Financial Data and Key Metrics Changes - Total company revenue for Q4 2025 was $539.1 million, a 15.9% increase from $465 million in Q4 2024 [6] - For the full year 2025, revenue reached $2.2 billion, up 13.9% from $1.9 billion in 2024 [7] - Adjusted EBITDA for Q4 2025 was $95.3 million, a 22.9% increase from $77.5 million in Q4 2024 [12] - Adjusted net income attributable to the company was $36.1 million for Q4 2025, compared to $22.2 million in the prior year [15] Business Line Data and Key Metrics Changes - Occupational health center segment revenue was $490.6 million in Q4 2025, a 12.2% increase year-over-year [18] - Workers' compensation revenue in Q4 2025 was $328.5 million, up 13.6% from the prior year [19] - On-site health clinics segment reported revenue of $36.2 million in Q4 2025, a 112% increase year-over-year, largely due to the acquisition of Pivot [21] Market Data and Key Metrics Changes - Total patient visits increased 9% to over 51,000 visits per day in Q4 2025 [7] - Workers' compensation visits per day increased 9.1%, while employer service visits increased 9.4% compared to the prior year [8] - The U.S. labor market grew at a rate of 0.1% in 2025, but the blue-collar economy added over 450,000 net jobs, growing at 0.4% [10] Company Strategy and Development Direction - The company plans to continue with smaller bolt-on acquisitions, which are expected to be highly accretive due to top-line and cost synergies [17] - The company is targeting 7 to 9 de novo openings in 2026, which would be a record for the company [32] - The company is actively monitoring the New York workers' compensation fee schedule for potential opportunities to expand into the state [33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term outlook for the U.S. labor market, expecting to add 5.2 million jobs from 2024 through 2034 [10] - The company anticipates steady growth in revenue per visit and visits, with a focus on maintaining efficiency gains captured in 2025 [36] - Management noted that they are largely through the integration process for the Nova and Pivot acquisitions and have captured most expected synergies [32] Other Important Information - The company generated $118.7 million in operating cash flow in Q4 2025, compared to $93.7 million in Q4 2024 [27] - Free Cash Flow for the full year was $197.8 million, with a conversion rate of 114% [29] - The company declared a cash dividend of $0.0625 per share, payable on March 19, 2026 [37] Q&A Session Summary Question: How are you contemplating impacts from weather or potential elevated respiratory activity? - Management indicated that weather has not significantly impacted operations and does not anticipate material effects from respiratory activity [42] Question: Can you elaborate on your Return on Invested Capital assessment for new opportunities? - Management stated they closely monitor ROIC and have a track record of successful M&A and de novo execution, typically resulting in strong ROICs [44] Question: What are your expectations regarding the New York opportunity? - Management highlighted the need for a comprehensive look at the fee schedule and expressed readiness to move quickly into the market once conditions improve [51] Question: How do you view the 2026 outlook in terms of seasonality and de novo investments? - Management confirmed that they expect a pickup in Q1 from recent acquisitions and are working on spreading de novo openings throughout the year [58] Question: What is the impact of the Select services agreement expiration on margins? - Management noted that they are nearing completion of the hiring process and expect TSA costs to ramp down by mid-2026, which will have some impact on margins [62] Question: How is labor retention trending and what wage inflation is built into the guide? - Management reported normal wage inflation trends of 2%-3% and noted improvements in retention and reduced turnover [67][68]
Concentra Group Holdings Parent, Inc.(CON) - 2025 Q4 - Earnings Call Transcript