Select Medical Holdings Corporation: Announces Business Outlook for 2019

Select Medical Holdings Corporation (“Select Medical”) (NYSE: SEM), today announced its business outlook for calendar year 2019.

Select Medical expects consolidated net operating revenues for the full year 2019 to be in the range of $5.2 billion to $5.4 billion.  Select Medical expects net income before interest, income taxes, depreciation and amortization, stock compensation expense, other income/(expense), and equity in earnings/(losses), or Adjusted EBITDA for the full year 2019 to be in the range of $660 million to $700 million.  Select Medical expects fully diluted income per common share for the full year 2019 to be in the range of $0.97 to $1.13.

Select Medical assumed a 25.5% effective tax rate when preparing the above business outlook for 2019. Select Medical assumed total shares outstanding of 135 million when preparing the above business outlook for 2019. This share count includes unvested restricted shares, which have participation rights and are allocated an equitable portion of earnings under the two-class method for calculating income per common share.

The following is a reconciliation of full year 2019 Adjusted EBITDA expectations as computed to the low and high points of the range to the closet comparable GAAP financial measure.  Refer to Select Medical’s most recent Form 10-Q filing for a discussion of Select Medical’s use of Adjusted EBITDA in evaluating financial performance and determining resource allocation.  Each item presented in the table below is an estimation of full year 2019 expectations (dollars in millions).

	Range
Non-GAAP Measure Reconciliation	Low	High
Net Income attributable to Select Medical	$             132	$             153
Net Income attributable to non-controlling interests	56	65
Net Income	188	218
Income tax expense	64	74
Interest expense	200	200
Equity in earnings of unconsolidated subsidiaries	(25)	(25)
Income from operations	427	467
Stock compensation expense	27	27
Depreciation and amortization	206	206
Adjusted EBITDA	$             660	$             700

Select Medical is one of the largest operators of critical illness recovery hospitals (previously referred to as long term acute care hospitals), rehabilitation hospitals (previously referred to as inpatient rehabilitation facilities), outpatient rehabilitation clinics, and occupational health centers in the United States based on the number of facilities. Our reportable segments include the critical illness recovery hospital segment, rehabilitation hospital segment, outpatient rehabilitation segment, and Concentra segment. As of September 30, 2018, Select Medical operated 97 critical illness recovery hospitals in 27 states, 26 rehabilitation hospitals in 11 states, and 1,649 outpatient rehabilitation clinics in 37 states and the District of Columbia. Select Medical’s joint venture subsidiary Concentra operated 525 occupational health centers in 41 states. Concentra also provides contract services at employer worksites and Department of Veterans Affairs community-based outpatient clinics. At September 30, 2018, Select Medical had operations in 47 states and the District of Columbia. Information about Select Medical is available at www.selectmedical.com.

https://www.marketscreener.com/SELECT-MEDICAL-HOLDINGS-C-5610006/news/Select-Medical-Holdings-Corporation-Announces-Business-Outlook-for-2019-27824487/