US Physical Therapy (USPH) Q3 2024 earnings summary

Executive summary

• Achieved record quarterly patient volume and 6% year-over-year growth in Q3 visits, with visits per clinic per day reaching 30.1.

• Revenue grew 12% to $168.0 million in Q3 2024, with Adjusted EBITDA up 13.4% to $21.1 million.

• Closed 32 underperforming clinics and added/acquired 20 new facilities, including a 50% stake in MSO Metro for $75–$76.5 million.

• Expanded injury prevention (IIP) business, with revenue up nearly 30% and operating profit up 27% year-over-year.

• Declared a quarterly dividend of $0.44 per share payable December 6, 2024.

Financial highlights

• Net rate per visit increased 3.2% to $105.65, despite a 1.8% Medicare rate reduction.

• Adjusted EBITDA margin was 15.5%, up from 15.3% in Q3 last year.

• Net income attributable to shareholders was $6.6 million ($0.39/share), down from $9.3 million, including $2.5–$3.4 million in clinic closure costs.

• Gross margin for Q3 2024 was 16.5% (18.9% excluding closure costs); PT gross margin rose 90 basis points.

• Total patient visits in Q3 2024 were 1,317,051, up 6% year-over-year.

Outlook and guidance

• EBITDA guidance for 2024 remains at $80–$85 million, with strong early Q4 volumes and full-year benefit from recent acquisitions expected in 2025.

• Management expects operational adjustments and cost alignment to yield benefits in Q4 2024 and into 2025.

• Sufficient cash and credit available to fund operations and acquisitions through at least September 2025.