US Physical Therapy Inc. (NYSE:USPH) Q1 2015 Earnings Conference Call - Final Transcript
May 07, 2015 • 10:30 am ET
forward is significant. That is if you will recall the second closed deal of the 2015 year, and we remain actively working on additional projects. So for the remainder of this year we will focus on the same key areas as we have recently that being great care and service to our patients, referral sources and customers, great care and service to our partners with some recent adjustments that we have made to make sure that we can continue to do that as we further scale the company, continued heavy focus on our work comp programs with an increased eye on using our preventative and testing relationships to get exclusivity on the treatment side where and when we can, focus on our referral conversion rate and our authorization and reauthorization processes to ensure that we don't lose any visits as we see some insurance companies deploying creative authorization and reauthorization processes designed to care.
We will continue to roll out and deploy our primo functional training system, which has been very well received. We will continue focusing on getting good deals done that will be a long-term benefit to the company. Lastly, it remains persistently important that we do all of these things the right way and for the right reasons in order to build a great company for the long haul. I believe that we can and will do these things and more with the help of a great team of clinician partners, wonderful and talented support group here in Houston and around the country.
That concludes my prepared comments. Larry, if you would, please go ahead and cover the financials in more detail and then we will open up for questions.
Thanks, Chris. Okay, now I will talk about the first quarter of '15 versus the first quarter of '14. Revenue increased 10.7% to $77.2 million due to an increase in patient visits of 10.7%, and as Chris alluded to a slight increase in the average net rate per visit to $106.34 from $106.23. Total clinic operating costs were $60.4 million or 78.2% of revenue in the first quarter of 2015, as compared to $53.1 million or 76.1% in the 2014 period. The increase is primarily attributable to $5.5 million in operating costs of new clinics open or acquired in the past 12 months. The gross margin for the first quarter of 2015 was $16.8 million or 21.8% as compared to $16.6 million or 23.9% a year ago.
Corporate office costs were 9.9% of revenue as compared to 10.2% in the 2014 quarter. Our operating income for the recent quarter was $9.2 million versus $9.5 million a year ago. Interest expense was $0.3 million in both periods. The income tax rate in the recent quarter was 40% as compared to 41% in the first quarter of 2014. Operating results were consistent at $4.2 million for both periods, diluted earnings per share were $0.34 in the first quarter of 2015 versus $0.35 a year ago. As Chris mentioned, same