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NHC Reports Third Quarter 2021 Earnings

National HealthCare Corporation (NYSE American: NHC), the nation's oldest publicly traded senior health care company, announced today net operating revenues and CARES Act income for the quarter ended September 30, 2021 totaled $276,737,000 compared to $250,626,000 for the quarter ended September 30, 2020, an increase of 10.4%. The net operating revenues increase for the third quarter of 2021 was primarily driven by the June 2021 controlling equity interest acquisition of Caris Healthcare, a hospice provider with 28 agencies. The census in our skilled nursing facilities increased 90 basis points during the third quarter of 2021, when compared sequentially to the second quarter of 2021.

For the quarter ended September 30, 2021, the reported GAAP net loss attributable to NHC was $3,348,000 compared to net income attributable to NHC of $12,849,000 for the same period in 2020. The decrease in our reported GAAP earnings for the third quarter of 2021 is due to the unrealized losses in our marketable equity securities portfolio. Excluding the unrealized losses in our marketable equity securities portfolio and other non-GAAP adjustments, adjusted net income for the quarter ended September 30, 2021 was $14,884,000 compared to $13,475,000 for the same period in 2020, an increase of 10.5% (*). The GAAP diluted loss per share was $0.22 for the quarter ended September 30, 2021 compared to earnings per share of $0.84 for the same period in 2020. Adjusted diluted earnings per share were $0.96 and $0.88 for the quarters ended September 30, 2021 and 2020, respectively (*).

(*) - See the tables below that provide a reconciliation of GAAP to non-GAAP items.

About NHC

NHC affiliates operate for themselves and third parties 75 skilled nursing facilities with 9,473 beds. NHC affiliates also operate 24 assisted living communities, five independent living communities, one behavioral health hospital, 34 homecare agencies, and 28 hospice agencies. NHC’s other services include Alzheimer’s and memory care units, pharmacy services, a rehabilitation services company, and providing management and accounting services to third party post-acute operators. Other information about the company can be found on our web site at www.nhccare.com.

Non-GAAP Financial Presentation

The Company is providing certain non-GAAP financial measures as the Company believes that these figures are helpful in allowing investors to more accurately assess the ongoing nature of the Company’s operations and measure the Company’s performance more consistently across periods. Therefore, the Company believes this information is meaningful in addition to the information contained in the GAAP presentation of financial information. The presentation of this additional non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP.

Forward-Looking Statements

Statements in this press release that are not historical facts are forward-looking statements. NHC cautions investors that any forward-looking statements made involve risks and uncertainties and are not guarantees of future performance. The risks and uncertainties are detailed from time to time in reports filed by NHC with the S.E.C., including Forms 8-K, 10-Q and 10-K, and include, among others, the following: liabilities and other claims asserted against us and patient care liabilities, as well as the resolution of current litigation; availability of insurance and assets for indemnification; national and local economic conditions; including their effect on the availability and cost of labor, utilities and materials; the effect of government regulations and changes in regulations governing the healthcare industry, including our compliance with such regulations; changes in Medicare and Medicaid payment levels and methodologies and the application of such methodologies by the government and its fiscal intermediaries; and other factors referenced or incorporated by reference in the S.E.C. filings. The risks included here are not exhaustive. All forward-looking statements represent NHC’s best judgment as of the date of this release.

Consolidated Statements of Operations
(in thousands, except share and per share amounts)
Three Months Ended Nine Months Ended
September 30 September 30

2021

2020

2021

2020

(unaudited) (unaudited)
Revenues and grant income:
Net patient revenues

$

254,817

 

$

227,383

 

$

708,648

 

$

697,149

 

Other revenues

 

11,491

 

 

11,111

 

 

33,916

 

 

34,463

 

Government stimulus income

 

10,429

 

 

12,132

 

 

48,304

 

 

36,780

 

Net operating revenues and grant income

 

276,737

 

 

250,626

 

 

790,868

 

 

768,392

 

 
Costs and expenses:
Salaries, wages and benefits

 

159,305

 

 

151,564

 

 

461,239

 

 

455,947

 

Other operating

 

84,039

 

 

70,887

 

 

226,235

 

 

213,416

 

Facility rent

 

10,204

 

 

10,320

 

 

30,437

 

 

30,972

 

Depreciation and amortization

 

10,229

 

 

10,548

 

 

30,521

 

 

31,531

 

Interest

 

198

 

 

285

 

 

657

 

 

1,150

 

Total costs and expenses

 

263,975

 

 

243,604

 

 

749,089

 

 

733,016

 

 
Income from operations

 

12,762

 

 

7,022

 

 

41,779

 

 

35,376

 

 
Non-operating income

 

3,399

 

 

6,478

 

 

15,245

 

 

18,870

 

Gains on acquisitions of equity method investments

 

-

 

 

-

 

 

95,202

 

 

1,708

 

Unrealized losses on marketable equity securities

 

(23,797

)

 

(241

)

 

(23,227

)

 

(40,580

)

 
Income/(loss) before income taxes

 

(7,636

)

 

13,259

 

 

128,999

 

 

15,374

 

Income tax (provision)/benefit

 

4,090

 

 

(391

)

 

(5,907

)

 

(800

)

Net income/(loss)

 

(3,546

)

 

12,868

 

 

123,092

 

 

14,574

 

 
Net (income)/loss attributable to noncontrolling interest

 

198

 

 

(19

)

 

(290

)

 

(253

)

 
Net income/(loss) attributable to National HealthCare Corporation

$

(3,348

)

$

12,849

 

$

122,802

 

$

14,321

 

 
Net income/(loss) per common share
Basic

$

(0.22

)

$

0.84

 

$

8.00

 

$

0.94

 

Diluted

$

(0.22

)

$

0.84

 

$

7.97

 

$

0.93

 

 
Weighted average common shares outstanding
Basic

 

15,364,043

 

 

15,310,754

 

 

15,347,043

 

 

15,304,235

 

Diluted

 

15,434,438

 

 

15,371,311

 

 

15,414,683

 

 

15,368,775

 

 
Dividends declared per common share

$

0.52

 

$

0.52

 

$

1.56

 

$

1.56

 

 
 
Balance Sheet Data Sept. 30 Dec. 31
(in thousands)

2021

2020

(unaudited)
 
Cash, cash equivalents and marketable securities

$

254,945

 

$

323,445

 

Restricted cash, cash equivalents and marketable securities

 

176,356

 

 

158,162

 

Current assets

 

424,829

 

 

456,755

 

Property and equipment, net

 

522,019

 

 

520,318

 

Total assets

 

1,415,798

 

 

1,362,132

 

Current liabilities

 

257,670

 

 

281,228

 

NHC stockholders' equity

 

895,677

 

 

795,177

 

 
Selected Operating Statistics
Three Months Ended Nine Months Ended
September 30 September 30

2021

2020

2021

2020

(unaudited) (unaudited)
Skilled Nursing Per Diems:
Medicare

$

523.98

 

$

521.50

 

$

528.60

 

$

513.29

 

Managed Care

 

404.43

 

 

413.11

 

 

406.32

 

 

405.68

 

Medicaid

 

231.39

 

 

218.21

 

 

225.68

 

 

209.43

 

Private Pay and Other

 

257.13

 

 

248.76

 

 

254.03

 

 

249.34

 

 
Average Skilled Nursing Per Diem

$

295.40

 

$

288.51

 

$

297.04

 

$

281.68

 

 
Skilled Nursing Patient Days:
Medicare

 

87,534

 

 

94,158

 

 

271,024

 

 

290,597

 

Managed Care

 

57,486

 

 

53,319

 

 

183,593

 

 

165,544

 

Medicaid

 

315,979

 

 

320,734

 

 

895,955

 

 

998,456

 

Private Pay and Other

 

158,011

 

 

151,841

 

 

439,225

 

 

485,025

 

 
Total Skilled Nursing Patient Days

 

619,010

 

 

620,052

 

 

1,789,797

 

 

1,939,622

 

 
 
The tables below provide reconciliations of GAAP to non-GAAP items (in thousands, except per share amounts):
Three Months Ended Nine Months Ended
September 30 September 30

2021

2020

2021

2020

(unaudited) (unaudited)
 
Net income/(loss) attributable to National Healthcare Corporation

$

(3,348

)

$

12,849

 

$

122,802

 

$

14,321

 

Non-GAAP adjustments
Unrealized losses on marketable equity securities

 

23,797

 

 

241

 

 

23,227

 

 

40,580

 

Operating results for newly opened facilities not at full capacity (1)

 

115

 

 

87

 

 

480

 

 

401

 

Gains on acquisitions of equity method investments

 

-

 

 

-

 

 

(95,202

)

 

(1,707

)

Stock-based compensation expense

 

726

 

 

518

 

 

1,905

 

 

1,807

 

Income tax (benefit)/provision on non-GAAP adjustments

 

(6,406

)

 

(220

)

 

(6,369

)

 

(10,681

)

Non-GAAP Net income

$

14,884

 

$

13,475

 

$

46,843

 

$

44,721

 

 
GAAP diluted earnings/(loss) per share

$

(0.22

)

$

0.84

 

$

7.97

 

$

0.93

 

Non-GAAP adjustments
Unrealized losses on marketable equity securities

 

1.14

 

 

0.01

 

 

1.12

 

 

1.95

 

Operating results for newly opened facilities not at full capacity (1)

 

0.01

 

 

0.01

 

 

0.02

 

 

0.02

 

Gains on acquisitions of equity method investments

 

-

 

 

-

 

 

(6.16

)

 

(0.08

)

Stock-based compensation expense

 

0.03

 

 

0.02

 

 

0.09

 

 

0.09

 

Non-GAAP diluted earnings per share

$

0.96

 

$

0.88

 

$

3.04

 

$

2.91

 

 
(1) The newly opened facilities not at full capacity for the 2021 period presented consist of operations opened from 2019 through 2021. The newly opened facilities for the 2020 period presented consist of operations opened from 2018 through 2020. For both of the periods presented, one memory care facility was opened during these years.

 

Contacts

Brian F. Kidd, SVP/Controller

Phone: (615) 890-2020

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