MECHANICSBURG, Pa.  , Nov. 18, 2024 /PRNewswire/ -- Select Medical Holdings Corporation ("Holdings") (NYSE: SEM), today announced that Select Medical Corporation, a wholly-owned subsidiary of Holdings ("Select"), has priced a private offering (the "Offering") of $550.0 million in aggregate principal amount of its 6.250% senior notes due 2032 (the "notes"). The Offering is expected to close on December 3, 2024, subject to the satisfaction of customary closing conditions. The notes will be senior unsecured ob ...

MECHANICSBURG, Pa., Nov. 18, 2024 /PRNewswire/ -- Select Medical Holdings Corporation ("Holdings") (NYSE: SEM), today announced that Select Medical Corporation ("Select") has commenced a private offering (the "Offering"), subject to market and other customary conditions, of $850 million in aggregate principal amount of senior notes due 2032 (the "notes"). The notes will be senior unsecured obligations of Select and will be guaranteed by certain of Select's existing and future domestic subsidiaries.Concurren ...

Medical worker shows the structure of a recipe.gettyOn November 06, Select Medical Holdings (NYSE: SEM; $40.20; Market Cap: $5.2 billion) announced a special stock distribution of its carved out unit Concentra Holdings (NYSE: CON; $19.67; Market Cap: $2.5 billion) to its shareholders. The distribution is set for November 25, 2024, with a record date of November 18, 2024. Shareholders will receive approximately 0.806971 shares of Concentra’s common stock for each share of Select Medical stock they own. This ...

Core Viewpoint - Select Medical Holdings Corporation (SEM) experienced a 13.8% increase in stock price following the release of its third-quarter 2024 results, attributed to upward revisions in revenue and adjusted EBITDA outlook, driven by growth in patient days and revenue per patient day at its hospitals [1][2]. Financial Performance - SEM reported adjusted earnings per share (EPS) of 50 cents, exceeding the Zacks Consensus Estimate by 38.9%, with an 8.7% year-over-year increase [2]. - Net operating revenues reached $1.76 billion, reflecting a 5.4% year-over-year growth and surpassing the consensus mark by 2.3% [2]. - Total costs and expenses rose 5.5% year over year to $1.54 billion, which was lower than the estimated $1.59 billion [3]. - Adjusted EBITDA was $205.5 million, a 6% year-over-year increase, exceeding the estimate of $190.3 million [3]. Segment Performance - **Critical Illness Recovery Hospital**: Revenues were $583 million, a 3.4% year-over-year increase, but fell short of estimates. Revenue per patient day increased by 2.4%, while patient days improved by 1.1% [4]. - **Rehabilitation Hospital**: Revenues grew 14.4% year over year to $282.7 million, surpassing estimates. Adjusted EBITDA rose 12.1% to $60.1 million [6]. - **Outpatient Rehabilitation**: Revenues reached $312 million, a 6.9% year-over-year increase, driven by a 5.6% rise in patient visits [7]. - **Concentra**: Revenues were $489.6 million, a 3.3% year-over-year increase, exceeding estimates. Adjusted EBITDA improved 2.7% to $101.6 million [8]. Financial Position - As of September 30, 2024, SEM had cash and cash equivalents of $191.5 million, up from $84 million at the end of 2023. Total assets increased to $8 billion from $7.7 billion [9]. - Long-term debt decreased to $3.1 billion, while total equity rose to $2.3 billion from $1.5 billion at the end of 2023 [9]. Cash Flow and Shareholder Returns - SEM generated cash flow from operations of $181 million in the reported quarter, a 55.5% year-over-year increase [10]. - The company did not repurchase shares in Q3 2024 but declared a cash dividend of 12.5 cents per share, payable on November 26, 2024 [11]. 2024 Outlook - Management revised revenue guidance to between $6.95 billion and $7.15 billion, indicating a 5.2% growth from 2023 [12]. - Adjusted EBITDA is expected to be between $865 million and $885 million, suggesting an 8.4% rise from the previous year [12]. - EPS is projected to be between $2.01 and $2.12, reflecting an 8.1% improvement from 2023 [13].

Financial Data and Key Metrics Changes - The consolidated adjusted EBITDA grew 6% from $193.8 million to $205.5 million, with an adjusted EBITDA margin of 11.7% compared to 11.6% in the prior year Q3 [16][25] - Revenue increased by 6% compared to Q3 of the prior year [16] - EPS was $0.43 per share for the third quarter compared to $0.38 per share in the same quarter prior year [25] Business Line Data and Key Metrics Changes - The inpatient rehab hospital division had a 14% increase in revenue and a 12% increase in adjusted EBITDA compared to Q3 of the prior year [20] - The critical illness recovery hospital division saw a 3% increase in revenue and a 9% increase in adjusted EBITDA compared to the same quarter prior year [17] - The outpatient rehab division experienced a 7% increase in revenue, with patient volumes increasing by 6% [24] Market Data and Key Metrics Changes - Concentra experienced increases of 3% in both net revenue and adjusted EBITDA over the prior year same quarter, driven by a 4% increase in rate [23] - The outpatient division's adjusted EBITDA margin increased from 9% to 9.1% [25] Company Strategy and Development Direction - The company plans to open several new inpatient rehab hospitals and expand its operations, adding 569 additional beds from 2024 through 2026 [13][11] - The development pipeline is described as robust, with opportunities in both inpatient and outpatient rehab [48] - The company aims to maintain a leverage ratio of around 3 times, allowing flexibility in capital deployment [49] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the operating environment, noting improvements in labor costs and occupancy rates [29][44] - The company updated its business outlook for 2024, expecting revenue in the range of $6.95 billion to $7.15 billion and adjusted EBITDA between $865 million to $885 million [42] Other Important Information - The company completed Concentra's initial public offering, retaining an 81.74% ownership stake [5][6] - A cash dividend of $0.125 was declared, payable on November 26, 2024 [26] - The company did not repurchase shares during the quarter but continues to evaluate stock repurchases and debt reduction [41] Q&A Session Summary Question: Comments on LTAC occupancy trends - Management noted that the occupancy rate was higher than the prior year and attributed it to seasonal factors rather than staffing issues [44] Question: Thoughts on capital deployment and leverage - Management indicated a preference to maintain leverage around 3 times and emphasized a robust development pipeline [49] Question: Additional progress on SWB as a percent of revenue - Management believes there is room for improvement and expects to end the year in the 57% range [57] Question: Keys for outpatient rehab margin improvement - Management highlighted clinical efficiency and technology improvements as major factors for future margin enhancements [61]

Group 1: Earnings Performance - Select Medical reported quarterly earnings of $0.50 per share, exceeding the Zacks Consensus Estimate of $0.36 per share, and up from $0.46 per share a year ago, representing an earnings surprise of 38.89% [1] - The company posted revenues of $1.76 billion for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 2.30%, compared to $1.67 billion in the same quarter last year [2] - Over the last four quarters, Select Medical has consistently surpassed consensus EPS estimates and revenue estimates [2] Group 2: Stock Performance and Outlook - Select Medical shares have increased approximately 39.8% since the beginning of the year, outperforming the S&P 500's gain of 21.9% [3] - The future stock price movement will largely depend on management's commentary during the earnings call and the earnings outlook [4][6] - The current consensus EPS estimate for the upcoming quarter is $0.31 on revenues of $1.75 billion, and for the current fiscal year, it is $2.03 on revenues of $7.02 billion [7] Group 3: Industry Context - The Medical - HMOs industry, to which Select Medical belongs, is currently ranked in the bottom 18% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Select Medical's performance [5]

Core Viewpoint - Select Medical Holdings Corporation reported strong financial results for the third quarter and nine months ended September 30, 2024, with significant increases in revenue, net income, and earnings per share, alongside the declaration of a cash dividend and a stock repurchase program. Financial Performance - For Q3 2024, revenue increased by 5.7% to $1,761.2 million from $1,665.7 million in Q3 2023 [1] - Income from operations rose by 8.6% to $141.1 million compared to $130.0 million in the prior year [1] - Net income surged by 33.2% to $81.0 million from $60.8 million year-over-year [1] - Adjusted EBITDA grew by 6.0% to $205.5 million from $193.8 million in Q3 2023 [1] - Earnings per share increased by 13.2% to $0.43 from $0.38 in the same quarter last year [1] Segment Performance Critical Illness Recovery Hospital Segment - Revenue increased by 3.4% to $583.0 million in Q3 2024 from $563.6 million in Q3 2023 [3] - Adjusted EBITDA rose by 9.5% to $50.8 million, with an adjusted EBITDA margin of 8.7% [3] Rehabilitation Hospital Segment - Revenue increased by 14.4% to $282.7 million in Q3 2024 from $247.1 million in Q3 2023 [4] - Adjusted EBITDA increased by 12.1% to $60.1 million, with an adjusted EBITDA margin of 21.3% [4] Outpatient Rehabilitation Segment - Revenue increased by 6.9% to $312.0 million in Q3 2024 from $291.8 million in Q3 2023 [4] - Adjusted EBITDA rose by 7.5% to $28.3 million, with an adjusted EBITDA margin of 9.1% [4] Concentra Segment - Revenue increased by 3.3% to $489.6 million in Q3 2024 from $474.0 million in Q3 2023 [5] - Adjusted EBITDA increased by 2.7% to $101.6 million, with an adjusted EBITDA margin of 20.7% [5] Dividend and Stock Repurchase - The Board of Directors declared a cash dividend of $0.125 per share, payable on or about November 26, 2024 [6] - A stock repurchase program was authorized to repurchase up to $1.0 billion worth of shares, effective until December 31, 2025 [6] Business Outlook - The company updated its 2024 business outlook, expecting revenue between $6.95 billion and $7.15 billion, with adjusted EBITDA between $865.0 million and $885.0 million [7]

Group 1 - A new joint venture between Select Medical and SSM Health will establish a 50-bed inpatient rehabilitation hospital in Oklahoma City, named SSM Health Rehabilitation Hospital – Oklahoma City, set to open in December 2024 [1] - The new hospital will incorporate SSM Health's existing 12-bed acute rehabilitation unit from St. Anthony Hospital in Oklahoma City [1] - This partnership aims to enhance access to high-quality rehabilitation services in the region, building on a 15-year collaboration between the two organizations [2][3] Group 2 - Select Medical will be the majority owner and managing partner of the new joint venture, reflecting their commitment to quality, safety, and outcomes in post-acute care [3] - The existing partnership includes three inpatient rehabilitation hospitals and numerous outpatient physical therapy centers across the St. Louis region, demonstrating a strong operational footprint [2] - As of June 30, 2024, Select Medical operates 107 critical illness recovery hospitals and 33 rehabilitation hospitals across the United States, indicating significant scale and reach in the healthcare sector [5]

Group 1 - Select Medical Holdings (NYSE: SEM) has shown strong performance over the past couple of years, indicating a bullish outlook for the company [1] - The company is one of the largest operators in its sector, which contributes to its growth potential [1] Group 2 - Crude Value Insights provides an investing service focused on oil and natural gas, emphasizing cash flow and companies that generate it [1] - The service offers subscribers access to a 50+ stock model account, in-depth cash flow analyses of exploration and production firms, and live chat discussions about the sector [2]

Company Overview - Select Medical Holdings Corporation is one of the largest operators of critical illness recovery hospitals, rehabilitation hospitals, outpatient rehabilitation clinics, and occupational health centers in the United States based on the number of facilities [4] - As of June 30, 2024, Select Medical operated 107 critical illness recovery hospitals in 28 states, 33 rehabilitation hospitals in 12 states, 1,925 outpatient rehabilitation clinics in 39 states and the District of Columbia, 547 occupational health centers in 41 states, and 154 onsite clinics at employer worksites [4] - The company has operations in 46 states and the District of Columbia [4] Financial Results Announcement - Select Medical will release its financial results for the third quarter ended September 30, 2024, on Thursday, October 31, 2024, after the market closes [1] - A conference call regarding the third quarter results and business outlook will be hosted on Friday, November 1, 2024, at 9:00 am ET [2] - The conference call will be available as a live webcast and can be accessed through Select Medical's website [2]