v3.26.1
Segment Information
 6 Months Ended
Jun. 30, 2026
Segment Information [Abstract]  
Segment Information
13. Segment Information

The Company’s reportable segments include the physical therapy operations segment and the IIP segment. Also included in the physical therapy operations segment are revenues from strategic hospital affiliations, other management contract services and other services, which include services the Company provides on-site, such as athletic trainers for schools.

Physical Therapy Operations

The physical therapy operations segment primarily operates through subsidiary clinic partnerships (“Clinic Partnerships”), in which the Company generally owns a 1% general partnership interest in all the Clinic Partnerships. The Company’s limited partnership interests generally range from 65% to 75% (the range is 25% - 99%) in the Clinic Partnerships. The managing therapist of each clinic owns, directly or indirectly, the remaining limited partnership interest in most of the clinics (hereinafter referred to as “Clinic Partnerships”). Some of the Clinic Partnerships serve as management services organizations which manage and provide staffing and a variety of administrative services to physical therapy provider entities in which the Company does not have an ownership interest. These Clinic Partnerships similarly are owned collectively by the Company and one or more physical therapists who are involved in the management of the operations. To a lesser extent, the Company operates some clinics, through wholly-owned subsidiaries (hereinafter referred to as “Wholly-Owned Facilities).
 
The Company continues to seek to attract for employment physical therapists who have established relationships with physicians and other referral sources, by offering these therapists a competitive salary and incentives based on the profitability of the clinic that they manage. For multi-site clinic practices in which a controlling interest is acquired by the Company, the prior owners typically continue on as employees to manage the clinic operations, retain a non-controlling ownership interest in the clinics and receive a competitive salary for managing the clinic operations. In addition, the Company has developed satellite clinic facilities as part of existing Clinic Partnerships and Wholly-Owned Facilities, with the result that a substantial number of Clinic Partnerships and Wholly-Owned Facilities operate more than one clinic location.

Clinic Partnerships

For non-acquired Clinic Partnerships, the earnings and liabilities attributable to the non-controlling interests, typically owned by the managing therapist, directly or indirectly, are recorded within the balance sheets and income statements as non-controlling interest—permanent equity. For acquired Clinic Partnerships with redeemable non-controlling interests, the earnings attributable to the redeemable non-controlling interests are recorded within the consolidated balance sheets and income statements as redeemable non-controlling interest—temporary equity.

Wholly-Owned Facilities

For Wholly-Owned Facilities with profit sharing arrangements, an appropriate accrual is recorded for the amount of profit sharing due to the clinic partners/directors. The amount is expensed as compensation and included in clinic operating costs—salaries and related costs. The respective liability is included in current liabilities—accrued expenses on the consolidated balance sheets.

Industrial Injury Prevention Services

Services provided in the IIP segment include onsite injury prevention and rehabilitation, performance optimization, post offer employment testing, functional capacity evaluations, ergonomic assessments, occupational medicine testing services, and drug & alcohol testing. Other clients include large insurers and their contractors. The Company performs these services through industrial sports medicine professionals, consisting primarily of specialized certified athletic trainers.

Segment Financials

The Company, including its chief operating decision maker, the Chief Executive Officer, uses gross profit in its budget-to-actual, forecasting, and other analytical processes to assess segment performance and allocate resources.

The Company has provided additional information regarding its reportable segments which contributes to the understanding of the Company and provides useful information.


  
Three Months Ended
     Six Months Ended
  

 
June 30, 2026
    
June 30, 2025
     June 30, 2026     June 30, 2025  

  (In thousands)     (In thousands)  
Net revenue:                        
Physical therapy operations
   $ 182,355     $ 168,292     $ 350,030     $ 324,700  
Industrial injury prevention services
  
31,704       29,052       62,314       56,432  
Total Company
   $ 214,059     $ 197,344     $ 412,344     $ 381,132  
 
                                
Operating Costs:
                                
Salaries and related costs:
                                
Physical therapy operations
   $ 105,793     $ 95,668     $ 206,280     $ 189,241  
Industrial injury prevention services
     19,611       18,120       38,612       35,796  
Total salaries and related costs
   $ 125,404     $ 113,788     $ 244,892     $ 225,037  
Rent supplies, contract labor and other:
                                
Physical therapy operations
   $ 34,301     $ 29,826     $ 68,345     $ 59,925  
Industrial injury prevention services
     4,664       4,301       9,072       8,046  
Total rent, supplies, contract labor and other
   $ 38,965     $ 34,127     $ 77,417     $ 67,971  
Depreciation and amortization: *                                
Physical therapy operations   $ 4,680     $ 5,025     $ 9,429     $ 9,719  
Industrial injury prevention services     941       716       1,849       1,562  
Total depreciation and amortization
   $ 5,621     $ 5,741     $ 11,278     $ 11,281  
Provision for credit losses:
                                
Physical therapy operations
   $ 2,104     $ 1,980     $ 4,070     $ 3,821  
Industrial injury prevention services
     16       15       54       22  
Total provision for credit losses
   $ 2,120     $ 1,995     $ 4,124     $ 3,843  
Clinic closure costs:
                               
Physical therapy operations
  $ 6     $ 69     $ (62 )   $ 311  
Industrial injury prevention services
    -
       -
       -       -  
Total clinic closure costs
  $ 6     $ 69     $ (62 )   $ 311  
Total Company
   $ 172,116     $ 155,720     $ 337,649     $ 308,443  

                               
Gross profit:
                                
Physical therapy operations
   $ 35,471     $ 35,724     $ 61,968     $ 61,683  
Industrial injury prevention services
     6,472       5,900       12,727       11,006  
Total Company
   $ 41,943     $ 41,624     $ 74,695     $ 72,689  
                                 
Unallocated amounts                                
Corporate office costs   $ 19,005     $ 17,476     $ 37,279     $ 33,721  
Interest expense, debt and other     3,213       2,422       6,004       4,701  
Interest income from investments     (29 )     (28 )     (45 )     (52 )
Loss (gain) on change in fair value of contingent earn-out consideration     992       (790 )     2,989       (5,612 )
Change in revaluation of put-right liability     168       339       (195 )     743  
Equity in earnings of unconsolidated affiliate     (408 )     (401 )     (772 )     (794 )
Loss on sale of a partnership     -       -       -       123  
Loss on extinguishment of debt     124       -       124       -  
Other     (175 )     (47 )     (305 )     (122 )
Total unallocated amounts     22,890       18,971    
45,079    
32,708  
Income before taxes   $ 19,053     $ 22,653     $ 29,616     $ 39,981  

Assets:
  
June 30, 2026
    
December 31, 2025
  
Goodwill:
           
Physical therapy operations
   $ 613,813     $ 604,440  
Industrial injury prevention services
     102,722       87,952  
Total goodwil   $ 716,535     $ 692,392  
All other assets:                
Physical therapy operations   $ 447,800     $ 434,804  
Industrial injury prevention services     84,539       76,814  
Total all other assets     532,339       511,618  
Total Assets
   $ 1,248,874     $ 1,204,010  

*Amortization of certain intangible assets was reallocated between the physical therapy operations and IIP segments for the three and six months ended June 30, 2025 to conform with current presentation.