![](/cdn/assets/images/search/clock.png)
We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Share Name | Share Symbol | Market | Type |
---|---|---|---|
US Physical Therapy Inc | NYSE:USPH | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
-8.36 | -9.29% | 81.64 | 86.34 | 79.21 | 83.00 | 482,676 | 23:05:50 |
☒ |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐ |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
NEVADA
|
76-0364866
|
|
(STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION)
|
(I.R.S. EMPLOYER IDENTIFICATION NO.)
|
1300 WEST SAM HOUSTON PARKWAY SOUTH,
SUITE 300, HOUSTON, TEXAS
|
77042
|
|
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
|
(ZIP CODE)
|
Large accelerated filer
|
☐
|
Accelerated filer
|
☒
|
Non-accelerated filer
|
☐
(Do not check if a smaller reporting company)
|
Smaller reporting company
|
☐
|
Emerging growth company
|
☐
|
Title of each class
|
Trading
Symbol(s)
|
Name of each exchange on which registered
|
Common Stock, $.01 par value
|
USPH
|
New York Stock Exchange
|
Item 1.
|
3
|
|
3
|
||
4
|
||
5
|
||
6
|
||
7
|
||
Item 2.
|
25
|
|
Item 3.
|
32 | |
Item 4.
|
32 | |
PART II—OTHER INFORMATION
|
||
Item 1. | Legal Proceedings | 33 |
Item 6.
|
33 | |
34 | ||
Certifications
|
March 31, 2019
|
December 31, 2018
|
|||||||
ASSETS
|
(unaudited)
|
|||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
20,238
|
$
|
23,368
|
||||
Patient accounts receivable, less allowance for doubtful accounts of $2,692 and $2,672, respectively
|
48,443
|
44,751
|
||||||
Accounts receivable - other
|
7,237
|
6,742
|
||||||
Other current assets
|
5,238
|
4,353
|
||||||
Total current assets
|
81,156
|
79,214
|
||||||
Fixed assets:
|
||||||||
Furniture and equipment
|
53,267
|
52,611
|
||||||
Leasehold improvements
|
33,089
|
31,712
|
||||||
Fixed assets, gross
|
86,356
|
84,323
|
||||||
Less accumulated depreciation and amortization
|
65,197
|
64,154
|
||||||
Fixed assets, net
|
21,159
|
20,169
|
||||||
Operating lease right-of-use assets
|
77,870
|
-
|
||||||
Goodwill
|
293,338
|
293,525
|
||||||
Other identifiable intangible assets, net
|
48,125
|
48,828
|
||||||
Other assets
|
1,439
|
1,430
|
||||||
Total assets
|
$
|
523,087
|
$
|
443,166
|
||||
LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS, USPH SHAREHOLDERS’ EQUITY AND NON-CONTROLLING INTERESTS
|
||||||||
Current liabilities:
|
||||||||
Accounts payable - trade
|
$
|
1,894
|
$
|
2,019
|
||||
Accrued expenses
|
39,237
|
38,493
|
||||||
Current portion of operating lease liabilities
|
26,733
|
-
|
||||||
Current portion of notes payable
|
1,066
|
1,434
|
||||||
Total current liabilities
|
68,930
|
41,946
|
||||||
Notes payable, net of current portion
|
516
|
402
|
||||||
Revolving line of credit
|
29,000
|
38,000
|
||||||
Deferred taxes
|
9,872
|
9,012
|
||||||
Deferred rent
|
-
|
2,159
|
||||||
Operating lease liabilities, net of current portion
|
55,834
|
-
|
||||||
Other long-term liabilities
|
566
|
829
|
||||||
Total liabilities
|
164,718
|
92,348
|
||||||
Redeemable non-controlling interests
|
137,196
|
133,943
|
||||||
U.S. Physical Therapy, Inc. ("USPH") shareholders’ equity:
|
||||||||
Preferred stock, $.01 par value, 500,000 shares authorized, no shares issued and outstanding
|
-
|
-
|
||||||
Common stock, $.01 par value, 20,000,000 shares authorized, 14,975,829 and 14,899,233 shares issued, respectively
|
149
|
149
|
||||||
Additional paid-in capital
|
82,295
|
80,028
|
||||||
Retained earnings
|
168,952
|
167,396
|
||||||
Treasury stock at cost, 2,214,737 shares
|
(31,628
|
)
|
(31,628
|
)
|
||||
Total USPH shareholders’ equity
|
219,768
|
215,945
|
||||||
Non-controlling interests
|
1,405
|
930
|
||||||
Total USPH shareholders' equity and non-controlling interests
|
221,173
|
216,875
|
||||||
Total liabilities, redeemable non-controlling interests, USPH shareholders' equity and non-controlling interests
|
$
|
523,087
|
$
|
443,166
|
For the Three Months Ended
|
||||||||
March 31, 2019
|
March 31, 2018
|
|||||||
Net patient revenues
|
$
|
106,650
|
$
|
100,552
|
||||
Other revenues
|
9,581
|
7,790
|
||||||
Net revenues
|
116,231
|
108,342
|
||||||
Operating costs:
|
||||||||
Salaries and related costs
|
66,267
|
62,279
|
||||||
Rent, supplies, contract labor and other
|
22,044
|
21,776
|
||||||
Provision for doubtful accounts
|
1,206
|
1,061
|
||||||
Closure costs
|
(4
|
)
|
12
|
|||||
Total operating costs
|
89,513
|
85,128
|
||||||
Gross profit
|
26,718
|
23,214
|
||||||
Corporate office costs
|
11,293
|
10,163
|
||||||
Operating income
|
15,425
|
13,051
|
||||||
Interest and other income, net
|
16
|
32
|
||||||
Interest expense - debt and other
|
(358
|
)
|
(553
|
)
|
||||
Income before taxes
|
15,083
|
12,530
|
||||||
Provision for income taxes
|
2,708
|
2,476
|
||||||
Net income
|
12,375
|
10,054
|
||||||
Less: net income attributable to non-controlling interests:
|
||||||||
Non-controlling interests - permanent equity
|
(1,537
|
)
|
(1,201
|
)
|
||||
Redeemable non-controlling interests - temporary equity
|
(2,395
|
)
|
(1,736
|
)
|
||||
(3,932
|
)
|
(2,937
|
)
|
|||||
Net income attributable to USPH shareholders
|
$
|
8,443
|
$
|
7,117
|
||||
Basic and diluted earnings per share attributable to USPH shareholders
|
$
|
0.39
|
$
|
0.27
|
||||
Shares used in computation - basic and diluted
|
12,707
|
12,616
|
||||||
Dividends declared per common share
|
$
|
0.27
|
$
|
0.23
|
Three Months Ended
|
||||||||
March 31, 2019
|
March 31, 2018
|
|||||||
OPERATING ACTIVITIES
|
||||||||
Net income including non-controlling interests
|
$
|
12,375
|
$
|
10,054
|
||||
Adjustments to reconcile net income including non-controlling interests to net cash provided by operating activities:
|
||||||||
Depreciation and amortization
|
2,400
|
2,468
|
||||||
Provision for doubtful accounts
|
1,206
|
1,061
|
||||||
Equity-based awards compensation expense
|
1,728
|
1,381
|
||||||
Deferred income taxes
|
2,118
|
(1,162
|
)
|
|||||
Other
|
12
|
54
|
||||||
Changes in operating assets and liabilities:
|
||||||||
Increase in patient accounts receivable
|
(4,898
|
)
|
(2,782
|
)
|
||||
Increase in accounts receivable - other
|
(495
|
)
|
(849
|
)
|
||||
Increase in other assets
|
(894
|
)
|
(1,238
|
)
|
||||
Increase in accounts payable and accrued expenses
|
274
|
7,389
|
||||||
Decrease in other liabilities
|
(263
|
)
|
(845
|
)
|
||||
Net cash provided by operating activities
|
13,563
|
15,531
|
||||||
INVESTING ACTIVITIES
|
||||||||
Purchase of fixed assets
|
(2,497
|
)
|
(1,404
|
)
|
||||
Purchase of redeemable non-controlling interest
|
(2,053
|
)
|
(761
|
)
|
||||
Purchase of non-controlling interest
|
(139
|
)
|
(246
|
)
|
||||
Proceeds on sale of fixed assets
|
59
|
-
|
||||||
Net cash used in investing activities
|
(4,630
|
)
|
(2,411
|
)
|
||||
FINANCING ACTIVITIES
|
||||||||
Distributions to non-controlling interests, permanent and temporary equity
|
(2,576
|
)
|
(2,208
|
)
|
||||
Proceeds from revolving line of credit
|
19,000
|
19,000
|
||||||
Payments on revolving line of credit
|
(28,000
|
)
|
(31,000
|
)
|
||||
Payments to settle mandatorily redeemable non-controlling interests
|
-
|
(265
|
)
|
|||||
Principal payments on notes payable
|
(482
|
)
|
(823
|
)
|
||||
Other
|
(5
|
)
|
56
|
|||||
Net cash used in financing activities
|
(12,063
|
)
|
(15,240
|
)
|
||||
Net decrease in cash and cash equivalents
|
(3,130
|
)
|
(2,120
|
)
|
||||
Cash and cash equivalents - beginning of period
|
23,368
|
21,933
|
||||||
Cash and cash equivalents - end of period
|
$
|
20,238
|
$
|
19,813
|
||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
|
||||||||
Cash paid during the period for:
|
||||||||
Income taxes
|
$
|
313
|
$
|
2,941
|
||||
Interest
|
$
|
343
|
$
|
526
|
||||
Non-cash investing and financing transactions during the period:
|
||||||||
Purchase of business - seller financing portion
|
$
|
228
|
$
|
150
|
U.S.Physical Therapy, Inc.
|
||||||||||||||||||||||||||||||||||||
Common Stock
|
Additional
|
Retained
|
Treasury Stock
|
Total Shareholders’
|
Non-Controlling
|
|||||||||||||||||||||||||||||||
Shares
|
Amount
|
Paid-In Capital
|
Earnings
|
Shares
|
Amount
|
Equity
|
Interests
|
Total
|
||||||||||||||||||||||||||||
Balance December 31, 2018
|
14,899
|
$
|
149
|
$
|
80,028
|
$
|
167,396
|
(2,215
|
)
|
$
|
(31,628
|
)
|
$
|
215,945
|
$
|
930
|
$
|
216,875
|
||||||||||||||||||
Issuance of restricted stock, net of cancellations
|
77
|
-
|
-
|
(3,437
|
)
|
-
|
-
|
(3,437
|
)
|
-
|
(3,437
|
)
|
||||||||||||||||||||||||
Compensation expense - equity-based awards
|
-
|
-
|
1,728
|
-
|
-
|
-
|
1,728
|
-
|
1,728
|
|||||||||||||||||||||||||||
Transfer of compensation liability for certain stock issued pursuant to long-term incentive plans
|
-
|
-
|
636
|
-
|
-
|
-
|
636
|
-
|
636
|
|||||||||||||||||||||||||||
Purchase of non-controlling interest
|
-
|
-
|
(97
|
)
|
-
|
-
|
-
|
(97
|
)
|
(8
|
)
|
(105
|
)
|
|||||||||||||||||||||||
Dividends payable to USPT shareholders
|
-
|
-
|
-
|
(3,445
|
)
|
-
|
-
|
(3,445
|
)
|
-
|
(3,445
|
)
|
||||||||||||||||||||||||
Distributions to non-controlling interest partners, permanent equity
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(1,054
|
)
|
(1,054
|
)
|
|||||||||||||||||||||||||
Other
|
-
|
-
|
-
|
(5
|
)
|
-
|
-
|
(5
|
)
|
-
|
(5
|
)
|
||||||||||||||||||||||||
Net income attributable to non-controlling interests - permanent equity
|
-
|
-
|
-
|
-
|
-
|
-
|
1,537
|
1,537
|
||||||||||||||||||||||||||||
Net income attributable to USPH shareholders
|
-
|
-
|
-
|
8,443
|
-
|
-
|
8,443
|
-
|
8,443
|
|||||||||||||||||||||||||||
Balance March 31, 2019
|
14,976
|
149
|
82,295
|
168,952
|
(2,215
|
)
|
(31,628
|
)
|
$
|
219,768
|
1,405
|
221,173
|
U.S.Physical Therapy, Inc.
|
||||||||||||||||||||||||||||||||||||
Common Stock
|
Additional
|
Retained
|
Treasury Stock
|
Total Shareholders’
|
Non-Controlling
|
|||||||||||||||||||||||||||||||
Shares
|
Amount
|
Paid-In Capital
|
Earnings
|
Shares
|
Amount
|
Equity
|
Interests
|
Total
|
||||||||||||||||||||||||||||
Balance December 31, 2017
|
14,809
|
$
|
148
|
$
|
73,940
|
$
|
162,406
|
(2,215
|
)
|
$
|
(31,628
|
)
|
$
|
204,866
|
$
|
1,204
|
$
|
206,070
|
||||||||||||||||||
Issuance of restricted stock, net of cancellation
|
76
|
1
|
-
|
-
|
-
|
-
|
1
|
-
|
1
|
|||||||||||||||||||||||||||
Revaluation of redeemable non-controlling interest, net of tax
|
-
|
-
|
-
|
(3,747
|
)
|
-
|
-
|
(3,747
|
)
|
-
|
(3,747
|
)
|
||||||||||||||||||||||||
Compensation expense - equity-based awards
|
-
|
-
|
1,381
|
-
|
-
|
-
|
1,381
|
-
|
1,381
|
|||||||||||||||||||||||||||
Transfer of compensation liability for certain stock issued pursuant to long-term incentive plans
|
-
|
-
|
373
|
-
|
-
|
-
|
373
|
-
|
373
|
|||||||||||||||||||||||||||
Purchase of non-controlling interest
|
-
|
-
|
(151
|
)
|
-
|
-
|
-
|
(151
|
)
|
(42
|
)
|
(193
|
)
|
|||||||||||||||||||||||
Dividends payable to USPT shareholders
|
-
|
-
|
-
|
(2,914
|
)
|
-
|
-
|
(2,914
|
)
|
-
|
(2,914
|
)
|
||||||||||||||||||||||||
Distributions to non-controlling interest partners
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(849
|
)
|
(849
|
)
|
|||||||||||||||||||||||||
Other
|
-
|
-
|
-
|
45
|
-
|
-
|
45
|
-
|
45
|
|||||||||||||||||||||||||||
Net income
|
-
|
-
|
-
|
7,117
|
-
|
-
|
7,117
|
1,201
|
8,318
|
|||||||||||||||||||||||||||
Balance March 31, 2018
|
14,885
|
149
|
75,543
|
162,907
|
(2,215
|
)
|
(31,628
|
)
|
$
|
206,971
|
1,514
|
208,485
|
|
Date |
% Interest Acquired
|
Number of Clinics
|
||||||
|
2018
|
||||||||
August 2018 Acquisition
|
August 31
|
70
%
|
|
4
|
Cash paid, net of cash acquired
|
$
|
16,367
|
||
Seller notes
|
950
|
|||
Total consideration
|
$
|
17,317
|
||
Estimated fair value of net tangible assets acquired:
|
||||
Total current assets
|
$
|
1,691
|
||
Total non-current assets
|
305
|
|||
Total liabilities
|
(508
|
)
|
||
Net tangible assets acquired
|
$
|
1,488
|
||
Referral relationships
|
1,879
|
|||
Non-compete
|
386
|
|||
Tradename
|
2,172
|
|||
Goodwill
|
19,537
|
|||
Fair value of non-controlling interest (classified as redeemable non-controlling interests)
|
(8,145
|
)
|
||
$
|
17,317
|
Three Months Ended
|
||||||||
March 31, 2019
|
March 31, 2018
|
|||||||
Net patient revenues
|
$
|
106,650
|
$
|
100,552
|
||||
Management contract revenues
|
2,146
|
2,236
|
||||||
Industrial injury prevention services revenues
|
6,900
|
4,852
|
||||||
Other revenues
|
535
|
702
|
||||||
$
|
116,231
|
$
|
108,342
|
Three Months Ended March 31,
|
||||||||
2019
|
2018
|
|||||||
Computation of earnings per share - USPH shareholders:
|
||||||||
Net income attributable to USPH shareholders
|
$
|
8,443
|
$
|
7,117
|
||||
Charges to retained earnings:
|
||||||||
Revaluation of redeemable non-controlling interest
|
(4,661
|
)
|
(5,081
|
)
|
||||
Tax effect at statutory rate (federal and state) of 26.25%
|
1,224
|
1,334
|
||||||
$
|
5,006
|
$
|
3,370
|
|||||
Basic and diluted per share
|
0.39
|
$
|
0.27
|
|||||
Shares used in computation:
|
||||||||
Basic and diluted earnings per share - weighted-average shares
|
12,707
|
12,616
|
|
1. |
Prior to the Acquisition, the Therapy Practice exists as a separate legal entity (the “Seller Entity”). The
Seller Entity is owned by one or more individuals (the “Selling Shareholders”) most of whom are physical therapists that work in the Therapy Practice and provide physical therapy services to patients.
|
|
2. |
In conjunction with the Acquisition, the Seller Entity contributes the Therapy Practice into a newly-formed
limited partnership (“NewCo”), in exchange for one hundred percent (100%) of the limited and general partnership interests in NewCo. Therefore, in this step, NewCo becomes a wholly-owned subsidiary of the Seller Entity.
|
|
3. |
The Company enters into an agreement (the “Purchase Agreement”) to acquire from the Seller Entity a majority
(ranges from 50% to 90%) of the limited partnership interest and in
all
cases 100% of
the general partnership interest in NewCo. The Company does not purchase 100% of the limited partnership interest because the Selling Shareholders, through the Seller Entity, want to maintain an ownership percentage. The consideration
for the Acquisition is primarily payable in the form of cash at closing and a small two-year note in lieu of an escrow (the “Purchase Price”). The Purchase Agreement does not contain any future earn-out or other contingent
consideration that is payable to the Seller Entity or the Selling Shareholders.
|
|
4. |
The Company and the Seller Entity also execute a partnership agreement (the “Partnership Agreement”) for
NewCo that sets forth the rights and obligations of the limited and general partners of NewCo. After the Acquisition, the Company is the general partner of NewCo.
|
|
5. |
As noted above, the Company does not purchase 100% of the limited partnership interests in NewCo and the
Seller Entity retains a portion of the limited partnership interest in NewCo (“Seller Entity Interest”).
|
|
6. |
In most cases, some or all of the Selling Shareholders enter into an employment agreement (the “Employment
Agreement”) with NewCo with an initial term that ranges from three to five years (the “Employment Term”), with automatic one-year renewals, unless employment is terminated prior to the end of the Employment Term. As a result, a
Selling Shareholder becomes an employee (“Employed Selling Shareholder”) of NewCo. The employment of an Employed Selling Shareholder can be terminated by the Employed Selling Shareholder or NewCo, with or without cause, at any time.
In a few situations, a Selling Shareholder does not become employed by NewCo and is not involved with NewCo following the closing; in those situations, such Selling Shareholders sell their entire ownership interest in the Seller
Entity as of the closing of the Acquisition.
|
|
7. |
The compensation of each Employed Selling Shareholder is specified in the Employment Agreement and is
customary and commensurate with his or her responsibilities based on other employees in similar capacities within NewCo, the Company and the industry.
|
|
8. |
The Company and the Selling Shareholder (including both Employed Selling Shareholders and Selling
Shareholders not employed by NewCo) execute a non-compete agreement (the “Non-Compete Agreement”) which restricts the Selling Shareholder from engaging in competing business activities for a specified period of time (the “Non-Compete
Term”). A Non-Compete Agreement is executed with the Selling Shareholders in all cases. That is, even if the Selling Shareholder does not become an Employed Selling Shareholder, the Selling Shareholder is restricted from engaging in a
competing business during the Non-Compete Term.
|
|
9. |
The Non-Compete Term commences as of the date of the Acquisition and expires on the
later
of :
|
|
a. |
Two years after the date an Employed Selling Shareholders’ employment is terminated (if the Selling Shareholder becomes an Employed Selling Shareholder) or
|
|
b. |
Five to six years from the date of the Acquisition, as defined in the Non-Compete Agreement, regardless of whether the Selling Shareholder is employed by NewCo.
|
|
10. |
The Non-Compete Agreement applies to a restricted region which is defined as a 15-mile radius from the
Therapy Practice. That is, an Employed Selling Shareholder is permitted to engage in competing businesses or activities outside the 15-mile radius (after such Employed Selling Shareholder no longer is employed by NewCo) and a Selling
Shareholder who is not employed by NewCo immediately is permitted to engage in the competing business or activities outside the 15-mile radius.
|
|
1. |
Put Right
|
|
a. |
In the event that any Selling Shareholder’s employment is terminated under certain circumstances prior to the fifth anniversary of the Closing Date, the Seller Entity
thereafter may have an irrevocable right to cause the Company to purchase from Seller Entity the Terminated Selling Shareholder’s Allocable Percentage of Seller Entity’s Interest at the purchase price described in “3” below.
|
|
b. |
In the event that any Selling Shareholder is not employed by NewCo as of the fifth anniversary of the Closing Date and the Company has not exercised its Call Right with
respect to the Terminated Selling Shareholder’s Allocable Percentage of Seller Entity’s Interest, Seller Entity thereafter shall have the Put Right to cause the Company to purchase from Seller Entity the Terminated Selling Shareholder’s
Allocable Percentage of Seller Entity’s Interest at the purchase price described in “3” below.
|
|
c. |
In the event that any Selling Shareholder’s employment with NewCo is terminated for any reason on or after the fifth anniversary of the Closing Date, the Seller Entity
shall have the Put Right, and upon the exercise of the Put Right, the Terminated Selling Shareholder’s Allocable Percentage of Seller Entity’s Interest shall be redeemed by the Company at the purchase price described in “3” below.
|
|
2. |
Call Right
|
|
a. |
If any Selling Shareholder’s employment by NewCo is terminated prior to the fifth anniversary of the Closing Date, the Company thereafter shall have an irrevocable right to
purchase from Seller Entity the Terminated Selling Shareholder’s Allocable Percentage of Seller Entity’s Interest, in each case at the purchase price described in “3” below.
|
|
b. |
In the event that any Selling Shareholder’s employment with NewCo is terminated for any reason on or after the fifth anniversary of the Closing Date, the Company shall have
the Call Right, and upon the exercise of the Call Right, the Terminated Selling Shareholder’s Allocable Percentage of Seller Entity’s Interest shall be redeemed by the Company at the purchase price described in “3” below.
|
|
3. |
For the Put Right and the Call Right, the purchase price is derived from a formula based on a specified multiple of NewCo’s trailing twelve months of earnings before
interest, taxes, depreciation, amortization, and the Company’s internal management fee, plus an Allocable Percentage of any undistributed earnings of NewCo (the “Redemption Amount”). NewCo’s earnings are distributed monthly based on
available cash within NewCo; therefore, the undistributed earnings amount is small, if any.
|
|
4. |
The Purchase Price for the initial equity interest purchased by the Company is also based on the same specified multiple of the trailing twelve-month earnings that is used
in the Put Right and the Call Right noted above.
|
|
5. |
The Put Right and the Call Right do not have an expiration date, but the Seller Entity Interest is not required to be purchased by the Company or sold by the Seller Entity.
|
|
6. |
The Put Right and the Call Right never apply to Selling Shareholders who do not become employed by NewCo, since the Company requires that such Selling Shareholders sell
their entire ownership interest in the Seller Entity at the closing of the Acquisition.
|
Three Months Ended
March 31, 2019
|
Year Ended
December 31, 2018
|
|||||||
Beginning balance
|
$
|
133,943
|
$
|
102,572
|
||||
Operating results allocated to redeemable non-controlling interest partners
|
2,395
|
8,433
|
||||||
Distributions to redeemable non-controlling interest partners
|
(1,522
|
)
|
(9,835
|
)
|
||||
Changes in the fair value of redeemable non-controlling interest
|
4,661
|
24,770
|
||||||
Purchases of redeemable non-controlling interest
|
(2,281
|
)
|
8,145
|
|||||
Other
|
-
|
(142
|
)
|
|||||
Ending balance
|
$
|
137,196
|
$
|
133,943
|
March 31, 2019
|
December 31, 2018
|
|||||||
Contractual time period has lapsed but holder's employment has not been terminated
|
$
|
48,058
|
$
|
42,624
|
||||
Contractual time period has not lapsed and holder's employment has not been terminated
|
$
|
89,138
|
$
|
91,319
|
||||
Holder's employment has terminated and contractual time period has expired
|
$
|
-
|
$
|
-
|
||||
Holder's employment has terminated and contractual time period has not expired
|
$
|
-
|
$
|
-
|
||||
$
|
137,196
|
$
|
133,943
|
Three Months Ended
March 31, 2019
|
Year Ended
December 31, 2018
|
|||||||
Beginning balance
|
$
|
293,525
|
$
|
271,338
|
||||
Goodwill acquired
|
$
|
-
|
$
|
19,778
|
||||
Goodwill adjustments for purchase price allocation of businesses acquired in prior year
|
(241
|
)
|
2,409
|
|||||
Other
|
54
|
-
|
||||||
Ending balance
|
$
|
293,338
|
$
|
293,525
|
March 31, 2019
|
December 31, 2018
|
|||||||
Tradenames
|
$
|
30,256
|
$
|
30,256
|
||||
Referral relationships, net of accumulated amortization of $9,903 and $$9,370, respectively
|
16,361
|
16,895
|
||||||
Non-compete agreements, net of accumulated amortization of $4,885 and $4,716, respectively
|
1,508
|
1,677
|
||||||
$
|
48,125
|
$
|
48,828
|
Three Months Ended
|
Three Months Ended
|
|||||||
March 31, 2019
|
March 31, 2018
|
|||||||
Referral relationships
|
$
|
533
|
$
|
520
|
||||
Non-compete agreements
|
169
|
197
|
||||||
$
|
702
|
$
|
717
|
Referral Relationships
|
Non-Compete Agreements
|
|||||||||||
Years
Ending December 31,
|
Annual Amount
|
Years
Ending December 31,
|
Annual Amount
|
|||||||||
2019
|
$
|
2,132
|
2019
|
$
|
632
|
|||||||
2020
|
$
|
2,132
|
2020
|
$
|
418
|
|||||||
2021
|
$
|
2,132
|
2021
|
$
|
340
|
|||||||
2022
|
$
|
2,084
|
2022
|
$
|
163
|
|||||||
2023
|
$
|
1,977
|
2023
|
$
|
94
|
|||||||
2024
|
$
|
1,791
|
2024
|
$
|
30
|
|||||||
Thereafter
|
$
|
4,646
|
March 31, 2019
|
December 31, 2018
|
|||||||
Salaries and related costs
|
$
|
21,131
|
$
|
21,726
|
||||
Credit balances due to patients and payors
|
7,662
|
7,293
|
||||||
Group health insurance claims
|
2,815
|
3,124
|
||||||
Other
|
7,629
|
6,350
|
||||||
Total
|
$
|
39,237
|
$
|
38,493
|
March 31, 2019
|
December 31, 2018
|
|||||||
Credit Agreement average effective interest rate of 4.4% inclusive of unused fee
|
$
|
29,000
|
$
|
38,000
|
||||
Various notes payable with $1,066 plus accrued interest due in the next year,interest accrues in the range of 3.25% through 5.50% per annum
|
1,582
|
1,836
|
||||||
30,582
|
39,836
|
|||||||
Less current portion
|
(1,066
|
)
|
(1,434
|
)
|
||||
Long term portion
|
$
|
29,516
|
$
|
38,402
|
During the twelve months ended March 31, 2020
|
$
|
1,066
|
||
During the twelve months ended March 31, 2021
|
516
|
|||
During the twelve months ended March 31, 2022
|
29,000
|
|||
$
|
30,582
|
Three Months
Ended
March 31, 2019
|
||||
Operating lease cost
|
$
|
7,587
|
||
Short-term lease cost
|
371
|
|||
Variable lease cost
|
1,581
|
|||
Total lease cost *
|
$
|
9,539
|
Other Information
|
Three Months
Ended
March 31, 2019
|
|||
Cash paid for amounts included in the measurement of operating lease liabilities
|
$
|
7,706
|
||
Right-of-use assets obtained in exchange for new operating lease liabilities**
|
$
|
89,885
|
Fiscal Year
|
Amount
|
|||
2019 (excluding the three months ended March, 31, 2019)
|
$
|
22,498
|
||
2020
|
24,890
|
|||
2021
|
18,329
|
|||
2022
|
11,499
|
|||
2023
|
6,678
|
|||
2024 and thereafter
|
4,734
|
|||
Total lease payments
|
$
|
88,628
|
||
Less: imputed interest
|
6,061
|
|||
Total operating lease liabilities
|
$
|
82,567
|
Three Months
Ended
March 31, 2019
|
||||
Weighted-average remaining lease term - Operating leases
|
3.7 Years
|
|||
Weighted-average discount rate - Operating leases
|
3.8
%
|
|
|
Date |
% Interest Acquired
|
Number of Clinics
|
||||
|
|
||||||
|
2018 | ||||||
August 2018 Acquisition
|
August 31
|
70
%
|
|
4
|
For the Three Months Ended
|
||||||||
March 31, 2019
|
March 31, 2018
|
|||||||
Number of clinics, at the end of period
|
590
|
580
|
||||||
Working Days
|
63
|
64
|
||||||
Average visits per day per clinic
|
26.9
|
25.7
|
||||||
Total patient visits
|
1,001,510
|
956,237
|
||||||
Net patient revenue per visit
|
$
|
106.49
|
$
|
105.15
|
• |
For the first quarter ended March 31, 2019 (“2019 First Quarter”), USPH’s Operating Results increased 18.6% to $8.4 million, or $0.66 per diluted share, as compared to
$7.1 million, or $0.56 per diluted share, in the first quarter ended March 31, 2018 (“2018 First Quarter”). Operating Results, per share, a non-GAAP measure, equals net income attributable to USPH shareholders per the consolidated
statement of net income, and excludes the impact of the revaluation of redeemable non-controlling interest, net of tax to calculate earnings per share.
|
• |
For the 2019 First Quarter, USPH’s net income attributable to its shareholders was $8.4 million as compared to $7.1 million in the first quarter of 2018. Inclusive of
the charge for revaluation of non-controlling interest, net of tax, in accordance with GAAP, in the recent quarter, the amount is $5.0 million, or $0.39 per share, as compared to $3.4 million, or $0.27 per share for the 2018 First
Quarter. In accordance with current accounting guidance, the revaluation of redeemable non-controlling interest, net of tax, is not included in net income but charged directly to retained earnings and is included in the earnings
per basic and diluted share calculation.
|
Three Months Ended March 31,
|
||||||||
2019
|
2018
|
|||||||
Computation of earnings per share - USPH shareholders
|
||||||||
Net income attributable to USPH shareholders
|
$
|
8,443
|
$
|
7,117
|
||||
Charges to retained earnings:
|
||||||||
Revaluation of redeemable non-controlling interest
|
(4,661
|
)
|
(5,081
|
)
|
||||
Tax effect at statutory rate (federal and state) of 26.25%
|
1,224
|
1,334
|
||||||
$
|
5,006
|
$
|
3,370
|
|||||
Basic and diluted per share
|
0.39
|
$
|
0.27
|
|||||
Adjustments:
|
||||||||
Tax benefit - revaluation of deferred tax assets and liabilities
|
-
|
-
|
||||||
Revaluation of redeemable non-controlling interest
|
4,661
|
5,081
|
||||||
Tax effect at statutory rate (federal and state) of 26.25%
|
(1,224
|
)
|
(1,334
|
)
|
||||
Operating results
|
$
|
8,443
|
$
|
7,117
|
||||
Basic and diluted operating results per share
|
$
|
0.66
|
$
|
0.56
|
||||
Shares used in computation - basic and diluted
|
12,707
|
12,616
|
|
• |
Net revenues increased $7.9 million or 7.3% from $108.3 million in the 2018 First Quarter to $116.2 million in the 2019 First Quarter, primarily due to an increase in
net patient revenues from physical therapy operations and an increase in the revenue from the industrial injury prevention business. Both increases are due to internal growth and acquisitions. The 2019 First Quarter had 63 business
days versus 64 in the 2018 First Quarter.
|
|
• |
Net patient revenues from physical therapy operations increased approximately $6.1 million, or 6.1%, to $106.7 million in the 2019 First Quarter from $100.6 million in
the 2018 First Quarter due to an increase in total patient visits of 4.7% from 956,000 to 1,001,500 and an increase in the average net patient revenue per visit to $106.49 from $105.15. Of the $6.1 million increase in net patient
revenues, $3.3 million related to an increase in business of clinics opened or acquired prior to April 1, 2018 (“Mature Clinics”) and $2.8 million related to clinics opened or acquired after March 31, 2018 (“New Clinics”). Revenue
from physical therapy management contracts was $2.1 million for the first quarter of 2019 and $2.2 million for the comparable 2018 period.
|
|
• |
Revenue from the industrial injury prevention business increased 42.2% to $6.9 million in the first quarter of 2019 compared to $4.9 million in the first quarter 2018
due to internal growth and an April 2018 acquisition.
|
|
• |
Other miscellaneous revenue was $0.5 million in the 2019 First Quarter and $0.7 million in the 2018 First Quarter.
|
For the Three Months Ended
|
||||||||
March 31, 2019
|
March 31, 2018
|
|||||||
Income before taxes
|
$
|
15,083
|
$
|
12,530
|
||||
Less: net income attributable to non-controlling interests:
|
||||||||
Non-controlling interests - permanent equity
|
(1,537
|
)
|
(1,201
|
)
|
||||
Redeemable non-controlling interests - temporary equity
|
(2,395
|
)
|
(1,736
|
)
|
||||
(3,932
|
)
|
(2,937
|
)
|
|||||
Income before taxes less net income attributable to non-controlling interests
|
11,151
|
9,593
|
||||||
Provision for income taxes
|
2,708
|
2,476
|
||||||
Percentage
|
24.3
|
%
|
25.8
|
%
|
|
• |
changes as the result of government enacted national healthcare reform;
|
|
• |
changes in Medicare rules and guidelines and reimbursement or failure of our clinics to maintain their Medicare certification status;
|
|
• |
revenue we receive from Medicare and Medicaid being subject to potential retroactive reduction;
|
|
• |
business and regulatory conditions including federal and state regulations;
|
|
• |
governmental and other third party payor inspections, reviews, investigations and audits;
|
|
• |
compliance with federal and state laws and regulations relating to the privacy of individually identifiable patient information, and associated fines and penalties for
failure to comply;
|
|
• |
changes in reimbursement rates or payment methods from third party payors including government agencies and deductibles and co-pays owed by patients;
|
|
• |
revenue and earnings expectations;
|
|
• |
legal actions, which could subject us to increased operating costs and uninsured liabilities;
|
|
• |
general economic conditions;
|
|
• |
availability and cost of qualified physical therapists;
|
|
• |
personnel productivity and retaining key personnel;
|
|
• |
competitive, economic or reimbursement conditions in our markets which may require us to reorganize or close certain clinics and thereby incur losses and/or closure
costs including the possible write-down or write-off of goodwill and other intangible assets;
|
|
• |
acquisitions, purchase of non-controlling interests (minority interests) and the successful integration of the operations of the acquired businesses;
|
|
• |
maintaining our information technology systems with adequate safeguards to protect against cyber-attacks;
|
|
• |
maintaining adequate internal controls;
|
|
• |
maintaining necessary insurance coverage;
|
|
• |
availability, terms, and use of capital; and
|
|
• |
weather and other seasonal factors.
|
(a) |
Evaluation of Disclosure Controls and Procedures
|
(b) |
Changes in Internal Control Over Financial Reporting
|
Exhibit
Number
|
Description
|
10.1+
|
Objective Long-Term Incentive Plan for Senior Management [incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K
filed with the SEC on March 8, 2019.]
|
10.2+
|
Discretionary Long-Term Incentive Plan for Senior Management [incorporated by reference to Exhibit 99.2 to the Company’s Current Report on Form
8-K filed with the SEC on March 8, 2019.]
|
10.3+
|
Objective Cash/RSA Bonus Plan for Senior Management [incorporated by reference to Exhibit 99.3 to the Company’s Current Report on Form 8-K filed
with the SEC on March 8, 2019.]
|
10.4+
|
Discretionary Cash/RSA Bonus Plan for Senior Management [incorporated by reference to Exhibit 99.4 to the Company’s Current Report on Form 8-K
filed with the SEC on March 8, 2019.]
|
31.1*
|
Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.
|
31.2*
|
Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer.
|
31.3*
|
Rule 13a-14(a)/15d-14(a) Certification of Corporate Controller.
|
32*
|
Certification Pursuant to 18 U.S.C 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101.INS*
|
XBRL Instance Document
|
101.SCH*
|
XBRL Taxonomy Extension Schema Document
|
101.CAL*
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF*
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB*
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE*
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
* |
Filed herewith
|
+ |
Management contract or compensatory plan or arrangement
|
U.S. PHYSICAL THERAPY, INC.
|
||
Date: May 6, 2019
|
By:
|
/s/ LAWRANCE W. MCAFEE
|
Lawrance W. McAfee
|
||
Chief Financial Officer
|
||
(duly authorized officer and principal financial and accounting officer)
|
||
By:
|
/s/ JON C. BATES
|
|
Jon C. Bates
|
||
Vice President/Corporate Controller
|
* |
Filed herewith
|
+ |
Management contract or compensatory plan or arrangement
|
1 Year US Physical Therapy Chart |
1 Month US Physical Therapy Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions