Select Medical Holdings Reports $5.19 Billion Revenue for Fiscal Year 2024, Up 7.5%

Select Medical Holdings Corporation reported a revenue of $5.19 billion for the fiscal year ending December 31, 2024, marking a 7.5% increase from $4.83 billion in 2023. The company's income from continuing operations before other income and expense was $268.3 million, slightly up from $267.2 million in the previous year. Adjusted EBITDA also saw an increase, rising to $510.4 million with an adjusted EBITDA margin of 9.8%, compared to $446.1 million and a margin of 9.2% in 2023. The growth in revenue was primarily driven by increases in the critical illness recovery hospital and rehabilitation hospital segments, which reported revenue increases of 6.3% and 13.4%, respectively.

In terms of operational metrics, Select Medical's critical illness recovery hospitals operated 104 facilities, with an average length of stay of 31 days and an occupancy rate of 68%. The rehabilitation hospital segment expanded to 35 facilities, achieving an occupancy rate of 84% and an average length of stay of 14 days. The outpatient rehabilitation segment, which includes 1,914 clinics, reported 11.15 million patient visits, reflecting a 4.6% increase from the previous year. The company continues to focus on enhancing patient care quality and expanding its service offerings, which has contributed to its growth in patient volumes.

Significant strategic developments included the initial public offering (IPO) of Concentra Group Holdings Parent, a subsidiary of Select Medical, which raised approximately $499.7 million in net proceeds. Following the IPO, Select Medical distributed its remaining equity interest in Concentra to its stockholders, effectively separating the two entities. This strategic move is expected to allow Select Medical to concentrate on its core operations in critical illness recovery, rehabilitation hospitals, and outpatient rehabilitation services.

The company faced challenges, including rising labor costs and increased operational expenses, which were reflected in its general and administrative expenses rising to 4.4% of revenue in 2024, up from 3.5% in 2023. Select Medical employed approximately 44,100 individuals across its segments, with a focus on retaining skilled healthcare professionals amid a competitive labor market. The company is actively working to manage these costs while maintaining high-quality patient care.

Looking ahead, Select Medical anticipates continued growth driven by an aging population and rising demand for healthcare services. However, the company remains cautious about potential regulatory changes, particularly regarding Medicare reimbursement rates, which could impact its financial performance. The management is committed to adapting to market conditions and enhancing operational efficiencies to sustain its growth trajectory.