Houston, TX -(BusinessWire)- U.S. Physical Therapy, Inc. (NYSE: USPH), a national operator of outpatient physical therapy clinics, recently reported results for the second quarter and six months ended June 30, 2013.
U.S. Physical Therapy’s net income for the three months ended June 30, 2013 was $4.9 million and diluted earnings per share were $0.41.
U.S. Physical Therapy’s net income for the six months ended June 30, 2013 was $8.6 million and diluted earnings per share were $0.72.
Second Quarter 2013 compared to Second Quarter 2012
- Net revenues increased 5.1% from $63,959,000 in the second quarter of 2012 to $67,224,000 in the second quarter of 2013, due to an increase in visits from 587,000 to 614,000 and an increase in the average net patient revenue per visit to $106.30 from $105.65 in the comparable 2012 period.
- Total clinic operating costs were $49,918,000, or 74.3% of net revenues, in the second quarter of 2013, as compared to $46,965,000, or 73.4% of net revenues, in the 2012 period. The increase was primarily attributable to $3,288,000 in operating costs of new clinics opened or acquired in the past 12 months offset by a reduction in operating costs of $335,000 for those clinics opened or acquired prior to the past 12 months. Clinic salaries and related costs were 53.3% of net revenues in the recent quarter versus 51.1% in the 2012 period. Rent, clinic supplies, contract labor and other costs as a percentage of net revenues were 19.2% for the recent quarter versus 20.3% in the 2012 period. The provision for doubtful accounts as a percentage of net revenues was 1.8% for the 2013 period versus 2.0% in the 2012 period.
- The gross margin dollars for the second quarter of 2013 increased by $312,000; however, the gross margin percentage decreased to 25.7% for the 2013 quarter, compared to 26.6% for the comparable 2012 quarter. Gross margin percentage decreased due to a lower average number of patient visits per clinic per day in the 2013 quarter compared to the 2012 quarter and a larger negative gross margin incurred in physician services in the 2013 quarter compared to the 2012 quarter.
- Corporate office costs were $6,622,000 in the second quarter of 2013 as compared to $6,396,000 in the 2012 second quarter. Corporate office costs were 9.9% of net revenues in the 2013 period versus 10.0% in 2012.
- Operating income for the second quarter of 2013 was $10,684,000 compared to $10,598,000 in the 2012 second quarter.
- Interest expense was $130,000 in the second quarter of 2013 versus $145,000 in the second quarter of 2012.
- Net income attributable to non-controlling interests was $2,460,000 in the recent quarter as compared to $2,465,000 in the year earlier period.
- The provision for income taxes as a percentage of income before taxes less net income attributable to non-controlling interests was 39.3% in both periods.
- Net income for the three months ended June 30, 2013 was $4,914,000 compared to $4,849,000 for the three months ended June 30, 2012. Diluted earnings per share were $0.41 for both periods.
- Same store revenues for de novo and acquired clinics open for one year or more decreased slightly. The net rate per visit and visits for de novo and acquired clinics open for one year or more remained relatively flat.
Six Months 2013 compared to Six Months 2012
- Net revenues increased 3.0% from $126,541,000 in the first six months of 2012 to $130,322,000 in the first six months of 2013, due to an increase in visits from 1,166,000 to 1,192,000 and an increase in the average net patient revenue per visit to $106.37 from $105.10 in the comparable 2012 period.
- Total clinic operating costs were $98,358,000, or 75.5% of net revenues, in the first six months of 2013, as compared to $93,414,000, or 73.8% of net revenues, in the 2012 period. The increase was primarily attributable to $4,878,000 in operating costs of new clinics opened or acquired in the past 12 months and a slight increase in operating costs of $66,000 for those clinics opened or acquired prior to the past 12 months. Clinic salaries and related costs were 53.9% of net revenues in the recent six months versus 51.7% in the 2012 period. Rent, clinic supplies, contract labor and other costs as a percentage of net revenues were 19.8% for the recent six months versus 20.1% in the 2012 period. The provision for doubtful accounts as a percentage of net revenues was 1.8% for the 2013 period versus 1.9% in the 2012 period.
- Gross margin for the first six months of 2013 was $31,964,000, or 24.5%, compared to $33,127,000, or 26.2%, for the comparable 2012 period. Gross margin decreased due to a lower average number of patient visits per clinic per day in the 2013 period compared to the 2012 period and a negative gross margin incurred in physician services in the 2013 period.
- Corporate office costs were $13,129,000 in the first six months of 2013 as compared to $12,658,000 in the 2012 first six months. Corporate office costs were 10.1% of net revenues in the 2013 period versus 10.0% in 2012.
- Operating income for the first six months of 2013 was $18,835,000 compared to $20,469,000 in the 2012 first six months.
- Interest expense was $265,000 in the first six months of 2013 versus $307,000 in the first six months of 2012.
- Net income attributable to non-controlling interests was $4,348,000 in the first six months of 2013 as compared to $4,799,000 in the year earlier period.
- The provision for income taxes as a percentage of income before taxes less net income attributable to non-controlling interests was 39.3% in both periods.
- Net income for the six months ended June 30, 2013 was $8,635,000 compared to $9,327,000 for the six months ended June 30, 2012. Diluted earnings per share were $0.72 for the 2013 period compared to $0.79 for the 2012 period.
- Same store revenues for de novo and acquired clinics open for one year or more were flat. While the net rate per visit increased 1.3%, visits for de novo and acquired clinics open for one year or more decreased by 1.8%. Same store revenues and visits were adjusted to reflect the same number of days in each period as the 2013 period included 127 days of operations while the 2012 period included 128 days. Patient visits for the first six months of 2013 would have been higher were it not for the effects of severe weather and the flu in the first quarter of 2013.
Chris Reading, Chief Executive Officer, said, “For the quarter our team made solid progress from the first quarter although we have more work to do. Development activity has been strong so far this year and we expect that to continue as our active discussions with physical therapy owners continue to be very steady. We remain focused on growing and improving our core physical therapy business and continuing our progress with our Fit2WRK workplace solutions.”
Larry McAfee, Chief Financial Officer, noted, “The Company’s receivable collections have been excellent. Average A/R days outstanding is at an all-time low of 40 days. Despite having added 21 clinics through acquisition in the first half of 2013, the amount outstanding under our credit line was reduced to $15,750,000 as of June 30 as compared to $17,400,000 at year end 2012.”
U.S. Physical Therapy Declares Quarterly Dividend
The third quarterly dividend of 2013 for $.10 per share will be paid on September 6 to shareholders of record as of August 20.
The complete earnings release is available here: US Physical Therapy Second Quarter and Six Months 2013 Results (PDF)
Source: BusinessWire