NHC(US:NHC)2025-11-06 21:39Operations and Facilities - As of September 30, 2025, the company operates or manages 80 skilled nursing facilities with a total of 10,329 licensed beds, 26 assisted living facilities with 1,413 units, and 34 homecare agencies[143]. - The overall occupancy rate in owned and leased skilled nursing facilities was 90.0% for the three months ending September 30, 2025, compared to 88.3% for the same period a year ago[144]. - The company has 47 skilled nursing facilities rated 4 or 5 stars, representing 59% of its total facilities, compared to 37% in the industry[148]. - The average census at skilled nursing facilities increased to 90.0% from 88.3% year-over-year[176]. - The average census at skilled nursing facilities increased to 89.6% for the nine months ended September 30, 2025, compared to 88.6% for the same period in 2024[188]. Financial Performance - For the three months ended September 30, 2025, net operating revenues increased by 12.5% to $382,661,000 compared to $340,198,000 for the same period in 2024[173]. - Net patient revenues rose by $42,315,000, or 12.9%, to $370,989,000 compared to $328,674,000 for the same quarter last year[175]. - Adjusted net income for the quarter was $24,744,000, reflecting a 24.3% increase from $19,910,000 in the same period of 2024[174]. - Net operating revenues increased by 20.6% for the nine months ended September 30, 2025, driven by a 9.2% increase in same-facility net operating revenues and the acquisition of White Oak[185]. - GAAP net income attributable to the company for the nine months ended September 30, 2025, was $95,166,000, a decrease from $95,846,000 in 2024, while adjusted net income increased by 47.9% to $75,293,000[186]. - Net patient revenues increased by $201,530,000, or 22.5%, compared to the same period last year[187]. Costs and Expenses - The total costs and expenses increased by $34,874,000, or 11.0%, to $352,283,000 from $317,409,000 in the prior year[178]. - Other operating expenses increased by $14,095,000, or 17.1%, to $96,604,000 for the three months ended September 30, 2025, compared to $82,509,000 for the same period in 2024[181]. - Total costs and expenses increased by $158,985,000, or 18.1%, to $1,036,033,000 for the nine months ended September 30, 2025[190]. - Salaries, wages, and benefits increased by $19,781,000, or 9.3%, to $233,176,000, with a percentage of net operating revenues decreasing to 60.9% from 62.7%[179]. - Salaries, wages, and benefits increased by $111,231,000, or 19.3%, to $687,840,000, with salaries as a percentage of net operating revenues decreasing to 60.8%[191]. Medicaid and Medicare Rates - The average Medicare per diem rate for skilled nursing facilities increased by 5.9% for the first nine months of 2025 compared to the same period in 2024[155]. - The fiscal year 2026 Medicare payment rates for skilled nursing facilities include a net increase of 3.2% compared to 2025 levels[153]. - The state of Tennessee's Medicaid increase is estimated to generate an additional $3,000,000 annually, or $750,000 per quarter, starting from fiscal year 2026[156]. - The state of South Carolina's Medicaid increase is estimated to generate an additional $4,200,000 annually, or $1,050,000 per quarter, starting from fiscal year 2026[157]. - Medicare per diem rates increased by 6.1%, while managed care per diem rates decreased by 7.1% compared to the same quarter last year[176]. Acquisitions and Partnerships - The company purchased the assets of White Oak Management, which included 15 skilled nursing facilities and 1,928 licensed skilled nursing beds[150]. - The White Oak operations contributed an increase of $20,026,000 in net patient revenues for the quarter ended September 30, 2025[177]. - The company is focusing on partnerships with hospital systems and payors to enhance its position in post-acute healthcare services[146]. Cash Flow and Liquidity - Cash provided by operating activities for the nine months ended September 30, 2025, was $168,271,000, an increase of 78.0% compared to $94,514,000 in the same period last year[201]. - Net cash used in investing activities was $20,924,000 for the nine months ended September 30, 2025, significantly lower than $225,048,000 for the same period in 2024[203]. - Net cash used in financing activities for the nine months ended September 30, 2025, was $92,735,000, a decrease from cash provided of $119,640,000 for the same period in 2024[205]. - Current cash on hand is $130,629,000, with unrestricted marketable equity securities valued at $166,754,000[207]. - The company has a borrowing capacity of $50 million on its available line of credit, which is expected to support both short-term and long-term liquidity requirements[208]. Marketable Securities - At September 30, 2025, the fair value of marketable equity securities was approximately $184,236,000, with $129.6 million (70.4%) invested in NHI[217]. - The company has net unrealized gains of $141.3 million in its equity securities, with $104.9 million related to the investment in NHI[217]. - The company has available for sale marketable debt securities amounting to $122,912,000 as of September 30, 2025[212]. - 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 $18.4 million[217]. Workforce and Labor - The company faced workforce and labor shortages but is actively working to reduce agency nurse staffing expenses, which decreased to $1,207,000 from $3,099,000 year-over-year[179].