U.S. Physical Therapy(US:USPH)2022-02-26 17:57Financial Data and Key Metrics Changes - Operating income increased by $18.2 million or 34.8% compared to 2020, with reported revenue rising 17% to $495 million [5][12] - Physical therapy net revenue increased by 17.4%, while the net rate dropped from $105.66 in 2020 to $103.88 in 2021 due to reduced Medicare pricing [6][23] - Gross profit reached $117.2 million in 2021, a 19.1% increase, with a gross margin of 23.7% [11][26] - Adjusted EBITDA for the full year was $74.3 million, a 31.5% increase from 2020 [21] Business Line Data and Key Metrics Changes - Physical therapy revenues were $441.3 million for the full year, a 17.6% increase over 2020, and $114.2 million for Q4 2021, an 8.6% increase [24] - Injury prevention services revenue increased by 12% for the year and 38.5% in Q4 2021, reaching all-time highs of $43.9 million for the full year [24][26] Market Data and Key Metrics Changes - The company experienced strong visit volumes, with visits per clinic per day averaging 29.1 for the full year and peaking at 29.8 in Q4 2021 [22] - The net rate for physical therapy operations was $103.88 for the full year, reflecting a 3.5% Medicare rate cut [23] Company Strategy and Development Direction - The company plans to focus on managing through Medicare rate reductions in 2022, with guidance for operating results per share set between $3.25 and $3.35 [32][34] - Significant acquisition-related capital was deployed in 2021, with a focus on growth opportunities in the physical therapy and injury prevention sectors [13][30] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about 2022 prospects despite challenges from COVID-19 and inflation, noting a strong performance in 2021 [32][19] - The labor market remains challenging, but turnover rates for licensed clinicians have decreased compared to pre-pandemic levels [17][18] Other Important Information - The Board of Directors approved an increase in the first quarter dividend from $0.38 to $0.41 per share, reflecting confidence in the company's growth [14] - The company ended 2021 with a strong balance sheet, including $114 million in revolving credit facilities and a net debt of $94 million [30][31] Q&A Session Summary Question: Guidance on same-store sales volumes and margin expectations - Management indicated a 2% to 3% increase in volume for Mature Clinics, with net rates expected to decline slightly [40] Question: Impact of COVID-19 on first quarter performance - Management acknowledged that the first quarter would likely be lighter due to COVID and weather impacts, but noted improvements in COVID cases [39] Question: Turnover rates and staffing challenges - Management confirmed that turnover is higher for back-office staff, while clinical turnover rates have improved compared to pre-pandemic levels [44][55] Question: Industrial Injury Prevention segment and trade shows - Management expressed hope for the return of trade shows and noted ongoing conversations for new client acquisitions in the segment [61] Question: M&A activity and market conditions - Management reported increased inbound interest for M&A, indicating a busy environment for potential acquisitions [64]