USPH - U.S. Physical Therapy Reports Second Quarter 2022 Results

U.S. Physical Therapy, Inc. ("USPH" or the “Company”) (NYSE: USPH), a national operator of outpatient physical therapy clinics and provider of industrial injury prevention (“IIP”) services, today reported results for the second quarter and six months ended June 30, 2022 (“2022 Second Quarter”).

QUARTER HIGHLIGHTS

• Operating Results per diluted share, a non-GAAP measure (defined below), was $0.90 per diluted share for the 2022 Second Quarter, the second highest quarterly amount in the Company’s history. For the three months ended June 30, 2021 (“2021 Second Quarter”), Operating Results per diluted share was $0.96, the highest quarterly amount in the Company’s history.
• Adjusted EBITDA, a non-GAAP measure (defined below), was $21.3 million for the 2022 Second Quarter, a slight decrease from $21.4 million for the 2021 Second Quarter. See pages 14 and 15 for a discussion and reconciliation to results according to GAAP.
• For the 2022 Second Quarter, USPH’s net income attributable to its shareholders, a Generally Accepted Accounting Principles (“GAAP”) measure, was $11.2 million compared to $12.4 million for the 2021 Second Quarter. GAAP requires the Company to include a charge for the revaluation of its non-controlling interest, net of taxes, in its computation of earnings per diluted share. Earnings per diluted share on a GAAP basis, was $0.87 for the 2022 Second Quarter as compared to $0.82 for the 2021 Second Quarter.
• Average visits per clinic per day in the 2022 Second Quarter was 29.5, an increase from the first quarter of 2022 of 27.9 and slightly less than the Company-high 30.0 in the 2021 Second Quarter.
• Total patient visits were 1,145,554 for the 2022 Second Quarter, an increase of 5.7% from 1,084,070 for the 2021 Second Quarter.
• The net rate per patient visit was $103.18 in the 2022 Second Quarter as compared to $104.46 in the 2021 Second Quarter due to rate reductions implemented by Medicare in 2022.
• Net patient revenue from physical therapy operations was $118.2 million for the 2022 Second Quarter, an increase of 4.4% from $113.2 million for the 2021 Second Quarter.
• Industrial injury prevention (“IIP”) services revenue was an all-time high of $19.4 million for the 2022 Second Quarter, representing a 93.7% increase over the 2021 Second Quarter. Excluding $6.8 million of revenue related to the November 2021 IIP acquisition, IIP services revenue increased 25.5% period over period.
• Total revenue of $140.7 million for the 2022 Second Quarter was 10.8% higher than total revenue of $126.9 million for the 2021 Second Quarter.
• Physical therapy total operating costs were $81.09 per visit in the 2022 Second Quarter as compared to $76.50 per visit in the 2021 Second Quarter, an increase of 6.0%. Physical therapy salaries and related costs were $58.29 per visit in the 2022 Second Quarter as compared to $55.95 per visit in the Second Quarter 2021, an increase of 4.2%.
• Total operating cost was 78.1% of total revenue in the 2022 Second Quarter, as compared to 73.0% for the 2021 Second Quarter. Total salaries and related costs were 56.8% of total revenue for the 2022 Second Quarter versus 54.3% for the 2021 Second Quarter.
• On June 21, 2022, the Company announced the closing of a $325 million, five-year credit facility that includes a $150 million term loan and a $175 million revolver. Based on strong lender support, the credit facility was upsized from its $300 million launch amount. This is an increase and extension of the Company’s previous $150 million credit facility. The Company concurrently announced that it entered into an interest rate swap agreement in May, with a June 30 effective date, to lock the 1-month term SOFR rate on $150 million of its debt at a 5-year swap rate of 2.815%. The total interest rate in any particular period will also include an applicable margin based on the Company’s consolidated leverage ratio.
• The Company’s Board of Directors declared a quarterly dividend of $0.41 per share payable on September 16, 2022 to shareholders of record on August 18, 2022.
• Management updated the Company’s guidance to reflect the impact of its recent financing transaction on interest expense as well as inflation in wages and other costs it began experiencing in the 2022 Second Quarter. Management currently expects its Adjusted EBITDA for the full year of 2022 to be in the range of $73.5 million to $75.4 million with Operating Results per share, which reflects the increase in interest expense, to be in the range of $2.65 to $2.75.

Management’s Comments

Chris Reading, Chief Executive Officer, said, “Despite an increasingly difficult operating environment, our team produced the second highest quarterly results in our Company’s history. In the second quarter, we began to feel the impact of rising costs and while we are working hard and making some adjustments to alleviate some of those, we believe our costs will be higher than originally expected for the remainder of the year which has been reflected in our updated guidance numbers. Further, we took the important and necessary step to expand our credit facility which gives us more dry powder to use for acquisitions and other investments. On that front, we have been very active and expect to close a number of deals before year’s end which should be very positive for 2023 and forward.”

Carey Hendrickson, Chief Financial Officer, said, “We are very pleased to have completed the financing transaction in the second quarter, which was important to provide us the capital we need for growth. The related interest rate swap, which fixed the interest rate on $150 million of our debt for five years, provides us certainty in the rising interest rate environment at a rate that we believe is favorable over the five-year period.”

Second Quarter 2022 Compared to Second Quarter 2021

• Reported total revenue for the 2022 Second Quarter was $140.7 million, an increase of 10.8% as compared to $126.9 million for the 2021 Second Quarter. See table below for a detail of reported total revenue (in thousands):

• Revenue from physical therapy operations increased $4.9 million, or 4.3%, to $119.1 million for the 2022 Second Quarter from $114.2 million for the 2021 Second Quarter. The average net patient revenue per visit was $103.18 for the 2022 Second Quarter as compared to $104.46 for the 2021 Second Quarter. Total patient visits increased 5.7% to 1,145,554 for the 2022 Second Quarter from 1,084,070 for the 2021 Second Quarter.

• Net patient revenue related to clinics opened or acquired prior to 2021 and still in operation at June 30, 2022 (“Mature Clinics”) decreased $1.5 million, or 1.4%, to $108.6 million for the 2022 Second Quarter compared to $110.1 million for the 2021 Second Quarter, due mostly to the decrease in average net patient revenue per visit. Visits for Mature Clinics (same store) for the 2022 Second Quarter decreased slightly (0.2%) as compared to the 2021 Second Quarter.

• IIP services revenue increased 93.7% to $19.4 million for the 2022 Second Quarter as compared to $10.0 million for the 2021 Second Quarter. Excluding $6.8 million of revenue related to the IIP acquisition in November 2021, IIP services revenue increased 25.5% in the 2022 Second Quarter as compared to the 2021 Second Quarter.

• Total operating cost was $109.8 million for the 2022 Second Quarter, or 78.1% of total revenue, as compared to $92.6 million, or 73.0% of total revenue, for the 2021 Second Quarter. Operating cost related to Mature Clinics increased by $4.0 million, or 5.0%, for the 2022 Second Quarter compared to the 2021 Second Quarter. In addition, operating cost related to the industrial injury prevention services business increased by $7.8 million of which $5.7 million related to the Company’s November 2021 IIP acquisition. See table below for a detail of operating cost (in thousands):

• Total salaries and related costs, including all operations, were 56.8% of total revenue for the 2022 Second Quarter versus 54.3% for the 2021 Second Quarter. Rent, supplies, contract labor and other costs as a percentage of total revenue were 20.2% for the 2022 Second Quarter versus 17.6% for the 2021 Second Quarter. The provision for credit losses as a percentage of total revenue were 1.1% for 2022 Second Quarter and 2021 Second Quarter.

• Gross profit for the 2022 Second Quarter, was $30.8 million, a decrease of $3.5 million, or 10.2%, as compared to $34.3 million for the 2021 Second Quarter. The gross profit percentage was 21.9% of total revenue for the 2022 Second Quarter as compared to 27.0% for the 2021 Second Quarter. The gross profit percentage for the Company’s physical therapy operations was 22.0% for the 2022 Second Quarter as compared to 27.4% for the 2021 Second Quarter. The gross profit percentage on management contracts was 23.7% for the 2022 Second Quarter as compared to 19.6% for the 2021 Second Quarter. The gross profit percentage for industrial injury prevention services was 21.2% for the 2022 Second Quarter as compared to 25.3% for the 2021 Second Quarter. The IIP margin in 2022 has been impacted by the lower margin profile of the Company’s November 2021 IIP acquisition. The table below details the gross profit (in thousands):

• Corporate office costs were $10.7 million for the 2022 Second Quarter compared to $12.1 million for the 2021 Second Quarter. Corporate office costs were 7.6% of total revenue for the 2022 Second Quarter as compared to 9.5% for the 2021 Second Quarter. The decrease was primarily due to lower estimated bonus expense in the 2022 Second Quarter than the 2021 Second Quarter.

• Operating income for the 2022 Second Quarter was $20.1 million and $22.2 million for 2021 Second Quarter. Operating income as a percentage of total revenue was 14.3% for the 2022 Second Quarter as compared to 17.5% for the 2021 Second Quarter.

• The loss on revaluation of put-right liability was $617,000. As part of the IIP business acquisition on November 30, 2021, the Company also agreed to the potential future purchase of a separate company under the same ownership that provides physical therapy and rehabilitation services to hospitals and other ancillary providers in a distinct market area. The owners have the right to put this transaction to the Company approximately five years, with such right having a $3.5 million value at June 30,2022, as reflected on the Company’s consolidated balance sheet in Other long-term liabilities. The value of this right will continue to be adjusted in future periods, as appropriate.

• The provision for income tax was $4.2 million for the 2022 Second Quarter and $4.6 million for the 2021 Second Quarter. The provision for income tax as a percentage of income before taxes less net income attributable to non-controlling interest (effective tax rate) was 27.5% for the 2022 Second Quarter and 26.9% for the 2021 Second Quarter. See table below ($ in thousands):

• Net income attributable to redeemable non-controlling interest (temporary equity) was $2.6 million for the 2022 Second Quarter and $3.6 million for the 2021 Second Quarter. Net income attributable to non-controlling interest (permanent equity) was $1.4 million for the 2022 Second Quarter and for the 2021 Second Quarter.

• For the 2022 Second Quarter, the Company’s net income attributable to its shareholders was $11.2 million as compared to $12.4 million for the 2021 Second Quarter. In accordance with GAAP, the revaluation of redeemable non-controlling interest, net of taxes, is not included in net income but charged directly to retained earnings; however, the charge for this change is included in the earnings per basic and diluted share calculation. Inclusive of the charge for revaluation of non-controlling interest, net of taxes, the amount is $11.4 million, or $0.87 per diluted share, for the 2022 Second Quarter, and $10.5 million, or $0.82 per diluted share, for the 2021 Second Quarter.

• For the 2022 Second Quarter, the Company’s Operating Results, a non-GAAP measure, was $11.7 million, or $0.90 per diluted share, a decrease of 6.3%, as compared to $12.4 million, or $0.96 per diluted share, for the 2021 Second Quarter. See table on page 15.

• For the 2022 Second Quarter, the Company’s Adjusted EBITDA, a non-GAAP measure, was $21.3 million, a slight decrease from $21.4 million in the 2021 Second Quarter. See definition, explanation and calculation of Adjusted EBITDA, a non-GAAP measure, in the schedule on pages 14 and 15.

2022 Six Months Compared to 2021 Six Months

• Reported total revenue for the 2022 Six Months was $272.4 million, an increase of 13.8% as compared to $239.3 million for the 2021 Six Months. See table below for a detail of reported total revenue (in thousands):

• Revenue from physical therapy operations increased $15.5 million, or 7.3%, to $229.5 million for the 2022 Six Months from $214.0 million for the 2021 Six Months. The average net patient revenue per visit was $103.09 for the 2022 Six Months as compared to $104.58 for the 2021 Six Months. Total patient visits increased 8.7% to 2,209,073 for the 2022 Six Months from 2,031,858 for the 2021 Six Months.

• Net patient revenue related to clinics opened or acquired prior to 2021 and still in operation at June 30, 2022 (“Mature Clinics”) increased $2.7 million, or 1.3%, to $211.2 million for the 2022 Six Months compared to $208.5 million for the 2021 Six Months. Visits for Mature Clinics (same store) for the 2022 Six Months increased 3.0% as compared to the 2021 Six Months. The increase in visits was partially offset by a reduction in the net patient revenue per visit.

• IIP services revenue increased 92.1% to $38.5 million for the 2022 Six Months as compared to $20.0 million for the 2021 Six Months. Excluding $13.7 million of revenue related to the IIP acquisition in November 2021, IIP services revenue increased 24.0% in the 2022 Six Months as compared to the 2021 Six Months.

• Total operating cost was $215.0 million for the 2022 Six Months, or 78.9% of total revenue, as compared to $179.1 million, or 74.8% of total revenue, for the 2021 Six Months. Operating cost related to Mature Clinics increased by $10.1 million for the 2022 Six Months compared to the 2021 Six Months. In addition, operating cost related to the industrial injury prevention services business increased by $15.5 million of which $11.3 million related to the recent IIP acquisition. See table below for a detail of operating cost (in thousands):

• Total salaries and related costs, including all operations, were 56.9% of total revenue for the 2022 Six Months versus 55.4% for the 2021 Six Months. Rent, supplies, contract labor and other costs as a percentage of total revenue were 20.9% for the 2022 Six Months versus 18.3% for the 2021 Six Months. The provision for credit losses as a percentage of total revenue was 1.0% for 2022 Six Months and 1.1% for 2021 Six Months.

• Gross profit for the 2022 Six Months, was $57.4 million, a decrease of $2.8 million, or 4.6%, as compared to $60.2 million for the 2021 Six Months. The gross profit percentage was 21.1% of total revenue for the 2022 Six Months as compared to 25.2% for the 2021 Six Months. The gross profit percentage for the Company’s physical therapy operations was 21.0% for the 2022 Six Months as compared to 25.3% for the 2021 Six Months. The gross profit percentage on management contracts was 20.6% for the 2022 Six Months as compared to 16.0% for the 2021 Six Months. The gross profit percentage for industrial injury prevention services was 21.5% for the 2022 Six Months as compared to 26.3% for the 2021 Six Months. The IIP margin in 2022 has been impacted by the lower margin profile of the Company’s November 2021 IIP acquisition. The table below details the gross profit (in thousands):

• Corporate office costs were $22.3 million for the 2022 Six Months compared to $22.9 million for the 2021 Six Months. Corporate office costs were 8.2% of total revenue for the 2022 Six Months as compared to 9.6% for the 2021 Six Months. The decrease was primarily due to lower estimated bonus expense in the 2022 Six Months than the 2021 Six Months.

• Operating income for the 2022 Six Months were $35.1 million and $37.3 million for 2021 Six Months. Operating income as a percentage of total revenue was 12.9% for the 2022 Six Months as compared to 15.6% for the 2021 Six Months.

• The loss on revaluation of the put-right liability was $14,000. As part of the IIP business acquisition on November 30, 2021, the Company also agreed to the potential future purchase of a separate company under the same ownership that provides physical therapy and rehabilitation services to hospitals and other ancillary providers in a distinct market area. The owners have the right to put this transaction to the Company in approximately five years, with such right having a $3.5 million value at June 30, 2022, as reflected on the Company’s consolidated balance sheet in Other long-term liabilities. The value of this right will continue to be adjusted in future periods, as appropriate.

• The provision for income tax was $7.7 million for the 2022 Six Months and $7.5 million for the 2021 Six Months. The provision for income tax as a percentage of income before taxes less net income attributable to non-controlling interest (effective tax rate) was 27.9% for the 2022 Six Months and 26.7% for the 2021 Six Months. See table below ($ in thousands):

• Net income attributable to redeemable non-controlling interest (temporary equity) was $5.2 million for the 2022 Six Months and $6.1 million for the 2021 Six Months. Net income attributable to non-controlling interest (permanent equity) was $2.1 million for the 2022 Six Months and $2.7 million for the 2021 Six Months.

• For the 2022 Six Months, the Company’s net income attributable to its shareholders was $20.0 million for the 2022 Six Months and $20.6 million for 2021 Six Months. Inclusive of the charge for revaluation of non-controlling interest, net of taxes, the amount is $20.0 million, or $1.55 per diluted share, for the 2022 Six Months, and $13.3 million, or $1.03 per diluted share, for the 2021 Six Months. See table on page 15.
  
• For the 2022 Six Months, the Company’s Operating Results, a non-GAAP measure, was $20.0 million, or $1.54 per diluted share, a decrease of 3.0%, as compared to $20.6 million, or $1.60 per diluted share, for the 2021 Second Quarter. See table on page 15.

• For the 2022 Six Months, the Company’s Adjusted EBITDA, a non-GAAP measure, was $38.8 million, an increase of 5.5% from $36.8 million in the 2021 Six Months. See definition, explanation and calculation of Adjusted EBITDA, a non-GAAP measure, in the schedule on pages 14 and 15.

Other Comprehensive Income

Concurrently with the amended credit facility, the Company entered into an interest rate swap agreement in May 2022, which has a $150 million notional value, a maturity date of June 30, 2027 and was effective on June 30, 2022. Beginning in July 2022, the Company pays a fixed rate of interest of 2.815% based on 1-month SOFR. The total interest rate in any period will also include an applicable margin based on the Company’s consolidated leverage ratio. Currently, the Company’s interest rate including the applicable margin is 4.665%. Unrealized gains and losses related to the fair value of the interest rate swap are recorded to accumulated other comprehensive income (loss), net of tax. The fair value of the interest rate swap at June 30, 2022, was $0.5 million, which has been included within current liabilities in the accompanying Consolidated Balance Sheet. The impact of the interest rate swap on the accompanying Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2022 was an unrealized loss of $0.4 million, net of tax.

Quarterly Dividend

The Board of Directors declared a quarterly dividend of $0.41 per share payable on September 16, 2022, to shareholders of record on August 18, 2022.

Management Revises 2022 Guidance

Management currently expects the Company’s Adjusted EBITDA for the full year of 2022 to be in the range of $73.5 million to $75.4 million and for its Operating Results to be in the range of $34.4 million to $35.8 million, or $2.65 to $2.75 per share. The change in guidance is primarily attributable to two factors:

• Increases in the Company’s interest expense due to rising interest rates in the U.S. and the Company’s financing transaction completed in the second quarter of 2022. The Company has $150 million of fixed debt which is currently expected to generate interest at a fixed rate of 4.665% for the remainder of the year.
• The impact of inflation on the Company’s wages and other costs which elevated during the second quarter and are expected to continue through the remainder of the year.

Please note that the earnings guidance represents projected results from existing operations and excludes future acquisitions. The annual guidance figures will not be updated unless there is a material development that causes management to believe that results will be significantly outside the given ranges.

Second Quarter 2022 Conference Call

U.S. Physical Therapy's management will host a conference call at 10:30 a.m. Eastern Time, 9:30 a.m. Central Time, on August 4, 2022, to discuss results for the Company's 2022 Second Quarter and Six months ended June 30, 2022. Interested parties may participate in the call by dialing 1-800-459-5346 or 203-518-9544 and entering reservation number USPHQ22022 approximately 10 minutes before the call is scheduled to begin. To listen to the live call via webcast, go to the Company's website at www.usph.com at least 15 minutes early to register, download and install any necessary audio software. The conference call will be archived and can be accessed until November 5, 2022, at U.S. Physical Therapy’s website.

Forward-Looking Statements

This press release contains statements that are considered to be forward-looking within the meaning under Section 21E of the Securities Exchange Act of 1934, as amended. These statements contain forward-looking information relating to the financial condition, results of operations, plans, objectives, future performance and business of our Company. These statements (often using words such as “believes”, “expects”, “intends”, “plans”, “appear”, “should” and similar words) involve risks and uncertainties that could cause actual results to differ materially from those we expect. Included among such statements may be those relating to new clinics, availability of personnel and the reimbursement environment. The forward-looking statements are based on our current views and assumptions and actual results could differ materially from those anticipated in such forward-looking statements as a result of certain risks, uncertainties, and factors, which include, but are not limited to:

• the multiple effects of the impact of public health crises and epidemics/pandemics, such as the novel strain of COVID-19 and its variants, for which the total financial magnitude cannot be currently estimated;
• changes in Medicare rules and guidelines and reimbursement or failure of our clinics to maintain their Medicare certification and/or enrollment status;
• revenue we receive from Medicare and Medicaid being subject to potential retroactive reduction;
• changes in reimbursement rates or payment methods from third party payors including government agencies, and changes in the deductibles and co-pays owed by patients;
• compliance with federal and state laws and regulations relating to the privacy of individually identifiable patient information, and associated fines and penalties for failure to comply;
• competitive, economic or reimbursement conditions in our markets which may require us to reorganize or close certain clinics and thereby incur losses and/or closure costs including the possible write-down or write-off of goodwill and other intangible assets;
• the impact of COVID-19 related vaccination and/or testing mandates at the federal, state and/or local level, which could have an adverse impact on staffing, revenue, costs and the results of operations;
• changes as the result of government enacted national healthcare reform;
• business and regulatory conditions including federal and state regulations;
• governmental and other third party payor inspections, reviews, investigations and audits, which may result in sanctions or reputational harm and increased costs;
• revenue and earnings expectations;
• legal actions, which could subject us to increased operating costs and uninsured liabilities;
• general economic conditions, including but not limited to inflationary and recessionary periods;
• availability and cost of qualified physical therapists;
• personnel productivity and retaining key personnel;
• competitive environment in the industrial injury prevention services business, which could result in the termination or nonrenewal of contractual service arrangements and other adverse financial consequences for that service line;
• acquisitions, and the successful integration of the operations of the acquired businesses;
• impact on the business and cash reserves resulting from retirement or resignation of key partners and resulting purchase of their non-controlling interest (minority interests);
• maintaining our information technology systems with adequate safeguards to protect against cyber-attacks;
• a security breach of our or our third party vendors’ information technology systems may subject us to potential legal action and reputational harm and may result in a violation of the Health Insurance Portability and Accountability Act of 1996 of the Health Information Technology for Economic and Clinical Health Act;
• maintaining clients for which we perform management and other services, as a breach or termination of those contractual arrangements by such clients could cause operating results to be less than expected;
• maintaining adequate internal controls;
• maintaining necessary insurance coverage;
• availability, terms, and use of capital; and
• weather and other seasonal factors.

In addition to the above, see Risk Factors in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2021 and the additional risk factor below:

Our debt and financial obligations could adversely affect our financial condition, our ability to obtain future financing, and our ability to operate our business.

We have outstanding debt obligations that could adversely affect our financial condition and limit our ability to successfully implement our business strategy. Furthermore, from time to time, we may need additional financing to support our business and pursue our business strategy, including strategic acquisitions. Our ability to obtain additional financing, if and when required, will depend on investor demand, our operating performance, the condition of the capital markets, and other factors. We cannot assure that additional financing will be available to us on favorable terms when required, or at all.

Our loan agreements contain certain restrictions and requirements that among other things:

• require us to maintain a quarterly fixed charge coverage ratio and minimum working capital ratio;
• limit our ability to obtain additional financing in the future for working capital, capital expenditures and acquisitions, to fund growth or for general corporate purposes;
• limit our future ability to refinance our indebtedness on terms acceptable to us or at all;
• limit our flexibility in planning for or reacting to changes in our business and market conditions or in funding our strategic growth plan; and
• impose on us financial and operational restrictions.

Our ability to meet our debt service obligations will depend on our future performance, which will be affected by the other risk factors described in our Annual Report on Form 10-K filed on March 1, 2022. If we do not generate enough cash flow to pay our debt service obligations, we may be required to refinance all or part of our existing debt, sell our assets, borrow more money or raise equity. There is no guarantee that we will be able to take any of these actions on a timely basis, on terms satisfactory to us, or at all.

If we fail to satisfy our debt service obligations or the other restrictions and requirements in our loan agreements, we could be in default. Unless cured or waived, a default would permit lenders to accelerate the maturity of the debt under the credit agreement and to foreclose upon the collateral securing the debt.

Our outstanding loans bear interest at variable rates. In response to the variable rates, we entered into entered into an interest rate swap agreement. See above for further discussion of this swap agreement.

Many factors are beyond our control. Given these uncertainties, you should not place undue reliance on our forward-looking statements. Please see the other sections of this report and our other periodic reports filed with the Securities and Exchange Commission (the “SEC”) for more information on these factors. Our forward-looking statements represent our estimates and assumptions only as of the date of this report. Except as required by law, we are under no obligation to update any forward-looking statement, regardless of the reason the statement may no longer be accurate.

About U.S. Physical Therapy, Inc.

Founded in 1990, U.S. Physical Therapy, Inc. operates 608 outpatient physical therapy clinics in 39 states. The Company's clinics provide preventative and post-operative care for a variety of orthopedic-related disorders and sports-related injuries, treatment for neurologically-related injuries and rehabilitation of injured workers. In addition to owning and operating clinics, the Company manages 33 physical therapy facilities for unaffiliated third parties, including hospitals and physician groups. The Company also has an industrial injury prevention services business which provides onsite services for clients’ employees including injury prevention and rehabilitation, performance optimization, post-offer employment testing, functional capacity evaluations, and ergonomic assessments.

More information about U.S. Physical Therapy, Inc. is available at www.usph.com . The information included on that website is not incorporated into this press release.