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Select Medical Holdings Corp SEM
Q4 2011 Earnings Call Transcript

Transcript Call Date 02/24/2012

Operator: Good morning and thank you for joining us today for Select Medical Holdings Company's Earnings Conference Call to discuss the Fourth Quarter and Full Year 2011 Results and the Company's business outlook. Speaking today are the Company's CEO, Robert Ortenzio; and the Company's Executive Vice President and Chief Financial Officer, Martin Jackson. Management will give you an overview of the quarter highlights and then open the call for questions.

Before we get started, we would like to remind you that this conference call may contain forward-looking statements regarding future events or the future financial performance of the Company including without limitation, statements regarding operating results, growth opportunities and other statements that refer to Select's plans, expectations, strategies, intentions and belief. These forward-looking statements are based on the information available to management of Select Medical today and the Company assumes no obligation to update these statements as circumstances change.

At this time, I would now like to turn the call over to Robert Ortenzio. Please proceed, sir.

Robert A. Ortenzio - CEO: Thank you. Good morning, everyone, and thank you for joining us for Select Medical Holdings' fourth quarter and full year earnings conference call for 2011. For our prepared remarks, I'll provide some overall highlights for the Company and our operating divisions and then ask Marty Jackson, our CFO, to provide some additional financial details before we open the call up for questions.

Earnings per fully diluted share were $0.25 in the fourth quarter and $0.71 for the full year. Full year EPS included a non-recurring loss on early retirement of debt related to the refinancing we completed June 1 of 2011. Excluding this one-time loss and the related tax effect, our adjusted earnings per fully diluted share would have been $0.84 for the full year.

Net revenue for the fourth quarter increased 12.7% to $718.4 million compared to the same quarter last year. Net revenue for the full year increased 17.3% to $2.8 billion compared to $2.4 billion last year. During the year, we generated approximately 75% of our revenues from our specialty hospitals segment, which includes both our long-term acute care and inpatient rehab hospitals and 25% from our outpatient rehabilitation segment, which includes both our outpatient clinics and contract services.

Net revenue in our specialty hospitals for the fourth quarter increased 14.3% to $534.2 million compared to the same quarter last year. The increase was driven by both improved occupancy and rate during the quarter. Overall, occupancy was 71% in the fourth quarter compared to 66% in the same quarter last year. Our patient days in the fourth quarter increased 8.1% to 336,711 days. Specialty hospital net revenue per patient day was up 2.5% to $1,494 in the fourth quarter compared $1,457 per patient day in the same quarter last year. We experienced increases in both our average Medicare and non-Medicare net revenue per patient day in the fourth quarter.

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