net operating revenues and grant income[220]. - Total costs and expenses increased by $30,568,000, or 2.9%, to $1,084,410,000 in 2023[238]. - Agency nurse staffing expenses decreased by approximately 44.5%, or $30,682,000, compared to the prior year[239]. Investments and Acquisitions - The company made a substantial acquisition of White Oak Manor for $215,896 thousand in 2024, marking a significant investment in market expansion[300]. - The total estimated fair value of the White Oak acquisition, including goodwill, is $215,905,000[360]. Cash Flow and Assets - Cash provided by operating activities was $107,303,000 in 2024, compared to $111,216,000 in 2023[250]. - Total assets grew to $1,524,429, reflecting an increase of 16.28% from $1,310,796 in 2023[294]. - Cash and cash equivalents decreased to $76,121, down 28.93% from $107,076 in 2023[294]. Compliance and Risk Management - The Company believes it is compliant with all applicable laws and regulations governing Medicare and Medicaid programs[378]. - The company is self-insured for risks related to workers' compensation and general and professional liability insurance, with reserves reassessed quarterly[266]. Market and Economic Factors - The company is actively pursuing partnerships with hospital systems and payors to enhance its position in the post-acute healthcare services market[188]. - A hypothetical 10% change in quoted market prices would result in a related increase or decrease in the fair value of equity investments of approximately $16,325,000[275].

Financial Performance - National HealthCare Corporation reported net operating revenues and grant income of $1,307,382,000 for the year ended December 31, 2024, representing a 14.5% increase from $1,141,544,000 in 2023[1] - The GAAP net income attributable to NHC for 2024 was $101,927,000, up from $66,798,000 in 2023, while adjusted net income increased by 39.9% to $76,862,000[2] - For Q4 2024, the GAAP net income attributable to NHC was $6,081,000, a decrease from $28,406,000 in Q4 2023, but adjusted net income rose 62.7% to $25,954,000[3] - NHC's diluted earnings per share for 2024 were $6.53, up from $4.34 in 2023, reflecting strong earnings growth[2] - The company declared dividends of $2.42 per share for the year ended December 31, 2024, compared to $2.34 in 2023, indicating a commitment to returning value to shareholders[8] Asset Growth - NHC's total assets increased to $1,524,429,000 in 2024 from $1,310,796,000 in 2023, reflecting a significant growth in the company's financial position[9] Operational Expansion - The company acquired White Oak Manor on August 1, 2024, which includes 22 healthcare operations, contributing to the revenue growth[1] - NHC operates 80 skilled nursing facilities with a total of 10,341 beds, alongside various other healthcare services, enhancing its market presence[5] Patient Utilization - The average skilled nursing per diem for Medicare increased to $607.67 in Q4 2024 from $579.84 in Q4 2023, indicating improved revenue per patient[10] - The company reported a total of 728,486 skilled nursing patient days in Q4 2024, compared to 600,510 in Q4 2023, showing a 21.3% increase in patient utilization[10]

Financial Performance - For Q3 2024, National HealthCare Corporation reported net operating revenues of $340,198,000, a 17.9% increase from $288,485,000 in Q3 2023, primarily due to the acquisition of White Oak Manor[1] - GAAP net income attributable to NHC for Q3 2024 was $42,789,000, compared to $10,388,000 in Q3 2023, marking a significant increase[2] - Adjusted net income for Q3 2024 was $19,910,000, up 50.3% from $13,250,000 in Q3 2023[2] - Diluted earnings per share for Q3 2024 were $2.73, compared to $0.68 for Q3 2023, reflecting strong earnings growth[2] - Net income attributable to National Healthcare Corporation for the three months ended September 30, 2024, was $42,789,000, compared to $10,388,000 for the same period in 2023, representing a significant increase[9] - Non-GAAP net income for the nine months ended September 30, 2024, was $50,909,000, up from $38,978,000 for the same period in 2023, indicating a growth of approximately 30%[9] - GAAP diluted earnings per share for the three months ended September 30, 2024, was $2.73, compared to $0.68 for the same period in 2023, reflecting a substantial increase[9] - Non-GAAP diluted earnings per share for the nine months ended September 30, 2024, was $3.27, compared to $2.54 for the same period in 2023, showing an increase of about 28.7%[9] Operational Metrics - The company operates 80 skilled nursing facilities with a total of 10,349 beds, alongside various assisted and independent living communities[4] - Total skilled nursing patient days for Q3 2024 reached 673,378, an increase from 598,938 in Q3 2023[8] - Average skilled nursing per diem for Medicare increased to $578.12 in Q3 2024 from $551.82 in Q3 2023[8] - The company reported operating results for newly opened operations not at full capacity, contributing $120,000 for the three months ended September 30, 2024[9] - The company has two hospice agencies and other healthcare operations that are still in the start-up phase, impacting overall capacity and performance metrics[9] Assets and Dividends - The company’s total assets as of September 30, 2024, were $1,562,707,000, up from $1,310,796,000 in December 2023[7] - NHC declared dividends of $0.61 per common share for Q3 2024, compared to $0.59 in Q3 2023[7] Non-GAAP Measures - The company emphasizes the importance of non-GAAP financial measures to provide a clearer view of its operational performance[5] - Unrealized gains/losses on marketable equity securities for the three months ended September 30, 2024, were $(32,767,000), compared to $3,093,000 for the same period in 2023[9] - Stock-based compensation expense for the three months ended September 30, 2024, was $1,093,000, up from $708,000 for the same period in 2023[9] - Acquisition-related expenses for the three months ended September 30, 2024, were $637,000, while there were no such expenses reported for the same period in 2023[9] - The income tax provision on non-GAAP adjustments for the three months ended September 30, 2024, was $8,038,000, compared to $(1,005,000) for the same period in 2023[9]

Operations and Facilities - As of September 30, 2024, the company operates or manages 80 skilled nursing facilities with a total of 10,349 licensed beds, 26 assisted living facilities with 1,413 units, and 34 homecare agencies[134]. - The overall census in owned and leased skilled nursing facilities for the three months ending September 30, 2024, was 88.3%, an increase from 88.1% for the same period a year ago[137]. - The company has 45 skilled nursing facilities rated 4 and 5 stars, representing 56% of its total facilities, compared to 36% in the industry[140]. - The average census at owned and leased skilled nursing facilities for the nine months ended September 30, 2024, was 88.6%, up from 87.8% in the same period last year[188]. Financial Performance - The Company reported net patient revenues of $328,674,000 for inpatient services and $35,648,000 for homecare and hospice services, totaling $340,198,000[161]. - Total costs and expenses for the Company amounted to $319,151,000, resulting in an income from operations of $21,047,000[161]. - For the three months ended September 30, 2023, net patient revenues were $277,005,000, with total costs and expenses of $275,460,000, leading to an income from operations of $13,025,000[162]. - The Company reported net patient revenues of $894,415,000 for inpatient services and $103,751,000 for homecare and hospice services, totaling $938,032,000[163]. - For the nine months ended September 30, 2023, net patient revenues were $804,617,000, with total costs and expenses of $803,616,000, resulting in an income from operations of $37,014,000[164]. - For the three months ended September 30, 2024, GAAP net income attributable to the company was $42,789,000, a significant increase from $10,388,000 in the same period of 2023, representing a 312.5% growth[171]. - Net operating revenues for the quarter increased by $51,669,000, or 18.7%, compared to the same period last year[173]. - The total costs and expenses for the three months ended September 30, 2024, increased by $43,691,000, or 15.9%, totaling $319,151,000 compared to $275,460,000 in 2023[178]. - Adjusted net income for the nine months ended September 30, 2024, was $50,909,000, compared to $38,978,000 for the same period in 2023, reflecting a 30.5% increase[185]. Revenue Sources and Changes - The average Medicare per diem rate for skilled nursing facilities increased by 4.9% for the first nine months of 2024 compared to the same period in 2023[148]. - The average Medicaid per diem increased by 10.2% for the first nine months of 2024 compared to the same period in 2023[152]. - The state of Tennessee's Medicaid increases are estimated to result in an additional revenue of approximately $11 million annually, or $2.75 million per quarter, starting from fiscal year 2025[148]. - The acquisition of the White Oak portfolio on August 1, 2024, contributed an increase of $37,299,000 in net patient revenues for the quarter ended September 30, 2024[175]. - Net patient revenues increased by $37,299,000 due to the acquisition of White Oak on August 1, 2024[189]. Cost Management - Salaries, wages, and benefits as a percentage of net operating revenues decreased from 63.3% in 2023 to 62.7% in 2024[179]. - The company experienced a 60% reduction in agency staffing expenses for the three months ended September 30, 2024, compared to the same period in 2023[179]. - Salaries, wages, and benefits as a percentage of net operating revenues decreased to 61.5% from 62.5% year-over-year[194]. - Total costs and expenses rose by $75,220,000, or 9.4%, to $878,836,000 for the nine months ended September 30, 2024[193]. Tax and Cash Flow - The effective income tax rate for the three months ended September 30, 2024, was 26.4%, with a provision of $15,338,000[184]. - The effective income tax rate for the nine months ended September 30, 2024, was 26.3%, with an income tax provision of $34,294,000[199]. - Net cash provided by operating activities was $94,514,000, an increase of 10.6% compared to $85,483,000 in the same period last year[202]. - Net cash used in investing activities totaled $225,048,000, a significant increase from $7,382,000 in the prior year[204]. - Net cash provided by financing activities was $119,640,000, compared to net cash used of $32,711,000 in the same period last year[205]. Market and Regulatory Changes - In fiscal year 2025, CMS projects a 1.7% decrease in payments to home health agencies, equating to a reduction of $280 million compared to the previous year[155]. - For fiscal year 2024, CMS issued a 3.1% rate increase for hospice services, amounting to $780 million, effective October 1, 2023[157]. - In fiscal year 2025, CMS announced a 2.9% rate increase for hospice services, totaling $790 million, effective October 1, 2024[158]. Non-GAAP Financial Measures - The Company provides non-GAAP financial measures to help investors assess ongoing operations and performance consistency across periods[165]. - The Company believes that excluding unrealized gains or losses on marketable equity securities and other specific items provides a clearer view of operational performance[166]. Marketable Securities - The fair value of marketable equity securities was approximately $187,755,000 as of September 30, 2024, with unrealized gains of $139.9 million[215].

Operations Overview - As of June 30, 2024, the company operates or manages 65 skilled nursing facilities with a total of 8,421 licensed beds, 24 assisted living facilities with 1,365 units, and 34 homecare agencies[110]. - The overall census in owned and leased skilled nursing facilities for the three months ending June 30, 2024, was 89.0%, up from 87.9% for the same period a year ago[112]. - The overall census in owned and leased skilled nursing facilities for the six months ending June 30, 2024, was 88.7%, compared to 87.7% for the same period a year ago[112]. - The company has 62% of its skilled nursing facilities rated 4 and 5 stars, compared to 36% for the industry average[115]. - The company purchased the White Oak portfolio, which includes six skilled nursing facilities and totals 1,928 licensed beds[117]. Financial Performance - The Company reported net patient revenues of $245,385 thousand for inpatient services and $34,533 thousand for homecare and hospice for the three months ended June 30, 2024, totaling $279,918 thousand[131]. - Total costs and expenses for the Company were $278,138 thousand for the three months ended June 30, 2024, resulting in income from operations of $22,520 thousand[131]. - For the six months ended June 30, 2024, the Company reported net patient revenues of $497,638 thousand for inpatient services and $68,103 thousand for homecare and hospice, totaling $565,741 thousand[133]. - The Company’s total costs and expenses for the six months ended June 30, 2024, were $559,685 thousand, leading to income from operations of $38,149 thousand[133]. - The Company’s non-operating income for the three months ended June 30, 2024, was $4,956 thousand, contributing to income before income taxes of $36,600 thousand[131]. - For the three months ended June 30, 2024, GAAP net income attributable to the company was $26,844,000, a 64.5% increase from $16,281,000 in the same period of 2023[139]. - Adjusted net income for the quarter ended June 30, 2024 was $15,612,000, compared to $13,658,000 for the same period in 2023, reflecting a 14.3% increase[139]. - For the six months ended June 30, 2024, GAAP net income attributable to the company was $53,057,000, compared to $28,004,000 for the same period in 2023, representing an increase of 89.4%[149]. - Net patient revenues for the six months ended June 30, 2024 increased by $38,129,000, or 7.2%, compared to the same period last year[151]. Revenue Sources and Changes - The company recorded $2,585,000 in net patient revenues from supplemental Medicaid payments for the three months ended June 30, 2024[124]. - New operations contributed an increase of $9,803,000 in net patient revenues for the six months ended June 30, 2024, compared to the same period in the prior year[152]. - The company exited operations of two skilled nursing facilities and one memory care facility, resulting in a decrease of $10,869,000 in net patient revenues for the six months ended June 30, 2024[154]. - Other revenues decreased by $1,885,000, or 7.7%, compared to the same period last year[154]. Cost Management - Total costs and expenses increased by $31,529,000, or 6.0%, to $559,685,000 for the six months ended June 30, 2024, compared to $528,156,000 in the prior year[154]. - Total costs and expenses for the three months ended June 30, 2024 increased by $9,533,000, or 3.5%, to $278,138,000 from $268,605,000[145]. - Salaries, wages, and benefits as a percentage of net operating revenues decreased to 59.9% from 62.0% for the three months ended June 30, 2023[145]. - Salaries, wages, and benefits as a percentage of net operating revenues decreased to 60.8% for the six months ended June 30, 2024, from 62.1% in the prior year[155]. - Agency staffing expense decreased approximately 54% for the six months ended June 30, 2024, compared to the same period in 2023[155]. Medicare and Medicaid Impact - The average Medicare per diem rate for skilled nursing facilities increased by 5.0% for the first six months of 2024 compared to the same period in 2023[122]. - The fiscal year 2024 Medicare payment rates for skilled nursing facilities will see a net increase of 4.0%, approximately $1.4 billion, compared to 2023 levels[119]. - The state of Tennessee's individual nursing facility increases are estimated to result in an additional revenue of approximately $11 million annually for fiscal year 2025[122]. - In fiscal year 2025, CMS projects a decrease of 1.7% or $280 million in payments to home health agencies compared to the previous year[127]. - For fiscal year 2024, CMS issued a hospice payment rate increase of 3.1%, amounting to $780 million, effective October 1, 2023[127]. - For fiscal year 2025, CMS announced a hospice payment rate increase of 2.9%, totaling $790 million, effective October 1, 2024[128]. Cash Flow and Liquidity - Net cash provided by operating activities was $60,307,000 for the six months ended June 30, 2024, compared to $53,178,000 in the same period last year[161]. - Cash, cash equivalents, and restricted cash at the end of the period increased by 60.9% to $165,605,000 from $102,905,000[160]. - The company expects to meet short-term liquidity requirements primarily from cash flows from operating activities and a new $200 million credit facility effective August 1, 2024[164]. Marketable Securities - The fair value of marketable equity securities was approximately $154,883,000 as of June 30, 2024, with net unrealized gains of $107.1 million[170]. - As of June 30, 2024, the fair value of the company's marketable equity securities is approximately $154.9 million[170]. - The investment in NHI comprises approximately $110.4 million, or 71.3%, of the total fair value of the equity securities portfolio[170]. - A hypothetical 10% change in quoted market prices would result in a related increase or decrease in the fair value of equity investments of approximately $15.5 million[170]. - The company's equity securities had net unrealized gains of $107.1 million as of June 30, 2024[170]. - Of the $107.1 million in unrealized gains, $85.7 million is related to the investment in NHI[170]. Non-GAAP Financial Measures - The Company emphasizes the importance of non-GAAP financial measures to provide a clearer assessment of ongoing operations and performance consistency across periods[135]. - The Company believes that excluding unrealized gains or losses on marketable equity securities and other specific items in non-GAAP measures helps investors assess operations more accurately[136].

Financial Performance - Net operating revenues for Q1 2024 totaled $297,176,000, an increase of 10.2% compared to $269,563,000 in Q1 2023[1] - GAAP net income attributable to NHC was $26,213,000 for Q1 2024, up from $11,723,000 in Q1 2023, representing a growth of 123.3%[2] - Adjusted net income for Q1 2024 was $15,048,000, a 24.7% increase from $12,071,000 in Q1 2023[2] - GAAP diluted earnings per share rose to $1.69 in Q1 2024 from $0.76 in Q1 2023, while adjusted diluted earnings per share increased to $0.97 from $0.79[2] Operational Metrics - Total skilled nursing patient days increased to 585,851 in Q1 2024 from 576,406 in Q1 2023[9] - Average skilled nursing per diem increased to $343.48 in Q1 2024 from $315.81 in Q1 2023[9] - NHC operates 65 skilled nursing facilities with 8,421 beds and 24 assisted living communities with 1,365 units[4] Assets and Cash Position - Cash, cash equivalents, and marketable securities totaled $217,506,000 as of March 31, 2024, down from $223,620,000 at the end of 2023[8] - Total assets increased to $1,319,640,000 as of March 31, 2024, from $1,310,796,000 at the end of 2023[8] Dividends - The company declared dividends of $0.59 per common share for Q1 2024, compared to $0.57 in Q1 2023[8]

Operations Overview - As of March 31, 2024, the company operates 65 skilled nursing facilities with a total of 8,421 licensed beds, 24 assisted living facilities with 1,365 units, and 35 homecare agencies[127]. - The overall occupancy rate in owned and leased skilled nursing facilities for the three months ending March 31, 2024, was 88.5%, an increase from 87.4% for the same period a year ago[131]. - The company has 40 skilled nursing facilities rated 4 and 5 stars, representing 62% of its total facilities, compared to the industry average of 36%[135]. - The average census at owned and leased skilled nursing facilities increased to 88.5% from 87.4% year-over-year[167]. - The average census at skilled nursing facilities increased to 87.4% from 82.7% year-over-year, with a 3.3% increase in composite skilled nursing facility per diem[182]. Financial Performance - For the first three months of 2024, net operating revenues increased by 10.2% to $297,176,000 compared to $269,563,000 for the same period in 2023[165]. - Net patient revenues rose by $27,816,000, or 10.8%, to $285,823,000 compared to $258,007,000 in the prior year[166]. - Total costs and expenses increased by $21,996,000, or 8.5%, to $281,547,000 from $259,551,000[171]. - Salaries, wages, and benefits as a percentage of net operating revenues decreased to 61.6% from 62.3% year-over-year[172]. - GAAP net income attributable to the company was $26,213,000 for Q1 2024, compared to $11,723,000 in Q1 2023[165]. - Non-GAAP net income for Q1 2024 was $15,048,000, up from $12,071,000 in Q1 2023[165]. - The effective income tax rate for the three months ended March 31, 2024, was 26.5%, resulting in an income tax provision of $9,462,000[177]. - For the quarter ended March 31, 2023, GAAP net income attributable to the company was $11,723,000, a decrease from $15,318,000 in the same period in 2022[180]. - Adjusted net income for the quarter was $12,071,000, down from $14,081,000 year-over-year, primarily due to a decrease of $10,620,000 in government stimulus income[180]. Revenue Sources - The average Medicare per diem rate for skilled nursing facilities increased by 4.7% in the first three months of 2024 compared to the same period in 2023[142]. - For the first three months of 2024, the average Medicaid per diem increased by 12.0% compared to the same period in 2023[148]. - The company estimates an annual revenue increase of approximately $15 million from Tennessee's Medicaid facility increases, $9 million from South Carolina, and $5 million from Missouri for fiscal year 2024[144][145][146]. - The fiscal year 2024 Medicare payment rates for skilled nursing facilities include a net increase of 4.0%, equating to approximately $1.4 billion in additional payments compared to 2023 levels[140]. - The composite skilled nursing facility per diem increased by 8.8%, with Medicare per diem rates up 4.7% and Medicaid rates up 12.0%[167]. Cash Flow and Investments - Cash provided by operating activities was $9,646,000, a decrease of 30.4% from $13,857,000 in the same period last year[196]. - Cash used in investing activities totaled $2,415,000, compared to $1,427,000 for the same period in the previous year[199]. - Cash used in financing activities was $12,067,000, a slight decrease from $12,619,000 year-over-year, with dividend payments totaling $9,051,000[200]. - As of March 31, 2024, the fair value of the company's marketable equity securities is approximately $152.7 million[211]. - The investment in NHI comprises approximately $102.5 million, or 67.1%, of the total fair value of the equity securities portfolio[211]. - A hypothetical 10% change in quoted market prices would result in a related increase or decrease in the fair value of equity investments of approximately $15.3 million[211]. - The company's equity securities had net unrealized gains of $98.0 million as of March 31, 2024[211]. - Of the $98.0 million in unrealized gains, $77.7 million is related to the investment in NHI[211]. Risk Management - The company does not currently use any derivative instruments to hedge interest rate exposure[209]. - Credit risk is managed by diversifying the fixed maturity portfolio to avoid concentrations in any single industry group or issuer[210]. - The company has not used derivative instruments for trading purposes, and future use would require approvals from the Investment Committee[209]. - A hypothetical 1% change in interest rates would have minimal impact on future earnings and cash flows related to cash instruments[208]. - The company's cash and cash equivalents consist of highly liquid investments with a maturity of less than three months when purchased[208]. Expansion and Acquisitions - The company is expanding its senior care operations, including new agencies and acquisitions, such as a 66-bed skilled nursing facility acquired in Nashville, TN, in May 2023[137]. Liabilities - The accrued professional liability and workers' compensation reserves totaled $108.237 million as of March 31, 2024[138].

Financial Performance - Net patient revenues for the year ended December 31, 2023, were $956,077,000, an increase from $900,231,000 in 2022[193]. - For the year ended December 31, 2023, net income attributable to National HealthCare Corporation was $66,798,000, a significant increase from $22,445,000 in 2022[198]. - Net patient revenues totaled $1,087,614,000, reflecting a $58,529,000 increase, or 5.7%, compared to the prior year[207]. - Same-facility net operating revenues increased by 11.3% when excluding government stimulus income and operations ceased in September 2022[205]. - The Company reported income before income taxes of $88,738,000 for the year ended December 31, 2023, compared to $27,231,000 in 2022[193]. - GAAP net income attributable to the company for 2022 was $22,445,000, a significant decrease from $138,590,000 in 2021, largely due to a $95.2 million gain from the Caris acquisition in 2021[221]. - Net patient revenues totaled $1,029,085,000 for 2022, reflecting a 6.6% increase compared to the prior year, with supplemental Medicaid payments contributing $19,442,000 in 2022[222]. - Comprehensive income attributable to National HealthCare Corporation for 2023 was $69,726, compared to $11,308 in 2022, reflecting a substantial increase[276]. - Earnings per share (EPS) for 2023 were $4.36 (basic), compared to $1.46 in 2022, representing a growth of 198.6%[273]. - Net income for 2023 was $65,288,000, a significant increase from $19,977,000 in 2022, reflecting a growth of approximately 226%[285]. Revenue Sources - The Company recorded government stimulus income from the Provider Relief Funds of $63,360,000, $11,457,000, and $0 for the years ended December 31, 2021, 2022, and 2023, respectively[180]. - Supplemental Medicaid payments contributed $20,214,000 to net patient revenues in 2023, slightly down from $20,482,000 in 2021[339]. - Medicare accounted for 34% of net patient revenues in 2023, down from 37% in 2022, while Medicaid increased to 30% from 28%[345]. - Other revenues totaled $53,930,000 in 2023, an increase from $45,196,000 in 2022[355]. - Rental income for 2023 was $23,926,000, a slight increase from $23,451,000 in 2022[356]. - Management fees from other healthcare centers amounted to $13,344,000 in 2023, up from $11,828,000 in 2022[361]. Operational Metrics - The overall occupancy rate in owned and leased skilled nursing facilities increased to 87.9% in 2023 from 83.8% in 2022 and 80.6% in 2021[183]. - The Company operates or manages 68 skilled nursing facilities with 8,732 licensed beds, 26 assisted living facilities with 1,501 units, and 35 homecare agencies across 8 states as of December 31, 2023[178]. - The Company has 40 skilled nursing facilities rated 4 or 5 stars, representing 59% of its total facilities, compared to an industry average of 36%[186]. - New operations contributed an increase of $25,821,000 in net patient revenues for the year ended December 31, 2023[209]. - The average census in owned and leased skilled nursing facilities rose to 83.8% in 2022 from 80.6% in 2021, with Medicare and managed care per diem rates increasing by 2.3% and 6.0%, respectively[223]. Costs and Expenses - Total costs and expenses for the year ended December 31, 2023, were $1,084,410,000, compared to $1,053,842,000 in 2022[193]. - Salaries, wages, and benefits increased by $26,175,000, or 3.8%, totaling $712,344,000, while the percentage of net operating revenues decreased to 62.4% from 63.2%[213]. - Total costs and expenses rose by $30,568,000, or 2.9%, to $1,084,410,000 in 2023[212]. - General and administrative costs for the year ended December 31, 2023, were $21,412,000, compared to $20,651,000 in 2022 and $20,160,000 in 2021[304]. Cash Flow and Liquidity - Cash provided by operating activities for the year ended December 31, 2023 was $111,216,000, a substantial increase from $8,742,000 in 2022[237]. - The company expects to meet its short-term liquidity requirements primarily from cash flows from operating activities, with current cash on hand of $107,076,000 and unrestricted marketable securities of $116,544,000[241]. - Total cash, cash equivalents, restricted cash, and restricted cash equivalents at the end of 2023 amounted to $125,968,000, up from $74,865,000 in 2022, representing a 68% increase[285]. - The company’s total cash and cash equivalents increased by $51,103,000 in 2023, compared to a decrease of $44,878,000 in 2022[285]. Investments and Marketable Securities - The fair value of the company's marketable equity securities is approximately $137,896,000, with an investment in NHI comprising about $91,071,000, or 66.0%, of the total[262]. - The company has net unrealized gains of $83,586,000 in its equity securities, with approximately $66,337,000 related to the investment in NHI[262]. - The company recorded unrealized gains of $14,944,000 from marketable equity securities for the year ended December 31, 2023[218]. - The company reported unrealized losses on marketable equity securities of $14,944,000 in 2023, contrasting with unrealized gains of $15,806,000 in 2022[285]. Liabilities and Reserves - The accrued professional liability and workers' compensation reserves totaled $103,259,000 as of December 31, 2023, compared to $102,469,000 in 2022[189]. - As of December 31, 2023, the accrued risk reserves totaled $103,259,000, which includes professional liability claims reserves for unpaid reported claims and estimates for incurred but unreported claims[270]. - Total liabilities for 2023 were $400,316, slightly up from $397,936 in 2022, indicating a marginal increase of 0.4%[281]. Accounting and Compliance - The company recognizes revenue as performance obligations are completed, with net patient revenues derived from various healthcare services[249]. - Medicare and Medicaid program revenues are subject to audit and retroactive adjustment, impacting the estimated transaction price for providing patient care[252]. - The company has not adopted any new accounting standards during 2023[247].