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NHC Reports First Quarter 2023 Earnings

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 March 31, 2023 totaled $269,563,000 compared to $278,983,000 for the quarter ended March 31, 2022, a decrease of 3.4%. The decrease in net operating revenues during the first quarter of 2023 was primarily driven by the reduction in government stimulus income of $10.6 million compared to the first quarter a year ago, as well as us exiting seven skilled nursing facilities in Massachusetts and New Hampshire during the third quarter of 2022. Excluding the government stimulus income and the seven skilled nursing facilities in the Massachusetts and New Hampshire, same-facility net operating revenues increased 7.1% during the first quarter of 2023 compared to the same period a year ago.

For the quarter ended March 31, 2023, the reported GAAP net income attributable to NHC was $11,723,000 compared to $15,318,000 for the same period in 2022. Excluding the unrealized gains in our marketable equity securities portfolio and other non-GAAP adjustments, adjusted net income for the quarter ended March 31, 2023 was $12,071,000 compared to $14,081,000 for the same period in 2022 (*). The decrease in non-GAAP earnings for the quarter ended March 31, 2023 compared to the first quarter of 2022 was primarily due to the $10.6 million decrease of government stimulus income recorded. The GAAP diluted earnings per share was $0.76 for the quarter ended March 31, 2023 compared to $0.99 for the quarter ended March 31, 2022. Adjusted diluted earnings per share were $0.79 and $0.91 for the quarters ended March 31, 2023 and 2022, 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 68 skilled nursing facilities with 8,732 beds. NHC affiliates also operate 23 assisted living communities with 1,181 units, five independent living communities with 475 units, three behavioral health hospitals, 34 homecare agencies, and 30 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
March 31

 

2023

 

 

2022

 

(unaudited)
Revenues and grant income:
Net patient revenues

$

258,007

 

$

256,337

 

Other revenues

 

11,556

 

 

12,026

 

Government stimulus income

 

-

 

 

10,620

 

Net operating revenues and grant income

 

269,563

 

 

278,983

 

 
Costs and expenses:
Salaries, wages and benefits

 

167,824

 

 

170,694

 

Other operating

 

71,489

 

 

74,085

 

Facility rent

 

10,092

 

 

10,065

 

Depreciation and amortization

 

10,048

 

 

9,757

 

Interest

 

98

 

 

165

 

Total costs and expenses

 

259,551

 

 

264,766

 

 
Income from operations

 

10,012

 

 

14,217

 

 
Non-operating income

 

4,323

 

 

3,199

 

Unrealized gains on marketable equity securities

 

1,386

 

 

3,126

 

 
Income before income taxes

 

15,721

 

 

20,542

 

Income tax provision

 

(4,436

)

 

(5,193

)

Net income

 

11,285

 

 

15,349

 

 
Net (income)/loss attributable to noncontrolling interest

 

438

 

 

(31

)

 
Net income attributable to National HealthCare Corporation

$

11,723

 

$

15,318

 

 
Net income per common share
Basic

$

0.76

 

$

0.99

 

Diluted

$

0.76

 

$

0.99

 

 
Weighted average common shares outstanding
Basic

 

15,337,423

 

 

15,416,836

 

Diluted

 

15,356,335

 

 

15,463,855

 

 
Dividends declared per common share

$

0.57

 

$

0.55

 

 
 
Balance Sheet Data March 31 December 31
(in thousands)

 

2023

 

 

2022

 

(unaudited)
 
Cash, cash equivalents and marketable securities

$

164,791

 

$

182,589

 

Restricted cash, cash equivalents and marketable securities

 

173,317

 

 

158,067

 

Current assets

 

337,903

 

 

353,932

 

Property and equipment, net

 

503,124

 

 

506,532

 

Total assets

 

1,265,353

 

 

1,275,450

 

Current liabilities

 

183,210

 

 

197,887

 

NHC stockholders' equity

 

877,102

 

 

874,276

 

 
Selected Operating Statistics
Three Months Ended
March 31

 

2023

 

 

2022

 

(unaudited)
Skilled Nursing Per Diems:
Medicare

$

555.85

 

$

544.66

 

Managed Care

 

444.95

 

 

433.48

 

Medicaid

 

236.78

 

 

228.53

 

Private Pay and Other

 

278.55

 

 

270.19

 

 
Average Skilled Nursing Per Diem

$

315.81

 

$

305.78

 

(1)

 
Skilled Nursing Patient Days:
Medicare

 

84,032

 

 

91,583

 

Managed Care

 

58,446

 

 

55,637

 

Medicaid

 

276,506

 

 

304,260

 

Private Pay and Other

 

157,422

 

 

153,955

 

 
Total Skilled Nursing Patient Days

 

576,406

 

 

605,435

 

(1)

 
(1) For the three months ended March 31, 2022, the skilled nursing per diems and patient days included the seven skilled nursing facilities in Massachusetts and New Hampshire. NHC exited these seven skilled nursing facilities on September 1, 2022. For the quarter ended March 31, 2022, the exited Massachusetts and New Hampshire skilled nursing facilities had an average skilled nursing per diem of $291.35 and 52,278 total patient days.
 
 
The tables below provide reconciliations of GAAP to non-GAAP items (in thousands, except per share amounts):
Three Months Ended
March 31

 

2023

 

 

2022

 

(unaudited)
 
Net income attributable to National Healthcare Corporation

$

11,723

 

$

15,318

 

Non-GAAP adjustments
Unrealized gains on marketable equity securities

 

(1,386

)

 

(3,126

)

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

 

1,217

 

 

743

 

Stock-based compensation expense

 

639

 

 

712

 

Income tax provision on non-GAAP adjustments

 

(122

)

 

434

 

Non-GAAP Net income

$

12,071

 

$

14,081

 

 
GAAP diluted earnings per share

$

0.76

 

$

0.99

 

Non-GAAP adjustments
Unrealized gains on marketable equity securities

 

(0.06

)

 

(0.15

)

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

 

0.06

 

 

0.04

 

Stock-based compensation expense

 

0.03

 

 

0.03

 

Non-GAAP diluted earnings per share

$

0.79

 

$

0.91

 

 
(2) The newly opened operations not at full capacity for the 2023 period presented consisted of operations opened from 2021 through 2023. This consisted of two behavioral health hospitals, one homecare agency, and two hospice agencies. The newly opened operations for the 2022 period presented consisted of operations opened from 2020 through 2022. This consisted of two behavioral health hospitals that opened during the second quarter of 2022.
 

 

Contacts

Brian F. Kidd, SVP/Controller

Phone: (615) 890-2020

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