[PART I - FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) This section provides the company's unaudited condensed consolidated financial statements and management's discussion and analysis [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, including balance sheets, income, and cash flow statements, with accompanying notes [Condensed Consolidated Financial Statements](index=4&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section provides key financial metrics, including total assets of $7.95 billion and Q2 2025 revenues of $826.2 million Financial Position (in millions) | Financial Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Total current assets | $1,105.3 | $1,119.4 | | Total assets | $7,954.8 | $7,890.0 | | **Liabilities & Equity** | | | | Total current liabilities | $573.3 | $624.4 | | Long-term debt, less current maturities | $3,465.2 | $3,268.9 | | Total stockholders' equity | $3,156.5 | $3,196.4 | Consolidated Statements of Operations (in millions, except EPS) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenues | $826.2 | $762.1 | $1,602.2 | $1,479.5 | | Operating income | $111.7 | $84.8 | $173.6 | $160.8 | | Net loss attributable to Surgery Partners, Inc. | $(2.5) | $(15.5) | $(40.2) | $(27.9) | | Basic and Diluted EPS | $(0.02) | $(0.12) | $(0.32) | $(0.22) | Consolidated Statements of Cash Flows (in millions) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $87.3 | $123.5 | | Net cash used in investing activities | $(74.3) | $(327.2) | | Net cash (used in) provided by financing activities | $(32.4) | $221.3 | [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes detail accounting policies, segment reporting, acquisitions, and payor mix for the company's 162 surgical facilities - As of June 30, 2025, the company owned or operated a portfolio of **162 surgical facilities**, including 143 ambulatory surgery centers (ASCs) and 19 surgical hospitals, across 30 states[25](index=25&type=chunk) Patient Service Revenues by Payor (%) | Payor | % of Patient Service Revenues (H1 2025) | % of Patient Service Revenues (H1 2024) | | :--- | :--- | :--- | | Private insurance | 52.6% | 52.2% | | Government | 42.5% | 42.2% | | Self-pay | 2.7% | 2.8% | | Other | 2.2% | 2.8% | - During the first six months of 2025, the company acquired a controlling interest in **four surgical facilities and two physician practices** for aggregate cash consideration of **$48.0 million**, net of cash acquired[62](index=62&type=chunk) - Goodwill increased from **$5,068.0 million** at year-end 2024 to **$5,098.6 million** as of June 30, 2025, primarily due to acquisitions (**$76.1 million**) net of disposals (**$45.5 million**)[48](index=48&type=chunk) - The company operates as a single reportable segment, **"Surgical Facilities,"** which includes ASCs, surgical hospitals, anesthesia services, and physician practices, generating **$289.9 million** in Adjusted EBITDA for the six months ended June 30, 2025[89](index=89&type=chunk)[90](index=90&type=chunk)[94](index=94&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, including an 8.3% revenue increase in Q2 2025, liquidity, capital resources, and non-GAAP reconciliations [Results of Operations](index=23&type=section&id=Results%20of%20Operations) This section details Q2 2025 revenue growth of 8.3% to $826.2 million, driven by same-facility increases, and changes in net loss Consolidated Results (in millions) | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Revenues | $826.2 | $762.1 | 8.4% | | Cost of Revenues | $630.6 | $582.9 | 8.2% | | Operating Income | $111.7 | $84.8 | 31.7% | | Net Loss Attributable to Surgery Partners, Inc. | $(2.5) | $(15.5) | 83.9% improvement | - The increase in Q2 2025 patient service revenues was driven by a **5.1% increase** in days-adjusted same-facility revenues, resulting from a **3.4% increase** in same-facility case volumes and a **1.6% increase** in same-facility revenue per case[113](index=113&type=chunk) - Interest expense for Q2 2025 increased to **$67.9 million** from **$51.5 million** in Q2 2024, primarily due to 2024 financing activities, increased Revolver borrowings, and maturing interest rate swaps[119](index=119&type=chunk) [Liquidity and Capital Resources](index=26&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with **$250.1 million** in cash and **$394.9 million** available on its revolver, despite a decrease in operating cash flow Liquidity Metrics (in millions) | Liquidity Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $250.1 | $269.5 | | Revolver borrowing capacity | $394.9 | N/A | | Net working capital | $532.0 | $495.0 | - The decrease in operating cash flow for H1 2025 compared to H1 2024 was primarily driven by **higher cash interest payments** and the **timing of changes in working capital**[132](index=132&type=chunk) - Management believes that cash flows from operations, available cash, revolver capacity, and access to capital markets will be adequate to meet both short-term and long-term liquidity needs[139](index=139&type=chunk) [Certain Non-GAAP Measures](index=26&type=section&id=Certain%20Non-GAAP%20Measures) This section reconciles non-GAAP measures, showing Q2 2025 Adjusted EBITDA increased 9.0% to **$129.0 million** Adjusted EBITDA Reconciliation (in millions) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Income before income taxes | $43.8 | $33.3 | $43.5 | $62.0 | | Adjusted EBITDA | $129.0 | $118.3 | $232.9 | $215.8 | Credit Agreement EBITDA (in millions) | Metric | Twelve Months Ended June 30, 2025 | | :--- | :--- | | Cash flows from operating activities | $263.9 | | Credit Agreement EBITDA | $579.0 | [Quantitative and Qualitative Disclosures About Market Risk](index=28&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages interest rate risk on its variable-rate debt through hedging strategies, anticipating no material impact on 2025 earnings - The company's main market risk is exposure to changes in interest rates on its **variable-rate debt**, primarily indexed to the prime rate or SOFR[149](index=149&type=chunk)[150](index=150&type=chunk) - To mitigate interest rate risk, the company uses a mix of debt maturities and types, and periodically enters into **interest rate swap and cap agreements**[149](index=149&type=chunk) [Controls and Procedures](index=28&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal controls - Management, including the CEO and CFO, concluded that the company's **disclosure controls and procedures were effective** as of June 30, 2025[152](index=152&type=chunk) - There were **no material changes** in internal control over financial reporting during the quarter ended June 30, 2025[153](index=153&type=chunk) [PART II - OTHER INFORMATION](index=29&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, and other disclosures, including equity sales and trading arrangements [Legal Proceedings](index=29&type=section&id=Item%201.%20Legal%20Proceedings) Management believes no current legal proceedings will have a material adverse effect on the company's business or financial condition - In management's opinion, the company is not currently a party to any proceedings that would have a **material adverse effect** on its business, financial condition, or results of operations[155](index=155&type=chunk) [Risk Factors](index=29&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred regarding the risk factors previously disclosed in the company's 2024 Annual Report on Form 10-K - There have been **no material changes** with respect to the risk factors discussed in the company's 2024 Annual Report on Form 10-K[156](index=156&type=chunk) [Other Information (Items 2-6)](index=29&type=section&id=Other%20Information%20%28Items%202-6%29) This section confirms no unregistered equity sales, no defaults on senior securities, and no Rule 10b5-1 trading arrangement changes - The company reports **no unregistered sales of equity securities** and **no defaults upon senior securities**[157](index=157&type=chunk)[158](index=158&type=chunk) - During the three months ended June 30, 2025, none of the company's directors or officers adopted or terminated any **Rule 10b5-1 trading arrangement**[160](index=160&type=chunk)

Company Performance - Surgery Partners reported quarterly earnings of $0.17 per share, exceeding the Zacks Consensus Estimate of $0.16 per share, but down from $0.21 per share a year ago, representing an earnings surprise of +6.25% [1] - The company posted revenues of $826.2 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 0.15%, and up from $762.1 million year-over-year [2] - Over the last four quarters, Surgery Partners has surpassed consensus EPS estimates two times and topped consensus revenue estimates three times [2] Market Outlook - Surgery Partners shares have increased approximately 4.9% since the beginning of the year, compared to the S&P 500's gain of 7.6% [3] - The company's earnings outlook, including current consensus earnings expectations for upcoming quarters, will be crucial for investors [4] - The current consensus EPS estimate for the coming quarter is $0.21 on revenues of $841.4 million, and $0.95 on revenues of $3.39 billion for the current fiscal year [7] Industry Context - The Medical Services industry, to which Surgery Partners belongs, is currently ranked in the top 35% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Surgery Partners' stock performance [5][6]

Financial Data and Key Metrics Changes - Surgery Partners reported second quarter net revenue of $826 million, an increase of 8.4% compared to the previous year, and adjusted EBITDA of $129 million, reflecting a 9% growth [6][25][26] - The company achieved a same facility revenue growth of 5.1%, with same facility case growth at 3.4% and rate growth at 1.6% [25][26] - The adjusted EBITDA margin was 15.6%, which is 10 basis points higher than the prior year [26] Business Line Data and Key Metrics Changes - The company performed nearly 173,000 surgical cases in the second quarter, a 3.8% increase from the previous year, with significant growth in gastrointestinal (GI) and musculoskeletal (MSK) procedures [9][25] - Total joint procedures grew by 26% in the second quarter compared to the prior year, indicating strong demand for orthopedic surgeries [10] Market Data and Key Metrics Changes - The total addressable market for Surgery Partners is estimated to grow from $40 billion to over $150 billion in the near to medium term, driven by demographic trends and technological advancements [22] - The company has less than 5% exposure to Medicaid, indicating limited risk from changes in Medicaid reimbursement policies [18] Company Strategy and Development Direction - The company focuses on three growth pillars: organic growth, margin improvement, and capital deployment for mergers and acquisitions (M&A) [5][6] - Surgery Partners plans to deploy $200 million in acquisitions for the year, with a disciplined approach to ensure long-term value creation [15][31] - The company is actively evaluating its asset portfolio to optimize for growth and leverage reduction, including potential partnerships or sales of non-core facilities [22][80] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's positioning within the current regulatory environment, noting minimal exposure to tariff-related price increases and a favorable outlook from CMS regarding outpatient rates [17][18] - The company anticipates continued growth in same facility revenue, expecting to reach the high end of its growth target of 6% for the full year [9][81] Other Important Information - Surgery Partners opened eight de novo facilities in 2024 and has a robust pipeline for future developments, particularly in higher acuity specialties [12][22] - The company recorded a 27% sequential decrease in transaction and integration costs, reflecting a more normalized M&A activity level [17] Q&A Session Summary Question: What is the expected pace of acquisitions for the year? - Management confirmed a strong pipeline and reiterated the target of at least $200 million in acquisitions, emphasizing the importance of timing and quality over rushing to meet targets [34][36] Question: How do de novo facilities impact margins? - Management explained that de novo facilities take time to reach full profitability, typically achieving breakeven within 6-12 months and full run rate earnings within three years [39][40] Question: Are there any service lines considered less core? - Management indicated that they are evaluating opportunities to optimize the portfolio, which may include divesting non-core facilities or expanding partnerships with local health systems [45][80] Question: What is the impact of the potential removal of the inpatient-only list? - Management expressed optimism about the potential for increased revenue from higher acuity procedures being performed in outpatient settings, although they cautioned against overestimating immediate impacts [51][72] Question: How is the company addressing payer behavior and revenue cycle standardization? - Management noted ongoing efforts to improve revenue cycle processes and maintain strong relationships with payers, which are crucial for optimizing cash flow and operational efficiency [62][63]

Financial Data and Key Metrics Changes - Surgery Partners reported Q2 2025 net revenue of $826 million, an increase of 8.4% compared to Q2 2024, and adjusted EBITDA of $129 million, reflecting a 9% growth year-over-year [6][25]. - The adjusted EBITDA margin improved to 15.6%, up 10 basis points from the previous year [25]. - The company ended the quarter with $250 million in cash and total liquidity of $645 million [25][26]. Business Line Data and Key Metrics Changes - Same facility revenue growth was 5.1%, driven by a 3.4% increase in surgical case volume and a 1.6% increase in rates [24][25]. - Total joint procedures grew by 26% year-over-year, indicating strong demand in orthopedic surgeries [9]. - The company performed nearly 173,000 surgical cases in Q2 2025, a 3.8% increase from the previous year [24]. Market Data and Key Metrics Changes - The total addressable market for Surgery Partners is estimated to exceed $150 billion, with a current market size of over $40 billion [21]. - The company has limited exposure to Medicaid, accounting for less than 5% of revenue, which mitigates risks from regulatory changes [17]. - Proposed changes by CMS could add 276 procedures to the ASC covered list, enhancing the company's market position [18]. Company Strategy and Development Direction - The company focuses on three growth pillars: organic growth, margin improvement, and M&A activities [5][14]. - Surgery Partners plans to deploy $200 million in acquisitions for 2025, with a disciplined approach to ensure long-term value [15][29]. - The company is actively evaluating its asset portfolio to optimize operations and reduce leverage [21][44]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the current regulatory environment, with minimal exposure to tariff-related price increases [16][17]. - The company anticipates continued growth in same facility revenue, aiming for the high end of the 6% growth target for the full year [8][25]. - Management highlighted the importance of physician recruitment and the positive impact of new facilities on long-term growth [11][20]. Other Important Information - Surgery Partners opened eight de novo facilities in 2024 and has 10 more under construction, focusing on higher acuity specialties [12][20]. - The company recorded a 27% sequential decrease in transaction and integration costs, indicating improved efficiency in M&A activities [15][16]. - The strategic review process concluded with a reaffirmation of the company's value creation opportunities as a publicly traded entity [20][22]. Q&A Session Summary Question: What is the pace of acquisitions and how should it be modeled going forward? - Management indicated that while the pace of acquisitions has been slower, they remain confident in achieving the $200 million target for the year, emphasizing the importance of finding the best deals [32][34]. Question: What are the economics of de novo facilities and their impact on margins? - Management explained that de novo facilities take time to ramp up but are expected to contribute positively to margins as they focus on higher acuity procedures [35][39]. Question: Are there any service lines considered less core during portfolio optimization? - Management stated they are evaluating opportunities to maximize long-term shareholder value, which may include partnerships or sales in certain markets [42][44]. Question: What is the company's exposure to health exchange volume and its potential impact? - Management noted that their exposure to health exchange volume is limited and not a significant part of their business, indicating minimal risk from potential declines in exchange membership [97]. Question: What drove the increase in operating expenses and variability in other OpEx? - Management clarified that fluctuations in operating expenses are due to various miscellaneous items and that the increase in professional fees is related to newly acquired surgical facilities [84][86].

[Overview and Highlights](index=1&type=section&id=SURGERY%20PARTNERS%2C%20INC.%20ANNOUNCES%20SECOND%20QUARTER%202025%20RESULTS) Surgery Partners reported strong Q2 2025 financial results and reaffirmed its full-year guidance, reflecting confidence in its operational strategy [Second Quarter 2025 Financial Highlights & 2025 Guidance](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Highlights%20%26%202025%20Guidance) Surgery Partners reported strong Q2 2025 results with 8.4% revenue growth and 9.0% Adjusted EBITDA increase, reaffirming full-year guidance Q2 2025 Key Financial Metrics (in millions) | Metric | Q2 2025 | YoY Growth (%) | | :--- | :--- | :--- | | Revenue | $826.2 | 8.4 | | Same-facility Revenues | - | 5.1 | | Same-facility Cases | - | 3.4 | | Adjusted EBITDA | $129.0 | 9.0 | | Net Loss Attributable to SGRY | $2.5 | - | Full Year 2025 Guidance (Reaffirmed, in millions) | Metric | Guidance Range | | :--- | :--- | | Revenue | $3,300 - $3,450 | | Adjusted EBITDA | $555 - $565 | [Management Commentary](index=1&type=section&id=Management%20Commentary) Management attributed strong growth to operational strategy and market momentum, reaffirming full-year guidance and expecting margin expansion - CEO Eric Evans highlighted the company's focus on maximizing portfolio performance, capitalizing on surgical trends, and evaluating opportunities to expedite **leverage reduction** and accelerate **cash flow generation**[2](index=2&type=chunk) - CFO Dave Doherty expressed confidence in achieving **full-year guidance**, citing ongoing operating system improvements and benefits from recent acquisitions and new facility openings[2](index=2&type=chunk) [Financial Performance](index=1&type=section&id=Financial%20Performance) The company reported strong Q2 2025 financial performance with revenue growth, increased Adjusted EBITDA, and stable liquidity [Quarterly and Year-to-Date Results](index=1&type=section&id=Quarterly%20and%20Year-to-Date%20Results) Q2 2025 revenues grew 8.4% to $826.2 million, with year-to-date revenues up 8.3% to $1.6 billion Q2 2025 vs Q2 2024 Performance (in millions) | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Revenues | $826.2 | $762.1 | 8.4% | | Same-Facility Revenues | - | - | 5.1% | | Adjusted EBITDA | $129.0 | $118.3 | 9.0% | Year-to-Date 2025 vs 2024 Performance (in millions) | Metric | YTD 2025 | YTD 2024 | % Change | | :--- | :--- | :--- | :--- | | Revenues | $1,602.2 | $1,479.5 | 8.3% | | Same-Facility Revenues | - | - | 5.1% | | Adjusted EBITDA | $232.9 | $215.8 | 7.9% | [Liquidity and Financial Position](index=2&type=section&id=Liquidity) Surgery Partners reported $250.1 million cash, $394.9 million credit availability, and a 4.1x net debt to EBITDA ratio - The company had cash and cash equivalents of **$250.1 million** and a borrowing capacity of **$394.9 million** under its revolving credit facility at the end of Q2 2025[6](index=6&type=chunk) Cash Flow from Operating Activities (in millions) | Period | 2025 | 2024 | | :--- | :--- | :--- | | Second Quarter | $81.3 | $82.8 | | Year-to-Date | $87.3 | $123.5 | - The ratio of total net debt to EBITDA, calculated per the company's credit agreement, was approximately **4.1x** at the end of Q2 2025[8](index=8&type=chunk) [Detailed Financial Tables](index=4&type=section&id=Detailed%20Financial%20Tables) Detailed financial tables provide a comprehensive view of the company's financial performance and key operating metrics [Consolidated Financial Data (Income Statement)](index=4&type=section&id=Selected%20Consolidated%20Financial%20Data) The consolidated income statement highlights key financial results for Q2 2025, including revenues, operating income, and net loss Q2 2025 Consolidated Income Statement Highlights (in millions) | Line Item | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Revenues | $826.2 | $762.1 | | Operating Income | $111.7 | $84.8 | | Interest Expense, net | $(67.9) | $(51.5) | | Net Income | $44.9 | $28.4 | | Net Loss Attributable to SGRY | $(2.5) | $(15.5) | [Selected Financial and Operating Data](index=5&type=section&id=Selected%20Financial%20and%20Operating%20Data) This section presents key balance sheet data and operating metrics, including cases, revenue per case, and Adjusted EBITDA margin Balance Sheet Data at Period End (in millions) | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $250.1 | $269.5 | | Total Assets | $7,954.8 | $7,890.0 | | Long-term debt, less current | $3,465.2 | $3,268.9 | | Total Liabilities | $4,375.9 | $4,254.8 | | Total SGRY Stockholders' Equity | $1,748.3 | $1,789.7 | Key Operating Metrics (Q2) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Cases | 172,858 | 166,520 | | Revenue per Case ($) | 4,780 | 4,577 | | Adjusted EBITDA Margin (%) | 15.6 | 15.5 | [Supplemental Information (Same-Facility Data)](index=6&type=section&id=Supplemental%20Information) Supplemental information details same-facility performance, including case growth, revenue per case, and days-adjusted revenue growth Same-Facility Performance (Q2) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Cases | 183,623 | 177,514 | | Case Growth (%) | 3.4 | N/A | | Revenue per Case ($) | 4,736 | 4,663 | | Revenue per Case Growth (%) | 1.6 | N/A | | Revenue Growth (days adjusted) (%) | 5.1 | N/A | [Non-GAAP Financial Measures](index=3&type=section&id=Use%20of%20Non-GAAP%20Financial%20Measures) This section explains the company's non-GAAP financial measures and provides detailed reconciliations for key metrics [Explanation of Non-GAAP Measures](index=3&type=section&id=Explanation%20of%20Non-GAAP%20Measures) Surgery Partners uses non-GAAP measures like Adjusted EBITDA to supplement GAAP results, aiding performance evaluation - The company presents non-GAAP measures like **Adjusted EBITDA** and **Adjusted net income** as supplemental tools that management uses to assess operating performance, make business decisions, and allocate resources[15](index=15&type=chunk)[16](index=16&type=chunk)[26](index=26&type=chunk) - These measures are not intended to replace GAAP metrics and have limitations, as they exclude items that can be significant in evaluating financial performance[16](index=16&type=chunk)[27](index=27&type=chunk) [Reconciliation of Adjusted EBITDA](index=6&type=section&id=Reconciliation%20of%20Non-GAAP%20Financial%20Measures) The company provides a detailed reconciliation of Adjusted EBITDA from income before income taxes for Q2 2025, totaling $129.0 million Adjusted EBITDA Reconciliation (Q2 2025, in millions) | Description | Amount | | :--- | :--- | | Income before income taxes | $43.8 | | Net income attributable to NCI | $(47.4) | | Interest expense, net | $67.9 | | Depreciation and amortization | $40.3 | | Transaction and integration costs | $18.1 | | Other Adjustments | $(0.5) | | **Adjusted EBITDA** | **$129.0** | Adjusted EBITDA from Unconsolidated Affiliates (Q2, in millions) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Management fee revenues | $8.6 | $6.8 | | Equity in earnings | $5.5 | $4.4 | | **Total** | **$15.2** | **$11.8** | [Reconciliation of Adjusted Net Income](index=7&type=section&id=Reconciliation%20of%20Adjusted%20Net%20Income) Adjusted net income attributable to common stockholders for Q2 2025 was $21.9 million, or $0.17 per diluted share Adjusted Net Income Reconciliation (Q2 2025, in millions) | Description | Amount | | :--- | :--- | | Net income | $44.9 | | Net income attributable to NCI | $(47.4) | | Transaction and integration costs | $18.1 | | Equity-based compensation expense | $6.8 | | Other Adjustments | $(0.5) | | **Adjusted net income** | **$21.9** | Adjusted Net Income Per Share (Diluted) | Period | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Second Quarter | 0.17 | 0.21 | | Year-to-Date | 0.21 | 0.31 | [Additional Information](index=2&type=section&id=Additional%20Information) This section provides supplementary details including conference call information, company overview, and forward-looking statements [Conference Call Information](index=2&type=section&id=Conference%20Call%20Information) Surgery Partners held a conference call on August 5, 2025, to discuss quarterly results, with replay information available - A conference call was held on **August 5, 2025**, at 8:30 a.m. (Eastern Time) to discuss the results[9](index=9&type=chunk) - A replay of the call is available until **August 19, 2025**, and a webcast replay is accessible on the company's Investor Relations website[9](index=9&type=chunk)[10](index=10&type=chunk) [About Surgery Partners](index=2&type=section&id=About%20Surgery%20Partners) Surgery Partners is a leading healthcare services company operating over 200 short-stay surgical facilities across 30 states - Surgery Partners is a leading owner and operator of **short-stay surgical facilities**, with a model focused on high-quality, cost-effective outpatient care[1](index=1&type=chunk)[12](index=12&type=chunk) - The company operates more than **200 locations** in **30 states**, including ambulatory surgery centers, surgical hospitals, and physician practices[12](index=12&type=chunk) [Forward-Looking Statements](index=2&type=section&id=Forward-Looking%20Statements) This report contains forward-looking statements subject to risks and uncertainties that could cause actual results to differ materially - The report includes forward-looking statements concerning growth and future results, which are subject to **risks and uncertainties**[13](index=13&type=chunk) - Factors that could affect results include **payment reductions** from payors, physician relationships, **competition**, **regulatory changes**, and other risks detailed in the company's Form 10-K[13](index=13&type=chunk)[14](index=14&type=chunk)

Reaffirms Full Year 2025 GuidanceBRENTWOOD, Tenn., Aug. 05, 2025 (GLOBE NEWSWIRE) -- Surgery Partners, Inc. (NASDAQ:SGRY) (“Surgery Partners” or the “Company”), a leading short-stay surgical facility owner and operator, today announced results for the second quarter ended June 30, 2025. Second Quarter 2025 Financial Highlights (All comparisons are year-over-year unless otherwise noted) Revenue increased 8.4% for the second quarter Same-facility revenues increased 5.1% for the second quarterSame-facility cas ...

BRENTWOOD, Tenn., July 18, 2025 (GLOBE NEWSWIRE) -- Surgery Partners, Inc. (NASDAQ:SGRY) ("Surgery Partners" or the "Company"), a leading short-stay surgical facility owner and operator, announced the Company will release its second quarter 2025 results before the market opens on Tuesday, August 5, 2025, to be followed by a conference call at 8:30 a.m. (Eastern Time). You can join the call as follows: Dial in number for live access: 1-844-826-3033 (domestic), 1-412-317-5185 (international)Replay (available ...

Core Viewpoint - Surgery Partners, Inc. has reaffirmed its confidence in its long-term growth prospects and reiterated its full-year 2025 financial guidance, indicating a strong outlook for the company as an independent entity [1][2]. Company Overview - Surgery Partners is a leading healthcare services company focused on outpatient surgical care, operating over 200 locations across 30 states [6][8]. - The company utilizes a joint venture model and has a strong track record in mergers and acquisitions, positioning it well in the high-growth outpatient surgical care market [3]. Financial Guidance - The company expects 2025 revenues to be in the range of $3.30 billion to $3.45 billion and Adjusted EBITDA to be between $555 million and $565 million [5]. Strategic Initiatives - Surgery Partners plans to host an Investor Day in the second half of 2025 to discuss its future growth plans, industry trends, and strategies for maximizing portfolio performance and operational efficiencies [4]. Board and Management Confidence - The Independent Committee of the Board, after reviewing a non-binding acquisition proposal from Bain Capital, concluded that remaining independent would better serve the long-term interests of the company and its shareholders [2][3]. - The management team, led by CEO Eric Evans, expressed confidence in achieving the financial guidance for 2025, supported by favorable surgical trends and a positive regulatory outlook [3].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _____________________________________ Form 10-Q _____________________________________ (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number: 001-37576 340 Seven Springs Way, Suite 600 Brentwood, Tennessee 37027 (Address of Princip ...

Financial Data and Key Metrics Changes - Surgery Partners reported first quarter net revenue of $776 million and adjusted EBITDA of $103.9 million, reflecting an 8% increase in net revenue and nearly 7% growth in adjusted EBITDA compared to the prior year's first quarter [5][18][24] - Same facility revenue growth was over 5%, driven by 6.5% surgical case growth, although there was a slight decline in rates of approximately 1% due to a shift towards lower acuity specialties [6][18] - The company ended the quarter with $229 million in cash and over $615 million in total liquidity, with a net debt to EBITDA ratio of 4.1 times [19][22][23] Business Line Data and Key Metrics Changes - The company performed over 160,000 surgical cases in the first quarter, a 4.5% increase from 2024, with notable growth in gastrointestinal (GI) and orthopedic procedures [18][7] - Orthopedic cases grew by 3.4% year-over-year, with total joint procedures increasing by 22% [8][9] - The company added nearly 50 new physicians in the first quarter, with a focus on orthopedic specialties, which are expected to contribute to higher acuity surgical cases [9][56] Market Data and Key Metrics Changes - The company continues to experience strong growth in Medicare and commercial payer segments, with no significant changes in payer mix reported [40][43] - The company has a robust pipeline of de novo facilities, with 10 currently under construction and a target of 10 new openings each year [10][108] Company Strategy and Development Direction - Surgery Partners focuses on three pillars for growth: organic growth, margin improvement, and capital deployment for mergers and acquisitions (M&A) [4][11] - The company is committed to margin expansion through operational efficiencies and integration of acquired facilities, with a target of maintaining a leverage ratio below 3 times [12][82] - The company is actively monitoring regulatory changes and has minimal exposure to tariff-related price increases, ensuring a stable operational environment [15][70] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's growth trajectory, expecting same facility growth to be at or above the high end of the 6% target for 2025 [6][17] - The company anticipates continued improvements in cash flow generation as the year progresses, despite some headwinds from interest costs [32][36] - Management remains optimistic about the impact of new physician recruits and de novo facilities on future performance [9][56] Other Important Information - Surgery Partners is currently evaluating a nonbinding acquisition proposal from Bain Capital, with a special committee formed to consider the proposal [16] - The company has invested $55 million in five surgical facilities in 2025, with an effective multiple under eight times adjusted EBITDA [12] Q&A Session Summary Question: Current utilization trends and sustainability - Management noted that first quarter same store revenue growth was in line with expectations, with case growth driven by stronger de novos and MSK growth [26][28] Question: Seasonality of free cash flow generation - Management expects overall improvement in operating cash flows as earnings grow, with the second and fourth quarters typically being stronger [31][32] Question: Changes in payer mix and commercial rates - Management confirmed no significant changes in payer mix, with strong commercial growth and constructive negotiations with payers [40][43] Question: Labor dynamics and specialty areas - Management indicated that professional fees were in line with expectations, driven by recent acquisitions, and that anesthesia costs were not a major headwind [51][53] Question: Impact of GI mix on revenue per case - Management acknowledged growth in the GI portfolio but noted that its impact on revenue per case was marginal [60][62] Question: Confidence in tariff exposure - Management expressed confidence in minimal tariff exposure due to strong relationships with suppliers and contract protections [69][72] Question: Free cash flow expectations - Management expects free cash flow to grow alongside business growth, despite some timing issues in the first quarter [91] Question: Margin expansion efforts - Management highlighted ongoing improvements in revenue cycle management and operational efficiencies as key drivers for margin expansion [94][96]