On April 27, Encompass Health released its first quarter earnings report. Below are a few key takeaways to help you gain a better understanding of our performance in the first quarter, which provided a strong start to 2023.
Q1 2023 Earnings Report Key Takeaways
Demand for inpatient rehabilitation services continues to increase, and we continue to invest in capacity expansions to meet this growing demand. We opened three new hospitals in the first quarter and a fourth in early April, adding a total of 199 beds. Over the balance of the year, we plan to open three additional new hospitals and add 93 beds to existing hospitals. We continue to build and maintain an active pipeline of new hospital projects, both wholly-owned and joint ventures with acute care hospitals.
Labor Costs Continue to Improve
Compared to the same period last year, contract labor costs decreased approximately 51% and sign-on and shift bonus costs decreased approximately 23% in the first quarter. On a sequential basis, these costs were similar to those in the previous quarter (Q4 2022).
Technology Investments Continue to Improve Care
We continue to invest in hospital-based technologies through initiatives such as our Tablo on-site dialysis rollout. We now offer in-house dialysis in 64 of our hospitals and will continue to expand this technology to additional hospitals this year. Reducing our reliance on third-party providers and avoiding patient transport to receive dialysis reduces costs and improves patient outcomes and satisfaction.
Revised 2023 Guidance
We increased our 2023 guidance and now expect net operating revenue of $4.70 billion to $4.77 billion, adjusted EBITDA of $870 million to $910 million and earnings per share of $2.94 to $3.23.
A Note of Appreciation
As always, we credit our success to the daily efforts of our dedicated employees. Our teams across the country continue to set the standard in rehabilitative care and build trust with our patients, partners and communities. The year is off to a great start, and I look forward to building on that momentum.