DVCR - Earnings call transcript Q3 2020 | Diversicare Healthcare Services, Inc.

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Operator

Greetings and welcome to Diversicare’s 3Q 2020 Earnings Conference Call.

During the presentation, all participant lines will be in a listen-only mode. Afterwards we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference is being recorded Thursday, November 5, 2020. I now have the pleasure of turning now the conference over to Alexa Karpinski, Vice President with Diversicare. ahead. go Please

Alexa Karpinski

in events, Reform Good Services to Jennifer. is welcome the conference everyone to recorded. comments of and And information, Thank XXXX. these during made third afternoon quarter materially involve Healthcare this that risks remind to the XXXX would be forward-looking Harbor call indicated statements. to of conference Diversicare historical I of certain you, will statements like and meeting addition call. by being within performance the Act provisions may results, cause from those actual uncertainties Safe differ the private and/or securities litigation such statements, Today’

XX-K encouraged company the ended well its December for statement reviews to its as factors risk XX, disclosures XXXX, are and of with has and report for Exchange annual the the an XXXX, XX-Q in on Form forward-looking XX, as Commission. all Form Securities filings and the You provided quarterly quarter year the on September ended public report

today's made I release to encouraged to may and reconciliation the comparable press financial results those financial Form non-GAAP under McKnight, measures Jay non-GAAP be like President and of measures GAAP to references review Executive those the are to Officer. to our Investors would the over measures. now Chief furnished X-K. During call, hand the call and

Jay McKnight

thank and third our joining Good quarter for Alexa. you call. you, afternoon Thank earnings

Chief and more a and benefits and most in team position regional challenging and Reliant company our the been support team therapy ever in The results our the innovation have the to our career leadership, continue are other I team, conclude we us the Financial quality in time partnership and our and have on has the week we members. here in into liability professional the information residents We I substantial to our As industry. our continue Kerry we have discussing also industry per our of that third some positive consideration in professional have processes care seen. have the provide specific one support liability beyond highest we and earlier the our for therapy with to will care of believe direction. exposure time of and cutting our impact Also, will We other cannot taken and and and move to predict patients on care the on this pandemic spend Massey, questions. going for a offer. the strategic cost help in and edge industry be best future costs. in country. provide facing above in-depth not factors we expert challenges high and were headquarters frontline some training, developing all had center the cannot with that jurisdictions proud by They for operating want of their This many our Rehabilitation is announced of These centers. COVID-XX our of this shared to some time presence be certain will that financial COVID-XX before, a providing quarter’s team impress and team. quarter, partnered another. more all the for a Reliant impact to Officer for will provider patients with our on keep that some focus to ladders, our members offers residents. we to Diversicare the bed

future for an about quarters. sharing in our forward outcomes as partnership and the savings to This centers. more we expect transition exciting we gain look a significant us cost in Additionally, is from we efficiencies this

Turning to the quarter’s results.

that after results improving The our third from Kentucky. exit in XXXX theme quarter the of began followed

operations, million. million, than X.X we quarter of shared bringing continuing year-to-date our that ended last quarter net X.X For income where of as of different were federal the I thought continued well. million by in That be largely X.X income expected. net another the our million quarter of with Medicaid recognized we financial third add-ons. means We notion results stimulus with quarter state would they X.X during

patient expenses of the prior and us XX.X% extra quarter materially. from incurred at The is absorb also time these for serve year. from ago saw for patients the we to money to stimulus a XX.X served We In million year has XX.X% a XX% this additional testing, decrease PPE. the enabled COVID-related when expenses census skilled while quarter, improved decreased year, mix in our staffing,

the to in Our reimbursement through is related industry of federal that can the revenue survive what similar pandemic. experienced. we us operators significant been our in operating federal others been key Several lost other their respective received support increasing to has expenses. decline have on by relying industry be our period. states for primary stimulus The stimulus money dollars have COVID-XX is is our or only in for states this for temporarily and support have us The our census used emergency which

that have virus. in of X,XXX We on COVID and have residents, our tool a update review and for of centers asymptomatic our testing last certain each nursing encourage had testing, our or facilities test positive all long-term about process no will We today. of been to initiative test approximately suspected We antigen with page all to X,XXX cohorting, test have each and of team maintain positives, Roughly of be these you have centers, major perform a includes providing and recent updates. entire tests quarter centers. for which and information cases screening members The our residents website experience. now members of a as are website We've patients directly recovered have that the most the or half company's positive shared we for testing our that approximately CMS XX% as COVID-XX COVID-XX for all have in to We had reporting of been for with of our team of dealt dealing meaning rapid has XX patients, highlights importance country. XX% the that care and Between groups qualifying positive. We machines the patients the setting. ability in us. our in skilled residents

the We frequently our ratings to patients, depending once are our local positivity a members, of month markets. CMS week as from team residents a testing and as on anywhere twice

to circumstances need We have utilize partner. certain PCR in when lab we a tests

as results to since the us to for have as partners earnings good testing and to availability We're glad that quick situation possible. has last our very us prioritize significantly Our lab testing share been report to the call. improved

income EBITDAR for realize quarter we to XX.X. Focusing XXXX [$X.X results for EBITDAR on ago for million, compares X.X a the was with the of a of [EBITDAR] improvement. X.X loss year third very compared for from third X.X quarter operations the of X.X favorably the the million] continuing billion financial quarter. million net quarter, million net for of

million revenue patient quarter. Our for million, the XXX.X XXX was compared for the ago year quarter to

XX.X% beds to XX.X%. skilled occupancy Our XX.X% increasing was down for with available from from to XX.X% total mix

that year-over-year over and to remarks Our Please not the financial specific the does Managed by that, With increases $XX.XX for call I'll include the in on and Alabama, Texas. quarterly turn Care Medicaid and increased Medicare Kerry note temporary $XX.XX, rates rate Medicaid some Tennessee, our and respectively. $X.XX, statements.

Kerry Massey

Thanks, Jay.

in highlighted from a trends and year-over-year our improvement operations. EBITDA financial his and favorable results income Jay in on comments, As continuing with continue both sequential net

the quality focus increased continuing to patient impact structure. At to from and on push our pandemic benefit our are initiatives through COVID-XX costs, our We drive continues census, time, same labor expenses. the operating savings and operational cost other to our

$X.X relief operating the fund quarter. of has to year benefit recognize revenues prior million year decrease that over and mitigate all place CARES Act for the Under year-over-year were a and a of from prior approximately and million those as state the the to in in of rates. we $XX.X provider payments. the quarter-over-quarter served to revenue in the markets received At decline from XX% is prior state this have The funds, of $X we of million and Medicare, was balance the several million our continue actually also our mitigated Care reflected revenue third continuing our in and the $XXX year which over rates Act lost end about continues quarter, other quarter from $XX in $X.X income stimulus we skill third that of operations, today. PPPHCE stimulus during Medicaid, the income by of received sheet. stimulus of federal impact And recognition our the revenue. Medicare increase First same million drive time, with pandemic decline improvement. known Coronavirus which unrecognized prior support, improvement skilled we the the Act. However, deferred the mix due showed we quarter, the in-part up unfavorable the Patient in rate Families matching is significant little over end of remained $XXX,XXX helped At regular Through federal an quarter, quarter, of the than of our year a quarter. federal received representing we to remaining The stimulus in from amounting Managed federal have X.X% more had from quarter Response $XX patient waiver $XX.X under and million rate money third on decline stable million has a the to the impacts. as the increased temporary million connection we of resulting

to of to expect expenses as care expect a quarters revenue incur We COVID-XX. offset that and these in loss utilize health result funds upcoming to additional stimulus federal increased we related

up other the for by quarter as XX.X testing, expenses patient was other increased activities. nursing operating expenses increase or of XX.X which included the $X.X $X.X the prior the million of of infection increases cost in PPE, control XX.X% deep pandemic or and of our impact of of cleaning, of operating million labor and driven million percentage operations, represented Our XX.X% supplies, revenue quarter of of operating expenses, expenses by primarily a revenue. and million revenue from on The the were

improvements cost or on that are our We to to for XXXX, affected a made continue from potential we have expenses efficiencies prepare support our outbreaks. initiatives in functions as care in to we well fees, our also million. in provide in to by G&A to and Setting drive primarily the of centers driven our have which and $X.X operational reduction patient that spend, centers our continued was operations to to prior residents the in of million that expenses, relation as experience COVID-XX COVID-XX the decreased been legal operational current increase The centers. structure the quarter by through supplies. revenue year XXXX, the benefiting from nursing management, of and significant of $X.X in $XXX,XXX X.X% decreased our for in over aside quarter operating of patients labor impact pharmacy, G&A expenses

expense discussion the $X.X incurred $XX.X premiums was of costs turn results of represents increased $X.X have liability studies over quarter year of third by our market conclusion, for $X.X year, current was the revenue over some will lease to an Professional defend quarter claims. prior quarter. back Our consistent quarter fluctuates expense, quarter. prior EBITDA Jay, primarily the professional million. expense Also, existing In third the to over the liability for professional for our million expenses to X.X% QX million due call of of I due That now financial prior often improvement remarks. an the in party closing EBITDAR from the actuarial trends. the year increased with $X.X million, liability settle concludes for compared to third-party and the results. from period-to-period our or insurers increase to Adjusting which million, for and

Jay McKnight

you. Thank

started national we through fiscal allow to of X.X% extended that Medicare the will stay As to the sent X. us extend to extends was emergency XXXX. without not this day the hospital The provide gross on the the federal our FMAP emergency methodology end year period is skilled also pandemic. market and last we receive care increase. are federal October government January. did a The period three we fight [scale quarter, The to At shared waivers states the time, through January reimbursement changed funds official a roughly place] and patients basket new that

and/or to absolutely better want we expense optimistic unprecedented are support our progress be we strategic They're continues states been and the our recognize industry. that our make centers COVID-related here costs. add-ons moves industry for us continue to a to through our and end. to will at our an its as good doing pandemic for time after work company We Medicaid and with prepare most Diversicare the weather have to succeed positioned our reimbursement recent Again, heroic outstanding amazing Diversicare. in team think

As mission now is reminding exceeding touch you by providing conclude open statement expectations. like of every health improve custom, this concludes to Jennifer call we'd exceptional the remarks questions. This our by will our to prepared and for care We we life call today. our

Jay McKnight

future Thank you thank for We our in results Services you, all and joining today. your and sharing quarters. with call look Healthcare interest to Jennifer Diversicare you in forward appreciate our

Operator

does disconnect today's you your good Have presentation. lines. participation We much and you thank that kindly your so everyone. This for conclude a day, ask

Diversicare Healthcare Services (DVCR) 8 Nov 202020 Q3 Earnings call transcript