Concentra Group Holdings Parent, Inc. (CON) Q4 2024 Earnings Summary

Executive Summary

Q4 2024 revenue rose 5.5% year over year to $465.0M; Adjusted EBITDA grew 13.6% to $77.5M, with margin expansion to 16.7% (from 15.5%); net income was $22.8M ($0.17 EPS) .
2025 outlook: revenue ~$2.1B, Adjusted EBITDA $410–$425M, capex $80–$90M, year-end net leverage ~3.5x; commentary notes Florida workers’ comp fee schedule uplift, modest improvement expected in Employer Services volumes, and 10 months of Nova contribution with phased synergies .
Closed Nova Medical Centers (67 centers) on March 1; funded via ~$102M incremental term loan, $50M revolver draw, and cash; repriced Term Loan B to SOFR + 200 bps and upsized revolver to $450M at SOFR + 200 bps; pro forma net leverage ~3.9x, targeting ~3.0x within 18–24 months .
Capital return and liquidity: quarterly dividend of $0.0625 declared Feb 28; year-end cash $183.3M and DSO improved to 43 days .

What Went Well and What Went Wrong

What Went Well
- Adjusted EBITDA margin expanded 118 bps to 16.7% driven by improved cost of services and mix; revenue per visit increased 5.8% (Workers’ Comp +4.4%, Employer Services +4.8%), supporting pricing power and rate tailwinds .
- “We are well positioned for continued growth in 2025,” with early 2025 Employer Services trends “a decent bit better” than the recent −4% to −5% YoY range; guidance embeds improvement to flat-to-positive later in the year .
- Financing reset and capacity: repriced term loan/revolver lower, upsized revolver, and closed Nova—“very happy with these outcomes and the economic benefits in 2025 and beyond” .
What Went Wrong
- Visits per day declined 2.1% YoY with Employer Services VPD −4.8% (macro hiring/churn softness), partially offset by Workers’ Comp VPD +1.1% .
- Net income margin compressed YoY (4.9% vs 6.5%) and sequential EBITDA declined vs Q3 (seasonality); management cited IPO recapitalization and seasonality as primary drivers .
- Nova integration will carry transition costs in 2025; management guided Nova’s 2025 EBITDA contribution to “$15-plus million” (not the 10/12ths of $28.3M pro forma), with synergies phasing through year one .

Financial Results

Quarterly trend (sequential and YoY)

Metric	Q2 2024	Q3 2024	Q4 2024
Revenue ($M)	$477.9	$489.6	$465.0
Adjusted EBITDA ($M)	$101.6	$101.6	$77.5
Net Income ($M)	$53.1	$45.8	$22.8
Diluted EPS ($)	$0.50	$0.37	$0.17

Q4 2024 vs Q4 2023 and key KPIs

Metric	Q4 2023	Q4 2024
Revenue ($M)	$440.7	$465.0
Adjusted EBITDA ($M)	$68.3	$77.5
Net Income Margin (%)	6.5%	4.9%
Visits per Day (Total)	47.8k	46.8k
Workers’ Comp VPD	22.1k	22.3k
Employer Services VPD	24.7k	23.5k
Revenue per Visit (Total)	$137.15	$145.08
Workers’ Comp RPV	$193.69	$202.28
Employer Services RPV	$86.92	$91.09

Segment detail (Q4 2024)

Segment	Q4 2024 Revenue
Occupational Health Centers	$437.0M
- Workers’ Compensation	$289.1M (66% of centers)
- Employer Services	$137.2M
Onsite Clinics	$17.1M
Other Businesses	$10.9M

Balance sheet / cash flow highlights (Q4 2024)
- Cash $183.3M; net leverage 3.46x; operating cash flow $93.7M; DSO 43 days (improved by 2 days YoY) .

Guidance Changes

FY 2025 guidance (introduced March 3, 2025)

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY 2025	N/A	~$2.1B	First formal FY25 guide
Adjusted EBITDA	FY 2025	N/A	$410–$425M	First formal FY25 guide
Capital Expenditures	FY 2025	N/A	$80–$90M	First formal FY25 guide
Net Leverage	FY 2025 YE	N/A	~3.5x	First formal FY25 guide
Dividend	Ongoing	$0.0625 declared Nov ’24	$0.0625 declared Feb 28, 2025	Maintained

Guidance commentary: includes known workers’ comp fee updates (notably Florida effective 1/1/25), assumes modest Employer Services improvement through 2025, and reflects 10 months of Nova with one-time transition costs and phased synergies . Management expects Nova to contribute “$15-plus million” of 2025 Adjusted EBITDA (not annualized run-rate) .

FY 2024 guidance vs actual (context)

Metric	FY 2024 Guidance (as of 10/31/24)	FY 2024 Actual
Revenue	~$1.9B	$1,900.2M
Adjusted EBITDA	$370–$375M	$376.9M
Capital Expenditures	$65–$70M	$64.3–$65.7M (reported)
Net Leverage	3.5x–3.6x	~3.5x (3.46x)

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 & Q3 2024)	Current Period (Q4 2024)	Trend
Employer Services volumes	Stabilizing as expected; down mid-single digits YoY	−4.8% VPD YoY; early 2025 “decent bit better,” guiding improvement to flat/positive later in ’25	Improving into 2025
Workers’ Comp volumes/pricing	VPD +2% YoY; RPV up low-single digits	VPD +1.1% YoY; RPV +4.4%; strong rate environment	Solid growth
Fee schedule/macro	State-driven WC increases; IPO/separation progress	FL WC fee schedule uplift effective 1/1/25; “good year” for rate even ex-FL	Rate tailwinds
Deleveraging/financing	Target <3.0x in 24 months post-IPO	Repriced Term Loan B/revolver; PF leverage ~3.9x post-Nova, targeting ~3.0x in 18–24 months	Path reaffirmed
Nova M&A/integration	Building pipeline; de novo progress	Closed 3/1; $265M EV; 67 centers; $15M+ 2025 EBITDA contribution, synergies phase-in	Integration year
Onsite clinics growth	156 sites Q3; pipeline strong	157 sites YE; 10 new sites won in Q4; ongoing openings in coming months	Expanding
Tech/operations	Digitization; CCaaS rollout; patient satisfaction	DSO down to 43 days; continued operational discipline	Efficiency gains
Regulatory/tariffs	—	Tariff exposure not a headwind currently	Neutral

Management Commentary

Strategy and 2025 setup: “I am confident in our ability to continue to deliver strong results in 2025.” — CEO Keith Newton .
Volume/price dynamics: “We had a strong quarter with a 5.8% increase in revenue per visit… Workers’ compensation revenue per visit increased 4.4% versus prior year.” — President & CFO Matt DiCanio .
2025 Employer Services recovery: “We’re seeing something that’s a decent bit better [in Jan/Feb], implied to get to flat year‑over‑year and then slightly positive growth later in the year.” — CFO .
Nova economics: “We expect Nova’s actual contribution to Concentra’s 2025 adjusted EBITDA to be $15‑plus million,” with synergies phased and one‑time transition costs, not simply 10/12ths of $28.3M .
Financing and leverage: “We repriced our Term Loan B… upsized our revolver… Inclusive of the Nova transaction, our pro forma net leverage ratio is 3.9x… target ~3.0x within 18–24 months.” — CEO .

Q&A Highlights

Nova integration cadence: Management has a “proven playbook,” planned for 6+ months, with overlapping footprint enabling smoother execution (largest since U.S. HealthWorks in 2018) .
2025 EBITDA bridge and synergies: Nova 2025 contribution guided to $15M+ due to phased synergies and transition costs; synergies targeted by Q1 2026 with further upside in years 2–3 .
Deleveraging path: Expect ~3.5x by YE25 from 3.9x PF, then toward ~3.0x within 18–24 months via cash generation and EBITDA growth; second-half cash flow seasonality noted .
Pricing/rate environment: Ex‑Florida, rate outlook “very good” for 2025 across both Workers’ Comp and Employer Services; Florida uplift makes state more attractive for deployment .
Macro/tariffs: No material tariff headwind anticipated at this time .

Estimates Context

Wall Street consensus (S&P Global) for Q4 2024 and FY 2025 was unavailable at time of analysis due to data access limits (SPGI request limit exceeded). As a result, we cannot benchmark reported results or guidance versus consensus at this time. If you’d like, we can refresh consensus when access is restored and quantify beats/misses across revenue, EPS, and EBITDA [SPGI access error; no values to cite].

Key Takeaways for Investors

Mix and pricing tailwinds: Strong revenue per visit (+5.8% YoY) and workers’ comp rate environment undergird margin stability even as Employer Services volume improves more gradually .
Execution on capital structure: Debt repricing and larger revolver reduce interest expense and enhance flexibility for integration and de novos .
Nova adds density and runway: 67 centers and complementary footprint should be accretive, with $15M+ 2025 EBITDA contribution and synergy ramp through 2026 .
Path to deleveraging intact: From 3.9x PF post‑Nova toward ~3.0x in 18–24 months, aided by solid cash generation and EBITDA growth; seasonal cash flow suggests stronger 2H delever .
2025 guide >10% growth: Revenue ~2.1B and Adjusted EBITDA $410–$425M reflect Florida uplift, improving Employer Services trends, and Nova’s partial-year contribution with transition costs .
Dividend maintained: $0.0625 quarterly dividend alongside growth and deleveraging priorities underscores balanced capital allocation .
Watch items: Pace of Employer Services recovery, Nova synergy realization timing/costs, and ongoing separation workstreams from Select Medical (TSA through late 2026) .

Citations

Q4 2024 8-K press release and exhibits:
Q4 2024 earnings call transcript:
Q3 2024 8-K press release and investor presentation:
Q2 2024 8-K press release and investor presentation:
Preliminary results / Nova agreement 8-K (Jan 23, 2025):