Ardent Health (ARDT) Morgan Stanley 22nd Annual Global Healthcare Conference summary

Company overview and market strategy

• Operates 30 hospitals and over 200 care sites across eight markets in six states, with a focus on mid-sized urban areas in the South Central U.S.

• Employs a hub-and-spoke model, targeting high-growth markets growing three times faster than the U.S. average.

• Differentiates through joint ventures with academic and nonprofit partners, enabling expansion and enhanced clinical offerings.

• Academic partnerships have enabled unique services, such as being the only ECMO provider in East Texas.

• Partnerships help with clinical recruiting, training, and expanding brand presence.

Financial performance and growth outlook

• Achieved strong Q2 results with robust volume growth and normalization of inflationary pressures.

• Contract labor costs have declined to 4.3% of salaries and wages, down from 5.7% a year ago.

• Nurse turnover rates have dropped below pre-pandemic levels, now under 14%.

• Targets mid-to-high single-digit revenue growth, low-to-mid double-digit EBITDA growth, and mid-teens EBITDA margins.

• Margin improvement expected as more beds are covered by DPP programs and operational integration continues.

Operational initiatives and technology investments

• Supply chain initiatives have reduced costs as a percent of revenue by over 100 basis points year-over-year, with further improvements expected into 2025.

• Significant investment in Epic electronic health record system to enhance clinical operations and patient engagement.

• Technology partnerships, such as with BioIntelliSense, enable advanced patient monitoring and reduce caregiver burden.

• Virtual nursing services and remote care models are improving patient and nurse satisfaction.

• Focus on consumer engagement through technology, making healthcare access and management more convenient.