EAGLE, Idaho, May 06, 2024 (GLOBE NEWSWIRE) -- The Pennant Group, Inc. (NASDAQ: PNTG), the parent company of the Pennant group of affiliated home health, hospice and senior living companies, today announced its operating results for the first quarter of 2024, reporting GAAP diluted earnings per share of $0.16 for the first quarter of 2024. Pennant also reported adjusted diluted earnings per share of $0.20 for the quarter ⁽¹⁾.

First Quarter Highlights

• Total revenue for the quarter was $156.9 million, an increase of $30.5 million or 24.1% over the prior year quarter;

• Net income for the first quarter was $4.9 million, an increase of $3.1 million or 165.2% over the prior year quarter;

• Adjusted net income for the first quarter was $6.0 million, an increase of $2.1 million or 55.0% over the prior year quarter;

• Segment Adjusted EBITDAR from Operations for the first quarter was $21.4 million, an increase of $4.3 million or 24.9% over the prior year quarter;

• Adjusted EBITDA for the first quarter was $11.2 million, an increase of $3.3 million or 41.8% over the prior year quarter;

• Home Health and Hospice Services segment revenue for the first quarter was $116.5 million, an increase of $25.4 million or 27.9% over the prior year quarter;

• Home Health and Hospice Services segment adjusted EBITDAR from operations for the first quarter was $19.6 million, an increase of $5.1 million or 35.7% over the prior year quarter; and segment adjusted EBITDA from operations the first quarter was $17.9 million, an increase of $4.7 million or 35.7% over the prior year quarter;

• Total home health admissions for the first quarter were 14,649, an increase of 3,739 or 34.3% over the prior year quarter; total Medicare home health admissions for the first quarter were 6,346, an increase of 1,398 or 28.3% over the prior year quarter;

• Hospice average daily census for the first quarter was 2,962, an increase of 523 or 21.4% compared to the prior year quarter;

• Senior Living Services segment revenue for the first quarter was $40.4 million, an increase of $5.0 million or 14.2% over the prior year quarter; average occupancy for the first quarter was 78.5%, an increase of 40 basis points over the prior year quarter, and average monthly revenue per occupied room for the first quarter was $4,667 an increase of $367 or 8.5% over the prior year quarter;

• Same store⁽²⁾ Senior Living Services segment revenue for the first quarter was $38.9 million, an increase of $3.6 million or 10.2% over the prior year quarter; same store senior living average occupancy for the first quarter was 79.7%, an increase of 60 basis points over the prior year quarter, and average monthly revenue per occupied room for the first quarter was $4,643 an increase of $349 or 8.1% over the prior year quarter;

• Senior Living segment adjusted EBITDAR from operations for the first quarter was $12.0 million, an increase of $1.8 million or 17.3% over the prior year quarter; and segment adjusted EBITDA from Operations for the first quarter was $3.5 million, an increase of $1.3 million or 55.6% over the prior year quarter.

^{(1)  See "Reconciliation of GAAP to Non-GAAP Financial Information.”
(2) Same store senior living results is defined as all senior living communities excluding affiliate memory care units in transition, and new senior living operations acquired in 2023 or 2024.}

Operating Results

“We are pleased to report a strong first quarter and great start to the year,” said Brent Guerisoli, Pennant’s Chief Executive Officer. “We continue to experience accelerated growth and are encouraged to see our focus on margin result in solid bottom-line improvement. Our home health and hospice segment achieved record setting performance in both revenue and earnings and our senior living segment reached an all-time high in revenue and steady improvement in earnings. Our on-going investment in leadership is building a foundation of strength across the organization and the Company’s first quarter performance positions us to deliver on 2024 expectations.”

A discussion of the Company's use of Non-GAAP financial measures is set forth below. A reconciliation of net income to EBITDA, adjusted EBITDAR and adjusted EBITDA, as well as a reconciliation of GAAP earnings per share, net income to adjusted net earnings per share and adjusted net income, appear in the financial data portion of this release. More complete information is contained in the Company’s Form 10-Q for the three months ended March 31, 2024, which has been filed with the SEC today and can be viewed on the Company’s website at www.pennantgroup.com. 

Conference Call

A live webcast will be held tomorrow, May 7, 2024 at 10:00 a.m. Mountain time (12:00 p.m. Eastern time) to discuss Pennant’s first quarter 2024 financial results. To listen to the webcast, or to view any financial or statistical information required by SEC Regulation G, please visit the Investors Relations section of Pennant’s website at https://investor.pennantgroup.com. The webcast will be recorded and will be available for replay via the website.

About Pennant

The Pennant Group, Inc. is a holding company of independent operating subsidiaries that provide healthcare services through 112 home health and hospice agencies and 53 senior living communities located throughout Arizona, California, Colorado, Idaho, Montana, Nevada, Oklahoma, Oregon, Texas, Utah, Washington, Wisconsin and Wyoming. Each of these businesses is operated by a separate, independent operating subsidiary that has its own management, employees and assets. References herein to the consolidated "company" and "its" assets and activities, as well as the use of the terms "we," "us," "its" and similar verbiage, are not meant to imply that The Pennant Group, Inc. has direct operating assets, employees or revenue, or that any of the home health and hospice businesses, senior living communities or the Service Center are operated by the same entity. More information about Pennant is available at www.pennantgroup.com. 

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

This press release contains, and the related conference call and webcast will include, forward-looking statements that are based on management’s current expectations, assumptions and beliefs about its business, financial performance, operating results, the industry in which it operates and other future events. Forward-looking statements can often be identified by words such as "anticipates," "expects," "intends," "plans," "predicts," "believes," "seeks," "estimates," "may," "will," "should," "would," "could," "potential," "continue," "ongoing," similar expressions, and variations or negatives of these words. These forward-looking statements include, but are not limited to, statements regarding growth prospects, future operating and financial performance, and acquisition activities. They are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to materially and adversely differ from those expressed in any forward-looking statement.

These risks and uncertainties relate to the company’s business, its industry and its common stock and include: reduced prices and reimbursement rates for its services; its ability to acquire, develop, manage or improve operations, its ability to manage its increasing borrowing costs as it incurs additional indebtedness to fund the acquisition and development of operations; its ability to access capital on a cost-effective basis to continue to successfully implement its growth strategy; its operating margins and profitability could suffer if it is unable to grow and manage effectively its increasing number of operations; competition from other companies in the acquisition, development and operation of facilities; its ability to defend claims and lawsuits, including professional liability claims alleging that our services resulted in personal injury, and other regulatory-related claims; and the application of existing or proposed government regulations, or the adoption of new laws and regulations, that could limit its business operations, require it to incur significant expenditures or limit its ability to relocate its operations if necessary. Readers should not place undue reliance on any forward-looking statements and are encouraged to review the company’s periodic filings with the Securities and Exchange Commission, including its Form 10-Q and/or 10-K, for a more complete discussion of the risks and other factors that could affect Pennant’s business, prospects and any forward-looking statements. Except as required by the federal securities laws, Pennant does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changing circumstances or any other reason after the date of this press release.

Contact Information

Investor Relations
The Pennant Group, Inc.
(208) 506-6100
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The following table summarizes our senior living performance indicators for the periods indicated:

The table below reconciles Consolidated net income to the Consolidated Non-GAAP financial measures, Consolidated Adjusted EBITDA, and to the Non-GAAP valuation measure, Consolidated Adjusted EBITDAR, for the periods presented:

The following table present certain financial information regarding our reportable segments. General and administrative expenses are not allocated to the reportable segments and are included in “All Other”:

The table below provides a reconciliation of Segment Adjusted EBITDAR from Operations above to Condensed Consolidated Income from Operations:

The tables below reconcile Segment Adjusted EBITDAR from Operations to Segment Adjusted EBITDA from Operations for each reportable segment for the periods presented:

Discussion of Non-GAAP Financial Measures

EBITDA consists of net income before (a) interest expense, net, (b) (benefits) provisions for income taxes, and (c) depreciation and amortization. Adjusted EBITDA consists of net income attributable to the Company before (a) interest expense, net (b) (benefits) provisions for income taxes, (c) depreciation and amortization, (d) costs incurred for start-up operations, including rent and excluding depreciation, interest and income taxes, (e) share-based compensation expense, (f) non-capitalizable acquisition related costs and credit allowances, (g) net costs associated with transitioning operations, (h) unusual, non-recurring or redundant charges and (i) net income attributable to noncontrolling interest. Consolidated Adjusted EBITDAR is a valuation measure applicable to current periods only and consists of net income attributable to the Company before (a) interest expense, net, (b) (benefits) provisions for income taxes, (c) depreciation and amortization, (d) rent-cost of services, (e) costs incurred for start-up operations, excluding rent, depreciation, interest and income taxes, (f) share-based compensation expense, (g) acquisition related costs and credit allowances, (h) redundant or non-recurring transition services costs, (i) costs associated with transitioning operations, (j) unusual, non-recurring or redundant charges and (j) net income attributable to noncontrolling interest. The company believes that the presentation of EBITDA, adjusted EBITDA, consolidated adjusted EBITDAR, adjusted net income and adjusted earnings per share provides important supplemental information to management and investors to evaluate the company’s operating performance. The company believes disclosure of adjusted net income, adjusted net income per share, EBITDA, adjusted EBITDA and consolidated adjusted EBITDAR has economic substance because the excluded revenues and expenses are infrequent in nature and are variable in nature, or do not represent current revenues or cash expenditures. A material limitation associated with the use of these measures as compared to the GAAP measures of net income and diluted earnings per share is that they may not be comparable with the calculation of net income and diluted earnings per share for other companies in the company's industry. These non-GAAP financial measures should not be relied upon to the exclusion of GAAP financial measures. For further information regarding why the company believes that this non-GAAP measure provides useful information to investors, the specific manner in which management uses this measure, and some of the limitations associated with the use of this measure, please refer to the company's periodic filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K and Quarterly Report on Form 10-Q. The company’s periodic filings are available on the SEC's website at www.sec.gov or under the "Financial Information" link of the Investor Relations section on Pennant’s website at http://www.pennantgroup.com.