Privia Health Group (PRVA) Q3 2024 earnings summary

Executive summary

• Achieved strong financial and operational performance in Q3 2024, with implemented providers up 13.1% to 4,642 and attributed lives up 14.0% to 1,247,000 year-over-year.

• Expanded into Indiana with a new multi-specialty practice, now operating in 14 states and DC, and record new provider signings year-to-date.

• Delivered $176.6 million in MSSP 2023 shared savings, up 34.1% from 2022, with 81% of lives in downside risk tracks.

• Maintained high provider retention (98%+) and a Net Promoter Score of 85, serving over 5.1 million patients and 1.2 million attributed lives.

• Net income for Q3 2024 was $3.5 million, down from $5.6 million in Q3 2023, primarily due to higher operating expenses and stock-based compensation.

Financial highlights

• Q3 2024 revenue was $437.9 million, up 4.9% year-over-year; practice collections reached $739.9 million, up 2.3% year-over-year.

• Adjusted EBITDA for Q3 2024 was $23.6 million (23.3% margin), up 25.8% year-over-year; care margin was $101.4 million, up 10.2%.

• Year-to-date free cash flow was $87 million, pro forma for net CMS cash, with a pro forma cash balance of $473.5 million and no debt.

• Adjusted net income per diluted share for Q3 2024 was $0.20, up from $0.17 in Q3 2023.

• Gross profit for Q3 2024 was $99.9 million, up from $90.6 million in Q3 2023.

Outlook and guidance

• Raised 2024 guidance to the high end or above for all metrics, including attributed lives above 1.2 million, practice collections of $2.875 billion, GAAP revenue of $1.675 billion, care margin of $400 million, and adjusted EBITDA of $90 million.

• Targeting annual adjusted EBITDA growth of 20% or greater, with ~90% of full-year adjusted EBITDA expected to convert to free cash flow.

• Confident in continued organic provider growth and operating leverage into 2025, despite ongoing headwinds in Medicare Advantage.

• Practice collections guidance includes a $198 million year-over-year impact from renegotiated Medicare Advantage capitation agreements.

• Management expects cash on hand and operating cash flows to be sufficient for both short- and long-term capital needs.