US Physical Therapy Inc. (NYSE:USPH) Q3 2019 Earnings Conference Call Transcript

Nov 07, 2019 • 10:30 am ET

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US Physical Therapy Inc. (NYSE:USPH) Q3 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good morning. My name is Sia and I will be the conference operator today. At this time I would like to welcome everyone to the U.S. Physical Therapy 2019 Third Quarter Earnings Conference. [Operator Instructions] Thank you.

At this time I would like to turn the conference over to Chris Reading Chief Executive Officer. Please go ahead.

Executive
Christopher J. Reading

Thank you Sia. Good morning everyone and welcome to U.S. Physical Therapy's third quarter and year-to-date 2019 earnings call. With me here and on the line include Larry McAfee our Executive Vice President and Chief Financial Officer; Graham Reeve and Glenn McDowell Chief Operating Officers; Rick Binstein our General Counsel; and Jon Bates our Vice President and Controller. Before we begin today's call we need to review a brief disclosure.

Jon if you would please.

Executive
Jon Bates

Thanks Chris. This presentation contains forward-looking statements which involve certain risks and uncertainties. These forward-looking statements are based on the company's current views and assumptions and the company's actual results can vary materially from those anticipated.

Please see the company's filings with the Securities and Exchange Commission for more information.

Executive
Christopher J. Reading

Thank you Jon. So before I start I'm going to give you a quick summary of what I intend to cover before we get into the nitty-gritty. So first some highlights from the quarter and year-to-date periods. Next I'll spend some time discussing some of the elements within this quarter that I think will help you better understand where we are and why for the quarter. And then we can look forward and discuss the remainder of the year before Larry covers the financials in greater detail. Starting things off. Our company's operating results for the quarter despite some unique elements that I'll cover here in a minute increased 11.7% for Q3. And on a year-to-date basis operating results are up 13.7%. One of those unique elements that we previously announced in Q2's earnings results but remains important to remember and understand here is that we sold a part of a partnership on the final day of Q2 this year.

That revenue of a little less than $6 million in the quarter is no longer in our numbers. I'll also point out that sale posted a very nice nonoperating gain for us that's reported in Q2. So as we look deeper into the core PT business our mature facilities did really well excellent in my view with nice revenue growth and what I believe is one of the best if not the best year-to-date same-store volume numbers we have ever delivered. Our top 20 partnerships collectively are doing a terrific job in driving volume and together with our operations teams have been able to continue to demonstrate some nice margin improvement this quarter: 110 basis points in our physical therapy gross profit line 120 basis points in our managed contracts and a 70 basis point increase at our operating income line which of course includes all of our business segments. These gains improvements and performance numbers are in spite