Q4 2025 Select Medical Holdings Corp Earnings Call Transcript
Key Points
- Select Medical Holdings Corp (SEM) added 150 beds in the fourth quarter through hospital openings and acquisitions, contributing to a total of 212 rehab beds added in 2025.
- Revenue for all three divisions exceeded prior year figures in the fourth quarter, with total revenue growing more than 6% year over year.
- The inpatient rehab hospital division saw a revenue increase of over 15% year over year, with adjusted EBITDA rising 11%.
- The critical illness recovery hospital division experienced nearly a 5% revenue increase, with adjusted EBITDA growing 5%.
- Select Medical Holdings Corp (SEM) has a robust pipeline for 2026, expecting to add 399 beds across various projects, indicating strong growth potential.
- Adjusted EBITDA declined 10% to $104.7 million from $116 million in the prior year, partly due to increased health insurance expenses.
- The outpatient rehab division faced challenges, with adjusted EBITDA dropping to $11.2 million from $26.6 million last year, and margins declining to 3.4%.
- Net revenue per visit in the outpatient rehab division declined due to a reduction in Medicare reimbursement, an unfavorable shift in payer mix, and increased variable discounts.
- The company experienced a $15 million impact from unexpected health insurance expenses in the fourth quarter.
- Select Medical Holdings Corp (SEM) is undergoing a review process for a take-private proposal, which may create uncertainty about future strategic directions.
Good morning and thank you for joining us today for Select Medical Holdings Corporation's earnings conference call to discuss the fourth quarter and full year 2025 results and the company's business outlook.
Presenting today are the company's Chief Executive Officer, Thomas Mullin, and the company's Executive Vice President and Chief Financial Officer, Michael Malatesta. Also on the conference line is the company's Senior Vice President, Controller, and Chief Accounting Officer, Christopher Weigl.
Management will give you an overview of the quarter and then open the call for your questions.
Before we get started, we would like to remind you that this conference call may contain forward-looking statements regarding future events for the future financial performance of the company, including without limitation, statements regarding operating results, growth opportunities, and other statements that refer to Select Medical plans, expectations, strategies, intentions, and beliefs.
These forward-looking statements are based on the information available to management of
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