Extendicare (EXE) Q2 2025 earnings summary

Executive summary

• Adjusted EBITDA rose 15.4% year-over-year to CAD 39.8 million, driven by strong home health care and long-term care segment growth, supported by strategic M&A and disciplined capital allocation.

• Major acquisitions included nine long-term care homes from Revera and Closing the Gap for CAD 75.1 million, expanding capacity by 1.1 million service hours and 1,200 caregivers.

• Completed sale of three long-term care projects for CAD 56.3 million, realizing an after-tax gain of CAD 11.1 million.

• Home health care led growth, with average daily volumes up 10.9% and NOI margin up 90 bps to 13.5%.

• Strategic capital recycling and redevelopment projects underway, with six long-term care homes under construction and 18 more in planning.

Financial highlights

• Q2 2025 consolidated revenue increased 10% year-over-year to CAD 383.4 million, driven by acquisitions and organic growth.

• Q2 NOI rose 4.1% to CAD 55 million; adjusted EBITDA up 15.4% to CAD 39.8 million; net earnings increased 23.3% to CAD 31.9 million.

• Q2 AFFO per share was CAD 0.293, up 6.9% year-over-year; excluding out-of-period items, up 23.1%.

• Dividend payout ratio was 43% for Q2 and 46% on a trailing 12-month basis.

• Six-month revenue up CAD 42.5 million to CAD 758.1 million; adjusted EBITDA up CAD 6.6 million to CAD 75.4 million.

Outlook and guidance

• Full benefit of recent acquisitions expected in Q3 results, with anticipated operating leverage and scale benefits.

• New Ontario long-term care funding policy provides greater certainty and flexibility for redevelopment projects.

• Targeting construction start on one new project in 2025 and up to three in 2026.

• Expects $1.1 million in annualized cost synergies from Closing the Gap integration and potential earnout of $3.5–$5.5 million based on new business revenue.

• Demographic trends indicate sustained demand, with the 85+ population expected to triple by 2051.