Pediatrix Q3, update

 Pediatrix Medical Group, Inc. (NYSE: MD), a leading provider of physician services, today reported earnings of $0.23 per share for the three months ended September 30, 2024. On a non-GAAP basis, Pediatrix reported Adjusted EPS of $0.44.

For the 2024 third quarter, Pediatrix reported the following results:

• Net revenue of $511 million;
• Net income of $19 million; and
• Adjusted EBITDA of $60 million.

“Our third quarter operating results modestly exceeded our expectations, driven primarily by strength in same-unit revenue,” said James D. Swift, M.D., Chief Executive Officer of Pediatrix Medical Group. “During the quarter, we successfully completed our previously announced transition to a hybrid revenue cycle management structure, and we remain on track to complete our portfolio management plans by the end of 2024. We believe that a more focused portfolio, with enhanced support for our affiliated practices, will enable stronger financial performance and benefit all of our stakeholders.”

Portfolio Management Update

As previously disclosed, during the second quarter of 2024, Pediatrix formalized its practice portfolio management plans, resulting in a decision to exit almost all of its affiliated office-based practices, other than maternal-fetal medicine, and during and subsequent to the end of the 2024 second quarter, the Company completed the exit of its primary and urgent care service line through two separate transactions. In aggregate, the office-based practices that the Company intends to exit and the primary and urgent care clinics that have been divested contributed net revenue of approximately $200 million in 2023. As previously disclosed, Pediatrix expects that the annualized favorable impact to Adjusted EBITDA resulting from its portfolio management plans to be approximately $30 million, based on 2023 financial information.

The Company continues to expect to complete these exits prior to the end of 2024.

2024 Outlook

Pediatrix anticipates that its 2024 Adjusted EBITDA, as defined above, will be in a range of $205 million to $215 million. This outlook reflects Adjusted EBITDA for the first nine months of 2024 of $155.3 million.

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