ATI Physical Therapy, Inc.

Good afternoon, and welcome to the ATI Physical Therapy's fourth quarter and full year 2023 earnings conference call and webcast. All participants will be in a listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. On the call today is Sharon Vitti, Chief Executive Officer, Joseph Jordan, Chief Financial Officer, Chris Cox, Chief Operating Officer, and Joanne Fong, Senior Vice President, Treasurer, and Head of Investor Relations. I will now turn the call over to Ms. Fong.

Thank you, Mundy. Good afternoon, everyone. Thank you for joining us today. Before we begin, I'd like to remind you that certain statements made during this call before looking statements that are subject to various risks and uncertainties and reflect the current expectations based on our beliefs, assumptions and information currently available to us. Although we believe these expectations are reasonable, we undertake no obligation to revise any statements or collect changes that occur after this call. Descriptions of some of the factors that cause after results of different material from these forward-looking statements can be found in the risk factors section in the company's filing to the Securities and Exchange Commission. In addition, please note that the company is discussing certain non-GAAP financial measures that we believe are important in valuing performance Details on relationships between these non-GAAP measures, the most comparable GAAP measures, and reconciliation of historical non-GAAP financial measures can be found in the earnings press release that's posted on the ETI's website and filed at SCC. So with that, I'd like to turn the call over to Sharon.

Thank you, Joanne, and welcome, everyone. In addition to Chris and Joe, we have the rest of our ELT on the call. We have Emily Tanzi, our Chief People Officer, Scott Gregerson, our Chief Growth Officer, Gus Oakes, our Chief Information Officer, and Eric Cantz, our Chief Legal Officer. As you may know, earlier today we reported our fourth quarter and full year 2023 results. 2023 was a reset year, and I'm very proud of our achievements. ATI staff exhibited strong teamwork across our national single brand platform. to bring our purpose to life in our local communities, expanding access to care and helping people live their healthiest life. Our team implemented deliberate strategies to deliver meaningful quarter-over-quarter growth, allowing us to exceed our revenue targets and our 2023 guidance. was a year when we implemented many winning strategies, including strengthening the HVI culture, growing the provider base, elevating talent and creating development opportunities for our employees, expanding access for patients, advancing clinic operations, enhancing the patient experience, all resulting in improved financial and key KPI performance. I'm going to double down on a few areas that were highlights of 2023, starting with the demand for ATI services. It was exceptionally strong in 2023, and we saw an all-time high in ATI's history of referrals per day. And referrals continue to be robust into 2024. In 2023, the rate per visit increased by $3.30 over the previous year. And so as we look at this, there are two contributing factors. One, payer rate increases, coupled with operational improvements in our revenue cycle management. The HR and ops teams work together. to allow us to see 390,000 more patient visits in 2023 compared to 2022. The labor market continues to remain tight. And in 2023, Emily Tansey, our Chief People Officer, led our HR teams to successfully grow the number of clinical FTEs year over year and significantly reduce turnover to a more normalized level, creating stability in our clinics. Chris Cox, our COO, led the team's focus on reducing administrative burdens and improving processes in the clinic, allowing our providers to see more visits per day per clinical FTE in 2023, achieving a historic high watermark. On our clinic footprint, we opened 13 de novo clinics and closed or divested 40 clinics for performance reasons. 2024 will be a year of investing in our current fleet with necessary upgrades, expansion, and consolidations, coupled with opening a limited number of new clinics. Now, our long-term goal is to grow the footprint while continuously monitoring local markets and clinic performance. Overall, we are focused on capitalizing on the momentum achieved in 2023 and with people in operations to continue growing ATI's capacity in 2024. Our people are what set us apart from our competitors. Through all the changes in the market and within the company in the past few years, our team's commitment to our care excellence has grown. Hearing from our patients is a critical part of feedback. In 2023, we refined our patient survey processes during the year to gain additional insights in our patient experiences. We anticipate sharing this new improved customer satisfaction KPI later this year in 2024. Our clinical quality remains exceptional. As previously reported in 2023, ATI achieved an exceptional rating in patient quality from the Center for Medicare and Medicaid Services MIPS program for the fourth consecutive year. basically every year since the program's inception for physical therapy providers. In 2024, ATI will again receive a bonus payment to help offset the CMS fee schedule cuts in 2024. Another area of excellence is the launch earlier this month of the Institute for Musculoskeletal Advancement. The purpose of the institute is is to advance scientific research and to enhance the quality of musculoskeletal clinical care. The Institute for Musculoskeletal Advancement will create new opportunities for our colleagues to get involved with teaching, research, and influencing policy. It is a top priority in 2024. In 2023, the operations team completed numerous process improvements and technology implementations. Chris will provide a detailed discussion of those operational initiatives and performance later during the call. I do want to call out two areas. The operations team drove increased clinic utilization every quarter over quarter during the year. And in the fourth quarter drove the highest visits per clinic since the start of COVID in 2022. Our clinicians were highly productive throughout 2023 spending more time treating patients than the prior year, with each clinical FTE in 2023 seeing a historically high visits per day of 9.4. The strong demand for ATI services combined with the progress we made in the business resulted in the company feeding our 2023 revenue and adjusted EBITDA guidance. Shortly, Joe will provide a detailed walkthrough of Q4 in full 2023 financial results and share Q1 2024 expectations. Worth noting is our continuous progress in 2023 to increase revenue every quarter from the prior sequential quarter, with ATI's Q4 2023 revenue back to levels when the pandemic started in 2021. In 2024, we have kicked off the year implementing numerous strategies to extend the progress we made in 2023. It goes without saying we have incredible teams at ATI that are making a difference in the lives of our patients and communities every day. I have tremendous gratitude for our talented teams, dedicated clinicians, and leaders who emotionally invest and are passionate about enriching the lives of our colleagues, patients, and communities. Big congratulations to the entire ATI team for showing everyone the real ATI. With that, I will turn the call over to Chris to discuss operations.