Ensign the Energizer Bunny, our pet name for several years now for one of two publicly traded companies that continue to make a GAAP profit, quarter after quarter, did it again. And they did it during what could have been a disruptive third quarter when they spun out their senior living operations and home health and hospice business into The Pennant Group. Obviously, it was not disruptive.
To sum up some of the key numbers, there was a 33% year-over-year quarterly increase in income from operations, plus a 36% increase in net income to $27.8 million. This is after rent, depreciation and interest, or in other words, the real thing. And, net income per share increased by 25% year over year. You are not seeing this anywhere else in our industry.
Sure, you might say, acquisitions help push growth, and Ensign does a lot of acquisitions each quarter. But its same-facility skilled nursing revenues increased 7.4% compared to last year’s third quarter, patient days increased by 3.3%, occupancy jumped by 210 basis points, and the skilled mix increased by 60 basis points. And this is in the beleaguered skilled nursing business.
The company also has 33 properties that they refer to as “transitioning facilities,” and these have been purchased between January 1, 2016 and December 31, 2017. Remember, most of Ensign’s acquisitions are turnarounds, at least from an occupancy perspective. Year over year, revenues at these 33 facilities increased by 11.2%, patient days increased by 3.6% and occupancy by 240 basis points, and the skilled mix increased by 110 basis points. Landlord CareTrust REIT must be smiling. Shareholders are definitely smiling. Competitors should be studying.
