Pennant Group, Inc.
For the period ended Sep 30, 2025. Filed Nov 5, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 5, 2025
PNTG$36.36-9.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-06.
0001766400-25-000103
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-05.
0001766400-25-000139
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 169 previous paragraphs and 170 current paragraphs.
128 unchanged; 36 reworded; 6 added; 4 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 33 previous and 33 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (6)
Current report
•results at start-up operations;
Current report
•acquisition related costs;
Current report
General and Administrative Expense. Our general and administrative expense increased $6.3 million, or 48.2%, from $13.0 million to $19.3 million for the three months ended September 30, 2025 when compared to the three months ended September 30, 2024. General and administrative expense as a percentage of revenue increased 120 basis points from 7.2% to
Current report
Nine Months Ended September 30, 2025 Compared to the Nine Months Ended September 30, 2024
Current report
On November 3, 2025, the Company entered into the First Amendment to the Amended Credit Agreement (“Amendment”), which establishes an incremental term loan with an aggregate principal amount of $100,000. The incremental term loan constitutes a term loan under, and is subject to the terms and provisions of, the Amended Credit Agreement, including bearing interest at the same interest rate, and having the same maturity date. The Company used the proceeds of the incremental term loan to refinance a portion of the outstanding revolving loans under the Amended Credit Agreement and to pay fees and expenses incurred in connection with the Amendment. The lender group remains unchanged.
Current report
Nine Months Ended September 30, 2025 Compared to the Nine Months Ended September 30, 2024
Removed paragraphs (4)
Previous report
•costs at start-up operations;
Previous report
•acquisition related costs and credit allowances;
Previous report
Six Months Ended June 30, 2025 Compared to the Six Months Ended June 30, 2024
Previous report
Six Months Ended June 30, 2025 Compared to the Six Months Ended June 30, 2024
Reworded paragraphs (36)
Previous wording
We are a leading provider of high-quality healthcare services to patients and residents of all ages, including the growing senior population, in the United States. We strive to be the provider of choice in the communities we serve through our innovative operating model. We operate in multiple lines of businesses including home health, hospice and senior living services across Arizona, California, Colorado, Idaho, Montana, Nevada, Oklahoma, Oregon, Texas, Utah, Washington, Wisconsin and Wyoming. We also provide home health and hospice operational support through a management service agreement in Connecticut. As of June 30, 2025, our home health and hospice business provided home health, hospice and home care services from 137 agencies operating across these 13 states, and our senior living business operated 61 senior living communities throughout seven states.
Current wording
We are a leading provider of high-quality healthcare services to patients and residents of all ages, including the growing senior population, in the United States. We strive to be the provider of choice in the communities we serve through our innovative operating model. We operate in multiple lines of businesses including home health, hospice and senior living services across Arizona, California, Colorado, Idaho, Montana, Nevada, Oklahoma, Oregon, Texas, Utah, Washington, Wisconsin and Wyoming. We also provide home health and hospice operational support through a management service agreement in Connecticut. As of September 30, 2025, our home health and hospice business provided home health, hospice and home care services from 141 agencies operating across these 13 states, and our senior living business operated 61 senior living communities throughout seven states.
Previous wording
Acquisitions. During the six months ended June 30, 2025, we expanded our operations with the addition of five home health agencies, four hospice agencies, and four senior living communities. A subsidiary of the Company entered into a separate operations transfer agreement with the prior operator of each acquired operation as part of each transaction.
Current wording
Acquisitions. During the nine months ended September 30, 2025, we expanded our operations with the addition of nine home health agencies, four hospice agencies, and four senior living communities. A subsidiary of the Company entered into a separate operations transfer agreement with the prior operator of each acquired operation as part of each transaction.
Previous wording
We have experienced improvement in senior living revenue per occupied unit during the six months ended June 30, 2025, compared to the same period in 2024. Though we have seen improvements in revenue per occupied unit year over year, the highly competitive environment for senior living residents and inflationary factors will continue to impact the rate at which our revenue per occupied unit changes in our senior living communities.
Current wording
We have experienced improvement in senior living revenue per occupied unit and occupancy during the nine months ended September 30, 2025, compared to the same period in 2024. Though we have seen improvements in revenue per occupied unit and occupancy year over year, the highly competitive environment for senior living residents and inflationary factors will continue to impact the rate at which our revenue per occupied unit changes in our senior living communities.
Previous wording
On June 30, 2025, CMS issued the Calendar Year (“CY”) 2026 Home Health Prospective Payment System (the “HH Payment Proposed Rule”). The 2026 HH Payment Proposed Rule includes several changes that, if finalized, could materially impact reimbursement for home health providers. The HH Payment Proposed Rule’s net payment update percentage is -6.4%, which would result in an aggregate estimated decrease across all home health providers of $1.135 billion in payments compared to fiscal year 2025. The payment update percentage includes a market basket update of 2.4%, a permanent behavior adjustment of -3.7%, a temporary payment adjustment of -4.6%, and a -0.5% update to the fixed dollar loss ratio. These adjustments are intended to account for differences between assumed and actual provider behavior changes since the PDGM’s implementation in 2020, as required by the Bipartisan Budget Act of 2018. The HH Payment Proposed Rule also proposes changes to the regulations governing home health face-to-face visits, which would allow physicians, in addition to other professionals, to perform the face-to-face encounter regardless of whether they are the certifying practitioner or whether they previously cared for the patient. In addition, CMS proposes to recalibrate case-mix weights, adjust certain items relating to the home health quality reporting program, and revise certain measures included in the home health value-based purchasing model.
Current wording
On June 30, 2025, CMS issued the Calendar Year (“CY”) 2026 Home Health Prospective Payment System proposed rule (the “HH Payment Proposed Rule”). The 2026 HH Payment Proposed Rule includes several changes that, if finalized, could materially impact reimbursement for home health providers. The HH Payment Proposed Rule’s net payment update percentage is -6.4%, which would result in an aggregate estimated decrease across all home health providers of $1.135 billion in payments compared to fiscal year 2025. The payment update percentage includes a market basket update of 2.4%, a permanent behavior adjustment of -3.7%, a temporary payment adjustment of -4.6%, and a -0.5% update to the fixed dollar loss ratio. These adjustments are intended, in part, to account for differences between assumed and actual provider behavior changes since the PDGM’s implementation in 2020, as required by the Bipartisan Budget Act of 2018. The HH Payment Proposed Rule also proposes changes to the regulations governing home health face-to-face visits, which would allow physicians, in addition to other professionals, to perform the face-to-face encounter regardless of whether they are the certifying practitioner or whether they previously cared for the patient. In addition, CMS proposes to recalibrate case-mix weights, adjust certain items relating to the home health quality reporting program, and revise certain measures included in the home health value-based purchasing model.
Previous wording
On August 1, 2025, CMS issued the 2026 Hospice Wage Index and Payment Rate Update final rule (the “Hospice Payment Final Rule”). The Hospice Payment Final Rule’s payment update percentage is 2.6%, which is an estimated increase of $750 million in payments from fiscal year 2025 in the aggregate across all hospice providers. The payment update percentage is based on a 3.3% market basket percentage increase, which is reduced by a 0.7% productivity adjustment. The Hospice Payment Final Rule clarifies that the physician member of a hospice’s interdisciplinary group may recommend admission to hospice care, which aligns certification regulations with the hospice conditions of participation. In addition, the Hospice Payment Final Rule updates the statutory aggregate cap that limits the overall payments per patient that may be made to a hospice annually. The hospice cap amount for the 2026 fiscal year is $35,361.44, increased from the 2025 fiscal year cap of $34,465.34.
Current wording
On August 1, 2025, CMS issued the 2026 Hospice Wage Index and Payment Rate Update final rule (the “Hospice Payment Final Rule”) with changes effective October 1, 2025. The Hospice Payment Final Rule’s payment update percentage is 2.6%, which is an estimated increase of $750 million in payments from fiscal year 2025 in the aggregate across all hospice providers. The payment update percentage is based on a 3.3% market basket percentage increase, which is reduced by a 0.7% productivity adjustment. The Hospice Payment Final Rule clarifies that the physician member of a hospice’s interdisciplinary group may recommend admission to hospice care, which aligns certification regulations with the hospice conditions of participation. In addition, the Hospice Payment Final Rule updates the statutory aggregate cap that limits the overall payments per patient that may be made to a hospice annually. The hospice cap amount for the 2026 fiscal year is $35,361.44, increased by 2.6% from the 2025 fiscal year cap of $34,465.34.
Previous wording
On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was signed into law, which enacts significant reforms to the Medicaid program that may indirectly impact the Company’s operations. These changes include mandatory work requirements for certain adult beneficiaries, expanded cost-sharing obligations, and reductions to provider tax funding. As a result, states may experience reduced federal Medicaid funding, which could lead to changes in Medicaid eligibility and benefit design and result in potential reductions or delays in reimbursement for Medicaid-covered services our independent subsidiaries provide. The Company’s independent subsidiaries that serve Medicaid or dual-eligible beneficiaries may be affected by these policy changes, particularly in states with high Medicaid utilization.
Current wording
On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was signed into law, which enacts significant reforms to the Medicaid program that may indirectly impact the Company’s operations. These changes include mandatory work requirements for certain adult beneficiaries, expanded cost-sharing obligations, and reductions to provider tax funding. As a result, states may experience reduced federal Medicaid funding, which could lead to changes in Medicaid eligibility and benefit design and result in potential reductions or delays in reimbursement for Medicaid-covered services our independent subsidiaries provide. The Company’s independent subsidiaries that serve Medicaid or dual-eligible beneficiaries may be affected by these policy changes, particularly in states with high Medicaid utilization. In addition, the OBBBA may impact state budgets due to reduced federal Medicaid contributions as a result of the OBBBA. Some states where the Company provides services have taken actions to address the OBBBA. For example, California signed S.B. 105 into law on September 17, 2025, which is a comprehensive budget bill for the state’s fiscal year 2025 - 2026 and contains specific allocation of funds for the state’s Medicaid program, Medi-Cal, to align with the OBBBA. Other states may take similar actions to address the OBBBA which can further affect the Company’s operations.
Previous wording
The following table presents our consolidated GAAP Financial measures for the three and six months ended June 30, 2025 and 2024:
Current wording
The following table presents our consolidated GAAP Financial measures for the three and nine months ended September 30, 2025 and 2024:
Previous wording
We calculate Consolidated EBITDA as net income, adjusted for net income (loss) attributable to noncontrolling interest, before (a) interest expense (b) provision for income taxes and (c) depreciation and amortization.
Current wording
We calculate Consolidated EBITDA as net income, adjusted for net income attributable to noncontrolling interest, before (a) interest expense (b) provision for income taxes and (c) depreciation and amortization.
Previous wording
•costs associated with transitioning operations; and
Current wording
•activities associated with transitioning operations; and
Previous wording
Our total revenue increased $50.8 million, or 30.1%, during the three months ended June 30, 2025. We experienced growth of $40.7 million from increased operational performance in our Home Health and Hospice segment from increased admissions and census, in part driven by newly acquired agencies when compared to the three months ended June 30, 2024. The growth in our Senior Living segment resulted in an increase in revenue of $10.0 million driven by acquired senior living communities and an improved average rate per occupied room.
Current wording
Our total revenue increased $48.4 million, or 26.8%, during the three months ended September 30, 2025. We experienced growth of $37.9 million from increased operational performance in our Home Health and Hospice segment from increased admissions and census, in part driven by newly acquired agencies when compared to the three months ended September 30, 2024. The growth in our Senior Living segment resulted in an increase in revenue of $10.5 million driven by acquired senior living communities and an improved average rate per occupied room and improved occupancy.
Previous wording
Home health and hospice revenue increased $40.7 million, or 32.5%, for the three months ended June 30, 2025 compared to the prior year quarter. Revenue grew due to an increase in certain key performance indicators, including an increase of 26.1% in total home health admissions, an increase in total hospice admissions of 14.7%, and an increase in average daily hospice census of 21.4% during the three months ended June 30, 2025 compared to the prior year quarter. Growth was also driven by the addition of twenty home health and hospice operations between June 30, 2024 and June 30, 2025. Agencies acquired during calendar year 2024 and year-to-date June 30, 2025 drove an increase in revenue of $29.5 million, representing a 23.5% increase compared to the prior year quarter.
Current wording
Home health and hospice revenue increased $37.9 million, or 27.9%, for the three months ended September 30, 2025 compared to the prior year quarter. Revenue grew due to an increase in certain key performance indicators, including an increase of 36.2% in total home health admissions, an increase in total hospice admissions of 16.6%, and an increase in average daily hospice census of 17.4% during the three months ended September 30, 2025 compared to the prior year quarter. Growth was also driven by the addition of nineteen home health and hospice operations between September 30, 2024 and September 30, 2025. Agencies acquired during calendar year 2024 and year-to-date September 30, 2025 drove an increase in revenue of $25.3 million, representing an 18.7% increase compared to the prior year quarter.
Previous wording
Senior living revenue increased $10.0 million, or 23.1%, for the three months ended June 30, 2025 compared to the prior year quarter. Revenue grew due to a 8.3% increase in average monthly revenue per occupied unit between June 30, 2024 and June 30, 2025. Growth was also driven by the addition of seven senior living communities between June 30, 2024 and June 30, 2025. Communities acquired during calendar year 2024 and year-to-date June 30, 2025 drove an increase in revenue of $6.4 million, representing a 14.6% increase compared to the prior year quarter.
Current wording
Senior living revenue increased $10.5 million, or 23.2%, for the three months ended September 30, 2025 compared to the prior year quarter. Revenue grew due to a 7.4% increase in average monthly revenue per occupied unit and an increase of 180 basis points in occupancy between September 30, 2024 and September 30, 2025. Growth was also driven by the addition of seven senior living communities between September 30, 2024 and September 30, 2025. Communities acquired during calendar year 2024 and year-to-date September 30, 2025 drove an increase in revenue of $6.6 million, representing a 14.7% increase compared to the prior year quarter.
Previous wording
Total consolidated cost of services increased $42.0 million, or 31.0%, for the three months ended June 30, 2025 when compared to the three months ended June 30, 2024. Cost of services as a percentage of revenue increased by 60 basis points from 80.2% to 80.8% for the three months ended June 30, 2025 when compared to the three months ended June 30, 2024.
Current wording
Total consolidated cost of services increased $41.0 million, or 28.4%, for the three months ended September 30, 2025 when compared to the three months ended September 30, 2024. Cost of services as a percentage of revenue increased by 100 basis points from 80.0% to 81.0% for the three months ended September 30, 2025 when compared to the three months ended September 30, 2024.
Previous wording
Cost of services related to our Home Health and Hospice Services segment increased $33.8 million, or 32.3%, primarily due to increased volume of services provided. Cost of services as a percentage of revenue for the three months ended June 30, 2025 decreased 10 basis points when compared to the three months ended June 30, 2024.
Current wording
Cost of services related to our Home Health and Hospice Services segment increased $32.3 million, or 28.7%, primarily due to increased volume of services provided. Cost of services as a percentage of revenue for the three months ended September 30, 2025 increased 50 basis points when compared to the three months ended September 30, 2024.
Previous wording
Cost of services related to our Senior Living Services segment increased $8.2 million, or 26.7%, primarily due to increased wages and benefits and acquisition activity. As a percentage of revenue, costs of service increased by 210 basis points for the three months ended June 30, 2025 when compared to the three months ended June 30, 2024 primarily due to decreases in state relief funding.
Current wording
Cost of services related to our Senior Living Services segment increased $8.6 million, or 27.1%, primarily due to increased wages and benefits and acquisition activity. As a percentage of revenue, costs of service increased by 220 basis points for the three months ended September 30, 2025 when compared to the three months ended September 30, 2024 primarily due to decreases in state relief funding.
Previous wording
Rent—Cost of Services. Rent expense increased 13.3% from $10.5 million to $11.9 million in the three months ended June 30, 2025 when compared to the three months ended June 30, 2024, primarily as a result of the new leases on the acquired home health and hospice operations and senior living communities. Rent as a percentage of total revenue decreased 80 basis points from 6.2% for the three months ended June 30, 2024, compared to 5.4% for the three months ended June 30, 2025.
Current wording
Rent—Cost of Services. Rent expense increased 10.6% from $10.9 million to $12.1 million in the three months ended September 30, 2025 when compared to the three months ended September 30, 2024, primarily as a result of the new leases related to the acquired home health and hospice operations and senior living communities. Rent as a percentage of total revenue decreased 70 basis points from 6.0% for the three months ended September 30, 2024, compared to 5.3% for the three months ended September 30, 2025.
Previous wording
General and Administrative Expense. Our general and administrative expense increased $5.7 million, or 48.1%, from $11.9 million to $17.6 million for the three months ended June 30, 2025 when compared to the three months ended June 30, 2024. General and administrative expense as a percentage of revenue increased 100 basis points from 7.0% to 8.0% during the period. The primary driver of the increase in general and administrative expense was due to an increase in payroll and related benefits and an increase in professional services related to acquisition activities for the three months ended June 30, 2025 when compared to the three months ended June 30, 2024.
Current wording
8.4% during the period. The primary driver of the increase in general and administrative expense was due to an increase in payroll and related benefits and an increase in professional services related to acquisition activities for the three months ended September 30, 2025 when compared to the three months ended September 30, 2024.
Previous wording
Depreciation and Amortization. Depreciation and amortization expense increased $0.8 million, or 51.5%, from $1.5 million to $2.2 million for the three months ended June 30, 2025 when compared to the three months ended June 30, 2024. The increase in depreciation and amortization was due to the increase in overall property and equipment, net balances driven in part by acquisition activity.
Current wording
Depreciation and Amortization. Depreciation and amortization expense increased $0.6 million, or 38.2%, from $1.5 million to $2.1 million for the three months ended September 30, 2025 when compared to the three months ended September 30, 2024. The increase in depreciation and amortization was due to the increase in overall property and equipment, net balances driven in part by acquisition activity.
Previous wording
Provision for Income Taxes. We recorded income tax expense of $2.6 million and $1.8 million, or 24.6% and 23.2% of earnings before income taxes, for the three months ended June 30, 2025 and 2024, respectively. The increase in the effective tax rate is primarily due to having more compensation subject to IRC Section 162(m).
Current wording
Provision for Income Taxes. We recorded income tax expense of $2.5 million and $1.4 million, or 26.8% and 16.9% of earnings before income taxes, for the three months ended September 30, 2025 and 2024, respectively. The increase in the effective tax rate is primarily due to having more compensation subject to IRC Section 162(m) and less excess tax benefits on equity compensation.
Previous wording
Our total revenue increased $103.7 million, or 31.8%, during the six months ended June 30, 2025. We experienced growth of $84.1 million from increased operational performance in our Home Health and Hospice segment from increased admissions and census, in part driven by newly acquired agencies when compared to the three months ended June 30, 2024. The growth in our Senior Living segment resulted in an increase in revenue of $19.6 million driven by acquired senior living communities and an improved average rate per occupied room.
Current wording
Our total revenue increased $152.0 million, or 30.0%, during the nine months ended September 30, 2025. We experienced growth of $122.0 million from increased operational performance in our Home Health and Hospice segment from increased admissions and census, in part driven by newly acquired agencies when compared to the nine months ended September 30, 2024. The growth in our Senior Living segment resulted in an increase in revenue of $30.0 million driven by acquired senior living communities and an improved average rate per occupied room.
Previous wording
Home health and hospice revenue increased $84.1 million, or 34.8%, during the six months ended June 30, 2025 compared to the same period in the prior year primarily due to an increase of 27.5% in home health admissions, inclusive of an increase in total Medicare home health admissions of 20.6%, an increase in hospice average daily census of 24.6%, and an increase of 18.8% in hospice admissions. Growth was also driven by the addition of twenty home health and hospice operations between June 30, 2024 and June 30, 2025. Agencies acquired during calendar year 2024 and year-to-date June 30, 2025 drove an increase in revenue of $60.4 million, representing a 25.0% increase compared to the same period in the prior year.
Current wording
Home health and hospice revenue increased $122.0 million, or 32.3%, during the nine months ended September 30, 2025 compared to the same period in the prior year primarily due to an increase of 30.5% in home health admissions, inclusive of an increase in total Medicare home health admissions of 25.6%, an increase in hospice average daily census of 22.0%, and an increase of 18.1% in hospice admissions. Growth was also driven by the addition of nineteen home health and hospice operations between September 30, 2024 and September 30, 2025. Agencies acquired during calendar year 2024 and year-to-date September 30, 2025 drove an increase in revenue of $85.7 million, representing a 22.7% increase compared to the same period in the prior year.
Previous wording
Senior living revenue increased $19.6 million, or 23.4%, for the six months ended June 30, 2025 compared to the same period in the prior year primarily due to an increase of 9.2% in average monthly revenue per occupied unit between June 30, 2024 and June 30, 2025. Growth was also driven by the addition of seven senior living communities between June 30, 2024 and June 30, 2025. Communities acquired during calendar year 2024 and year-to-date June 30, 2025 drove and increase in revenue of $12.4 million, representing a 14.8% increase compared to the same period in the prior year.
Current wording
Senior living revenue increased $30.0 million, or 23.3%, for the nine months ended September 30, 2025 compared to the same period in the prior year primarily due to an increase of 8.9% in average monthly revenue per occupied unit between September 30, 2024 and September 30, 2025. Growth was also driven by the addition of seven senior living communities between September 30, 2024 and September 30, 2025. Communities acquired during calendar year 2024 and year-to-date September 30, 2025 drove and increase in revenue of $19.0 million, representing a 14.7% increase compared to the same period in the prior year.
Previous wording
Consolidated cost of services increased $84.7 million, or 32.4%, during the six months ended June 30, 2025 compared to the same period in the prior year. Cost of services as a percentage of revenue for the six months ended June 30, 2025 increased by 40 basis points to 80.6% from 80.2% compared to the six months ended June 30, 2024.
Current wording
Consolidated cost of services increased $125.7 million, or 31.0%, during the nine months ended September 30, 2025 compared to the same period in the prior year. Cost of services as a percentage of revenue for the nine months ended September 30, 2025 increased by 70 basis points to 80.8% from 80.1% compared to the nine months ended September 30, 2024.
Previous wording
Cost of services related to our Home Health and Hospice services segment increased $69.2 million, or 34.3%, compared to the same period in the prior year primarily due to the increased volume of services from the growth in admissions and average daily census. Cost of services as a percentage of revenue for the six months ended June 30, 2025 decreased by 30 basis points compared to the six months ended June 30, 2024.
Current wording
Cost of services related to our Home Health and Hospice services segment increased $101.5 million, or 32.3%, compared to the same period in the prior year primarily due to the increased volume of services from the growth in admissions and average daily census. Cost of services as a percentage of revenue for the nine months ended September 30, 2025 increased by 0 basis points compared to the nine months ended September 30, 2024.
Previous wording
Cost of services related to our Senior Living services segment increased $15.5 million, or 26.1%, during the six months ended June 30, 2025 compared to the same period in the prior year primarily due to increased wages and benefits and acquisition activity. As a percentage of revenue, costs of service increased by 160 basis points during the six months ended June 30, 2025 when compared to the six months ended June 30, 2024 primarily due to decreases in state relief funding.
Current wording
Cost of services related to our Senior Living services segment increased $24.2 million, or 26.4%, during the nine months ended September 30, 2025 compared to the same period in the prior year primarily due to increased wages and benefits and acquisition activity. As a percentage of revenue, costs of service increased by 180 basis points during the nine months ended September 30, 2025 when compared to the nine months ended September 30, 2024 primarily due to decreases in state relief funding.
Previous wording
Rent—Cost of Services. Rent increased 13.1% from $20.9 million to $23.6 million during the six months ended June 30, 2025 compared to the same period in the prior year, primarily as a result of the new leases on the acquired home health and hospice operations and senior living communities. As a percentage of revenue, rent—cost of services decreased 90 basis points when compared to the six months ended June 30, 2024.
Current wording
Rent—Cost of Services. Rent increased 12.2% from $31.8 million to $35.7 million during the nine months ended September 30, 2025 compared to the same period in the prior year, primarily as a result of the new leases related to the acquired home health and hospice operations and senior living communities. As a percentage of revenue, rent—cost of services decreased 90 basis points when compared to the nine months ended September 30, 2024.
Previous wording
General and Administrative Expense. Our general and administrative expense increased $9.1 million, or 39.1%, from $23.3 million to $32.4 million for the six months ended June 30, 2025 when compared to the six months ended June 30, 2024. The increase in general and administrative expense was due to an increase in payroll and related benefits and an increase in professional services related to acquisition activities for the six months ended June 30, 2025 when compared to the six months ended June 30, 2024.
Current wording
General and Administrative Expense. Our general and administrative expense increased $15.4 million, or 42.4%, from $36.3 million to $51.7 million for the nine months ended September 30, 2025 when compared to the nine months ended September 30, 2024. The increase in general and administrative expense was due to an increase in payroll and related benefits and an increase in professional services related to acquisition activities for the nine months ended September 30, 2025 when compared to the nine months ended September 30, 2024.
Previous wording
Depreciation and Amortization. Depreciation and amortization expense increased $1.3 million, or 47.1%, from $2.8 million to $4.1 million for the six months ended June 30, 2025 when compared to the six months ended June 30, 2024. The increase in depreciation and amortization was due to the increase in overall property and equipment, net balances driven in part by acquisition activity.
Current wording
Depreciation and Amortization. Depreciation and amortization expense increased $1.9 million, or 44.0%, from $4.3 million to $6.2 million for the nine months ended September 30, 2025 when compared to the nine months ended September 30, 2024. The increase in depreciation and amortization was due to the increase in overall property and equipment, net balances driven in part by acquisition activity.
Previous wording
Gain on disposition of property and equipment, net. We recorded a net gain of $1.0 million primarily due to insurance proceeds received in excess of the carrying values of related assets during the six months ended June 30, 2025. We recorded a gain of $0.8 million for insurance proceeds received in excess of the carrying values of related assets during the six months ended June 30, 2024.
Current wording
Gain on disposition of property and equipment, net. We recorded a net gain of $1.1 million primarily due to insurance proceeds received in excess of the carrying values of related assets during the nine months ended September 30, 2025. We recorded a gain of $0.8 million for insurance proceeds received in excess of the carrying values of related assets during the nine months ended September 30, 2024.
Previous wording
Provision for Income Taxes. We recorded income tax expense of $5.5 million and $3.6 million, or 24.8% and 24.4% of earnings before income taxes, for the six months ended June 30, 2025 and 2024, respectively. The increase in the effective tax rate is primarily due to having more compensation subject to IRC Section 162(m).
Current wording
Provision for Income Taxes. We recorded income tax expense of $8.0 million and $5.0 million, or 25.4% and 21.8% of earnings before income taxes, for the nine months ended September 30, 2025 and 2024, respectively. The increase in the effective tax rate is primarily due to having more compensation subject to IRC Section 162(m) and less excess tax benefits on equity compensation.
Previous wording
Our primary sources of liquidity are net cash provided by operating activities and borrowings under our Revolving Credit Facility.
Current wording
Our primary sources of liquidity are net cash provided by operating activities and borrowings under our Amended Revolving Credit Facility.
Previous wording
As of June 30, 2025, we had $14.4 million of cash and $208.8 million of available borrowing capacity on our Amended Revolving Credit Facility.
Current wording
As of September 30, 2025, we had $2.3 million of cash and $219.8 million of available borrowing capacity on our Amended Revolving Credit Facility.
Previous wording
Our net cash flow from operating activities for the six months ended June 30, 2025 increased by $2.4 million when compared to the six months ended June 30, 2024. The primary driver of this difference was an increase in net income of $5.4 million and an increase of $2.1 million in non-cash expenses, partially offset by a decrease in cash flows from the change in operating assets and liabilities of $5.0 million, net.
Current wording
Our net cash flow from operating activities for the nine months ended September 30, 2025 increased by $8.6 million when compared to the nine months ended September 30, 2024. The primary driver of this difference was an increase in net income of $5.6 million, an increase of $1.2 million in non-cash expenses, and an increase in cash flows from the change in operating assets and liabilities of $1.8 million, net.
Previous wording
Our net cash used in investing activities for the six months ended June 30, 2025 increased by $27.1 million compared to the six months ended June 30, 2024, primarily driven by an increase in business and asset acquisitions.
Current wording
Our net cash used in investing activities for the nine months ended September 30, 2025 increased by $8.7 million compared to the nine months ended September 30, 2024, primarily driven by an increase in business acquisitions.
Previous wording
Our net cash provided by financing activities increased by approximately $17.9 million for the six months ended June 30, 2025 compared to the six months ended June 30, 2024. The increase was primarily due to a net increase in the balance on our line of credit during the six months ended June 30, 2025 compared to the six months ended June 30, 2024.
Current wording
Our net cash provided by financing activities decreased by approximately $20.3 million for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decrease was primarily due to a net decrease in the balance on our line of credit during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024.
Previous wording
We continue to make draws and payments on our Revolving Credit Facility, as described in Note 11, Debt, to the Interim Financial Statements in Part I of this Quarterly Report. Additionally, we have right-of-use assets obtained in exchange for new operating lease obligations, as described in the supplemental disclosures of cash flow information in the Condensed Consolidated Statement of Cash Flows and in Note 13, Leases, to the Interim Financial Statements in Part I of this Quarterly Report.
Current wording
We continue to make draws and payments on our Amended Revolving Credit Facility, as described in Note 11, Debt, to the Interim Financial Statements in Part I of this Quarterly Report. Additionally, we have right-of-use assets obtained in exchange for new operating lease obligations, as described in the supplemental disclosures of cash flow information in the Condensed Consolidated Statement of Cash Flows and in Note 13, Leases, to the Interim Financial Statements in Part I of this Quarterly Report.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Gain on disposition of property and equipment, net. We recorded a net gain of $1.0 million primarily due to insurance proceeds received in excess of the carrying values of related assets during the six months ended June 30, 2025.