News Release Details
The Ensign Group Reports Third Quarter Results
Conference Call and Webcast scheduled for tomorrow,
Highlights Include:
- GAAP diluted earnings per share for the quarter was
$0.77 , representing an increase of 97.4%(1) over the prior year quarter and adjusted diluted earnings per share for the quarter was$0.78 , an increase of 95.0%(1)(2) over the prior year quarter.
- Consolidated GAAP revenues for the quarter were
$599 .3 million, an increase of 17.0%(1) over the prior year quarter and adjusted revenues for the quarter were$598 .4 million, an increase of$88 .8 million or 17.4%(1)(2) over the prior year quarter.
- Same store skilled revenue increased by 18.5% over the prior year quarter and by 7.8% sequentially over the second quarter with an increase in Medicare days of 34.3% and 10.2%, respectively.
- Transitioning skilled revenue improved by 26.8% over the prior year quarter with a 20.3% increase in transitioning managed care revenue and a 27.3% increase in Medicare revenue.
- GAAP net income was
$43 .1 million for the current quarter, an increase of 94.4% (1) over the prior year quarter.
- Adjusted net income for the current quarter was
$43 .7 million, an increase of 94.5%(1)(2) over the prior year quarter.
(1) Represents GAAP continued operations which excludes operating results for the
(2) See "Reconciliation of GAAP to Non-GAAP Financial Information". All Non-GAAP financial results exclude operating results for the recently spun-out The Pennant Group, Inc. in accordance with discontinued operation guidance.
Operating Results
“We are announcing another record quarter despite the continued challenges arising from the global pandemic. With the second surge of COVID-19 that occurred during the third quarter in some of our largest states, including
Port noted that the strong results came from quarter over quarter improvements in skilled mix across the portfolio, improved admissions trends, availability of more frequent and broader COVID testing, increased managed care revenues, cost saving initiatives, improved collections, sequestration suspension and improved Medicaid rates in certain states. He added, “Our operations have continued to see an increase in the number of higher acuity patients, including some COVID-19 positive patients and an increasing number of managed care patients. With the surge of COVID-19 patients in many of the surrounding communities we serve, we continue to see state and county health leaders and local hospital systems turn to Ensign-affiliated operations to care for all varieties of high acuity patients that can safely be admitted to, or remain under our care. As we expected, when positivity rates for COVID-19 occur in the surrounding community, we see occupancy decline and skilled mix increase.” He noted that in July, the Company saw overall occupancy decline, particularly in areas of high COVID positivity rates like
Chief Financial Officer,
A discussion of the company's use of non-GAAP financial measures is set forth below. A reconciliation of net income to EBITDA, adjusted EBITDAR, adjusted EBITDA, as well as a reconciliation of GAAP earnings per share, net income to adjusted net income and adjusted net earnings per share appear in the financial data portion of this release. More complete information is contained in the company’s Quarterly Report on Form 10-Q for the quarter ended
2020 and 2021 Guidance
“We are increasing our 2020 annual earnings guidance to
Management also provided guidance for 2021, with annual earnings per share guidance of
Management’s guidance is based on diluted weighted average common shares outstanding of approximately 55.7 and 57.7 million for 2020 and 2021, respectively, and a 25% tax rate. In addition, the guidance assumes, among other things, normalized health insurance costs, normal anticipated Medicare and Medicaid reimbursement rate increases, net of provider taxes, acquisitions closed in 2020 and the first six months of 2021 and recovery of the COVID-19 pandemic. It also excludes acquisition-related costs and amortization costs related to intangible assets acquired, share-based compensation and start-up losses.
COVID-19 Update
Port reported that each locally-led operation continues to manage patient needs during this pandemic. “The third quarter presented continued challenges as we experienced a significant surge in cases in some of our largest states. We are grateful that we were able to apply many of the lessons we learned in the second quarter to prevent and treat COVID in our operations in these geographies in addition to expanding the number of operations capable of safely admitting and treating COVID positive patients from the community. We also continue to focus on reducing the pressure on local hospitals by keeping patients in the skilled setting in a cost effective manner to further benefit the overall cost to Medicare and Medicaid programs,” he added.
Port also reported that early in the quarter the company’s portfolio experienced an increase in COVID-19 cases in its buildings in correlation with the trends occurring in the local community, noting that as the number of cases increases in the community overall, such as in parts of
The company reported that during the quarter combined same store and transitioning occupancy declined by 2.4% and skilled mix increased by 2.9%, both from second quarter as the pandemic worsened in many of its key states. However, from Mid-July to Mid-September, the Company’s census remained flat with a slight decrease in skilled mix days. Towards the end of the quarter and into October, as elective care procedures picked up and the number of COVID-19 cases in the communities stabilized, the Company saw an increase in our occupancy and skilled mix days. Between mid-September to mid-October, combined same store and transitioning occupancy increased by approximately 1.0% and skilled mix increased by 4.0%, respectively. Port also indicated that the number of admissions continued to progressively increase through the quarter, demonstrating that the flow of patients has improved as certain markets have begun to loosen restrictions on admissions and as the sentiment towards high quality post-acute care providers has continued to improve.
Port continued, “While the future of this pandemic remains unclear, we are confident that our local leaders, caregivers and other front-line staff will continue to provide amazing service to their patients, families and our society as a whole. Their endurance and strength is truly inspiring and we can’t thank them enough for all their selfless service as they continue to earn the trust of acute care providers, physicians, managed care payors and most importantly, their patients and their families. They truly are heroes and are doing some of the hardest work during one of the most challenging times in our industry’s history. We hope our communities will join us in recognizing and thanking them for all they do.”
Other Highlights
During the quarter, the company paid a quarterly cash dividend of
Keetch also noted that on
Conference Call
A live webcast will be held
About Ensign™
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:
This press release contains, and the related conference call and webcast will include, forward-looking statements that are based on management’s current expectations, assumptions and beliefs about its business, financial performance, operating results, the industry in which it operates and other future events. Forward-looking statements can often be identified by words such as "anticipates," "expects," "intends," "plans," "predicts," "believes," "seeks," "estimates," "may," "will," "should," "would," "could," "potential," "continue," "ongoing," similar expressions, and variations or negatives of these words. These forward-looking statements include, but are not limited to, statements regarding growth prospects, future operating and financial performance, and acquisition activities. They are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to materially and adversely differ from those expressed in any forward-looking statement.
These risks and uncertainties relate to the company’s business, its industry and its common stock and include: reduced prices and reimbursement rates for its services; its ability to acquire, develop, manage or improve operations, its ability to manage its increasing borrowing costs as it incurs additional indebtedness to fund the acquisition and development of operations; its ability to access capital on a cost-effective basis to continue to successfully implement its growth strategy; its operating margins and profitability could suffer if it is unable to grow and manage effectively its increasing number of operations; competition from other companies in the acquisition, development and operation of facilities; its ability to defend claims and lawsuits, including professional liability claims alleging that our services resulted in personal injury, and other regulatory-related claims; and the application of existing or proposed government regulations, or the adoption of new laws and regulations, that could limit its business operations, require it to incur significant expenditures or limit its ability to relocate its operations if necessary. Additionally, many of these risks and uncertainties are currently amplified by and in the future may be amplified by, the COVID-19 outbreak. The developments with respect to the spread of COVID-19 and its impacts have been occurring so rapidly and because of the unprecedented nature of the pandemic, we are unable to predict the extent and duration of the adverse financial impact of COVID-19 on our business, financial condition and results of operations. While we are not able to estimate the full impact of the COVID-19 outbreak on our financial condition and future results of operations, the pandemic could have an adverse effect on our reported results in the future. Therefore, our actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors. Readers should not place undue reliance on any forward-looking statements and are encouraged to review the company’s periodic filings with the
Contact Information
Investor/Media Relations,
SOURCE:
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF INCOME
Three Months Ended |
Nine Months Ended |
||||||||||||||||||
(In thousands, except per share data) | 2020 | 2019 | 2020 | 2019 | |||||||||||||||
Revenue | $ | 599,255 | $ | 512,109 | $ | 1,773,567 | $ | 1,476,333 | |||||||||||
Expense: | |||||||||||||||||||
Cost of services | 465,108 | 410,516 | 1,371,378 | 1,177,246 | |||||||||||||||
Rent—cost of services | 32,504 | 31,875 | 97,318 | 93,278 | |||||||||||||||
General and administrative expense | 32,817 | 25,514 | 96,493 | 78,622 | |||||||||||||||
Depreciation and amortization | 13,757 | 13,405 | 41,082 | 37,700 | |||||||||||||||
Total expenses | 544,186 | 481,310 | 1,606,271 | 1,386,846 | |||||||||||||||
Income from operations | 55,069 | 30,799 | 167,296 | 89,487 | |||||||||||||||
Other income (expense): | |||||||||||||||||||
Interest expense | (1,740 | ) | (3,900 | ) | (7,698 | ) | (11,513 | ) | |||||||||||
Interest and other income | 850 | 732 | 2,630 | 1,857 | |||||||||||||||
Other expense, net | (890 | ) | (3,168 | ) | (5,068 | ) | (9,656 | ) | |||||||||||
Income before provision for income taxes | 54,179 | 27,631 | 162,228 | 79,831 | |||||||||||||||
Provision for income taxes | 10,866 | 5,093 | 37,026 | 14,944 | |||||||||||||||
Net income from continuing operations | 43,313 | 22,538 | 125,202 | 64,887 | |||||||||||||||
Net income from discontinued operations, net of tax | — | 5,290 | — | 19,473 | |||||||||||||||
Net income | 43,313 | 27,828 | 125,202 | 84,360 | |||||||||||||||
Less: | |||||||||||||||||||
Net income attributable to noncontrolling interests in continuing operations | 253 | 390 | 1,045 | 591 | |||||||||||||||
Net income attributable to noncontrolling interests in discontinued operations | — | 279 | — | 629 | |||||||||||||||
Net income attributable to noncontrolling interests | 253 | 669 | 1,045 | 1,220 | |||||||||||||||
Net income attributable to |
$ | 43,060 | $ | 27,159 | $ | 124,157 | $ | 83,140 | |||||||||||
Amounts attributable to |
|||||||||||||||||||
Income from continuing operations attributable to |
$ | 43,060 | $ | 22,148 | $ | 124,157 | $ | 64,296 | |||||||||||
Income from discontinued operations, net of income tax | — | 5,011 | — | 18,844 | |||||||||||||||
Net income attributable to |
$ | 43,060 | $ | 27,159 | $ | 124,157 | $ | 83,140 | |||||||||||
Net income per share attributable to |
|||||||||||||||||||
Basic: | |||||||||||||||||||
Continuing operations | $ | 0.81 | $ | 0.41 | $ | 2.33 | $ | 1.20 | |||||||||||
Discontinued operations | — | 0.09 | — | 0.35 | |||||||||||||||
Basic income per share attributable to |
$ | 0.81 | $ | 0.50 | $ | 2.33 | $ | 1.55 | |||||||||||
Diluted: | |||||||||||||||||||
Continuing operations | $ | 0.77 | $ | 0.39 | $ | 2.23 | $ | 1.15 | |||||||||||
Discontinued operations | — | 0.09 | — | 0.33 | |||||||||||||||
Diluted income per share attributable to |
$ | 0.77 | $ | 0.48 | $ | 2.23 | $ | 1.48 | |||||||||||
Weighted average common shares outstanding: | |||||||||||||||||||
Basic | 53,328 | 53,941 | 53,299 | 53,470 | |||||||||||||||
Diluted | 55,713 | 56,364 | 55,585 | 56,054 | |||||||||||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except par values) | |||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 175,380 | $ | 59,175 | |||
Accounts receivable—less allowance for doubtful accounts of |
294,151 | 308,985 | |||||
Investments—current | 17,577 | 17,754 | |||||
Prepaid income taxes | 13,550 | 739 | |||||
Prepaid expenses and other current assets | 25,969 | 24,428 | |||||
Total current assets | 526,627 | 411,081 | |||||
Property and equipment, net | 783,187 | 767,565 | |||||
Right-of-use assets | 1,027,434 | 1,046,901 | |||||
Insurance subsidiary deposits and investments | 31,768 | 30,571 | |||||
Escrow deposits | 35 | 14,050 | |||||
Deferred tax assets | 3,435 | 4,615 | |||||
Restricted and other assets | 31,777 | 26,207 | |||||
Intangible assets, net | 2,959 | 3,382 | |||||
54,469 | 54,469 | ||||||
Other indefinite-lived intangibles | 3,299 | 3,068 | |||||
Total assets | $ | 2,464,990 | $ | 2,361,909 | |||
Liabilities and equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 50,971 | $ | 44,973 | |||
Accrued wages and related liabilities | 177,115 | 151,009 | |||||
Lease liabilities—current | 47,342 | 44,964 | |||||
Accrued self-insurance liabilities—current | 33,022 | 29,252 | |||||
123,988 | — | ||||||
Other accrued liabilities | 89,625 | 70,273 | |||||
Current maturities of long-term debt | 3,139 | 2,702 | |||||
Total current liabilities | 525,202 | 343,173 | |||||
Long-term debt—less current maturities | 113,222 | 325,217 | |||||
Long-term lease liabilities—less current portion | 952,866 | 973,983 | |||||
Accrued self-insurance liabilities—less current portion | 62,016 | 58,114 | |||||
Other long-term liabilities | 46,140 | 5,278 | |||||
Total equity | 765,544 | 656,144 | |||||
Total liabilities and equity | $ | 2,464,990 | $ | 2,361,909 | |||
THE ENSIGN GROUP, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
The following table presents selected data from our condensed consolidated statements of cash flows for the periods presented:
Nine Months Ended |
|||||||||
2020 | 2019 | ||||||||
(In thousands) | |||||||||
Net cash provided by/(used in): | |||||||||
Continuing operating activities | $ | 282,161 | $ | 109,077 | |||||
Continuing investing activities | (48,485 | ) | (121,183 | ) | |||||
Continuing financing activities | (117,471 | ) | 25,502 | ||||||
Net decrease in cash and cash equivalents from discontinued operations | — | (83 | ) | ||||||
Net increase in cash and cash equivalents | 116,205 | 13,313 | |||||||
Cash and cash equivalents beginning of period, including cash of discontinued operations | 59,175 | 31,083 | |||||||
Cash and cash equivalents end of period, including cash of discontinued operations | 175,380 | 44,396 | |||||||
Less cash of discontinued operations at end of period | — | 47 | |||||||
Cash and cash equivalents at end of period | $ | 175,380 | $ | 44,349 | |||||
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
(In thousands, except per share data)
(Unaudited)
RECONCILIATION OF GAAP TO NON-GAAP NET INCOME
The following table reconciles net income to Non-GAAP net income for the periods presented:
Three Months Ended |
Nine Months Ended |
||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||
Net income from continuing operations | $ | 43,060 | $ | 22,148 | $ | 124,157 | $ | 64,296 | |||||||||||
Net income from discontinued operations, net of tax | — | 5,011 | — | 18,844 | |||||||||||||||
Net income attributable to |
$ | 43,060 | $ | 27,159 | $ | 124,157 | $ | 83,140 | |||||||||||
Non-GAAP adjustments | |||||||||||||||||||
Stock-based compensation expense(a) | 4,173 | 2,829 | 10,936 | 8,215 | |||||||||||||||
Results related to operations not at full capacity(b) | 159 | 1,219 | 852 | 2,194 | |||||||||||||||
Acquisition related costs(c) | 20 | 69 | 104 | 144 | |||||||||||||||
Depreciation and amortization - patient base(d) | 7 | 104 | 240 | 261 | |||||||||||||||
COS - gain on sale of fixed assets, net of impairment charges(e) | — | (1,402 | ) | — | (1,402 | ) | |||||||||||||
Provision for income taxes on Non-GAAP adjustments(f) | (3,769 | ) | (2,520 | ) | (6,564 | ) | (7,368 | ) | |||||||||||
Non-GAAP income from continuing operations | $ | 43,650 | $ | 22,447 | $ | 129,725 | $ | 66,340 | |||||||||||
Non-GAAP income from discontinued operations(g) | — | 8,496 | — | 25,688 | |||||||||||||||
Non-GAAP net income | $ | 43,650 | $ | 30,943 | $ | 129,725 | $ | 92,028 | |||||||||||
Average number of diluted shares outstanding | 55,713 | 56,364 | 55,585 | 56,054 | |||||||||||||||
Diluted Earnings Per Share As Reported | |||||||||||||||||||
Continuing operations | $ | 0.77 | $ | 0.39 | $ | 2.23 | $ | 1.15 | |||||||||||
Discontinued operations | — | 0.09 | — | 0.33 | |||||||||||||||
Diluted income per share attributable to |
$ | 0.77 | $ | 0.48 | $ | 2.23 | $ | 1.48 | |||||||||||
Adjusted Diluted Earnings Per Share | |||||||||||||||||||
Continuing operations | $ | 0.78 | $ | 0.40 | $ | 2.33 | $ | 1.18 | |||||||||||
Discontinued operations | — | 0.15 | — | 0.46 | |||||||||||||||
Diluted income per share attributable to |
$ | 0.78 | $ | 0.55 | $ | 2.33 | $ | 1.64 | |||||||||||
Footnotes: | |||||||||||||||||||
(a) Represents stock-based compensation expense incurred. | |||||||||||||||||||
Three Months Ended |
Nine Months Ended |
||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||
Cost of services | $ | 2,972 | $ | 1,740 | $ | 7,409 | $ | 5,035 | |||||||||||
General and administrative | 1,201 | 1,089 | 3,527 | 3,180 | |||||||||||||||
Total Non-GAAP adjustment | $ | 4,173 | $ | 2,829 | $ | 10,936 | $ | 8,215 |
(b) Represents results to operations not at full capacity | |||||||||||||||||||
Three Months Ended |
Nine Months Ended |
||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||
Revenue | $ | (877 | ) | $ | (2,567 | ) | $ | (2,141 | ) | $ | (4,397 | ) | |||||||
Cost of services | 958 | 3,122 | 2,761 | 5,581 | |||||||||||||||
Rent | 25 | 295 | 72 | 478 | |||||||||||||||
Depreciation and amortization | 53 | 369 | 160 | 532 | |||||||||||||||
Total Non-GAAP adjustment | $ | 159 | $ | 1,219 | $ | 852 | $ | 2,194 | |||||||||||
(c) Represents costs incurred to acquire an operation which are not capitalizable. | |||||||||||||||||||
(d) Included in depreciation and amortization are expenses related to patient base intangible assets at newly acquired skilled nursing and senior living facilities. | |||||||||||||||||||
(e) Gain on sale of fixed assets includes impairment charges of |
|||||||||||||||||||
(f) Represents an adjustment to the provision for income tax to our historical year to date effective tax rate of 25.0% for the three and nine months ended |
|||||||||||||||||||
(g) Represents results of the home health, hospice and senior living operations we transferred to the Pennant Group, Inc. as a result of the Spin-Off. | |||||||||||||||||||
Three Months Ended |
Nine Months Ended |
||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||
Revenue | $ | — | $ | 88,327 | $ | — | $ | 248,713 | |||||||||||
Cost of services | — | (66,981 | ) | — | (185,963 | ) | |||||||||||||
General and administrative expenses | — | (2,892 | ) | — | (8,037 | ) | |||||||||||||
Rent | — | (5,849 | ) | — | (17,283 | ) | |||||||||||||
Depreciation and amortization | — | (909 | ) | — | (2,367 | ) | |||||||||||||
Interest income, net | — | 4 | — | 26 | |||||||||||||||
Provision for income taxes | — | (2,925 | ) | — | (8,772 | ) | |||||||||||||
Non-controlling interest | — | (279 | ) | — | (629 | ) | |||||||||||||
Non-GAAP net income from discontinued operations | $ | — | $ | 8,496 | $ | — | $ | 25,688 | |||||||||||
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
(In thousands)
(Unaudited)
The table below reconciles net income to EBITDA, Adjusted EBITDA and Adjusted EBITDAR for the periods presented:
Three Months Ended |
Nine Months Ended |
||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||
Consolidated Statements of Income Data: | |||||||||||||||||||
Net income attributable to |
$ | 43,313 | $ | 27,828 | $ | 125,202 | $ | 84,360 | |||||||||||
Less: net income attributable to noncontrolling interests in continuing operations | 253 | 390 | 1,045 | 591 | |||||||||||||||
Less: net income from discontinued operations | — | 5,290 | — | 19,473 | |||||||||||||||
Add: Interest expense, net | 890 | 3,168 | 5,068 | 9,656 | |||||||||||||||
Provision for income taxes | 10,866 | 5,093 | 37,026 | 14,944 | |||||||||||||||
Depreciation and amortization | 13,757 | 13,405 | 41,082 | 37,700 | |||||||||||||||
EBITDA from continuing operations | 68,573 | 43,814 | 207,333 | 126,596 | |||||||||||||||
EBITDA from discontinued operations(d) | — | 8,781 | — | 26,883 | |||||||||||||||
EBITDA | $ | 68,573 | $ | 52,595 | $ | 207,333 | $ | 153,479 | |||||||||||
Adjustments to EBITDA: | |||||||||||||||||||
Results related to operations not at full capacity(a) | 81 | 555 | 620 | 1,184 | |||||||||||||||
Stock-based compensation expense | 4,173 | 2,829 | 10,936 | 8,215 | |||||||||||||||
Acquisition related costs(b) | 20 | 69 | 104 | 144 | |||||||||||||||
Gain on sale of fixed assets, net of impairment charges(c) | — | (1,402 | ) | — | (1,402 | ) | |||||||||||||
Rent related to items above | 25 | 295 | 72 | 478 | |||||||||||||||
Adjusted EBITDA from continuing operations | 72,872 | 46,160 | 219,065 | 135,215 | |||||||||||||||
Adjusted EBITDA from discontinued operations(d) | — | 12,324 | — | 36,801 | |||||||||||||||
Adjusted EBITDA | $ | 72,872 | $ | 58,484 | $ | 219,065 | $ | 172,016 | |||||||||||
Rent—cost of services | 32,504 | 31,875 | 97,318 | 93,278 | |||||||||||||||
Less: rent related to items above | (25 | ) | (295 | ) | (72 | ) | (478 | ) | |||||||||||
Adjusted rent from continuing operations | 32,479 | 31,580 | 97,246 | 92,800 | |||||||||||||||
Adjusted rent included in discontinued operations | — | 5,849 | — | 17,283 | |||||||||||||||
Adjusted EBITDAR from continuing operations | $ | 105,351 | $ | 316,311 | |||||||||||||||
(a) Represents results of operations not at full capacity during the period presented.
(b) Costs incurred to acquire operations which are not capitalizable.
(c) Gain on sale of fixed assets includes impairment charges of
(d) All adjustments included in the table below are presented within net income from discontinued operations, net of tax.
Consolidated Statements of Income Data: | Three Months Ended |
Nine Months Ended |
|||||||
Net income from discontinued operations, net of tax | $ | 5,290 | $ | 19,473 | |||||
Less: net income attributable to noncontrolling interests in discontinued operations | 279 | 629 | |||||||
Add: Interest and other income, net | (4 | ) | (26 | ) | |||||
Provision for income taxes | 2,860 | 5,663 | |||||||
Depreciation and amortization | 914 | 2,402 | |||||||
EBITDA from discontinued operations | $ | 8,781 | $ | 26,883 | |||||
Results related to closed operations | |||||||||
Losses related to operations in the start-up phase | 59 | 377 | |||||||
Stock-based compensation expense | 149 | 1,018 | |||||||
Spin-Off transaction costs | 3,261 | 7,909 | |||||||
Acquisition related costs | 70 | 603 | |||||||
Rent related to items above | 4 | 11 | |||||||
Adjusted EBITDA from discontinued operations | $ | 12,324 | $ | 36,801 | |||||
SELECT PERFORMANCE INDICATORS
(Unaudited)
The following tables summarize our selected performance indicators for our transitional and skilled services segment along with other statistics, for each of the dates or periods indicated:
Three Months Ended |
||||||||||||||||
2020 | 2019 | Change | % Change | |||||||||||||
Total Facility Results: | (Dollars in thousands) | |||||||||||||||
Transitional and skilled revenue | $ | 570,384 | $ | 485,973 | $ | 84,411 | 17.4 | % | ||||||||
Number of facilities at period end | 193 | 179 | 14 | 7.8 | % | |||||||||||
Number of campuses at period end* | 24 | 22 | 2 | 9.1 | % | |||||||||||
Actual patient days | 1,495,285 | 1,516,697 | (21,412 | ) | (1.4 | )% | ||||||||||
Occupancy percentage — Operational beds | 70.7 | % | 78.9 | % | (8.2 | )% | ||||||||||
Skilled mix by nursing days | 32.8 | % | 28.5 | % | 4.3 | % | ||||||||||
Skilled mix by nursing revenue | 53.9 | % | 47.8 | % | 6.1 | % | ||||||||||
Three Months Ended |
||||||||||||||||
2020 | 2019 | Change | % Change | |||||||||||||
Same Facility Results(1): | (Dollars in thousands) | |||||||||||||||
Transitional and skilled revenue | $ | 443,217 | $ | 411,306 | $ | 31,911 | 7.8 | % | ||||||||
Number of facilities at period end | 152 | 152 | — | — | % | |||||||||||
Number of campuses at period end* | 15 | 15 | — | — | % | |||||||||||
Actual patient days | 1,138,971 | 1,267,903 | (128,932 | ) | (10.2 | )% | ||||||||||
Occupancy percentage — Operational beds | 71.2 | % | 79.5 | % | (8.3 | )% | ||||||||||
Skilled mix by nursing days | 34.7 | % | 29.8 | % | 4.9 | % | ||||||||||
Skilled mix by nursing revenue | 56.2 | % | 49.6 | % | 6.6 | % | ||||||||||
Three Months Ended |
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2020 | 2019 | Change | % Change | |||||||||||||
Transitioning Facility Results(2): | (Dollars in thousands) | |||||||||||||||
Transitional and skilled revenue | $ | 52,033 | $ | 46,350 | $ | 5,683 | 12.3 | % | ||||||||
Number of facilities at period end | 16 | 16 | — | — | % | |||||||||||
Number of campuses at period end* | 4 | 4 | — | — | % | |||||||||||
Actual patient days | 148,732 | 155,367 | (6,635 | ) | (4.3 | )% | ||||||||||
Occupancy percentage — Operational beds | 75.3 | % | 79.5 | % | (4.2 | )% | ||||||||||
Skilled mix by nursing days | 25.1 | % | 21.2 | % | 3.9 | % | ||||||||||
Skilled mix by nursing revenue | 41.7 | % | 35.7 | % | 6.0 | % | ||||||||||
Three Months Ended |
|||||||||||||
2020 | 2019 | Change | % Change | ||||||||||
Recently Acquired Facility Results(3): | (Dollars in thousands) | ||||||||||||
Transitional and skilled revenue | $ | 75,134 | $ | 25,570 | $ | 49,564 | NM | ||||||
Number of facilities at period end | 25 | 11 | 14 | NM | |||||||||
Number of campuses at period end* | 5 | 3 | 2 | NM | |||||||||
Actual patient days | 207,582 | 84,554 | 123,028 | NM | |||||||||
Occupancy percentage — Operational beds | 65.6 | % | 71.4 | % | NM | ||||||||
Skilled mix by nursing days | 27.7 | % | 23.5 | % | NM | ||||||||
Skilled mix by nursing revenue | 49.1 | % | 41.3 | % | NM | ||||||||
Three Months Ended |
||||||||||||||
2020 | 2019 | Change | % Change | |||||||||||
Facility Closed Results(4): | (Dollars in thousands) | |||||||||||||
Skilled nursing revenue | $ | — | $ | 2,747 | $ | (2,747 | ) | NM | ||||||
Actual patient days | — | 8,873 | (8,873 | ) | NM | |||||||||
Occupancy percentage — Operational beds | — | % | 64.7 | % | NM | |||||||||
Skilled mix by nursing days | — | % | 19.1 | % | NM | |||||||||
Skilled mix by nursing revenue | — | % | 41.9 | % | NM | |||||||||
* Campus represents a facility that offers both skilled nursing and senior living services. Revenue and expenses related to skilled nursing and senior living services have been allocated and recorded in the respective operating segment.
(1) Same Facility results represent all facilities purchased prior to
(2) Transitioning Facility results represent all facilities purchased from
(3) Recently Acquired Facility (Acquisitions) results represent all facilities purchased on or subsequent to
(4) Facility Closed results represents closed operations during the three months ended
Nine Months Ended |
|||||||||||||||
2020 | 2019 | Change | % Change | ||||||||||||
Total Facility Results: | (Dollars in thousands) | ||||||||||||||
Transitional and skilled revenue | $ | 1,685,568 | $ | 1,404,469 | $ | 281,099 | 20.0 | % | |||||||
Number of facilities at period end | 193 | 179 | 14 | 7.8 | % | ||||||||||
Number of campuses at period end* | 24 | 22 | 2 | 9.1 | % | ||||||||||
Actual patient days | 4,668,961 | 4,395,864 | 273,097 | 6.2 | % | ||||||||||
Occupancy percentage — Operational beds | 74.5 | % | 79.2 | % | (4.7 | )% | |||||||||
Skilled mix by nursing days | 30.6 | % | 29.1 | % | 1.5 | % | |||||||||
Skilled mix by nursing revenue | 51.8 | % | 48.7 | % | 3.1 | % | |||||||||
Nine Months Ended |
||||||||||||||||
2020 | 2019 | Change | % Change | |||||||||||||
Same Facility Results(1): | (Dollars in thousands) | |||||||||||||||
Transitional and skilled revenue | $ | 1,319,620 | $ | 1,216,841 | $ | 102,779 | 8.4 | % | ||||||||
Number of facilities at period end | 152 | 152 | — | — | % | |||||||||||
Number of campuses at period end* | 15 | 15 | — | — | % | |||||||||||
Actual patient days | 3,570,174 | 3,762,109 | (191,935 | ) | (5.1 | )% | ||||||||||
Occupancy percentage — Operational beds | 75.0 | % | 79.7 | % | (4.7 | )% | ||||||||||
Skilled mix by nursing days | 32.5 | % | 30.4 | % | 2.1 | % | ||||||||||
Skilled mix by nursing revenue | 54.1 | % | 50.4 | % | 3.7 | % | ||||||||||
Nine Months Ended |
||||||||||||||||
2020 | 2019 | Change | % Change | |||||||||||||
Transitioning Facility Results(2): | (Dollars in thousands) | |||||||||||||||
Transitional and skilled revenue | $ | 154,601 | $ | 136,155 | $ | 18,446 | 13.5 | % | ||||||||
Number of facilities at period end | 16 | 16 | — | — | % | |||||||||||
Number of campuses at period end* | 4 | 4 | — | — | % | |||||||||||
Actual patient days | 456,714 | 458,633 | (1,919 | ) | (0.4 | )% | ||||||||||
Occupancy percentage — Operational beds | 78.0 | % | 79.0 | % | (1.0 | )% | ||||||||||
Skilled mix by nursing days | 24.8 | % | 21.9 | % | 2.9 | % | ||||||||||
Skilled mix by nursing revenue | 41.8 | % | 36.9 | % | 4.9 | % | ||||||||||
Nine Months Ended |
|||||||||||||
2020 | 2019 | Change | % Change | ||||||||||
Recently Acquired Facility Results(3): | (Dollars in thousands) | ||||||||||||
Transitional and skilled revenue | $ | 211,347 | $ | 43,334 | $ | 168,013 | NM | ||||||
Number of facilities at period end | 25 | 11 | 14 | NM | |||||||||
Number of campuses at period end* | 5 | 3 | 2 | NM | |||||||||
Actual patient days | 642,073 | 148,385 | 493,688 | NM | |||||||||
Occupancy percentage — Operational beds | 69.5 | % | 71.6 | % | NM | ||||||||
Skilled mix by nursing days | 23.7 | % | 22.2 | % | NM | ||||||||
Skilled mix by nursing revenue | 44.7 | % | 39.3 | % | NM | ||||||||
Nine Months Ended |
||||||||||||||
2020 | 2019 | Change | % Change | |||||||||||
Facility Closed Results(4): | (Dollars in thousands) | |||||||||||||
Skilled nursing revenue | $ | — | $ | 8,139 | $ | (8,139 | ) | NM | ||||||
Actual patient days | — | 26,737 | (26,737 | ) | NM | |||||||||
Occupancy percentage — Operational beds | — | % | 65.7 | % | NM | |||||||||
Skilled mix by nursing days | — | % | 17.4 | % | NM | |||||||||
Skilled mix by nursing revenue | — | % | 37.5 | % | NM | |||||||||
* Campus represents a facility that offers both skilled nursing and senior living services. Revenue and expenses related to skilled nursing and senior living services have been allocated and recorded in the respective operating segment.
(1) Same Facility results represent all facilities purchased prior to
(2) Transitioning Facility results represent all facilities purchased from
(3) Recently Acquired Facility (Acquisitions) results represent all facilities purchased on or subsequent to
(4) Facility Closed results represents closed operations during the nine months ended
SKILLED NURSING AVERAGE DAILY REVENUE RATES AND
PERCENT OF SKILLED NURSING REVENUE AND DAYS BY PAYOR
(Unaudited)
The following table reflects the change in skilled nursing average daily revenue rates by payor source, excluding services that are not covered by the daily rate(1):
Three Months Ended |
|||||||||||||||||||||||||||||||
Same Facility | Transitioning | Acquisitions | Total | ||||||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||||||
Skilled Nursing Average Daily Revenue Rates: |
|||||||||||||||||||||||||||||||
Medicare | $ | 664.61 | $ | 600.96 | $ | 590.02 | $ | 530.91 | $ | 646.90 | $ | 651.12 | $ | 656.43 | $ | 597.82 | |||||||||||||||
Managed care | 496.14 | 458.91 | 477.39 | 425.49 | 489.23 | 432.31 | 493.78 | 455.48 | |||||||||||||||||||||||
Other skilled | 542.37 | 487.87 | 523.66 | 472.23 | 356.09 | 346.95 | 535.22 | 482.68 | |||||||||||||||||||||||
Total skilled revenue | 587.57 | 519.07 | 539.37 | 482.60 | 587.23 | 525.84 | 583.86 | 517.16 | |||||||||||||||||||||||
Medicaid | 245.99 | 226.19 | 257.44 | 235.48 | 234.94 | 229.85 | 245.54 | 227.48 | |||||||||||||||||||||||
Private and other payors | 233.83 | 226.78 | 234.44 | 217.99 | 218.59 | 229.67 | 231.77 | 225.04 | |||||||||||||||||||||||
Total skilled nursing revenue | $ | 363.39 | $ | 314.12 | $ | 324.76 | $ | 284.74 | $ | 330.63 | $ | 299.45 | $ | 354.99 | $ | 310.18 |
(1) These rates exclude additional FMAP revenue we recognized as part of The Family First Coronavirus Response Act and include sequestration reversal of 2%.
Nine Months Ended |
|||||||||||||||||||||||||||||||
Same Facility | Transitioning | Acquisitions | Total | ||||||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||||||
Skilled Nursing Average Daily Revenue Rates: |
|||||||||||||||||||||||||||||||
Medicare | $ | 668.14 | $ | 599.34 | $ | 591.32 | $ | 532.09 | $ | 643.17 | $ | 633.93 | $ | 658.38 | $ | 594.51 | |||||||||||||||
Managed care | 489.23 | 456.95 | 465.22 | 425.47 | 470.43 | 429.89 | 485.33 | 453.94 | |||||||||||||||||||||||
Other skilled | 534.44 | 490.70 | 509.31 | 466.05 | 341.41 | 346.85 | 526.54 | 487.06 | |||||||||||||||||||||||
Total skilled revenue | 579.53 | 519.87 | 532.29 | 482.40 | 572.14 | 515.17 | 574.99 | 517.24 | |||||||||||||||||||||||
Medicaid | 237.32 | 223.83 | 246.69 | 232.93 | 221.48 | 227.80 | 235.88 | 225.10 | |||||||||||||||||||||||
Private and other payors | 233.18 | 228.84 | 237.79 | 220.85 | 213.42 | 214.28 | 230.81 | 226.66 | |||||||||||||||||||||||
Total skilled nursing revenue | $ | 348.15 | $ | 314.75 | $ | 316.27 | $ | 285.47 | $ | 303.66 | $ | 289.92 | $ | 338.91 | $ | 310.71 |
(1) These rates exclude additional FMAP revenue we recognized as part of The Family First Coronavirus Response Act.
The following tables set forth our percentage of skilled nursing patient revenue and days by payor source for the three and nine months ended
Three Months Ended |
|||||||||||||||||||||||
Same Facility | Transitioning | Acquisitions | Total | ||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | ||||||||||||||||
Percentage of Skilled Nursing Revenue: |
|||||||||||||||||||||||
Medicare | 31.5 | % | 22.2 | % | 22.9 | % | 19.5 | % | 35.6 | % | 24.2 | % | 31.2 | % | 22.1 | % | |||||||
Managed care | 15.8 | 18.9 | 14.0 | 12.7 | 12.3 | 13.8 | 15.2 | 18.0 | |||||||||||||||
Other skilled | 8.9 | 8.5 | 4.8 | 3.5 | 1.2 | 3.3 | 7.5 | 7.7 | |||||||||||||||
Skilled mix | 56.2 | 49.6 | 41.7 | 35.7 | 49.1 | 41.3 | 53.9 | 47.8 | |||||||||||||||
Private and other payors | 6.5 | 8.2 | 10.7 | 12.3 | 7.3 | 7.3 | 7.1 | 8.5 | |||||||||||||||
Medicaid | 37.3 | 42.2 | 47.6 | 52.0 | 43.6 | 51.4 | 39.0 | 43.7 | |||||||||||||||
Total skilled nursing | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||
Three Months Ended |
|||||||||||||||||||||||
Same Facility | Transitioning | Acquisitions | Total | ||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | ||||||||||||||||
Percentage of Skilled |
|||||||||||||||||||||||
Medicare | 17.2 | % | 11.5 | % | 12.6 | % | 10.5 | % | 18.2 | % | 11.2 | % | 16.9 | % | 11.4 | % | |||||||
Managed care | 11.6 | 12.9 | 9.5 | 8.5 | 8.3 | 9.6 | 10.9 | 12.2 | |||||||||||||||
Other skilled | 5.9 | 5.4 | 3.0 | 2.2 | 1.2 | 2.7 | 5.0 | 4.9 | |||||||||||||||
Skilled mix | 34.7 | 29.8 | 25.1 | 21.2 | 27.7 | 23.5 | 32.8 | 28.5 | |||||||||||||||
Private and other payors | 10.3 | 11.9 | 14.8 | 15.6 | 10.9 | 9.5 | 10.8 | 12.2 | |||||||||||||||
Medicaid | 55.0 | 58.3 | 60.1 | 63.2 | 61.4 | 67.0 | 56.4 | 59.3 | |||||||||||||||
Total skilled nursing | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||
Nine Months Ended |
|||||||||||||||||||||||
Same Facility | Transitioning | Acquisitions | Total | ||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | ||||||||||||||||
Percentage of Skilled Nursing Revenue: |
|||||||||||||||||||||||
Medicare | 28.8 | % | 23.3 | % | 23.0 | % | 20.3 | % | 31.4 | % | 22.4 | % | 28.6 | % | 23.0 | % | |||||||
Managed care | 16.7 | 18.9 | 14.7 | 13.3 | 11.9 | 13.9 | 15.9 | 18.1 | |||||||||||||||
Other skilled | 8.6 | 8.2 | 4.1 | 3.3 | 1.4 | 3.0 | 7.3 | 7.6 | |||||||||||||||
Skilled mix | 54.1 | 50.4 | 41.8 | 36.9 | 44.7 | 39.3 | 51.8 | 48.7 | |||||||||||||||
Private and other payors | 7.1 | 8.1 | 10.8 | 12.2 | 8.5 | 8.0 | 7.7 | 8.5 | |||||||||||||||
Medicaid | 38.8 | 41.5 | 47.4 | 50.9 | 46.8 | 52.7 | 40.5 | 42.8 | |||||||||||||||
Total skilled nursing | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||
Nine Months Ended |
|||||||||||||||||||||||
Same Facility | Transitioning | Acquisitions | Total | ||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | ||||||||||||||||
Percentage of Skilled |
|||||||||||||||||||||||
Medicare | 15.0 | % | 12.2 | % | 12.3 | % | 10.9 | % | 14.8 | % | 10.3 | % | 14.7 | % | 12.0 | % | |||||||
Managed care | 11.9 | 13.0 | 10.0 | 8.9 | 7.7 | 9.4 | 11.1 | 12.4 | |||||||||||||||
Other skilled | 5.6 | 5.2 | 2.5 | 2.1 | 1.2 | 2.5 | 4.8 | 4.7 | |||||||||||||||
Skilled mix | 32.5 | 30.4 | 24.8 | 21.9 | 23.7 | 22.2 | 30.6 | 29.1 | |||||||||||||||
Private and other payors | 10.6 | 11.5 | 14.5 | 15.5 | 12.2 | 10.6 | 11.1 | 12.0 | |||||||||||||||
Medicaid | 56.9 | 58.1 | 60.7 | 62.6 | 64.1 | 67.2 | 58.3 | 58.9 | |||||||||||||||
Total skilled nursing | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||
REVENUE BY PAYOR SOURCE
(Unaudited)
The following table sets forth our total revenue by payor source and as a percentage of total revenue for the periods indicated:
Three Months Ended |
|||||||||||||
2020 | 2019 | ||||||||||||
Revenue | % of Revenue | Revenue | % of Revenue | ||||||||||
Medicaid | $ | 222,192 | 37.1 | % | $ | 205,945 | 40.2 | % | |||||
Medicare | 189,237 | 31.6 | 119,633 | 23.4 | |||||||||
Medicaid — skilled | 38,232 | 6.4 | 34,080 | 6.6 | |||||||||
Total Medicaid and Medicare | 449,661 | 75.1 | 359,658 | 70.2 | |||||||||
Managed care | 87,648 | 14.6 | 88,542 | 17.3 | |||||||||
Private and other(1) | 61,946 | 10.3 | 63,909 | 12.5 | |||||||||
Revenue | $ | 599,255 | 100.0 | % | $ | 512,109 | 100.0 | % |
(1) Private and other payors also includes revenue from rental income and all payors generated in our other ancillary operations for the three months ended
Nine Months Ended |
|||||||||||||
2020 | 2019 | ||||||||||||
Revenue | % of Revenue | Revenue | % of Revenue | ||||||||||
Medicaid | $ | 672,506 | 37.9 | % | $ | 586,222 | 39.7 | % | |||||
Medicare | 519,865 | 29.3 | 355,141 | 24.1 | |||||||||
Medicaid — skilled | 110,626 | 6.3 | 96,323 | 6.5 | |||||||||
Total Medicaid and Medicare | 1,302,997 | 73.5 | 1,037,686 | 70.3 | |||||||||
Managed care | 271,993 | 15.3 | 258,205 | 17.5 | |||||||||
Private and other(1) | 198,577 | 11.2 | 180,442 | 12.2 | |||||||||
Revenue | $ | 1,773,567 | 100.0 | % | $ | 1,476,333 | 100.0 | % |
(1) Private and other payors also includes revenue from rental income and all payors generated in our other ancillary operations for the nine months ended
Discussion of Non-GAAP Financial Measures
EBITDA consists of net income before (a) interest expense, net, (b) provisions for income taxes and (c) depreciation and amortization. Adjusted EBITDA consists of net income before (a) interest expense, net, (b) provisions for income taxes, (c) depreciation and amortization, (d) share-based compensation expense; (e) results of operations not at full capacity, excluding depreciation, interest and income taxes (f) acquisition related costs and (g) gain on sale of fixed assets, net of impairment charges; Adjusted EBITDAR consists of net income before (a) interest expense, net, (b) provisions for income taxes, (c) depreciation and amortization, (d) rent-cost of services, (e) share-based compensation expense; (f) results of operations not at full capacity, excluding rent, depreciation, interest and income taxes (g) acquisition related costs and (h) gain on sale of fixed assets, net of impairment charges. The company believes that the presentation of EBITDA, adjusted EBITDA, adjusted net income and adjusted earnings per share provides important supplemental information to management and investors to evaluate the company’s operating performance. Adjusted EBITDAR is a financial valuation measure that is not specified in GAAP. This measure is not displayed as a performance measure as it excludes rent expense, which is a normal and recurring operating expense. The company believes disclosure of adjusted net income, adjusted net income per share, EBITDA, adjusted EBITDA and adjusted EBITDAR has substance because the excluded revenues and expenses are infrequent in nature and are variable in nature, or do not represent current revenues or cash expenditures. A material limitation associated with the use of these measures as compared to the GAAP measures of net income and diluted earnings per share is that they may not be comparable with the calculation of net income and diluted earnings per share for other companies in the company's industry. These non-GAAP financial measures should not be relied upon to the exclusion of GAAP financial measures. For further information regarding why the company believes that this non-GAAP measures provide useful information to investors, the specific manner in which management uses these measures, and some of the limitations associated with the use of these measures, please refer to the company's periodic filings with the
Source: The Ensign Group, Inc.