Financial Data and Key Metrics Changes - The adjusted EBITDA for Q4 2025 was $66 million, aligning with the upwardly adjusted guidance, while the full-year adjusted EBITDA reached $276 million [5][6] - The company expects 2026 adjusted EBITDA to be in the range of $280 million to $300 million, representing a 5% increase from 2025 [6][10] - Consolidated revenue decreased due to net non-same-unit activity of $26 million, but same-unit growth was 4% with pricing up just under 7% [7][10] Business Line Data and Key Metrics Changes - Patient service volumes decreased by just under 3%, with NICU days down about 2% [7][8] - Variable practice incentive compensation and salary and benefits increased on a same-unit basis, while G&A expenses rose year-over-year due to salary and travel expenses [8][9] Market Data and Key Metrics Changes - The company ended Q4 with cash of $375 million and net debt of just over $220 million, reflecting a net leverage of just under 1x [9] - The accounts receivable days sales outstanding (AR DSO) improved to 42.8 days, down almost five days year-over-year [9] Company Strategy and Development Direction - The company introduced new programs to align physicians with cash bonuses and stock price tracking elements, aiming to enhance care quality and organizational alignment [12][13] - Pediatrix is focusing on leveraging telemedicine and expanding its presence in OB hospital medicine, with plans for growth in NICUs and maternal-fetal medicine [13][15] Management's Comments on Operating Environment and Future Outlook - Management noted that the operating environment remains stable, with expectations for steady metrics in 2026, although potential impacts from ACA subsidies are acknowledged [6][10] - The company is committed to maintaining its balance sheet strength and will only consider growth opportunities that do not dilute its core pediatrics and obstetrics strengths [15][41] Other Important Information - The company plans to update on potential M&A activity in 2026, with a focus on maintaining its core strengths while exploring growth opportunities [11][41] Q&A Session Summary Question: Drivers of revenue growth for 2026 - Management indicated that revenue growth is expected to be flat in both volume and pricing for 2026 [18][19] Question: Reasons for negative patient volume year-over-year - Management attributed the decline in patient volume to tough comparisons from Q4 of the previous year [20][21] Question: Details on variable compensation expenses - Management noted that various factors influenced Q4 operations, emphasizing alignment rather than smoothing effects for future years [25][26] Question: Guidance on pricing and payer mix - Management confirmed that pricing is expected to remain steady, with no significant changes anticipated in payer mix for 2026 [30][31] Question: G&A cost reduction assumptions - Management acknowledged a small expected decline in G&A expenses year-over-year, with no specific factors identified [37][38] Question: Share repurchase plans - Management indicated a smaller amount of stock buyback is anticipated in the current guidance compared to 2025 [39][40] Question: Sustainability of pricing strength - Management highlighted strong RCM collections and favorable payer mix as key drivers of pricing strength, with expectations for stability moving into 2026 [45][46]