Surgery Partners, Inc.

Good morning, ladies and gentlemen, and welcome to Surgery Partners' third quarter of 2023 earnings call. Currently, all participants are in listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press start at zero on your telephone keypad. Please note, this conference is being recorded. It is now my pleasure to hand you over to Chief Financial Officer, Dave Daugherty. Please go ahead, sir.

Good morning. My name is Dave Daugherty, CFO of Surgery Partners, and I'm here with our CEO, Eric Evans, and our Executive Chairman, Wayne Devite. Thank you for joining us for our third quarter 2023 earnings announcement. During our call, we will make forward-looking statements. There are risk factors that could cause future results to be materially different from these statements. These risk factors are described in this morning's press release and the reports we filed with the SEC, each of which are available on our website at surgerypartners.com. The company does not undertake any duty to update these forward-looking statements. In addition, we will reference certain financial measures that are considered non-GAAP, which we believe can be useful in evaluating our performance. The presentation of this information should not be considered in isolation or as a substitute for results prepared in accordance with GAAP. These measures are reconciled to the most applicable GAAP measure in this morning's press release. With that, I'll turn the call over to Wayne. Wayne?

Thank you, Dave. Good morning, and thank you all for joining us today. We are pleased to report another quarter of consistent growth in revenue and adjusted EBITDA, exceeding our prior guidance. Including our non-consolidating facilities, we performed over 172,000 surgical cases this quarter. When adjusted for divested facilities and factoring in one less business day, this was nearly 6% more than 2022. Other than the impact of Hurricane Idalia, which marginally impacted our Florida and Georgia facilities mid-quarter, we did not experience any pressure from external factors as we continue to produce steady, predictable growth in our key growth areas. This strong case growth, combined with increased acuity and contributions from recent acquisitions, generated $674.1 million of net revenue and $105.5 million of adjusted EBITDA, resulting in a 15.7% margin. Dave will share more details regarding our financial results, but let me highlight a few. Net revenue of $674.1 million was almost 9% more than the prior year, with same facility revenue growth in excess of 14% in the quarter. On a year-to-date basis, same facility revenue growth was nearly 11%. Adjusted EBITDA was $105.5 million, representing nearly 10% growth over the prior year quarter and a 14% on a year-to-date basis. Adjusted EBITDA margins improved 70 basis points sequentially to 15.7% as compared to the prior quarter. Finally, We completed the acquisition of two additional short-stay surgical facilities in the quarter and have deployed approximately $135 million year-to-date. The pipeline of future acquisitions is robust, which allows us to be highly selective and remain disciplined in our acquisition strategy. Specifically, we have well over $200 million currently under LOI and a significant number of additional opportunities in early conversations. We continue to be pleased with our balanced approach to growth, with all pillars of our long-term growth algorithm either meeting or exceeding our expectations. Based on the strength of our third quarter results and our continued positive outlook on our numerous investments in the business, we are raising our four-year adjusted EBITDA guidance to a range of $436 to $440 million, with approximately $2.75 billion in consolidated revenue. Dave will discuss our guidance in more detail later in the call. With that, let me turn the call over to Eric to highlight some of our operational initiatives and recent investment activities. Eric? Thanks, Wayne, and good morning, everyone.