What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-08-07 compared with 2025-05-08 · 146 added, 77 removed, 210 unchanged (52% of the section changed)

29 unchanged sentences

National HealthCare Corporation (“NHC” or the “Company”) is a leading provider of senior health care services.

As of March 31, 2025, we operate or manage, through certain affiliates, 80 skilled nursing facilities with a total of 10,329 licensed beds, 26 assisted living facilities with 1,413 units, nine independent living facilities, three behavioral health hospitals, 34 homecare agencies, and 33 hospice agencies.

As of June 30, 2025, we operate or manage, through certain affiliates, 80 skilled nursing facilities with a total of 10,329 licensed beds, 26 assisted living facilities with 1,413 units, nine independent living facilities, three behavioral health hospitals, 34 homecare agencies, and 33 hospice agencies.

We operate specialized care units within certain of our healthcare centers such as Alzheimer's disease care units and sub-acute nursing units.

1 unchanged sentence

We operate in 9 states and are located primarily in the southeastern United States.

Centers for Medicare and Medicaid Services Minimum Staffing Standards

On April 22, 2024, the Centers for Medicare and Medicaid Services (“CMS”) issued the Minimum Staffing Standards for Long-Term Care (“LTC”) Facilities and Medicaid Institutional Payment Transparency Reporting final rule.

Included in this final rule are new comprehensive minimum nurse staffing requirements, which aim to significantly reduce the risk of residents receiving unsafe and low-quality care within LTC facilities.

CMS is finalizing a total nurse staffing standard of 3.48 hours per resident day (“HPRD”), which must include at least 0.55 HPRD of direct registered nurse (“RN”) care and 2.45 HPRD of direct nurse aide care.

Facilities may use any combination of nurse staff (RN, licensed practical nurse and licensed vocational nurse, or nurse aide) to account for the additional 0.48 HPRD needed to comply with the total nurse staffing standard.

CMS is also finalizing enhanced facility assessment requirements and a requirement to have an RN onsite 24 hours a day, seven days a week (“24/7”), to provide skilled nursing care.

The 24/7 RN onsite can be the Director of Nursing;

however, they must be available to provide direct resident care.

This final rule provides a staggered implementation timeframe of the minimum nurse staffing standards and a 24/7 RN requirement based on geographic location, as well as possible exemptions for qualifying facilities for some parts of these requirements based on workforce unavailability and other factors.

Summary of Goals and Areas of Focus

A primary area of management focus continues to be the rates of occupancy within our skilled nursing facilities.

The overall census in owned and leased skilled nursing facilities for the three months ending March 31, 2025 was 89.3% compared to 88.5% for the same period a year ago.

The overall census in owned and leased skilled nursing facilities for the three months ending June 30, 2025 was 89.4% compared to 89.0% for the same period a year ago.

For the six months ended June 30, 2025, overall census in our owned and leased skilled nursing facilities was 89.3% compared to 88.7% for the same period a year ago.

Due to America’s healthcare labor shortage, the challenge of maintaining desirable patient census levels has been amplified.

6 unchanged sentences

The Company has always strived for patient-centered care and quality outcomes as precursors to outstanding financial performance.

The tables below summarize NHC's overall performance in these Five-Star ratings versus the skilled nursing industry as of March 31, 2025:

The tables below summarize NHC's overall performance in these Five-Star ratings versus the skilled nursing industry as of June 30, 2025:

Industry Ratings

15 unchanged sentences

Accrued Risk Reserves

Our accrued professional liability and workers’ compensation reserves totaled $108,197,000 at March 31, 2025 and are a primary area of management focus.

Our accrued professional liability and workers’ compensation reserves totaled $108,982,000 at June 30, 2025 and are a primary area of management focus.

We have set aside restricted cash and cash equivalents and marketable securities to fund our estimated professional liability and workers’ compensation liabilities.

11 unchanged sentences

CMS also finalized its proposal to adopt a data validation process for the SNF QRP beginning the same year.

In April 2025, CMS released its proposed rule outlining fiscal year 2026 Medicare payment rates and policy changes for skilled nursing facilities, which will begin on October 1, 2025.

The fiscal year 2026 proposal equates to a net 2.8% increase in Medicare Part A payments to SNFs in fiscal year 2026 compared to 2025 levels.

In July 2025, CMS released its final rule outlining fiscal year 2026 Medicare payment rates and policy changes for skilled nursing facilities, which will begin on October 1, 2025.

The fiscal year 2026 rule equates to a net 3.2% increase in Medicare Part A payments to SNFs in fiscal year 2026 compared to 2025 levels.

The rule includes a market basket increase of 3.3%, an increase of 0.6% to the market basket forecast error adjustment, and a negative 0.7% productivity adjustment.

1 unchanged sentence

those adjustments are estimated to total $208.4 million in fiscal year 2026.

For the first three months of 2025, our average Medicare per diem rate for skilled nursing facilities increased 5.2% as compared to the same period in 2024.

For the first six months of 2025, our average Medicare per diem rate for skilled nursing facilities increased 5.8% as compared to the same period in 2024.

Medicaid – Skilled Nursing Facilities

1 unchanged sentence

We estimate the resulting increase in revenue for the 2026 fiscal year will be approximately $3,000,000 annually, or $750,000 per quarter.

Additionally, the state of Tennessee implemented supplemental Medicaid payments for fiscal year 2025 for continued stabilization payments and Medicaid rate rebasing.

These supplemental payments will result in an increase in revenue for the 2025 fiscal year of approximately $7,500,000 annually, or $1,875,000 per quarter.

Effective July 1, 2024 and for the fiscal year 2025, the state of Missouri has approved specific individual nursing facility increases.

Effective October 1, 2025 and for the fiscal year 2026, the state of South Carolina implemented specific individual nursing facility increases.

We estimate the resulting increase in revenue for the 2026 fiscal year will be approximately $4,200,000 annually, or $1,050,000 per quarter.

For the first three months of 2025, our average Medicaid per diem increased 6.2% compared to the same period in 2024.

Congress is currently considering major cuts to federal spending on Medicaid.

One of the options under consideration is to limit the amount of federal Medicaid funding they receive by levying taxes on providers and thereby increasing their reimbursement rates.

Restricting these “provider taxes” would create financing gaps for states which could result in higher state taxes, reductions in Medicaid eligibility, lower provider payment rates, and fewer covered benefits.

For the first six months of 2025, our average Medicaid per diem increased 7.2% compared to the same period in 2024.

State Medicaid plans subject to budget constraints are of particular concern to us.

11 unchanged sentences

This adjustment accounts for differences between assumed behavior changes and actual behavior changes on estimated aggregate expenditures due to the CY2020 implementation of PDGM and the change to a 30-day unit of payment.

In June 2025, CMS released its proposed rule outlining fiscal year 2026 Medicare payment rates.

CMS projects payments to home health agencies in fiscal year 2026 will decrease by 6.4% or $1.1 billion, relative to the prior year.

This update includes a 3.2% market basket update, reduced by a 0.8 percentage point cut for productivity.

The rule also includes several reductions that CMS proposes as necessary to achieve budget neutral implementation of PDGM, including a 4.1% permanent reduction to the standard payment rate to prevent future overpayments, as well as a temporary but indefinite 5.0% reduction to recoup past overpayments.

CMS also proposes a 0.5% reduction related to high-cost outlier payments.

Medicare – Hospice

6 unchanged sentences

CMS issued a rate increase of 2.4%, or $695 million, effective October 1, 2025.

This increase is the result of a 3.2% market basket increase reduced by a 0.8% productivity adjustment.

This increase results from the proposed 3.2% inpatient hospital market basket percentage increase reduced by a proposed 0.8% point productivity adjustment, required by law.

The FY2026 hospice payment update also includes an update to the statutory aggregate cap amount, which limits the overall payments per patient that are made annually.

The proposed cap amount for FY2026 is $35,293.

The proposed hospice cap amount for FY2026 is $35,293.

Segment Reporting

7 unchanged sentences

The following table sets forth the Company’s unaudited interim condensed consolidated statements of operations by business segment (in thousands ):

Three Months Ended March 31, 2025

Three Months Ended June 30, 2025

Net patient revenues

9 unchanged sentences

Interest expense

Unrealized gains on marketable equity securities

Unrealized losses on marketable equity securities

Income/(loss) before income taxes

Three Months Ended March 31, 2024

Three Months Ended June 30, 2024

Net patient revenues

Other revenues

Net operating revenues

Government stimulus income

Net operating revenues and grant income

Costs and expenses:

3 unchanged sentences

Total costs and expenses

Income from operations

Non-operating income

Interest expense

Unrealized gains on marketable equity securities

Income before income taxes

Six Months Ended June 30, 2025

Net patient revenues

Other revenues

Net operating revenues and grant income

Costs and expenses:

Salaries, wages, and benefits

Other operating

Depreciation and amortization

Total costs and expenses

Income/(loss) from operations

3 unchanged sentences

Income before income taxes

Six Months Ended June 30, 2024

Net patient revenues

Other revenues

Government stimulus income

Net operating revenues and grant income

Costs and expenses:

Salaries, wages, and benefits

Other operating

Depreciation and amortization

Total costs and expenses

Income/(loss) from operations

Non-operating income

Interest expense

Unrealized gains on marketable equity securities

Income before income taxes

Results of Operations

The following table and discussion set forth items from the interim condensed consolidated statements of operations as a percentage of net operating revenues for the three months ended March 31, 2025 and 2024.

The following table and discussion set forth items from the interim condensed consolidated statements of operations as a percentage of net operating revenues and grant income for the three and six months ended June 30, 2025 and 2024.

Percentage of Net Operating Revenues

Three Months Ended

Net operating revenues

Six Months Ended

Net operating revenues and grant income

Costs and expenses:

7 unchanged sentences

Interest expense

Unrealized gains on marketable equity securities

Unrealized gains/(losses) on marketable equity securities

Income before income taxes

2 unchanged sentences

Net income attributable to stockholders of NHC

Three Months Ended March 31, 2025 Compared to Three Months Ended March 31, 2024

Results for the quarter ended March 31, 2025 compared to the first quarter of 2024 include a 25.7% increase in net operating revenues.

The net operating revenues increase was due to an 8.5% increase in same-facility net operating revenues, as well as the August 1, 2024 acquisition of White Oak.

For the quarter ended March 31, 2025, GAAP net income attributable to NHC was $32,205,000 compared to net income of $26,213,000 for the same period in 2024.

Excluding the unrealized gains in our marketable equity securities portfolio and other non-GAAP adjustments, adjusted net income for the quarter ended March 31, 2025 was $24,838,000 compared to $15,386,000 for the same period in 2024, an increase of 61.4%.

The increase in non-GAAP earnings for the three months ended March 31, 2025 compared to the same period in 2024 was primarily due to the continued increase in skilled nursing census, skilled nursing per diem increases from some of our government payors, the continued reduction of agency staffing expense, and the White Oak operations being accretive to earnings.

Net operating revenues

Three Months Ended June 30, 2025 Compared to Three Months Ended June 30, 2024

Results for the quarter ended June 30, 2025 compared to the second quarter of 2024 include a 24.7% increase in net operating revenues and grant income.

The net operating revenues increase was due to a 9.6% increase in same-facility net operating revenues, as well as the August 1, 2024 acquisition of White Oak.

For the quarter ended June 30, 2025, GAAP net income attributable to NHC was $23,722,000 compared to net income of $26,844,000 for the same period in 2024.

Excluding the unrealized gains and losses in our marketable equity securities portfolio and other non-GAAP adjustments, adjusted net income for the quarter ended June 30, 2025 was $25,710,000 compared to $15,612,000 for the same period in 2024, an increase of 64.7%.

The increase in non-GAAP earnings for the three months ended June 30, 2025 compared to the same period in 2024 was primarily due to the continued increase in skilled nursing census, skilled nursing per diem increases from some of our government payors, the continued reduction of agency staffing expense, and the White Oak operations being accretive to earnings.

Net operating revenues and grant income

Net patient revenues increased $83,431,000, or 29.8%, compared to the same period last year.

3 unchanged sentences

Medicaid and private pay per diem rates increased 8.3% and 9.1%, respectively, compared to the same quarter a year ago.

For the three months ended March 31, 2025 and 2024, respectively, $1,872,000 and $3,462,000 have been included in our net patient revenues for supplemental Medicaid payments.

The White Oak operations attributed to an increase of $56,726,000 in net patient revenues for the quarter ended March 31, 2025 compared to the same period in 2024.

On March 1, 2024, the Company exited a lease and transferred the operations of two skilled nursing facilities and one memory care facility located in Missouri.

The exiting of these operations resulted in net patient revenues decreasing $5,579,000 for the quarter ended March 31, 2025 compared to the first quarter of 2024.

For the three months ended June 30, 2025 and 2024, respectively, $1,812,000 and $2,585,000 have been included in our net patient revenues for supplemental Medicaid payments.

The White Oak operations attributed to an increase of $56,855,000 in net patient revenues for the quarter ended June 30, 2025 compared to the same period in 2024.

Other revenues increased $266,000, or 2.4%, compared to the same quarter last year, as further detailed in Note 4 to our interim condensed consolidated financial statements.

Total costs and expenses

Total costs and expenses for the three months ended March 31, 2025 compared to the same period of 2024 increased $61,429,000, or 21.8% to $342,930,000 from $281,501,000.

Total costs and expenses for the three months ended June 30, 2025 compared to the same period of 2024 increased $62,682,000, or 22.5% to $340,820,000 from $278,138,000.

Salaries, wages, and benefits increased $46,458,000, or 25.8%, to $226,534,000 from $180,076,000.

Salaries, wages, and benefits as a percentage of net operating revenues was 61.0% compared to 61.6% for the three months ended March 31, 2025 and 2024, respectively.

Salaries, wages, and benefits as a percentage of net operating revenues was 60.4% compared to 59.9% for the three months ended June 30, 2025 and 2024, respectively.

Although we continue to face workforce and labor shortages within all of our operations, we are working diligently to find solutions to reduce and eliminate agency nurse staffing expense within our healthcare operations.

For the first quarter of 2025, our agency nurse staffing expense was $1,487,000 compared to $5,286,000 for the first quarter of 2024.

The White Oak operations attributed to an increase of $37,018,000 in salaries, wages, and benefits for the three months ended March 31, 2025 compared to the same period in the prior year.

On March 1, 2024, the Company exited a lease and transferred the operations of two skilled nursing facilities and one memory care facility located in Missouri.

The exiting of these operations resulted in salaries, wages and benefits decreasing $4,009,000 for the quarter ended March 31, 2025 compared to the first quarter of 2024.

For the second quarter of 2025, our agency nurse staffing expense was $981,000 compared to $4,098,000 for the second quarter of 2024.

The White Oak operations attributed to an increase of $37,564,000 in salaries, wages, and benefits for the three months ended June 30, 2025 compared to the same period in the prior year.

Other operating expenses increased $13,789,000, or 17.6%, to $91,943,000 for the 2025 period compared to $78,154,000 for the 2024 period.

Other operating expenses as a percentage of net operating revenues was 24.7% and 26.1% for the three months ended March 31, 2025 and 2024, respectively.

The White Oak operations attributed to an increase of $12,769,000 in other operating expenses for the three months ended March 31, 2025 as compared to the same period in the prior year.

The three exited Missouri operations during the first quarter of 2024 resulted in other operating expenses decreasing $2,281,000 for the quarter ended March 31, 2025 compared to the same period last year.

Non–operating income decreased by $1,606,000 compared to the same period last year, as further detailed in Note 5 to our interim condensed consolidated financial statements.

In January 2024, the Company sold its ownership interest in a homecare agency located in Nashville, Tennessee.

The total consideration paid to the company was $2,100,000, which resulted in a gain of $1,024,000.

The income tax provision for the three months ended March 31, 2025 is $11,432,000 (an effective income tax rate of 26.1%).

Other operating expenses as a percentage of net operating revenues was 24.5% and 26.0% for the three months ended June 30, 2025 and 2024, respectively.

The White Oak operations attributed to an increase of $12,815,000 in other operating expenses for the three months ended June 30, 2025 as compared to the same period in the prior year.

During the second quarter of 2025, we contributed land to a newly-formed limited liability company resulting in an equity interest in the new entity.

The fair value of the land contributed to the new entity was $5,625,000.

The related cost basis of the contributed land was $2,019,000, which resulted in a gain of $3,606,000.

This gain was netted with other operating expenses resulting in a decrease of $3,606,000 in other operating expenses as compared to the same period in the prior year.

Non–operating income increased by $176,000 compared to the same period last year, as further detailed in Note 5 to our interim condensed consolidated financial statements.

The income tax provision for the three months ended June 30, 2025 is $8,055,000 (an effective income tax rate of 25.0%).

Noncontrolling interest

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The carrying amount of the noncontrolling interest is adjusted based on an allocation of subsidiary earnings based on ownership interest.

Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024

Results for the six months ended June 30, 2025 compared to the same period of 2024 include a 25.2% increase in net operating revenues and grant income.

The net operating revenues increase was due to a 9.5% increase in same-facility net operating revenues, as well as the August 1, 2024 acquisition of White Oak.

For the six months ended June 30, 2025, GAAP net income attributable to NHC was $55,927,000 compared to net income of $53,057,000 for the same period in 2024.

Excluding the unrealized gains in our marketable equity securities portfolio and other non-GAAP adjustments, adjusted net income for the six months ended June 30, 2025 was $50,549,000 compared to $30,998,000 for the same period in 2024, an increase of 63.1%.

The increase in non-GAAP earnings for the six months ended June 30, 2025 compared to the same period in 2024 was primarily due to the continued increase in skilled nursing census, skilled nursing per diem increases from some of our government payors, the continued reduction of agency staffing expense, and the White Oak operations being accretive to earnings.

Net operating revenues and grant income

Net patient revenues increased $159,215,000, or 28.1%, compared to the same period last year.

The total census at owned and leased skilled nursing facilities for the six months ended June 30, 2025 averaged 89.3%, compared to an average of 88.7% for the same period a year ago.

Overall, the composite skilled nursing facility per diem increased 5.7% compared to the same period a year ago.

Our Medicare per diem rates increased 5.8% and managed care per diem rates increased 6.5% compared to the same period a year ago.

Medicaid and private pay per diem rates increased 7.2% and 9.3%, respectively, compared to the same period a year ago.

For the six months ended June 30, 2025 and 2024, respectively, $3,684,000 and $6,047,000 have been included in our net patient revenues for supplemental Medicaid payments.

The White Oak operations attributed to an increase of $113,580,000 in net patient revenues for the six months ended June 30, 2025 compared to the same period in 2024.

On March 1, 2024, the Company exited a lease and transferred the operations of two skilled nursing facilities and one memory care facility located in Missouri.

The exiting of these operations in 2024 resulted in net patient revenues decreasing $5,579,000 for the six months ended June 30, 2025 compared to the same period a year ago.

Other revenues increased $1,003,000, or 4.4%, compared to the same period last year, as further detailed in Note 4 to our interim condensed consolidated financial statements.

Total costs and expenses

Total costs and expenses for the six months ended June 30, 2025 compared to the same period of 2024 increased $124,111,000, or 22.2% to $683,750,000 from $559,639,000.

Salaries, wages, and benefits increased $91,450,000, or 25.2%, to $454,664,000 from $363,214,000.

Salaries, wages, and benefits as a percentage of net operating revenues was 60.7% compared to 60.8% for the six months ended June 30, 2025 and 2024, respectively.

For the six months ended June 30, 2025, our agency nurse staffing expense was $2,468,000 compared to $9,384,000 for the same period of 2024.

The White Oak operations attributed to an increase of $74,583,000 in salaries, wages, and benefits for the six months ended June 30, 2025 compared to the same period in the prior year.

On March 1, 2024, the Company exited a lease and transferred the operations of two skilled nursing facilities and one memory care facility located in Missouri.

The exiting of these operations in 2024 resulted in salaries, wages and benefits decreasing $4,009,000 for the six months ended June 30, 2025 compared to the same period of 2024.

Other operating expenses increased $28,817,000, or 18.5%, to $184,400,000 for the 2025 period compared to $155,583,000 for the 2024 period.

Other operating expenses as a percentage of net operating revenues was 24.6% and 26.0% for the six months ended June 30, 2025 and 2024, respectively.

The White Oak operations attributed to an increase of $25,584,000 in other operating expenses for the six months ended June 30, 2025 as compared to the same period in the prior year.

The three exited Missouri operations during the first quarter of 2024 resulted in other operating expenses decreasing $2,281,000 for the six months ended June 30, 2025 compared to the same period last year.

During the second quarter of 2025, we contributed land to a newly-formed limited liability company resulting in an equity interest in the new entity.

The fair value of the land contributed to the new entity was $5,625,000.

The related cost basis of the contributed land was $2,019,000, which resulted in a gain of $3,606,000.

This gain was netted with other operating expenses resulting in a decrease of $3,606,000 in other operating expenses as compared to the same period in the prior year.

Non–operating income decreased by $1,430,000 compared to the same period last year, as further detailed in Note 5 to our interim condensed consolidated financial statements.

In January 2024, the Company sold its ownership interest in a homecare agency located in Nashville, Tennessee.

The total consideration paid to the company was $2,100,000, which resulted in a gain of $1,024,000

The income tax provision for the six months ended June 30, 2025 is $19,487,000 (an effective income tax rate of 25.7%).

Non-GAAP Financial Presentation

2 unchanged sentences

The presentation of this additional non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP.

Specifically, the Company believes the presentation of non-GAAP financial information that excludes the unrealized gains or losses on our marketable equity securities, gains on sale of unconsolidated companies, and share-based compensation expense is helpful in allowing investors to assess the Company’s operations more accurately.

Specifically, the Company believes the presentation of non-GAAP financial information that excludes the unrealized gains or losses on our marketable equity securities, gains on sale of unconsolidated companies, gains on sale of property and equipment, and share-based compensation expense is helpful in allowing investors to assess the Company’s operations more accurately.

The tables below provide reconciliations of GAAP to non-GAAP items (dollars in thousands, except per share data):

Three Months Ended

Six Months Ended

Net income attributable to National Healthcare Corporation

Non-GAAP adjustments:

Unrealized gains on marketable equity securities

Gain on sale of unconsolidated company

Unrealized (gains)/losses on marketable equity securities

Operating results for newly opened facilities or agencies not at full capacity

Share-based compensation expense

Income tax expense on non-GAAP adjustments

Gain on sale of property and equipment

Gain on sale of unconsolidated company

Acquisition-related expenses

Employee retention credit

Income tax expense/(benefit) on non-GAAP adjustments

Non-GAAP Net income

1 unchanged sentence

Non-GAAP adjustments:

Unrealized gains on marketable equity securities

Gain on sale of unconsolidated company

Unrealized (gains)/losses on marketable equity securities

Operating results for newly opened facilities or agencies not at full capacity

Share-based compensation expense

Income tax expense on non-GAAP adjustments

Gain on sale of property and equipment

Gain on sale of unconsolidated company

Acquisition-related expenses

Employee retention credit

Income tax expense/(benefit) on non-GAAP adjustments

Non-GAAP diluted earnings per share

4 unchanged sentences

The following is a summary of our sources and uses of cash flows (dollars in thousands) :

Three Months Ended

Three Month Change

Six Months Ended

Six Month Change

Cash, cash equivalents, restricted cash, and restricted cash equivalents, at beginning of period

4 unchanged sentences

Operating Activities

Net cash provided by operating activities for the three months ended March 31, 2025 was $39,255,000 as compared to $9,646,000 in the same period last year.

Net cash provided by operating activities for the six months ended June 30, 2025 was $102,074,000 as compared to $60,307,000 in the same period last year.

Cash provided by operating activities consisted of net income of $56,403,000 and adjustments for non–cash items of $12,704,000.

There was cash provided by working capital in the amount of $4,827,000 for the three months ended March 31, 2025 compared to cash used for working capital needs in the amount of $14,634,000 for the same period a year ago.

Included in the adjustments for non-cash items are depreciation expense, equity in earnings of unconsolidated investments, unrealized gains on our marketable equity securities, gain on sale of an unconsolidated company, deferred taxes, and stock compensation.

There was cash provided by working capital in the amount of $32,831,000 for the six months ended June 30, 2025 compared to $4,052,000 for the same period a year ago.

Investing Activities

Net cash used in investing activities totaled $7,323,000 for the three months ended March 31, 2025, compared to $2,415,000 for the three months ended March 31, 2024.

Cash used for property and equipment additions was $6,137,000 and $5,955,000 for the three months ended March 31, 2025, and 2024, respectively.

Proceeds from the sale of marketable securities, net of purchases, resulted in cash provided by investing activities of $1,226,000 and $2,912,000 for the three months ended March 31, 2025 and 2024, respectively.

For the three months ended March 31, 2025, we contributed capital of $2,419,000 to a joint venture, multi-family development that is under construction in Franklin, Tennessee.

Net cash used in investing activities totaled $22,902,000 for the six months ended June 30, 2025, compared to $990,000 for the six months ended June 30, 2024.

Cash used for property and equipment additions was $16,341,000 and $13,788,000 for the six months ended June 30, 2025, and 2024, respectively.

Purchases, net of proceeds from sales, of marketable securities resulted in cash used in investing activities of $3,821,000 for the six months ended June 30, 2025.

Proceeds from the sale of marketable securities, net of purchases, resulted in cash provided by investing activities of $15,764,000 for the six months ended June 30, 2024.

For the six months ended June 30, 2025, we contributed capital of $2,419,000 to a joint venture, multi-family development that is under construction in Franklin, Tennessee compared to $4,856,000 for the same period in the prior year.

We also contributed capital of $786,000 to a joint venture, multi-family development in Hermitage, Tennessee during the second quarter of 2025.

In January 2024, the Company sold its ownership interest in a homecare agency resulting in proceeds from the sale of $2,100,000.

Financing Activities

Net cash used in financing activities totaled $12,693,000 for the three months ended March 31, 2025 compared to $12,067,000 for the three months ended March 31, 2024.

During the first quarter of 2025, cash of $3,000,000 was used to pay down the outstanding principal balance of the long-term debt.

Net cash used in financing activities totaled $45,732,000 for the six months ended June 30, 2025 compared to $19,680,000 for the six months ended June 30, 2024.

During the first six months of 2025, cash of $27,000,000 was used to pay down the outstanding principal balance of the long-term debt.

Cash used for dividend payments to common stockholders totaled $18,854,000 in the current year period compared to $18,137,000 for the same period a year ago.

Proceeds from the issuance of common stock totaled $1,278,000 and $8,412,000 for the three months ended March 31, 2025 and 2024, respectively.

We repurchased common shares outstanding in the amount of $1,722,000 and $9,900,000 for the three months ended March 31, 2025 and 2024, respectively.

Proceeds from the issuance of common stock totaled $6,462,000 and $11,239,000 for the six months ended June 30, 2025 and 2024, respectively.

We repurchased common shares outstanding in the amount of $6,384,000 and $11,402,000 for the six months ended June 30, 2025 and 2024, respectively.

Short – term liquidity

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Governmental Regulations

Laws and regulations governing the Medicare, Medicaid and other federal healthcare programs are complex and subject to interpretation.

Laws and regulations governing Medicare, Medicaid and other federal healthcare programs are complex and subject to interpretation.

Management believes that it is following all applicable laws and regulations in all material respects.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis