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Pediatrix (MD) Q2 Earnings Meet Estimates, Revenues Up Y/Y

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Pediatrix Medical Group, Inc. (MD - Free Report) reported second-quarter 2023 adjusted earnings per share (EPS) of 39 cents, meeting the Zacks Consensus Estimate. However, the bottom line declined 17% year over year.

MD’s net revenues of $500.6 million rose 3% from the year-ago figure. The top line beat the consensus mark by 1.2%.

Pediatrix’s quarterly results benefited from strong patient volumes, cash flow generation and lower general and administrative (G&A) costs. However, escalating practice salaries and benefits and net borrowings partially offset the positives.

Q2 Update

Overall same-unit revenues rose 3.2% year over year in the quarter under review thanks to increased patient volumes, partially offset by net non-same unit activity impact. Same-unit revenues attributable to patient volume inched up 0.6% year over year.

Total operating expenses increased 3.7% year over year to $452.1 million, higher than our estimate of $442.5 million, due to an escalation in practice salaries and benefits, and supplies and other operating expenses. G&A expenses of $58.1 million dropped from $61.2 million, courtesy of cost savings resulting from net staffing reductions. However, the metric surpassed our estimate of $56.2 million.

Interest expenses increased to $11.2 million from $8.4 million a year ago, attributable to higher interest rates on the company’s borrowings. The metric was higher than our estimate of $10.1 million.

Adjusted EBITDA of $59.1 million tumbled from $65.6 million a year ago, primarily due to funds received in the year-ago period from the provider relief fund. The metric surpassed our estimate of $58.7 million.

At the second-quarter end, the company had $4.7 million remaining funds for share buybacks.

Financial Update (as of Jun 30, 2023)

Pediatrix exited the second quarter with cash and cash equivalents of $5.8 million, which declined from the 2022-end figure of $9.8 million.

Total assets of nearly $2,305.5 million decreased from $2,347.9 million at 2022-end.

Total debt, net, amounted to $681.2 million, up from $651.3 million at 2022-end.

Total equity of $942.4 million increased from $891.6 million at 2022-end.

In the second quarter, net cash used in operating activities increased to $92.6 million from $81.6 million a year ago.

2023 View Reaffirmed

For 2023, management reiterated adjusted EBITDA guidance in the range of $235-$245 million compared with $241 million in 2022. Also, it still expects depreciation and amortization expenses to be $38 million, while interest expenses are projected to be in the range of $40-$42.2 million.

Zacks Rank

Pediatrix currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Medical Sector Releases

Of the Medical sector players that have reported second-quarter 2023 results so far, the bottom-line results of Acadia Healthcare Company, Inc. (ACHC - Free Report) , Centene Corporation (CNC - Free Report) and HCA Healthcare, Inc. (HCA - Free Report) beat the Zacks Consensus Estimate.

Acadia Healthcare reported second-quarter 2023 adjusted EPS of 92 cents, which beat the Zacks Consensus Estimate by 10.8%. The bottom line improved 9.5% year over year. Total revenues amounted to $731.3 million, which advanced 12.2% year over year in the quarter under review. The top line outpaced the consensus mark by 3.4%. Total U.S. same-facility revenues of ACHC rose 11.4% year over year to $721.3 million in the second quarter. The growth came on the back of 6.1% improvement in revenue per patient day and 4.9% growth in patient days. Admissions increased 4.3% year over year. Adjusted EBITDA of $174.5 million advanced 10.9% year over year.

Centene reported second-quarter 2023 adjusted EPS of $2.10, which beat the Zacks Consensus Estimate by 2.4%. The bottom line advanced 18.6% year over year. Revenues of CNC amounted to $37,608 million, which improved 4.6% year over year. The top line outpaced the consensus mark by 3.4%. Premiums improved 7% year over year to $33,713 million, beating our estimate by 3.3%. The total membership of CNC came in at 28.4 million as of Jun 30, 2023, which increased 7.5% year over year. It reported adjusted net earnings of $1,155 million in the quarter under review, which increased 10.8% year over year.

HCA Healthcare reported second-quarter 2023 adjusted EPS of $4.29, which surpassed the Zacks Consensus Estimate by 0.2%. Also, the bottom line climbed 1.9% year over year. HCA’s revenues advanced 7% year over year to $15.9 billion. The top line beat the consensus mark by 1.8%. While same-facility equivalent admissions rose 3.7% year over year in the second quarter, same-facility admissions improved 2.2% year over year. Same-facility revenue per equivalent admission rose 2.4% year over year in the quarter under review. Adjusted EBITDA of $3.1 billion grew 0.5% year over year in the second quarter.


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