National HealthCare Corporation (NYSE American: NHC), the nation's oldest publicly traded senior health care company, announced today net operating revenues and government stimulus income for the quarter ended June 30, 2022 totaled $271,359,000 compared to $263,158,000 for the quarter ended June 30, 2021, an increase of 3.1%. The net operating revenues increase during the second quarter of 2022 was primarily driven by the continued occupancy increase in our skilled nursing facilities, as well as the June 2021 acquisition of Caris HealthCare, a hospice provider. The net patient revenue increases were offset by the reduction in government stimulus income of $14.8 million during the second quarter of 2022 compared to the same period a year ago.

For the quarter ended June 30, 2022, the reported GAAP net income attributable to NHC was $3,203,000 compared to $104,883,000 for the same period in 2021. The large increase in our reported GAAP net income for the second quarter of 2021 was primarily due to the gain recorded from the acquisition of Caris HealthCare, L.P. Excluding the gain on the Caris HealthCare, L.P. acquisition, as well as the unrealized losses in our marketable equity securities portfolio and other non-GAAP adjustments, adjusted net income for the quarter ended June 30, 2022 was $7,172,000 compared to $15,077,000 for the same period in 2021 ^(*). The decrease in non-GAAP earnings for the second quarter of 2022 compared to the same period in 2021 was primarily due to the $14.8 million less of government stimulus income recorded, as well as incurring inflationary wage pressures on our labor costs. GAAP diluted earnings per share was $0.21 for the quarter ended June 30, 2022 compared to $6.80 for the same period in 2021. Adjusted diluted earnings per share were $0.46 and $0.98 for the quarters ended June 30, 2022 and 2021, 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 9,447 beds. NHC affiliates also operate 24 assisted living communities with 1,210 units, five independent living communities with 475 units, three behavioral health hospitals, 35 homecare agencies, and 29 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						Six Months Ended
	June 30						June 30
	2022			2021			2022			2021
	(unaudited)						(unaudited)
Revenues and grant income:
Net patient revenues	$	260,077		$	236,976		$	516,414		$	453,831
Other revenues		10,962			11,056			22,988			22,425
Government stimulus income		320			15,126			10,940			37,875
Net operating revenues and grant income		271,359			263,158			550,342			514,131

Costs and expenses:
Salaries, wages and benefits		174,936			163,868			345,630			313,025
Other operating		71,311			64,979			145,396			131,105
Facility rent		10,411			10,170			20,476			20,233
Depreciation and amortization		10,001			10,131			19,758			20,292
Interest		149			215			314			459
Total costs and expenses		266,808			249,363			531,574			485,114

Income from operations		4,551			13,795			18,768			29,017

Non-operating income		2,521			5,586			5,720			11,846
Gain on acquisition of equity method investment		-			95,202			-			95,202
Unrealized gains/(losses) on marketable equity securities		(3,549	)		(6,489	)		(423	)		570

Income before income taxes		3,523			108,094			24,065			136,635
Income tax provision		(1,362	)		(2,764	)		(6,555	)		(9,997	)
Net income		2,161			105,330			17,510			126,638

Net (income)/loss attributable to noncontrolling interest		1,042			(447	)		1,011			(488	)

Net income attributable to National HealthCare Corporation	$	3,203		$	104,883		$	18,521		$	126,150

Net income per common share
Basic	$	0.21		$	6.83		$	1.20		$	8.22
Diluted	$	0.21		$	6.80		$	1.20		$	8.19

Weighted average common shares outstanding
Basic		15,452,402			15,349,162			15,434,718			15,338,400
Diluted		15,487,123			15,419,012			15,475,553			15,404,634

Dividends declared per common share	$	0.57		$	0.52		$	1.12		$	1.04


Balance Sheet Data	June 30			Dec. 31
(in thousands)	2022			2021
	(unaudited)

Cash, cash equivalents and marketable securities	$	219,831		$	256,025
Restricted cash, cash equivalents and marketable securities		167,071			175,884
Current assets		394,781			426,638
Property and equipment, net		515,771			520,996
Total assets		1,350,469			1,403,396
Current liabilities		224,365			263,201
NHC stockholders' equity		897,915			903,004

Selected Operating Statistics
	Three Months Ended						Six Months Ended
	June 30						June 30
	2022			2021			2022			2021
	(unaudited)						(unaudited)
Skilled Nursing Per Diems:
Medicare	$	540.15		$	523.70		$	542.48		$	530.80
Managed Care		413.58			408.81			423.56			407.18
Medicaid		226.40			226.75			227.45			222.57
Private Pay and Other		268.70			256.58			269.42			252.28

Average Skilled Nursing Per Diem	$	297.63		$	298.55		$	301.66		$	297.90

Skilled Nursing Patient Days:
Medicare		85,438			92,163			177,021			183,490
Managed Care		55,230			64,196			110,867			126,107
Medicaid		313,171			300,875			617,431			579,976
Private Pay and Other		166,454			148,247			320,409			281,214

Total Skilled Nursing Patient Days		620,293			605,481			1,225,728			1,170,787


The tables below provide reconciliations of GAAP to non-GAAP items (in thousands, except per share amounts):
	Three Months Ended						Six Months Ended
	June 30						June 30
	2022			2021			2022			2021
	(unaudited)						(unaudited)

Net income attributable to National Healthcare Corporation	$	3,203		$	104,883		$	18,521		$	126,150
Non-GAAP adjustments
Unrealized (gains)/losses on marketable equity securities		3,549			6,489			423			(570	)
Operating results for newly opened facilities not at full capacity⁽¹⁾		1,185			120			1,928			365
Gain on acquisition of equity method investment		-			(95,202	)		-			(95,202	)
Stock-based compensation expense		629			683			1,341			1,179
Income tax benefit on non-GAAP adjustments		(1,394	)		(1,896	)		(960	)		(253	)
Non-GAAP Net income	$	7,172		$	15,077		$	21,253		$	31,669

GAAP diluted earnings per share	$	0.21		$	6.80		$	1.20		$	8.19
Non-GAAP adjustments
Unrealized (gains)/losses on marketable equity securities		0.16			0.31			0.02			(0.03	)
Operating results for newly opened facilities not at full capacity ⁽¹⁾		0.06			0.01			0.09			0.02
Gain on acquisition of equity method investment		-			(6.17	)		-			(6.18	)
Stock-based compensation expense		0.03			0.03			0.06			0.06
Non-GAAP diluted earnings per share	$	0.46		$	0.98		$	1.37		$	2.06

⁽¹⁾ The newly opened facilities not at full capacity for the 2022 period presented consisted of operations opened from 2020 through 2022. This consisted of two behavioral health hospitals, one homecare agency, and one hospice agency. The newly opened facilities for the 2021 period presented consisted of operations opened from 2019 through 2021. The 2021 period consisted of one memory care facility.

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NHC Reports Second Quarter 2022 Earnings