Despite labor and inflationary pressures, the Pennant Group’s full-year and fourth-quarter 2022 financial results demonstrate progress in both senior living and home health / hospice, according to Brent Guerisoli, CEO of the Eagle, ID-based real estate investment company. That momentum is expected to carry through 2023, he said.
The fourth quarter results “reflected meaningful progress” in both operating segments, President and Chief Operating Officer John Gochnour said on Friday’s earnings call.
Total revenue was $473.2 million for the fiscal year 2022, an increase of $33.5 million or 7.6% over the prior year, and total revenue for the quarter was $124.7 million, an increase of $12.9 million or 11.5% over the prior year quarter.
Net income for the full year was $6.6 million, an increase of $3.9 million over the prior year, and net income for the fourth quarter was $3.5 million, an increase of $5.6 million over the prior year quarter.
Adjusted net income for the full year was $17.1 million, an increase of $3.1 million or 21.8% over the prior year, and adjusted net income of the fourth quarter was $5.4 million, an increase of $3.3 million or 152.4% over the prior year quarter.
Pennant’s senior living services segment revenue for the full year was $131 million, an increase of $0.9 million, or 0.7%, over the prior year. Segment revenue for the fourth quarter was $34 million, an increase of $0.1 million, or 0.3%, over the prior year quarter and $1.4 million or 4.4% over the third quarter of 2022.
The company’s home health and hospice services segment revenue for the full year was $342.2 million, an increase of $32.7 million, or 10.6%, over the prior year. Segment revenue for the fourth quarter was $90.7 million, an increase of $12.8 million, or 16.4%.
“While we are pleased with the progress we have made in our home health and hospice segment, we know our performance can be much better,” Gochnour said. “By executing on the fundamentals of our business, we can improve performance. We can create a more robust ramp of hospice growth, better manage the cost and efficiency of our care delivery and continue to improve our transitioning operations.”
According to Pennant Interim Chief Financial Officer Jennifer Freeman, the company had $2.1 million of cash on hand and $81.3 million available on its revolving line of credit at the end of 2022.
“We expect cash flow from operations for 2023 to reflect organic revenue growth and bottom-line improvement, unencumbered by the one-time cash outlays experienced in 2022,” she said. “With increases in earnings, continued improvement in cash collections and lower capital expenditures, we expect to fund future growth.”
For additional coverage of the earnings call, see McKnight’s Senior Living and McKnight’s Home Care.
