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Encompass Health (EHC) investor relations material
Encompass Health Q2 2025 earnings summary
Complete event summary combining all related documents: earnings call transcript, report, and slide presentation.
Executive summary
Q2 2025 net operating revenue rose 12% year-over-year to $1,457.7M, driven by 7.2% discharge growth and 4.2% higher net revenue per discharge.
Adjusted EBITDA increased 17.2% to $318.6M; adjusted EPS up 26.1% to $1.40.
Capacity expanded with new hospitals in Fort Myers, Daytona Beach, Athens, and Georgia, plus 51 additional beds.
Shareholder returns included increased dividends to $0.19/share and $56.8M in share repurchases YTD.
Business outlook remains positive, supported by demographic trends and a strong financial position.
Financial highlights
Q2 2025 net operating revenue: $1.46B, up 12% year-over-year; net income: $142.1M, up 24.5%.
Adjusted EBITDA: $318.6M, up 17.2%; adjusted free cash flow: $185.9M, up 30.5%.
Net patient revenue per discharge rose 4.2% to $21,670; discharges up 7.2%.
Occupancy rate improved to 76.6% from 74.5% year-over-year.
Net leverage at 2.0x; $99M in cash and $950M+ available on credit facility.
Outlook and guidance
2025 net operating revenue guidance: $5.88B–$5.98B; adjusted EBITDA: $1.22B–$1.25B; adjusted EPS: $5.12–$5.34.
Adjusted free cash flow expected at $705M–$795M, aided by bonus depreciation.
Medicare payment rates to increase 2.7%–2.9% effective October 2025; managed care pricing to rise ~3%.
8 new hospitals and 100–120 beds to be added in 2025; maintenance CAPEX projected at $215M–$225M.
Cash tax savings of $50M anticipated in 2025 due to new tax legislation.
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