National HealthCare Corporation (NYSE American: NHC), the nation's oldest publicly traded senior health care company, announced today net operating revenues and grant income for the year ended December 31, 2021 totaled $1,074,302,000 compared to $1,028,217,000 for the year ended December 31, 2020, an increase of 4.5%. The net operating revenues increase in 2021 was primarily driven by the June 2021 controlling equity interest acquisition of Caris Healthcare, a hospice provider with 28 agencies.

For the year ended December 31, 2021, the reported GAAP net income attributable to NHC was $138,590,000 compared to $41,871,000 for the 2020 year. Excluding the unrealized gains and losses in our marketable equity securities portfolio and other non-GAAP adjustments, adjusted net income for the year ended December 31, 2021 was $62,645,000 compared to $58,543,000 for the 2020 year, which is a 7.0% increase ^(*). GAAP diluted earnings per share were $8.99 compared to $2.72 for the years ended December 31, 2021 and 2020, respectively. Adjusted diluted earnings per share were $4.06 compared to $3.81 for the years ended December 31, 2021 and 2020, respectively ^(*).

For the quarter ended December 31, 2021, the reported GAAP net income attributable to NHC was $15,788,000 compared to $27,550,000 for the same period in 2020. Excluding the unrealized gains and losses in our marketable equity securities portfolio and other non-GAAP adjustments, adjusted net income for the quarter ended December 31, 2021 was $15,801,000 compared to $13,822,000 for the same period in 2020, an increase of 14.3% ^(*). The GAAP diluted earnings per share were $1.02 compared to $1.79 for the quarters ended December 31, 2021 and 2020, respectively. Adjusted diluted earnings per share were $1.02 and $0.90 for the quarters ended December 31, 2021 and 2020, respectively ^(*).

(*) - See the tables below that provide a reconciliation of GAAP to non-GAAP items.

About NHC

NHC affiliates operate for themselves and third parties 75 skilled nursing facilities with 9,473 beds. NHC affiliates also operate 24 assisted living communities, five independent living communities, one behavioral health hospital, 34 homecare agencies, and 28 hospice agencies. NHC's other services include Alzheimer's and memory care units, pharmacy services, a rehabilitation services company, and providing management and accounting services to third party post-acute operators. Other information about the company can be found on our web site at www.nhccare.com.

Non-GAAP Financial Presentation

The Company is providing certain non-GAAP financial measures as the Company believes that these figures are helpful in allowing investors to more accurately assess the ongoing nature of the Company's operations and measure the Company's performance more consistently across periods. Therefore, the Company believes this information is meaningful in addition to the information contained in the GAAP presentation of financial information. 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.

Forward-Looking Statements

Statements in this press release that are not historical facts are forward-looking statements. NHC cautions investors that any forward-looking statements made involve risks and uncertainties and are not guarantees of future performance. The risks and uncertainties are detailed from time to time in reports filed by NHC with the S.E.C., including Forms 8-K, 10-Q and 10-K, and include, among others, the following: liabilities and other claims asserted against us and patient care liabilities, as well as the resolution of current litigation; availability of insurance and assets for indemnification; national and local economic conditions; including their effect on the availability and cost of labor, utilities and materials; the effect of government regulations and changes in regulations governing the healthcare industry, including our compliance with such regulations; changes in Medicare and Medicaid payment levels and methodologies and the application of such methodologies by the government and its fiscal intermediaries; and other factors referenced or incorporated by reference in the S.E.C. filings. The risks included here are not exhaustive. All forward-looking statements represent NHC's best judgment as of the date of this release.

Consolidated Statements of Operations
(in thousands, except share and per share amounts)
			Three Months Ended						Year Ended
			December 31						December 31
				2021			2020			2021			2020
Revenues and grant income:
	Net patient revenues		$	256,894		$	234,646		$	965,542		$	931,795
	Other revenues			11,484			14,454			45,400			48,917
	Government stimulus income			15,056			10,725			63,360			47,505
		Net operating revenues and grant income		283,434			259,825			1,074,302			1,028,217

Costs and expenses:
	Salaries, wages and benefits			168,433			153,359			629,672			609,306
	Other operating			76,910			73,429			303,145			286,845
	Facility rent			10,381			9,522			40,818			40,494
	Depreciation and amortization			10,151			10,487			40,672			42,018
	Interest			188			249			845			1,399
	Impairment of assets			8,225			-			8,225			-
		Total costs and expenses		274,288			247,046			1,023,377			980,062

Income from operations				9,146			12,779			50,925			48,155

Non-operating income				2,529			7,656			17,774			26,527
Gain on acquisitions of equity method investments				-			-			95,202			1,707
Unrealized gains/(losses) on marketable equity securities				9,364			16,614			(13,863	)		(23,966	)

Income before income taxes				21,039			37,049			150,038			52,423
Income tax provision				(5,044	)		(9,633	)		(10,951	)		(10,433	)
Net income				15,995			27,416			139,087			41,990

Net (income)/loss attributable to noncontrolling interest				(207	)		134			(497	)		(119	)

Net income attributable to National HealthCare Corporation			$	15,788		$	27,550		$	138,590		$	41,871

Net income per common share
	Basic		$	1.03		$	1.80		$	9.03		$	2.74
	Diluted		$	1.02		$	1.79		$	8.99		$	2.72

Weighted average common shares outstanding
	Basic			15,364,302			15,311,947			15,347,129			15,306,174
	Diluted			15,440,633			15,371,718			15,416,716			15,369,523

Dividends declared per common share			$	0.55		$	0.52		$	2.11		$	2.08


	Balance Sheet Data		Dec. 31			Dec. 31
	(in thousands)			2021			2020

	Cash, cash equivalents and marketable securities		$	256,025		$	323,445
	Restricted cash, cash equivalents and marketable securities			175,884			158,162
	Current assets			426,638			456,755
	Property and equipment, net			520,996			520,318
	Total assets			1,403,396			1,362,132
	Current liabilities			263,201			281,228
	NHC stockholders' equity			903,004			795,177

Selected Operating Statistics
	Three Months Ended						Year Ended
	December 31						December 31
		2021			2020			2021			2020
Skilled Nursing Per Diems:
Medicare	$	530.32		$	533.95		$	529.03		$	518.46
Managed Care		439.61			418.14			414.11			408.92
Medicaid		224.61			258.47			225.40			220.50
Private Pay and Other		259.96			250.54			255.60			249.61

Average Skilled Nursing Per Diem	$	297.62		$	317.94		$	297.19		$	290.10

Skilled Nursing Patient Days:
Medicare		91,056			96,943			362,080			387,540
Managed Care		56,133			58,085			239,726			223,629
Medicaid		317,610			290,979			1,213,565			1,289,435
Private Pay and Other		158,577			140,288			597,802			625,313

Total Skilled Nursing Patient Days		623,376			586,295			2,413,173			2,525,917


The tables below provide reconciliations of GAAP to non-GAAP items (in thousands, except per share amounts):
	Three Months Ended						Year Ended
	December 31						December 31
		2021			2020			2021			2020

Net income attributable to National Healthcare Corporation	$	15,788		$	27,550		$	138,590		$	41,871
Non-GAAP adjustments
Unrealized loss (gains) on marketable equity securities		(9,364	)		(16,614	)		13,863			23,966
Impairment of assets		8,225			-			8,225			-
Gains on acquisitions of equity method investments		-			-			(95,202	)		(1,707	)
Gain on sale of real estate/healthcare facilities		-			(2,784	)		-			(2,784	)
Operating results for newly opened facilities not at full capacity⁽¹⁾		442			200			922			602
Stock-based compensation expense		715			646			2,620			2,453
Income tax (benefit)/provision on non-GAAP adjustments		(5	)		4,824			(6,373	)		(5,858	)
Non-GAAP Net income	$	15,801		$	13,822		$	62,645		$	58,543

GAAP diluted earnings per share	$	1.02		$	1.79		$	8.99		$	2.72
Non-GAAP adjustments
Unrealized loss (gains) on marketable equity securities		(0.45	)		(0.80	)		0.67			1.15
Impairment of assets		0.40			-			0.39			-
Gains on acquisitions of equity method investments		-			-			(6.16	)		(0.08	)
Gain on sale of real estate/healthcare facilities		-			(0.13	)		-			(0.13	)
Operating results for newly opened facilities not at full capacity ⁽¹⁾		0.02			0.01			0.04			0.03
Stock-based compensation expense		0.03			0.03			0.13			0.12
Non-GAAP diluted earnings per share	$	1.02		$	0.90		$	4.06		$	3.81

⁽¹⁾ The newly opened facilities not at full capacity for the 2021 periods presented consist of operations opened from 2019 through 2021. The newly opened facilities for the 2020 periods presented consist of operations opened from 2018 through 2020. For the 2021 periods, there is one memory care facility included and two behavioral health hospitals that are opening in the first quarter of 2022. For the 2020 periods, there was one memory care facility included in the results.

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