Financial Data and Key Metrics Changes - For Q4 2025, revenue was $1.36 billion, a 12% increase year-over-year. Net income was $59.8 million, with adjusted EBITDAR at $237.7 million and adjusted EBITDA at $142.1 million [23] - For the full year 2025, total revenue reached $5.29 billion, representing a 29% growth compared to 2024. Net income was $191.5 million, with diluted earnings per share at $1.22. Adjusted EBITDAR totaled $883.9 million, and adjusted EBITDA was $505 million [24] Business Line Data and Key Metrics Changes - Total occupancy for the year averaged 89.1%, with mature facilities at 94.9% occupancy, up from 94.4% the previous year. Ramping facilities averaged 86.3% occupancy, down from over 93% in the prior year [24][25] - New facilities averaged 81.1% occupancy compared to 82.8% in 2024, reflecting the onboarding and stabilization period for recently acquired facilities [25] Market Data and Key Metrics Changes - PACS operates 321 facilities across 17 states, caring for over 31,700 patients daily, supported by over 47,000 team members [7] - The company maintains a strong balance sheet with a net leverage of approximately 0.3 times, enhancing durability and flexibility for future investments [8][28] Company Strategy and Development Direction - The company focuses on integrating and optimizing its expanded portfolio, investing in people and clinical capabilities, and maintaining disciplined capital allocation for acquisitions [9][22] - PACS aims to serve as a responsible consolidator in the fragmented skilled nursing landscape, leveraging demographic trends that indicate sustained growth in the aging population [9] Management's Comments on Operating Environment and Future Outlook - Management expresses optimism for 2026, expecting steady organic growth and margin expansion through improved occupancy and skilled mix across the portfolio [30] - The company anticipates revenue for 2026 to be in the range of $5.65 billion to $5.75 billion, representing nearly an 8% growth over 2025 [29] Other Important Information - The company executed 8 strategic acquisitions in 2025, enhancing local scale and density within existing markets [5] - PACS has a robust pipeline for potential acquisitions, with a disciplined approach to evaluating distressed facilities [38] Q&A Session Summary Question: Can you discuss payer conversations and share gain opportunities? - Management highlighted that as facilities improve quality metrics, they become attractive partners for insurers, leading to stronger contract negotiations [34][35] Question: What is the M&A pipeline outlook? - The company expects to acquire about 5 facilities per quarter in 2026, focusing on underperforming assets with low occupancy [37] Question: Are there opportunities for more de novo activity? - While acquisitions remain the primary growth strategy, management is open to de novo developments if they make sense in certain states [41] Question: What are the pricing trends in the M&A environment? - Management noted that while prices have increased due to inflation, they are starting to plateau, allowing for selective and opportunistic acquisitions [43]