Group 1 - U.S. Physical Therapy, Inc. (USPH) is experiencing significant activity in the options market, particularly with the Jun 20, 2025 $105 Call showing high implied volatility, indicating potential for a major price movement [1] - Implied volatility reflects market expectations for future stock movement, suggesting that investors anticipate a significant event that could lead to a rally or sell-off [2] - Currently, U.S. Physical Therapy holds a Zacks Rank 3 (Hold) in the Medical - Outpatient and Home Healthcare industry, which is in the top 27% of the Zacks Industry Rank [3] Group 2 - Over the past 30 days, no analysts have raised their earnings estimates for the current quarter, while one analyst has lowered the estimate, resulting in a decrease of the Zacks Consensus Estimate from 79 cents to 74 cents per share [3] - The high implied volatility may indicate a trading opportunity, as options traders often seek to sell premium on options with high implied volatility, aiming for the underlying stock to not move as much as expected at expiration [4]

Business Segments and Operations - The company operates through two reportable business segments: physical therapy and industrial injury prevention services, with a focus on orthopedic-related disorders and sports injuries [158]. - As of March 31, 2025, the company owned or managed a total of 736 clinics, an increase from 679 clinics as of March 31, 2024, reflecting a net addition of 57 clinics [164]. - The company managed 37 clinics owned by third parties as of March 31, 2025, bringing the total owned/managed clinics to 773 [164]. - The company plans to continue acquiring outpatient physical therapy practices and expand its industrial injury prevention services [165]. - The company completed several acquisitions, including a 65% interest in 3 clinics in February 2025 and a 75% interest in 8 clinics in November 2024 [161]. - The company acquired an outpatient home care therapy practice through its 50% owned subsidiary, generating approximately $2.1 million in annual revenue [166]. Financial Performance - Net revenue for the 2025 First Quarter increased by $28.1 million, or 18.1%, to $183.8 million compared to $155.7 million in the 2024 First Quarter [176]. - Net patient revenue rose to $152.5 million, representing an increase of 16.4% from $131.1 million in the prior year [175]. - Operating income was $19.6 million for the 2025 First Quarter, an increase from $14.9 million in the 2024 First Quarter [211]. - Net income attributable to USPH shareholders was $9.9 million, a 23.0% increase from $8.0 million in the 2024 First Quarter [179]. - Earnings per share for the 2025 First Quarter was $0.80, compared to $0.46 in the 2024 First Quarter [181]. - Adjusted EBITDA for the 2025 First Quarter was $19.5 million, an increase of 16.5% from $16.8 million in the prior year [193]. Revenue and Cost Analysis - Operating costs increased by $25.4 million, or 20.0%, to $152.7 million, driven by the addition of 53 net clinics and an increase in patient visits [176]. - Gross profit for the 2025 First Quarter was $31.1 million, or 16.9% of net revenue, down from 18.2% in the previous year [178]. - The net rate per patient visit increased to $105.66, up $2.29 from $103.37 in the 2024 First Quarter, despite a 2.9% Medicare rate reduction [177]. - Industrial Injury Prevention (IIP) revenue increased by $6.1 million, or 28.8%, to $27.4 million for the 2025 First Quarter compared to $21.3 million for the 2024 First Quarter [208]. - Operating costs increased by $20.6 million, or 18.6%, to $130.9 million in the 2025 First Quarter, primarily due to the addition of 53 net new clinics [202]. - Gross profit from physical therapy operations was $25.5 million with a gross profit margin of 16.3% in the 2025 First Quarter, compared to $24.1 million and a margin of 17.9% in the 2024 First Quarter [207]. Cash Flow and Financing - Total cash and cash equivalents were $39.2 million as of March 31, 2025, down from $132.3 million at March 31, 2024 [220]. - Cash used by operating activities was $4.7 million for the 2025 First Quarter, compared to $4.4 million provided by operating activities for the 2024 First Quarter [226]. - Cash used in investing activities for Q1 2025 totaled $6.6 million, primarily for business interests and fixed asset purchases [227]. - Cash provided by financing activities for Q1 2025 was $9.1 million, mainly from $17.0 million in proceeds from the Revolving Facility [228]. - As of March 31, 2025, $135.9 million was outstanding on the Term Facility, with an interest rate of 4.9% for Q1 2025 [237]. Interest Rates and Debt - The company has a $150 million Term Facility with quarterly amortization and a maturity date of June 17, 2027 [234]. - The interest rate swap agreement has a notional value of $150 million, with a fixed rate of 2.815% [238]. - A 1% change in interest rates would yield an additional $0.1 million in interest expense on seller notes and $0.3 million on Credit Facilities due to the interest rate swap [252]. - The company was in compliance with all covenants in the Credit Agreement as of March 31, 2025 [235]. Employee and Operational Considerations - The company emphasizes the importance of hiring and retaining qualified employees, which is critical for its operations [160]. Dividends - The company declared a quarterly dividend of $0.45 per share, payable on June 13, 2025, to shareholders of record on May 23, 2025 [165]. Medicare Reimbursement - The Medicare reimbursement for therapy services decreased by approximately 2.9% for 2025 compared to the rates in effect for most of 2024, following a 1.8% reduction for the balance of 2024 [169]. - The company faced a 3.5% decrease in Medicare payments for therapy services from January 1 to March 8, 2024, which was later minimized to a 1.8% reduction [169].

Core Viewpoint - U.S. Physical Therapy (USPH) reported quarterly earnings of $0.48 per share, exceeding the Zacks Consensus Estimate of $0.46 per share, but down from $0.51 per share a year ago, indicating a mixed performance in earnings [1] Financial Performance - The company achieved revenues of $183.79 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 3.60% and showing an increase from $155.68 million year-over-year [2] - Over the last four quarters, U.S. Physical Therapy has exceeded consensus EPS estimates two times and topped consensus revenue estimates four times [2] Stock Performance - U.S. Physical Therapy shares have declined approximately 19.3% since the beginning of the year, contrasting with the S&P 500's decline of 4.7% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating it is expected to perform in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.79 on revenues of $189.46 million, and for the current fiscal year, it is $2.63 on revenues of $752.89 million [7] - The estimate revisions trend for U.S. Physical Therapy is mixed, which may change following the recent earnings report [6] Industry Context - The Medical - Outpatient and Home Healthcare industry, to which U.S. Physical Therapy belongs, is currently ranked in the top 22% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]

Financial Data and Key Metrics Changes - The company reported a record high average visits per day for the first quarter at 31.4, with a strong finish in March at 33.2 visits per clinic per day [7][32] - Adjusted EBITDA increased by 16.5% despite headwinds, with a notable performance in March [16] - The net rate for the first quarter was $105.66, an increase of $2.29 per visit compared to the previous year, despite a 2.9% Medicare rate cut [33][34] - Physical therapy revenues reached $156.4 million, up 16.4% year-over-year, driven by higher net rates and acquisitions [36] - The physical therapy margin was 16.3%, down from 17.9% in the previous year, but exceeded 20% in March [38] Business Line Data and Key Metrics Changes - The injury prevention (IIP) segment saw revenue growth of 28.8% year-over-year, with gross profit up 13.1% [39] - The workers' compensation revenue mix increased from 9.3% in Q1 2023 to 10.9% in Q1 2025, the highest since 2020 [35] - The company added 14 centers in the quarter, contributing to growth in both organic and acquisition-driven revenue [23] Market Data and Key Metrics Changes - The company faced significant weather-related disruptions, losing approximately 26,000 visits in the first quarter, primarily in January and February [32][46] - The impact of weather was particularly pronounced in major markets like Nashville and Texas, affecting overall performance [46] Company Strategy and Development Direction - The company is focused on increasing reimbursement rates through contract negotiations and expanding its workers' compensation business [34] - There is an emphasis on acquisitions as a primary focus for capital allocation, with ongoing diligence on several potential deals [41] - The company is exploring home care capabilities, leveraging the Metro acquisition to enhance service offerings [107][110] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about demand recovery following weather disruptions, with expectations for strong performance moving forward [47][48] - The company is preparing for potential economic downturns, citing past experiences and a solid demand outlook [52][54] - Management is hopeful about updating guidance in the coming months, indicating that current performance exceeds internal projections [27][28] Other Important Information - The company has a favorable debt position with $129.4 million in term loans at a 4.7% interest rate and a $175 million revolving credit facility with only $28 million drawn [40][41] - Corporate office costs were 8.8% of net revenue, down from 9% in the previous year, indicating improved cost management [39] Q&A Session Summary Question: What was the guiding volume inside the negative number for mature clinic revenue? - Management indicated that weather had a significant impact, particularly in established markets, leading to a decline in visits [46][49] Question: How has the business performed during past economic downturns? - Management noted that during the 2008-2009 recession, the company continued to grow and acquire facilities despite some negative impacts on same-store volume [52][54] Question: What are the drivers behind the IIP outperformance? - Management highlighted the effectiveness of injury prevention programs and the organic growth from existing clients as key drivers [60][62] Question: Can you provide more color on the commercial side and workers' compensation rates? - Management confirmed that commercial rates increased by over 3%, with workers' compensation rates also showing strong growth [86] Question: What are the biggest learnings from the Metro leadership meetings? - Management emphasized the strong leadership and growth plans at Metro, which could be beneficial for other partnerships [106][108]

Financial Data and Key Metrics Changes - The company reported a 16.5% increase in adjusted EBITDA despite headwinds, with the first quarter typically being the lightest volume quarter of the year [16][30] - Average visits per clinic per day reached a record high of 31.4, with a strong finish in March at 33.2 visits per clinic per day [6][31] - The net rate for the first quarter was $105.66, an increase of $2.29 per visit compared to the previous year, despite a 2.9% Medicare rate cut [32][34] Business Line Data and Key Metrics Changes - Physical therapy revenues increased by 16.4% year-over-year to $156.4 million, driven by higher net rates and acquisitions [35] - The injury prevention (IIP) segment saw a revenue increase of 28.8% year-over-year, with gross profit up 13.1% [38] - The physical therapy margin was reported at 16.3%, down from 17.9% in the previous year, but above 20% in March [37] Market Data and Key Metrics Changes - Workers' compensation as a percentage of revenue increased from 10% in the first quarter of last year to 10.9% this year, the highest since 2020 [34] - The company lost approximately 26,000 visits due to weather impacts in the first quarter, with significant losses in January and February [31][48] Company Strategy and Development Direction - The company is focused on increasing reimbursement rates through contract negotiations and expanding its workers' compensation business [33] - There is an emphasis on acquisitions, with the Metro acquisition contributing significantly to revenue growth [35][21] - The company is exploring home care capabilities, which are seen as a growth opportunity due to patient demand and flexibility for clinicians [110][116] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about demand and the potential for recovery following weather-related disruptions [48] - The company is preparing for potential economic downturns, citing past experiences and a strong demand outlook [52][54] - Management is hopeful about updating guidance in the coming months as performance improves [27] Other Important Information - The company has a favorable debt position with $129.4 million in term loan debt at a rate of 4.7% and a $175 million revolving credit facility with only $28 million drawn [40] - The corporate office costs were 8.8% of net revenue, down from 9% in the previous year [38] Q&A Session Summary Question: What was the guiding volume inside the negative mature clinic revenue? - Management indicated that weather had a significant impact on mature clinic revenue, particularly in established markets like Nashville and Texas [47][50] Question: How has the business performed during past economic downturns? - Management noted that during the 2008-2009 recession, the company continued to grow and acquire facilities despite some negative impacts on same-store volume [52][54] Question: What are the drivers of IIP outperformance? - The IIP segment's growth is attributed to effective injury prevention strategies that reduce reported injuries and improve employee satisfaction [62][66] Question: What is the outlook for staffing during a potential recession? - Management stated that staffing availability could improve during a recession, but it is difficult to predict [56][57] Question: Can you provide more details on the commercial rate increases? - Commercial rates increased by over 3%, with workers' compensation rates also showing strong growth [88] Question: What are the expectations for same-store volume growth? - Management expects to see growth in same-store volume for the year, particularly after overcoming weather-related challenges [92] Question: What initiatives are in place to trim excess costs? - The company is actively reviewing its top partnerships to identify areas for improvement and cost control [101]

Core Viewpoint - U.S. Physical Therapy (USPH) reported quarterly earnings of $0.41 per share, missing the Zacks Consensus Estimate of $0.46 per share, and showing a decline from $0.51 per share a year ago, indicating a -10.87% earnings surprise [1] Financial Performance - The company posted revenues of $183.79 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 3.60%, compared to $155.68 million in the same quarter last year [2] - Over the last four quarters, U.S. Physical Therapy has exceeded consensus revenue estimates four times [2] Stock Performance - U.S. Physical Therapy shares have declined approximately 19.3% since the beginning of the year, while the S&P 500 has decreased by -4.7% [3] - The current Zacks Rank for the stock is 3 (Hold), indicating expected performance in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.79 on revenues of $189.46 million, and for the current fiscal year, it is $2.63 on revenues of $752.89 million [7] - The estimate revisions trend for U.S. Physical Therapy is mixed, which may change following the recent earnings report [6] Industry Context - The Medical - Outpatient and Home Healthcare industry is currently in the top 22% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]

Financial Performance - Adjusted EBITDA for Q1 2025 was $19.5 million, a 16.5% increase from $16.8 million in Q1 2024[19] - Net income attributable to USPH's shareholders for Q1 2025 was $9.9 million, compared to $8.0 million in Q1 2024, with earnings per share rising to $0.80 from $0.46[18] - Operating income for Q1 2025 was $19.6 million, a 31.6% increase from $14.9 million in Q1 2024[13] - The company reported a net income of $13.5 million for the first quarter of 2025, compared to $11.6 million in the same quarter of 2024, representing a 15.9% increase[33] - Comprehensive income attributable to USPH shareholders for the first quarter of 2025 was $8.9 million, down from $9.4 million in the same quarter of 2024[34] - Net income including non-controlling interest for the three months ended March 31, 2025, was $13,468 thousand, compared to $11,617 thousand for the same period in 2024, reflecting a year-over-year increase of 15.9%[38] - Adjusted EBITDA for the first quarter of 2025 was $19,539 thousand, up from $16,771 thousand in the first quarter of 2024, indicating a growth of 10.5%[45] - Basic and diluted earnings per share attributable to USPH shareholders increased to $0.80 for the first quarter of 2025, compared to $0.46 in the same quarter of 2024[33] - Earnings per share (basic and diluted) for the first quarter of 2025 were $0.80, compared to $0.46 in the first quarter of 2024, reflecting a significant increase of 73.9%[45] Revenue and Patient Metrics - Total revenue from physical therapy operations increased by $22.0 million, or 16.4%, to $156.4 million in Q1 2025[8] - Net patient revenue for the three months ended March 31, 2025, was $152.5 million, up 16.4% from $131.1 million for the same period in 2024[33] - Average daily patient visits per clinic reached an all-time high of 31.4 in Q1 2025, up from 29.5 in Q1 2024, with total patient visits increasing by 13.9%[2] - The number of clinic visits increased to 1,443,805 in Q1 2025, compared to 1,268,002 in Q1 2024, representing a growth of approximately 13.8%[51] - The average net rate per visit rose to $105.66 in Q1 2025, up from $103.37 in Q1 2024, indicating an increase of 2.2%[51] Clinic Operations - The company added 14 clinics and closed 7 clinics, bringing the total clinic count to 773 as of March 31, 2025[2] - The company operated 736 clinics as of March 31, 2025, an increase from 679 clinics a year earlier, reflecting a growth of 8.4%[52] - The company managed a total of 773 clinics (owned and managed) as of March 31, 2025, compared to 720 clinics a year prior, marking a 7.4% increase[53] - The company added 14 new clinics in Q1 2025, maintaining a steady growth trajectory[52] - The company closed or sold 7 clinics in Q1 2025, compared to 6 in Q1 2024, indicating ongoing adjustments in its clinic portfolio[52] Costs and Expenses - Corporate office costs increased to $16.2 million in Q1 2025 from $14.1 million in Q1 2024, but improved as a ratio to net revenue to 8.8%[12] - Total operating costs for the first quarter of 2025 were $152.7 million, an increase from $127.3 million in the same quarter of 2024[33] - Salaries and related costs per visit decreased slightly to $63.58 in Q1 2025 from $63.53 in Q1 2024[48] - Operating costs per visit also saw a minor reduction, from $89.33 in Q1 2024 to $89.28 in Q1 2025[48] - The company incurred clinic closure costs of $242 thousand in Q1 2025, associated with the closure of 7 clinics, compared to $126 thousand for 6 clinics in Q1 2024[45] Cash and Assets - Total cash and cash equivalents decreased to $39.2 million as of March 31, 2025, from $41.4 million as of December 31, 2024, and $132.3 million as of March 31, 2024[20] - Cash and cash equivalents decreased to $39,183 thousand at the end of March 2025, down from $41,362 thousand at the beginning of the period, a decline of 5.3%[38] - Total assets increased to $1,179,687 thousand as of March 31, 2025, up from $1,167,467 thousand at December 31, 2024, representing a growth of 1.9%[36] - The total current liabilities increased to $123,795 thousand as of March 31, 2025, from $116,283 thousand at December 31, 2024, marking a rise of 6.3%[36] - The company’s total liabilities reached $420,679 thousand as of March 31, 2025, an increase from $408,421 thousand at December 31, 2024, representing a growth of 3.2%[36] Dividends and Acquisitions - The company declared a quarterly dividend of $0.45 per share, payable on June 13, 2025[3] - The company declared a quarterly dividend of $0.45 per share, an increase from $0.44 per share in the previous year[24] - The company acquired a 65% equity interest in a three-clinic practice generating $4.3 million in annual revenue[21] - An outpatient home care physical and speech therapy practice was acquired, generating approximately $2.1 million in annual revenue[22] Future Outlook - The company aims to continue acquiring multi-clinic outpatient physical therapy practices and develop outpatient clinics as satellites in existing partnerships[23] - Future outlook includes continued expansion and management of clinics, with a focus on enhancing operational efficiency and profitability[48]

Core Insights - The U.S. outpatient physical and occupational therapy centers industry is valued at $53 billion and is characterized by high fragmentation, with the top 50 competitors accounting for only 29% of total revenues, indicating potential for consolidation [2][3] - Moderate growth is anticipated, driven by factors such as a stable reimbursement environment, outpatient efficiencies, an alternative to opioid therapy, and increasing demand due to an aging population [2][4] Industry Overview - The industry primarily consists of small to medium regional providers, with an average annual revenue of $871,000 [3] - There is a notable increase in mergers and acquisitions (M&A) activity from both strategic buyers and private equity investors [3] - Physical therapists operate in various settings, including hospitals, private practices, outpatient clinics, homes, schools, sports facilities, workplaces, and nursing homes [3] Market Characteristics - The report includes an analysis of industry characteristics, national receipts, growth forecasts from 2007 to 2030, and the impact of the COVID-19 pandemic on operations and revenues [4] - Key industry trends include diversification, technological advancements, consolidation potential, and increased patient engagement tools [8] Financial Metrics - The report provides extensive operating ratios, including metrics such as the number of facilities, receipts, annual payroll, and average receipts per facility from 2002 to 2022 [8] - A sample profit and loss statement for an average physical therapy center in 2024 is included, along with gross profit margins for U.S. Physical Therapy from 2007 to 2023 [8] Growth Forecasts - The analysis projects industry size and growth from 2007 to 2030, with specific forecasts for 2025 and 2030 [13] - Factors influencing demand include the aging population, obesity rates, and the supply of therapists [13] Competitor Analysis - In-depth profiles of key competitors such as U.S. Physical Therapy, ATI Physical Therapy, Select Medical, and others are provided, detailing their operations and financial performance [4][18]

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 September 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM _____TO _____ COMMISSION FILE NUMBER 1-11151 U.S. PHYSICAL THERAPY, INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) Indicate by check mark whe ...

Financial Performance - For the second quarter of 2022, the company reported a net income of $11.2 million, a decrease of 9.0% from $12.4 million in the same period of 2021[183]. - Total revenue for the second quarter of 2022 was $140.7 million, representing a 10.8% increase compared to $126.9 million in the second quarter of 2021[192]. - Revenue from physical therapy operations increased by $4.9 million, or 4.3%, to $119.1 million for the second quarter of 2022 from $114.2 million for the same period in 2021[192]. - Revenue from the industrial injury prevention services business surged 93.7% to $19.4 million in the second quarter of 2022 compared to $10.0 million in the second quarter of 2021[195]. - The company's Operating Results for the second quarter of 2022 was $11.7 million, or $0.90 per diluted share, compared to $12.4 million, or $0.96 per diluted share, in the second quarter of 2021[184]. - Net operating revenue for the first six months of 2022 was $272.4 million, an increase of 13.8% from $239.3 million in the same period of 2021[213]. - Revenue from industrial injury prevention services surged 92.1% to $38.5 million in the first six months of 2022 compared to $20.0 million in 2021[216]. - Operating income for Q2 2022 was $20.1 million, representing 14.3% of total revenue, down from $22.2 million or 17.5% in Q2 2021[206]. - Operating income for the 2022 Six Months was $35.1 million, which is 12.9% of total revenue, down from $37.3 million or 15.6% in the 2021 Six Months[228]. Patient Metrics - The average net patient revenue per visit decreased to $103.18 in the second quarter of 2022 from $104.46 in the second quarter of 2021[193]. - Total patient visits increased by 5.7% to 1,145,554 in the second quarter of 2022 compared to 1,084,070 in the same period of 2021[193]. - Total patient visits increased by 8.7% to 2,209,073 in the first six months of 2022 from 2,031,858 in the same period of 2021[214]. - Average net patient revenue per visit was $103.09 for the first six months of 2022, down from $104.58 in the same period of 2021[214]. Operating Costs - Total operating cost for Q2 2022 was $109.8 million, representing 78.1% of total revenue, up from $92.6 million or 73.0% in Q2 2021[197]. - Total operating cost for the 2022 Six Months was $215.0 million, representing 78.9% of total revenue, compared to $179.1 million or 74.8% for the 2021 Six Months[219]. - Salaries and related costs for physical therapy operations increased to $66.7 million in Q2 2022, accounting for 56.1% of physical therapy operations revenue, compared to 53.1% in Q2 2021[198]. - Salaries and related costs were 56.9% of net revenue for the 2022 Six Months, up from 55.4% in the 2021 Six Months, with physical therapy operations salaries at $129.2 million[220]. - Corporate office costs decreased to $10.7 million in Q2 2022, representing 7.6% of total revenue, down from 9.5% in Q2 2021[205]. Profitability - Gross profit for Q2 2022 decreased to $30.8 million, a decline of 10.2% from $34.3 million in Q2 2021, with a gross profit percentage of 21.9% compared to 27.0%[204]. - Gross profit for the 2022 Six Months was $57.4 million, a decrease of $2.8 million or approximately 4.6% from $60.2 million in the 2021 Six Months, with a gross profit percentage of 21.1%[226]. Tax and Legal Matters - The provision for income tax was $4.2 million in Q2 2022, with an effective tax rate of 27.5%, slightly up from 26.9% in Q2 2021[209]. - Provision for income tax was $7.7 million for the 2022 Six Months, with an effective tax rate of 27.9%, compared to $7.5 million and 26.7% for the 2021 Six Months[231]. - The company is involved in various legal actions and regulatory audits that could potentially have a material adverse effect on its business and financial position[278]. - The company may face qui tam lawsuits under the federal False Claims Act, which can involve significant monetary damages and penalties[279]. Acquisitions and Growth Strategy - The company expects to continue adding personnel to support growth and potential acquisitions[182]. - The company completed acquisitions of four multi-clinic practices and two industrial injury services businesses during the 2021 year and the first half of 2022[175]. - The company plans to continue developing new clinics and making additional acquisitions, funded through a combination of cash and financing[254]. - The company acquired a 70% interest in a six-clinic physical therapy practice for approximately $11.5 million, with $11.2 million paid in cash and $0.3 million as a note payable[245]. - A 75% interest in a three-clinic physical therapy practice was acquired for about $3.7 million, with $3.5 million in cash and $0.2 million as a note payable[246]. - The company secured a $150 million term loan facility, amortizing at rates of 0.625% for the first two years, 1.250% for the third and fourth years, and 1.875% in the fifth year[247]. - An acquisition of a leading provider of industrial injury prevention services was made for approximately $63.2 million, generating annual revenue of about $27.0 million at a 20% margin[248]. - The company acquired a company specializing in return-to-work services for approximately $3.3 million, with an annual revenue exceeding $2.0 million[249]. - A 65% interest in an eight-clinic physical therapy practice was purchased for about $10.3 million, with an additional contingent payment of up to $0.8 million based on future operational objectives[250]. Financial Position and Credit Facilities - Cash and cash equivalents increased by $20.4 million from December 31, 2021, to June 30, 2022, totaling $48.6 million[235]. - The company entered into a Third Amended and Restated Credit Agreement providing for loans of $325 million, maturing on June 17, 2027[236]. - The interest rate for the Senior Credit Facilities is currently 4.665%[240]. - The provision for credit losses as a percentage of net revenue was 1.0% in the 2022 Second Quarter, down from 1.1% in the comparable period in 2021[224]. - As of June 30, 2022, the balance on outstanding notes payable was $5.7 million, with interest rates ranging from 3.25% to 5.5% per annum[257]. - The company has accrued $7.9 million related to credit balances due to patients and payors, expected to be paid in the next twelve months[259]. Risk Management and Internal Controls - The company entered into an interest rate swap agreement with a notional value of $150 million, effective June 30, 2022, maturing on June 30, 2027, receiving 1-month SOFR and paying a fixed interest rate of 2.815% plus an additional margin[273]. - The interest rate swap is designated as a cash flow hedge, with unrealized gains and losses recorded in accumulated other comprehensive income (loss), net of tax[274]. - The company's management evaluated the effectiveness of disclosure controls and procedures, concluding they are designed to ensure timely and accurate reporting as required by the SEC[276]. - There have been no changes in internal control over financial reporting that materially affected the company's financial reporting during the covered period[277].