U.S. Physical Therapy, Inc. (NYSE: USPH), a national operator of outpatient physical therapy clinics, today reported results for the third quarter and nine months ended September 30, 2012.
U.S. Physical Therapy’s net income for the nine months ended September 30, 2012 increased 9.0% to $13.9 million from $12.7 million for the nine months ended September 30, 2011. Diluted earnings per share rose to $1.17 for the 2012 period versus $1.06 for the 2011 period.
U.S. Physical Therapy’s net income for the third quarter ended September 30, 2012 increased 11.3% to $4.6 million from $4.1 million for the 2011 third quarter. Diluted earnings per share were $.38 for the 2012 quarter as compared to $.34 for the 2011 period.
Nine Months 2012 compared to Nine Months 2011
- Net revenues increased 7.4% from $176,328,000 in the first nine months of 2011 to $189,394,000 in the first nine months of 2012, primarily due to an increase in patient visits of 8.5% from 1,605,000 to 1,741,000. The average net patient revenue per visit for the 2012 period was $105.31 as compared to $104.59 in the comparable 2011 period. The increase in net revenues was partially offset by a decrease in other revenues of $2,385,000 due to a reduction in revenue from physician services.
- Total clinic operating costs were $140,898,000, or 74.4% of net revenues, in the 2012 period, as compared to $130,482,000, or 74.0% of net revenues, in the 2011 period. The increase was primarily attributable to $6,711,000 for increased costs related to the clinics acquired in July 2011 due to a full nine months of operations in 2012 versus two months in the 2011 period and $4,002,000 in operating costs of new clinics opened or acquired in the past 12 months. Clinic salaries and related costs were 52.2% of net revenues in the recent period versus 52.8% in the 2011 period. Rent, clinic supplies, contract labor and other costs as a percentage of net revenues were 20.2% in the recent period versus 19.7% in the 2011 period. The provision for doubtful accounts as a percentage of net revenues was 1.9% for the 2012 period versus 1.4% in the 2011 period. In the first nine months of 2012, the gross margin from the Company’s core physical therapy business increased by $4,966,000 or 11.4% as compared to the first nine months of 2011 which was partially offset by a $2,316,000 decrease in margin from the physician services business.
- Corporate office costs increased 5.7% to $18,635,000 in the 2012 period from $17,630,000 in the 2011 period. However, corporate office costs were reduced as a percentage of net revenues to 9.8% in the 2012 period as compared to 10.0% in the 2011 period.
- Operating income for the first nine months of 2012 rose to $29,861,000 compared to $28,216,000 in the 2011 nine months.
- Interest expense increased to $449,000 in the 2012 period from $331,000 in the 2011 period due to higher average borrowings in 2012.
- Net income attributable to non-controlling interests was $6,534,000 year-to-date in 2012 as compared to $6,896,000 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 the 2012 and 2011 periods.
- Reported net income attributable to common shareholders in the 2012 period was $13,890,000 compared to $12,745,000 in the 2011 period. Diluted earnings per share increased to $1.17 from $1.06.
- Same store revenues for de novo and acquired clinics open for one year or more increased 5.0%, adjusted to reflect same number of days in each period. The 2012 period included 191 days of operations while the 2011 period included 192. Higher same store visits and slightly higher average net rate per visit accounted for the same store revenues increase.