Ensign Group(US:ENSG)2024-02-02 20:38Financial Data and Key Metrics Changes - Consolidated GAAP revenues and adjusted revenues for the year were both $3.73 billion, an increase of 23% [35] - GAAP diluted earnings per share was $3.65, and GAAP net income was $209.4 million [35] - Adjusted diluted earnings per share was $4.77, an increase of 15.2%, and adjusted net income was $273.5 million, an increase of 16% [61] - Cash and cash equivalents stood at $509.6 million, with cash flow from operations at $376.7 million [36] - The company achieved a lease adjusted net debt-to-EBITDA ratio of 1.98x [36] - The quarterly cash dividend was increased to $0.06 per share, marking the twenty-first consecutive annual dividend increase [37] Business Line Data and Key Metrics Changes - Same-store occupancy was 79.9%, growing by 240 basis points year-over-year and 40 basis points sequentially [7] - Managed care revenue and managed care census increased by 12.3% and 3.5%, respectively, over the prior year quarter [7] - Skilled mix days improved by 17%, driven by a 40% increase in managed care days [59] - The senior living section maintained 100% occupancy for all of 2023, with revenues growing by 13.4% over the prior year quarter [18] Market Data and Key Metrics Changes - The company is now operating in 14 states, with significant potential for growth in the remaining 36 states [31] - The pipeline for new deals remains strong, with over $1 billion available for future investments [15] Company Strategy and Development Direction - The company focuses on a locally driven healthcare model, emphasizing the importance of leadership quality in operations [13] - Plans to continue improving expense management and driving occupancy in recently acquired operations [10] - The company is committed to a disciplined acquisition strategy, only pursuing growth when the right leaders and pricing are in place [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the future, citing strong clinical results and cultural values as key drivers [9] - The company anticipates continued organic growth potential within its existing portfolio and is optimistic about the upcoming year [10] - Management noted that many operators in the industry are struggling, presenting opportunities for acquisitions [32] Other Important Information - The company settled a litigation matter, allowing it to focus on its mission of providing high-quality healthcare services [38] - The company has over $593 million of available capacity on its line of credit, contributing to its liquidity for future growth [62] - CMS is reviewing comments for a federal minimum staffing rule, but the company does not expect it to impact operations in 2024 [63] Q&A Session Summary Question: Can you break down the top-line guidance and its drivers? - Management projected mid-single digits growth in same-store revenue, high-single digits in transitioning, and low-double digits in recently acquired operations [42] Question: What is the status of the California Medicaid rebasing process? - The state is undergoing a re-base program starting January 1, 2024, which is currently awaiting CMS approval [84] Question: How will the recent legal settlement impact future operations? - The recent settlement was unrelated to a new DOJ inquiry, which is a general audit and not expected to significantly impact operations [73]