Ardent Health Partners, LLC Q4 FY2025 earnings call

• Fourth quarter results reflected positive earnings performance and robust cash flow. • Impact program initiatives are showing traction with expected savings raised. • Key industry headwinds showed stability. • Technology initiatives are deployed for efficiency and care quality. • Focus on disciplined execution and care transformation for growth.

Fourth quarter revenue was $1.61 billion, essentially flat compared to prior year; adjusted admissions grew 2%, surgeries were essentially flat. Full year 2025 revenue grew 6% to $6.3 billion. Fourth quarter adjusted EBITDA of $134 million was 2% above implied guidance midpoint. Full year 2025 adjusted EBITDA grew 9% to $545 million, with margins expanding 20 basis points. Operating cash flow in 2025 was $471 million, up nearly 50% from prior year. Cash increased by approximately $150 million to over $700 million at end of 2025, and net leverage reduced to 2.5 times.

• 2026 adjusted EBITDA guidance $485 - $535M. • Midpoint assumes core growth ~4% and impact savings ~$55M. • Estimates exchange headwind ~$35M. • Expect adjusted EBITDA growth in 2027 as headwinds lap and savings build.

• Industry headwinds like payer denials and professional fees impact. • Subsidies expiration and HICS enrollment disruption risks. • Cash flow timing related to payroll cycles headwind.

Q: On guidance assumptions, professional fees growth in 2025 and expectations for 2026, and bad debt due to enhanced subsidies.

A: Professional fee growth in 2025 high single-digit, similar 2026 assumptions, too early to speak to bad debt.

Q: Detail on underlying HICS assumptions and impact program savings.

A: HICS enrollment decline ~20%, 10%-15% to employer, rest self-pay. Impact savings $15M mostly in SW&V.

Q: Impact initiatives lead time and sustainability of earnings growth.

A: Initiatives multi-year, technology provides tailwinds, continued opportunities in supply chain etc.

Q: 1Q volume impact from winter storms.

A: Very immaterial to Q1.

Q: Core operations cost structure and margin expansion.

A: Core margin expansion similar to 2025 excluding headwinds, sustainable efforts.

Q: Professional fees growth rate in 2026.

A: High single-digit expected throughout year.

Q: Impact program cost savings timeline.

A: 40+15M savings fully identified, modest ramp into 2027.

Q: Core growth drivers excluding DPP.

A: Volume growth 1.5%-2.5%, commercial contract rate increases 4%-5%.

Q: Ambulatory strategy and pipeline.

A: Continuing to develop ASC and ambulatory, opening new urgent cares etc.

Q: Cash flow timeline and Rural Health Fund.

A: Cash flow timing affected by payroll, some hospitals qualify for Rural Health Fund.

Q: 4Q volume trends and sustaining volume growth.

A: Volume consistent, demand strong, exchange dynamics headwind on adjusted admissions.

Q: Technology initiatives timeline and margin impact.

A: Technology initiatives to ramp by end of year, virtual programs have financial/quality benefits.

Q: CMS AI-based tools impact and denial rates.

A: Prudent look at denials, working with partners to streamline prior auth.

Q: Market growth and digital opportunities.

A: Focus on digital solutions to attract, retain, grow patient base.