AdaptHealth Corp. (NASDAQ:AHCO) Q4 2023 Earnings Conference Call February 27, 2024 8:30 AM ET

Company Participants

Richard Barasch – Chairman and Interim Chief Executive Officer

Jason Clemens – Chief Financial Officer

Conference Call Participants

Brian Tanquilut – Jefferies

Eric Coldwell – Baird

Pito Chickering – Deutsche Bank

Andrea Alfonso – UBS

Ben Hendrix – RBC Capital Markets

Joanna Gajuk – Bank of America

Operator

Good day, everyone, and welcome to today’s AdaptHealth Fourth Quarter and Full Year 2023 Earnings Release. At this time, all participants are in a listen-only mode. Later, you will have an opportunity to ask questions during the question-and-answer session. [Operator Instructions].

Today’s speakers will be Richard Barasch, Chairman and Interim CEO of AdaptHealth; and Jason Clemens, Chief Financial Officer of AdaptHealth; Josh Parnes, President of AdaptHealth will join Richard and Jason for the question-and-answer portion of today’s call.

Before we begin, I’d like to remind everyone that statements included in this conference call and in the press release issued today may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act. These statements include, but are not limited to comments regarding financial results for 2023 and beyond. Actual results could differ materially from those projected in the forward-looking statements because of a number of risk factors and uncertainties, which are discussed at length in the company’s annual and quarterly SEC filings. AdaptHealth Corp. should have no obligation to update the information provided on this call to reflect such subsequent events.

Additionally, on this morning’s call, the company will reference certain financial measures, such as EBITDA, adjusted EBITDA, and free cash flow, all of which are non-GAAP financial measures. This call – this morning’s call is being recorded, and a replay of this call will be available later today.

I am now pleased to introduce the Chairman and Interim CEO of AdaptHealth, Richard Barasch.

Richard Barasch

Good morning, everyone, and thank you for joining us this morning to review AdaptHealth’s fourth quarter and full year 2023 performance. Stated simply, we had a terrific fourth quarter and ended 2023 with a great deal of positive momentum throughout our business.

For the year, our net revenue grew by 7.7% and adjusted EBITDA grew 13% compared to the prior year. This is the fourth year in a row that AdaptHealth grew both top and bottom line, and it’s especially notable that nearly 95% of the 2023 revenue growth was non-acquired. We finished the year with a very favorable quarter, driven by continued strength in our sleep and respiratory product lines and the expected improvement in our Humana contract. It’s also noteworthy that adjusted EBITDA grew faster than revenue, largely as a result of the cost-out program and technology-driven operating improvements.