Encompass Health's Net Operating Revenues Inch Up While Adjusted EBITDA Slides

The Birmingham, Alabama-based post-acute care provider's CEO said volumes "recovered substantially" in Q3.

Encompass Health saw net operating revenues increase 1.1% in Q3 while its adjusted EBITDA slid 0.6%, according to the company's latest earnings report released Wednesday afternoon.

The Birmingham, Alabama-based post-acute care provider reported cash flows provided by operating activities of $173.4 million, marking a 51.6% year-over-year increase, though income from continuing operations attributable to the company per diluted share was $0.78, a decrease of 20.4%.

As part of the mixed financials, Encompass also achieved an adjusted cash flow of $124.1 million, up 13.2% for the quarter, while adjusted earnings per share (EPS) fell 16.1%.

Still, Encompass paid a quarterly dividend of $0.28 per share and declared a quarterly cash dividend of the same amount that will be paid in January 2021.

Related: Decreased Volumes Lead to Decreased Revenues for Encompass Health

During the quarter, Encompass announced plans to build seven new inpatient rehabilitation hospitals as well as 36 beds to existing hospitals.

C-suite perspective:

"Our teams are doing an extraordinary job in managing through the COVID-19 pandemic," Mark Tarr, CEO of Encompass, said in a statement. "Our volumes recovered substantially in the third quarter, and we remain confident in the longer-term outlook for our company."

Forward looking, Encompass released its guidance for Q4, which included new operating revenues in the range of $1.15 billion to $1.22 billion, adjusted EBITDA between $225 million to $240 million, and adjusted EPS from continuing operations attributable to the company between $0.79 to $0.90.

For complete financial information, review Encompass Health's filing with the Securities and Exchange Commission.