Extendicare (EXE) Q4 2024 earnings summary

Executive summary

• Adjusted EBITDA excluding out-of-period items rose 43.5% to $33.4M in Q4 2024, with improvements across all business segments and record home healthcare hours delivered.

• Home healthcare delivered a record 11 million hours in 2024, with Q4 average daily volume up 10.1% year-over-year and margins improving by 160 basis points.

• Managed services expanded with new homes in Kingston and Stittsville, and SGP serviced beds grew 7.4% to 146,300.

• Dividend payout ratio for 2024 was below 50%, enabling a 5% dividend increase to $0.42 per month starting March 2025.

• Strategic transformation and acquisitions, including agreement to acquire nine LTC homes from Revera for $60.3M, have shifted 55% of net operating income to managed services and home healthcare.

Financial highlights

• Q4 2024 consolidated revenue increased 11.8% to $391.6M, driven by LTC funding, occupancy recovery, home health care volume, and managed services expansion.

• Q4 NOI improved by $10.1M (27.1%) to $47.5M, and adjusted EBITDA rose by $10.1M (43.5%) year-over-year, excluding out-of-period items; Q4 NOI including out-of-period funding was $53.8M.

• Q4 AFFO per share was $0.34, up $0.11 year-over-year; excluding out-of-period funding, AFFO per share was $0.28.

• Cash and equivalents at year-end were $121.8M, with $108.5M available under a new $275M credit facility; total liquidity was $230.3M.

• Net earnings for Q4 2024 were $19.9M, up 131.2% year-over-year.

Outlook and guidance

• Continued growth expected in managed services and home healthcare, with high single-digit home care volume growth anticipated.

• Rate increases for LTC and home healthcare expected to align with inflation; Ontario government provided a 4.0% bill rate increase for home health care, retroactive to April 2024.

• Capital allocation will remain disciplined, focusing on acquisitions and redevelopment projects, including closing the Revera LTC acquisition and sale of three LTC projects to Axium JV in Q2 2025.

• Redevelopment pipeline includes 1,408 new beds to replace 1,097 Class C beds, with further projects advancing.

• Two new LTC projects commenced construction in December 2024, expected to open in H1 2027.