Concentra Group Holdings Parent, Inc. Q2 FY2025 earnings call

• Strong revenue growth with high single-digit revenue growth excluding Nova. Successfully integrated and rebranded Nova occupational health centers, and closed Pivot Onsite Health Clinic acquisition, doubling the onsite segment. Expanded Board of Directors with 2 new members. Cost of services decreased to 70.7% of revenue, driven by better staffing efficiencies. Progress in separation from Select Medical, with teams making good progress towards complete separation by November 2026. Plans for de novos with 2-3 locations planned for the second half of 2025 and ongoing bolt-on M&A pipeline.

Occupational Health Center

• Total revenue in Q2 2025: $516.1 million, up 14.4% year-over-year. Workers' compensation revenue: $332.2 million, up 15.2% y/y; visits per day up 9.3%, revenue per visit up 5.4%. Employer services revenue: $174.3 million, up 13.7% y/y; visits per day up 10.3%, revenue per visit up 3.1%.
• Excluding Nova impact: Occupational Health Center total revenue $484.8 million, up 7.4% y/y; visits per day up 2.4%, revenue per visit up 4.9%. Workers' compensation revenue $314 million, up 8.9% y/y; visits per day up 3.2%, revenue per visit up 5.5%. Employer services revenue $161.8 million, up 5.5% y/y; visits per day up 2%, revenue per visit up 3.4%.

Onsite Health Clinics

• Revenue in Q2 2025: $22.6 million, up 45.2% y/y. Excluding 1-month Pivot Onsite impact, up 9.9% y/y.

Other Businesses

• Revenue: $12.1 million, up 8.5% y/y

• Raised 2025 revenue guidance to $2.13 billion to $2.16 billion from $2.1 billion to $2.15 billion. Adjusted EBITDA range raised to $420 million to $430 million from $415 million. On track for $80 million to $90 million of CapEx and a 3.5x leverage ratio by year-end, with target of below 3x leverage by end of 2026.

Q: For the 2025 guidance update, could you walk through what's being contemplated in changes to revenue and adjusted EBITDA from M&A contribution or aggregate improvements? And on cadence, any other year-over-year dynamics to consider for incremental M&A spend?

A: Matt DiCanio said guidance is based on year-to-date performance, factoring in incremental Nova and Pivot performance, with no major material events other than possible weather impact in Q3 last year.

Q: Nice to see workers' comp accelerate into 2Q. Anything to explain softer trend in 1Q? And with respect to the guide, does the guide accommodate flattish to 3% same-store workers' comp visits?

A: Keith Newton said quarters can vary for many reasons, no specific reason for 1Q softness, and guidance projects closer to average of Q1 and Q2 numbers.

Q: You've spoken a lot about volume acceleration in 2Q. As we think about the back half of the year, is the right way to think about volume growth more like 2Q or year-to-date? And are you factoring any cushion into guidance for potential hiring slowdown?

A: Matt DiCanio said back half of the year should be thought of as closer to year-to-date performance, and no significant cushion factored for potential hiring slowdown.

Q: Can you expand on mix dynamics in underlying business and if it could create headwinds?

A: Keith Newton said no significant shifts in industries, no one industry more than 9-10% of business, and no anticipated headwinds from mix changes.

Q: On the onsite segment, excluding Pivot, revenue grew 10%. Is that organic growth we should be looking at?

A: Keith Newton said with advanced primary care addition, onsite segment is expected to have better growth rate than historically seen, winning business previously not won.