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National Healthcare Corp

NHC Reports Third Quarter 2024 Earnings

MURFREESBORO, Tenn.--(BUSINESS WIRE)--Nov. 8, 2024-- National HealthCare Corporation (NYSE American: NHC), the nation's oldest publicly traded senior health care company, announced today net operating revenues and grant income for the quarter ended September 30, 2024 totaled $340,198,000 compared to $288,485,000 for the quarter ended September 30, 2023, an increase of 17.9%. The increase in net operating revenues for the third quarter of 2024 compared to the same period last year was primarily related to the August 1, 2024 acquisition of White Oak Manor (“White Oak”). The White Oak operations consist of 21 healthcare operations, which includes 15 skilled nursing facilities, two assisted living facilities, and four independent living facilities.

For the quarter ended September 30, 2024, the reported GAAP net income attributable to NHC was $42,789,000 compared to $10,388,000 for the same period in 2023. Excluding the unrealized gains or losses in our marketable equity securities portfolio and other non-GAAP adjustments, adjusted net income for the quarter ended September 30, 2024 was $19,910,000 compared to $13,250,000 for the same period in 2023, an increase of 50.3% (*). The GAAP diluted earnings per share were $2.73 for the quarter ended September 30, 2024 compared to $0.68 for the quarter ended September 30, 2023. Adjusted diluted earnings per share were $1.27 and $0.86 for the quarters ended September 30, 2024 and 2023, respectively (*).

(*) - See the tables below that provide a reconciliation of GAAP to non-GAAP items.

About NHC

NHC affiliates operate for themselves and third parties 80 skilled nursing facilities with 10,349 beds. NHC affiliates also operate 26 assisted living communities with 1,413 units, nine independent living communities with 777 units, three behavioral health hospitals, 34 homecare agencies, and 32 hospice agencies. NHC’s other services include Alzheimer’s and memory care units, pharmacy services, a rehabilitation services company, and providing management and accounting services to third party post-acute operators. Other information about the company can be found on our web site at www.nhccare.com.

Non-GAAP Financial Presentation

The Company is providing certain non-GAAP financial measures as the Company believes that these figures are helpful in allowing investors to more accurately assess the ongoing nature of the Company’s operations and measure the Company’s performance more consistently across periods. Therefore, the Company believes this information is meaningful in addition to the information contained in the GAAP presentation of financial information. The presentation of this additional non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP.

Forward-Looking Statements

Statements in this press release that are not historical facts are forward-looking statements. NHC cautions investors that any forward-looking statements made involve risks and uncertainties and are not guarantees of future performance. The risks and uncertainties are detailed from time to time in reports filed by NHC with the S.E.C., including Forms 8-K, 10-Q, and 10-K. All forward-looking statements represent NHC’s best judgment as of the date of this release.

Consolidated Statements of Operations
(in thousands, except share and per share amounts)

Three Months Ended

 

Nine Months Ended

September 30

 

September 30

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

(unaudited)

 

(unaudited)

Revenues and grant income:
Net patient revenues

$

328,674

 

$

277,005

 

$

894,415

 

$

804,617

 

Other revenues

 

11,524

 

 

11,480

 

 

34,172

 

 

36,013

 

Government stimulus income

 

-

 

 

-

 

 

9,445

 

 

-

 

Net operating revenues and grant income

 

340,198

 

 

288,485

 

 

938,032

 

 

840,630

 

 
Costs and expenses:
Salaries, wages and benefits

 

213,395

 

 

182,664

 

 

576,609

 

 

525,782

 

Other operating

 

82,509

 

 

72,490

 

 

238,092

 

 

217,213

 

Facility rent

 

10,886

 

 

10,094

 

 

31,804

 

 

30,087

 

Depreciation and amortization

 

10,619

 

 

10,135

 

 

30,543

 

 

30,266

 

Interest

 

1,742

 

 

77

 

 

1,788

 

 

268

 

Total costs and expenses

 

319,151

 

 

275,460

 

 

878,836

 

 

803,616

 

 
Income from operations

 

21,047

 

 

13,025

 

 

59,196

 

 

37,014

 

 
Non-operating income

 

4,224

 

 

4,097

 

 

14,865

 

 

12,116

 

Unrealized gains/(losses) on marketable equity securities

 

32,767

 

 

(3,093

)

 

56,290

 

 

2,943

 

 
Income before income taxes

 

58,038

 

 

14,029

 

 

130,351

 

 

52,073

 

Income tax provision

 

(15,338

)

 

(3,908

)

 

(34,294

)

 

(14,750

)

Net income

 

42,700

 

 

10,121

 

 

96,057

 

 

37,323

 

 
Net (income)/loss attributable to noncontrolling interest

 

89

 

 

267

 

 

(211

)

 

1,069

 

 
Net income attributable to National HealthCare Corporation

$

42,789

 

$

10,388

 

$

95,846

 

$

38,392

 

 
Net income per common share
Basic

$

2.78

 

$

0.68

 

$

6.23

 

$

2.51

 

Diluted

$

2.73

 

$

0.68

 

$

6.15

 

$

2.50

 

 
Weighted average common shares outstanding
Basic

 

15,411,680

 

 

15,299,913

 

 

15,384,758

 

 

15,311,453

 

Diluted

 

15,667,321

 

 

15,324,511

 

 

15,576,294

 

 

15,334,269

 

 
Dividends declared per common share

$

0.61

 

$

0.59

 

$

1.81

 

$

1.75

 

 
 
Balance Sheet Data

September 30

 

December 31

(in thousands)

 

2024

 

 

 

2023

 

(unaudited)

 

 

 
Cash, cash equivalents and marketable securities

$

249,561

 

$

223,620

 

Restricted cash, cash equivalents and marketable securities

 

177,179

 

 

167,971

 

Current assets

 

445,726

 

 

406,235

 

Property and equipment, net

 

686,425

 

 

493,329

 

Total assets

 

1,562,707

 

 

1,310,796

 

Current liabilities, excluding long-term debt due within one year

 

240,446

 

 

214,476

 

Current and long-term debt

 

147,000

 

 

-

 

NHC stockholders' equity

 

983,468

 

 

908,752

 

Selected Operating Statistics

Three Months Ended

 

Nine Months Ended

September 30

 

September 30

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

(unaudited)

 

(unaudited)

Skilled Nursing Per Diems:
Medicare

$

578.12

 

$

551.82

 

$

579.24

 

$

552.21

 

Managed Care

 

459.94

 

 

489.18

 

 

459.64

 

 

460.20

 

Medicaid

 

290.00

 

 

256.46

 

 

274.44

 

 

248.99

 

Private Pay and Other

 

323.36

 

 

283.49

 

 

315.09

 

 

279.12

 

 
Average Skilled Nursing Per Diem

$

350.85

 

$

325.34

 

(1)

$

344.76

 

(1)

$

320.09

 

(1)

 
Skilled Nursing Patient Days:
Medicare

 

79,957

 

 

75,215

 

 

235,715

 

 

239,228

 

Managed Care

 

70,635

 

 

61,979

 

 

199,023

 

 

179,992

 

Medicaid

 

344,940

 

 

290,887

 

 

906,265

 

 

852,074

 

Private Pay and Other

 

177,846

 

 

170,857

 

 

485,523

 

 

492,279

 

 
Total Skilled Nursing Patient Days

 

673,378

 

 

598,938

 

(1)

 

1,826,526

 

(1)

 

1,763,573

 

(1)

 
(1) NHC exited three skilled nursing facilities in Missouri on March 1, 2024. For the first quarter of 2024, the exited Missouri skilled nursing facilities had an average skilled nursing per diem of $259.56 and 20,267 patient days. For the three months ended September 30, 2023, the exited Missouri skilled nursing facilities had an average skilled nursing per diem of $244.20 and 32,141 patient days. For the nine months ended September 30, 2023, the exited Missouri skilled nursing facilities had an average skilled nursing per diem of $248.51 and 95,030 patient days.
 
The tables below provide reconciliations of GAAP to non-GAAP items (in thousands, except per share amounts):

Three Months Ended

 

Nine Months Ended

September 30

 

September 30

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

(unaudited)

 

(unaudited)

 
Net income attributable to National Healthcare Corporation

$

42,789

 

$

10,388

 

$

95,846

 

$

38,392

 

Non-GAAP adjustments
Unrealized (gains)/losses on marketable equity securities

 

(32,767

)

 

3,093

 

 

(56,290

)

 

(2,943

)

Operating results for newly opened operations not at full capacity (2)

 

120

 

 

66

 

 

140

 

 

1,616

 

Stock-based compensation expense

 

1,093

 

 

708

 

 

3,062

 

 

2,119

 

Gain on sale of unconsolidated company

 

-

 

 

-

 

 

(1,024

)

 

-

 

Acquisition-related expenses (3)

 

637

 

 

-

 

 

2,831

 

 

-

 

Employee retention credit

 

-

 

 

-

 

 

(9,445

)

 

-

 

Income tax provision on non-GAAP adjustments

 

8,038

 

 

(1,005

)

 

15,789

 

 

(206

)

Non-GAAP Net income

$

19,910

 

$

13,250

 

$

50,909

 

$

38,978

 

 
GAAP diluted earnings per share

$

2.73

 

$

0.68

 

$

6.15

 

$

2.51

 

Non-GAAP adjustments
Unrealized (gains)/losses on marketable equity securities

 

(1.55

)

 

0.15

 

 

(2.67

)

 

(0.14

)

Operating results for newly opened operations not at full capacity (2)

 

0.01

 

 

-

 

 

0.01

 

 

0.07

 

Stock-based compensation expense

 

0.05

 

 

0.03

 

 

0.15

 

 

0.10

 

Gain on sale of unconsolidated company

 

-

 

 

-

 

 

(0.05

)

 

-

 

Acquisition-related expenses (3)

 

0.03

 

 

-

 

 

0.13

 

 

-

 

Employee retention credit

 

-

 

 

-

 

 

(0.45

)

 

-

 

Non-GAAP diluted earnings per share

$

1.27

 

$

0.86

 

$

3.27

 

$

2.54

 

 
(2) The operating results for newly opened facilities or agencies not at full capacity include healthcare operations that are still considered in the start-up phase, which are two hospice agencies for the three and nine months ended September 30, 3024. For the three and nine months ended September 30, 2023, included are two behavioral health hospitals, two homecare agencies, and two hospice agencies.
(3) Represents expenses incurred to acquire the White Oak operations that are not capitalizable.

 

Brian F. Kidd, SVP/CFO
Phone: (615) 890-2020

Source: National HealthCare Corporation