ModivCare (MODV) 23 Feb 232022 Q4 Earnings call transcript

Good morning and welcome to ModivCare's Fourth Quarter and Full Year 2022 Financial Results Conference Call. [Operator Instructions] Please note that this conference is being recorded.

I will now turn the call over to Kevin Ellich, Head of Investor Relations. Thank you, please go ahead.

Good morning and thank you for joining ModivCare's fourth quarter and full year 2022 earnings conference call and webcast.

Heath Officer; President, Mobility; Ken Kern, of is and Executive and today CFO Financial Chief Shepard, Home. me Sampson, Chief ModivCare's Officer, Scott Joining CFO of

factors during want with under actual statements Private results contained may differ in uncertainties Securities is These to remind I and make Act. the started, materially Reform or Information involve company's get management will the events press we the everyone Before regarding today's from cause that release statements today's Litigation other SEC. call, forward-looking that these to in expectations. risks, factors and filings

We included will and hour most will our approximately and discuss posted available A our financial comparable Form directly measures a to definition will conference and A is additional measures to X applicable also website, GAAP this to financial in investors. information release financial concludes X-K. non-GAAP be these call call the the press of replay non-GAAP be modivcare.com. to on of after extent provide today's measures reconciliation

review XXXX and Sampson the Ken morning, we call fourth remarks. provide will quarter he highlights our with full open and update begin outlook on and for year This XXXX. Then an business will of results opening Shepard strategy will our will Heath financial review results. Then for questions.

I'll that over the turn Heath. With to call

we full includes to a our warm solid business results monitoring. strong and ranges. EBITDA welcome XXXX quarter in guidance by double Home Today personal end the adjusted our growth remote services and and call. fourth These revenue patient high our a our digit of care from growth and division, everyone Hello which XXXX reported exceeding driven results mobility and were year earnings year with full

million my we I the XX care guidance members. to we to indicating year our We at for million, take and $X.XXX best acknowledge with of this heading of the dedication and the XXXX point, solid guidance moment issued high billion It's of ended want quality of in momentum express growth. and ModivCare. provide To for that continued EBITDA are entire $XXX $X.X and approximately revenue able team a hard adjusted appreciation $XXX the because into XXXX. work confidence to to them experience to

In taken steps efficiencies the realign drive reallocate to and two past operating quarters leverage. we significant have to resources and

will the our ModivCare best defined alignment One efficiencies across point of strategy, members Our for our which practices, scale services more and all best customer's is help experience share within and and ensure solutions. to our processes supportive across as and each drive us care all standardize holistically solution

for twofold, Our for build build business. To scale XXXX goal for grow our is scale. and

operational To will for to our effectively, to and integrate solutions we deliberately continue develop excellence, more our leverage use strive point will our grow as grow ModivCare We and based care technology solutions. our to value enable solutions. One relationships sell sell and cross

our each entire solutions value to our moving into across shared risk and payments driving approach more eventually about platform. of into based based Our is points arrangements performance care

I'd advancements like exciting to our discuss some efforts. innovation from

our EX allowing value closures and of EX program supportive from activity and sharing next a assessments, health essentially is arrangements are with as seeing are sign care data evolution the have us. impact up payers health utilizes our innovative who monitoring to services. plan and to EX care for the managed leading more organization. outcomes care improving greater patient gap partnership This new us meaningful the recently with based national and it remote using care based on program Our we a of We like value for increased an began solutions want spear tip with for

look to payers benefits. national in we supplemental benefits programs continue are build Advantage our and Medicare with point off several other standard shifting to We to solutions discussions similar from for for ways and innovative programs

more value of drive stakeholders. to and value about arrangements long member confident for are based our meaningful We care our data, adding term and insight all portfolio using analytics to valuable

a very Our year made growth. new for good our sales progress has and organization exciting we of lot have accelerate to plans the

success most revenue Although of beyond. sales the in will XXXX and increase

Our to historically we sales with are X/X pipeline close pursue. and customers contracts has increased we not that by over did signing new

some more highlights Execution, of hired some to into Seth leadership for for and wanted the Ravine we including SVP and Growth, even an dive soon made of it the imagine you job. of update takes people, I Snyder, the time Strategic to as you find our people have quarter, great and announcements our can segment team. we SVP exciting the Before I right We've Matt to changes Innovation on an to But come.

their As putting hard we're that some we make best work. changes. team confident thank to have I'm model to level. priorities to had and for personnel us But adjusted the together those leaving take want our that necessary been who are operating ModivCare the I to next

approximately to the Moving during experienced I'm quarter. This is growth million fourth trip NEMT NEMT driven report our commentary the as pleased or members, a with on increase XX% which by call. third revenue we earnings Mobility increased in from year that consistent membership our grew segment. XX to over quarter growth year to was

and execution discipline team alignment on is working. focus Our

time performance fourth years. on our was example, at For level its highest two quarter in

reduce trips service exceeded a in about contact and third. missed level also by We expectations centers our

main transform continue network model three our omnichannel provide and a operating to We member engagement. multimodal through partnership, Mobility initiatives,

best with in creating partnership provide relationships only transportation a Our initiative our involved narrowing the providers. network win-win

Our while traditional texting, where such, experience also Today, a IVA, member member of engagement operating of engagement. driving ride meets initiative, of member. these a further And primary down improve or All trip have or tailored us. is channel engagement ahead sedan, via as family our member's lot will they opportunity and the multimodal app telephonic we our transit medically the the providing three by initiatives portal members costs. public omnichannel chat, telephonic, the web rideshare, are network initiative, IVR,

We to our throughout operating have implemented performance in initiatives had member on impact structure. experience we both in significant improvement have cost and and fourth quarter, meaningful we the our the expect XXXX

acknowledge Regarding X. reviewed by redetermination, we April can states starting Medicaid that be members

However, could states presence. the fulfill cause delays to are and the obligations, significant reporting outreach especially in where obligated have which in process, various states we

earlier. overcome long expect business term process We we we as such at in And as operational this impacts. outlined enhancements of wins to enable which Investor contract to believe impact the Day strategies any be insignificant. in discussed XXXX June, our us repricing, have And and will

caregiver and Home the fourth continue In XX% our our monitoring care year, trends. caregiver recently to Moving strong segments. improvement we a as on personal the remote of patient division, is see which satisfaction great by implemented revenue We across quarter, grew care comprised caregiver over hiring in the score organization, in our to personal providing to assistance feedback XX caregiver health XXXX benefits XXX(k), by employee and improved such We by through similar to program. an benefit as satisfaction additional over net and advisory our our points capturing a promoter level score. council, year

us industry in we aim rate an better mark can we XXXX. that these excellent helped our we investments members achieve team our we leading has to know While XX%. score retention of maintain in experience year, the and even All do improved last

functions personal sector. doing lift non-caregiver heavy create we certain are Our care continuing to To platform scalable achieve main the this, growth. goal operational efficient in aim for a we is and growth the processes. to to more this, centralize in standardize achieve By and

deployed can efforts be Our standard tools locally and to techniques our strategy also that developing recruitment retention. and on involves accelerate caregiver focusing

de through we ourselves position plan care to openings addition, In to our locations integrate future novo any personal easily expand acquisitions. and

expect to to more based in the our arrangements care focused current arrangements value similar personal for care reimbursement care gap and favorable we We Pennsylvania on remain environment plan closure. value to based add services

as have escalation, on also Visit or arrangements condition added EVV. well focused changes Verification Electronic We new as

to in monitoring XX.X%. particularly part includes which fourth total year EBITDA Guardian XX% and monitoring increasing during the Medical the strong fourth segment, quarter business. year-over-year year We Monitoring of integrated innovative our from which XX% quarter Moving with contribution adjusted remote margin increase in active the revenue saw the patient and saw over acquisition. growth clients important is We our a of

performed that couple of strong execute with new pipeline team can business a well state and wins we our for quarter additional monitoring Medicaid Our last on exceptionally this year.

XX. net leading score remained industry Our at an promoter also

move our our As Advantage Medicare priorities accelerate into we offerings monitoring care to capabilities. and innovate based Medicaid are to XXXX and value continue and sales

growth, We target mid-teens and a our long expect of EBITDA revenue mid-XX% adjusted margin. line growth in with term

facing for want I Before results, review the to our the Shepard, biggest quarter financial challenges over year Ken fundamental to CFO to full of call remind everyone that XXXX fourth Mobility I and care its turn the the elevated the of US prevention inequities patients social on focus the the too vulnerable addressing and to healthcare little and today care health. cost, most are by determinants access systems

address challenges. to positioned uniquely these are We

quality, solutions our care please most experience financial provide in whole. in the us the member supportive as Ken, cost through manner results. walk healthcare in our for Our system customers effective highest the class a best

million Net strong in each was million for adjusted driven of year our share per XXXX and Heath, $X.XX growth income We with $X.XX million year-over-year and continuing per or approximately or X.X% had XXXX revenue share. up $XX $X.X across EBITDA year net digit segments. was was of double loss everyone. Thanks by good of morning, a approximately diluted consolidated $XXX Adjusted operations the and from revenue. $XXX or billion XX% approximately

net For about of X.X% our $XXX year approximately or was year to adjusted share. of $X.XX Net $X onetime contracts. of accrual Adjusted was revenue $X other in included year EBITDA continuing quarter recapture loss or million adjustments, to the half Fourth end million fourth XXXX cents and diluted income related million. million approximately EBITDA quarter of approximately our the share. the Fourth which quarter from increased half to quarter onetime $XX per revenue for revenue. or million fourth adjusted related was benefit a $X.XX over $XX XX% NEMT per operations was

have full Excluding in for about been our when this would range the of XXXX. which a benefit the growth guidance near we good is baseline midpoint adjusted EBITDA thinking year think

in financial segments starting increased to of XXXX or XX% revenue quarter members. to increase the year-over-year with NEMT, XX% our monthly average Mobility million, Transitioning by results $XXX a driven fourth

and a revenue XX% full for expense quarter XX% to the NEMT year average over costs segment, direct X% billion revenue per increase increased monthly per year in includes $X.XX the approximately members year fourth by million. Service XX% to which month. driven year in over XXXX a NEMT For the $XXX all member in increase year increased of

was paid NEMT said, in year. by due monthly in volume That member of a per general adjusted per the EBITDA paid increase transportation NEMT member higher we EBITDA X.X% was related NEMT cost trip. for service was purchase On to XXXX to of expense income the with at sequential XXXX million expect approximately which XX% of trip costs X.X%. monthly the XXXX. quarter gradually a utilization $XX increased membership revenue. environment. increase associated trips fourth The in defined any quarter approximately and XX.X% basis, million higher driven million per Full services the -- and $XXX or increase trip year $XX throughout $XX full quarter-over-quarter approximately inflationary at of NEMT to flat utilization, $XX million as or NEMT fourth was revenue. was were adjusted is trip per net

leverage. fourth margins costs. full and due the transportation year to were partially cost higher NEMT lower primarily by offset for G&A quarter

three higher quarters in expect gradually experienced first XXXX transportation improve the per we cost XXXX. stabilize costs While and of to throughout trip we

caregiver to over segment, the year increase of throughout quarter. quarter fourth Care hiring year. which We $XXX XXXX Turning the a was Personal saw in million, in revenue increases XX% our was

an see fourth $X.X slowdown we the was However, resulted QX December QX typically typically which quarter a low improvement hours to see hours typical flat in range decline as This million, sequentially we seasonality in the still hours from in single-digit around remaining from in seasonal holidays. at QX.

well as $XXX increase full to in quarter retention from which Full year hour, annualized minimum hour CareFinders particularly reimbursement of per third representing rate was an year September the revenue approximately XX% to during year-over-year the Care increase wage improvements due driven per expense increase service the contribution revenue in increased and expenses, primarily our by caregiver increased during where recruiting, corresponding Personal million, increased Care a the X% as wage there and in Personal fourth year. XXXX X% a expense approximately New quarter. XXXX York, in caregiver wages sequentially from acquisition,

$XX.X $X.X Going million, or segment we quarter million continue wage forward, EBITDA in to was of by caregiver increases. offset to of while expect reimbursement adjusted inflation the be was XXXX income segment Personal net rate X.X% revenue. Care fourth

year, Care to XX% was Personal EBITDA of adjusted Personal full year-over-year Care XX.X% $XX approximately increased which the million, For revenue.

expense able the a XXX to margin. to were EBITDA in sequential we drive quarter, G&A during leverage service While fourth point led higher adjusted some decrease basis

to Moving in $XX approximately the quarter $X.X to Monitoring Remote Guardian year-over-year our from included Patient on Revenue approximately XX% fourth million of of contribution Monitoring. million, increased XXXX our acquisition. which Medical

revenue Patient from of approximately contribution For was $XX which the $XX full Remote million included Monitoring year, Guardian. million,

range. and a On the remain RPM members increased improved in in and business. quarter, was approximately adjusted our margins EBITDA by growth fourth confident in million RPM the income across to growth average and mid-teens legacy for the recently mid-XX% monthly in points net adjusted sequential approximately in was million driven $X.X basis, $X.X basis referrals targets XX.X%. X%, EBITDA XX long-term RPM acquired consistent margins segment the We sequentially while revenue

our the use Turning sheet. $XX due from cash Consolidated in XXXX cash of by payments solid core partially our fourth and operations flow to contract million flow flow cash payables, offset of operations. was quarter balance from to the on

by our we contract reduced payables net our of balance $XXX to receivables a the million. net balance, million contract $XX fourth During quarter, of

net For contracts. certain reduced of contract and overpayments by NEMT all relates our XXXX, to million, reserves liability $XXX which on primarily we payables

the from quarter, million impact Excluding items cash remains core from combined flow our of business negative during these fourth solid. the $XX

environment contracts for revolving activity we flow million and, $XXX payable had amounts free of facility. normalized ended reminder, the with a our XXXX XXXX. normalized in drawn expect in for more million We and credit therefore, cash a more level As fourth approximately quarter forward $XX.X on moving a these our of no cash

XX, Our was X.Xx sequentially leverage pro balance December principal net XXXX. as and $X of forma at consolidated was debt flat billion, our

high and XXXX, of We gradually to to our growth. unchanged. reduced remains delevering net and debt reduction time, Xx over Xx ratio target remain through expect leverage the committed be EBITDA net we range In will leverage

As structure rates. a reminder, of current debt our fixed XXX% at is

unchanged our in XXXX provide to are $XXX focus $XXX This with guidance $X.XXX remains we towards range strategy to and deployment on approach billion $X.X committed EBITDA of allocation balanced the balance capital and as revenue that a billion sheet. million. million primary Our we morning, disciplined a to adjusted capital delevering of included

our XXXX. about digits which as Remote of year a division, and the includes basis Monitoring, the expect takes Personal some to Here to adjusted and are revenue puts we on Patient Care consider you think in Within EBITDA ahead. Home and double increase combined

to double-digit For to Personal caregiver the hiring, leading expect single-digit along in by Care, with we rate high hours, revenue driven in improvement reimbursement increases. growth growth, low continued

revenue we high Monitoring, to by mid- teens, driven Patient Remote client expect For in growth growth. new the

of see increased our We of monitoring also our to by services suite engagement expect EX solution. utilization led

flat in expect we segment, approximately Mobility be could our adjusted In XXXX. revenue and EBITDA

pushed in that out we don't While has been a our NEMT impact of opportunities we XXXX. the XXXX, have to meaningful timing had expect several the wins new larger in extent

is ever, confident competitive we and share are as that as of to strong fair continue will win Our contract our going contracts we pipeline forward.

from that the in believe impact half the could could that headwind, second expansions repricings also offset normal in of potential a We year expected wins, are and attrition and contract the XXXX. which be redetermination

half back ongoing making XXXX be the are quarter, of last first year As seasonality on our the expect we investments more we weighted normal year EBITDA impact as to adjusted initiatives, operating as our to half full suggested profitability. well we due during

we second and Xx free to improved also the XXXX. net generate XXXX initiatives expect drive consensus in estimates solid of lower and committed we well our remain the in current delevering expect cadence capture for We cash Overall, the of to think Again, fairly achieve flow leverage half expect time. over quarterly to year. margins cost to these and target

we our wrap and fourth Lastly, full are of things year financial remain long-term To and confident we for in strong up, adjusted in XXXX targets with quarter of billion XXXX. $X EBITDA results. million pleased our revenue $XXX

forward that meaningful for health in to generate next entire like reporting progress and the would also on have work we care, over for upon I confident XXXX, strategic initiatives to year our ModivCare team prepared look several are progress take made that members. XXXX and our at quarters. We results this will the high-quality the build and opportunity the these the outcomes we throughout concludes our while providing thank to to dedication hard operational improving This remarks.

the open questions. please Operator, call for

from is Brian Jefferies. first question today The of Instructions] coming Tanquilut [Operator

on Congrats quarter. solid a

As I should going the an expected. at was rebates? about was generation that's point? thinking behind that be forward in us that flow, this burn how issue think about -- obviously, Is cash there But QX cash we cash and you

Yes. Yes.

So we've XXXX the cash that the we saying XXXX. disproportional bulk been through accumulation just and balance -- or involves amount that off last of and so consistent accumulated paying X was with paid in on accumulation quarters, all of our a for us the what sheet -- off in XXXX XXXX COVID

So the finished $XX the fluctuations. you was And quarter-over-quarter that that as COVID can working payoff we capital our was beyond of kind decrease normal in our million see driver, XXXX. in above paid main and

our for Another as pay debt semi-annually. well, item we everybody, to that when note we just pay

in quarter. So this also that happened

each we the of working reasons question reasons for why And those going are of we your are then So normal forward. we're cash. capital, quarter at flow free main generating forward, to be going again, X now expect for and levels cash

But the that. as obviously, course know being in normalize even in for thinking about you've for redeterminations I this we headwind past, post redeterminations? I also be as then you've should year strong of we it And NEMT business, about talked how and over year the the quantified Awesome. margins a about the NEMT and think QX. Heath, was pretty

Yes.

forward XXXX end as we with Last mainly range be for for There's costs. really feeling through cost and the and around has X inflation, QX by to it primarily primarily QX work the is within on the been margins driven going So fuel hit mark of do lower we've feeling reasons that transition. everybody general. our will our pressures the unit on that the Mobility high segment, in and that

we down that assuring providers, them primarily initiatives unit half, the in expect narrowing mainly involving the start higher coming our the in to latter we a have cost because that key to pay network we However, the level. place, level right which at is can of of therefore,

the the come will that that So high year. watermark, but of part down, hit will be this latter

that, In a kind in take, to that to common the has doing will start chunk to X addition the majority calls moving we allow interactions the call of our of XXXX. expectations telephone. range our apps, our that's text big in members cost, expense, those which reduce messages, us of the the of kind we part with avoidance, have operating are And around middle are and experience, to we still do whether to member of -- with things expect the us of I increase practices

Labick The Bob CJS from next of coming Securities. question is

Peter Bob. It's for Lukas

lot a here. to answer covered most guys You of my questions

are you Just the goals? staffing And the pre-pandemic if And of terms much achieve how on in are those in improvement hiring do quick any think can expectations you closer making levels? year? to for and Personal conditions Care, give levels could seeing and you're update a get in to you labor what

Yes.

in and that everything been has to done that segment So the it where that the a you and XXX-plus tremendous. amount doing really Personal journey, how we've we made of is halfway are a of We've that. a part Haney kind from centralizing the me you that And XXXX these lot the locations account end those for led it. is the lot in by transforming there work used organization of deliver and of to big through really standardizing have on of service how Care progress beginning can

investing that level, see up pay investments that that and we'll in importantly or pay is make bodies in that needed Those as additional with point those start and to our even the some to caregivers integration. the resources, can recruit some importantly, that's investments cases, increased that around had efforts, benefits we we the or retain. that we corporate capital giving with ensure are we whether that off frees more at to that properly finish and ensure as But we

in numbers. So up that -- recruitment showing retention is the our in and

grown care. high-performing consistent with have personal relatively the within players We

a made progress. successful, very of So lot

it articulated challenges the retention. have and to the So stabilized, going initiatives And stay expect to before to stabilized level. we at is the allow beyond in us then really just labor accelerate that I market that

than noted as rates our earlier, higher we normal. high, retention well are As

labor in but to -- good going is about going. always we caregivers So good challenging, in be hourly we're where a people spot, hiring feel specific

there Pre-pandemic yet levels, meeting of not standpoint demand. we're from a that

won't will, all related to question. will but at that's end this that year, of significant think the way I that to we your back we growth. And have even get the

think beyond that of after that, doing that. -- accelerate what the point we'll push is, a we the think labor beyond the So then on of that's update and continue do we're to have I kind And market so that. I reasonable to plan. But

The Street O'Neil from of Partners. Capital next Brooks is question coming Lake

ModivCare a and to initiative in I first, One have I companies state I'd bit that questions. the the of your love hear to managed discussed prepared response you of little a care about governments more couple guess, remarks.

Yes.

vision even for all So our it's cross-functionally us, payers the of allowing well work ModivCare all across resonating is yes, our to and with internally us One divisions.

specific or states. senior why So people within it's the that? C-level they're and resonating within these Because patient payers population. really challenges their is the same having of each struggles And with

of care. services all around that, supportive the impact of and the there It's on and has risk lower ahead or comes that month, study some they week that almost outcomes. direct get how the people And the every every that do kind help higher changing and can of is about one also care of benefits they cost them identify out

discussions now, pilots executives. change really where are doing helping we clients of And So then outcomes their actually we together that acceleration, are to doing data in even help of right them population. and with contract we front that broader either a resonating on lot is them how all bring work in

to So continues and expect long happen. to ensure to increase story and of lot a year that contracts we around this short, that, resonating then that our do very well, work

Fantastic.

a I it's think great initiative.

personal me arena. I call or I ask care just So but you stages really it opportunity guess one various let consolidation personal I some might activity, care the see see Do more. in to arena? more activity that you threat guys happening. the in just it's corporate as

care as up So a then it's XXX,XXX the made personal industry whole continues plus. to mature. mom-and-pop still primarily organizations And of

a it's of are that But rates. shows is industry regulation, -- so actually by sounds thing. the a in -- -- even valuable. So increased almost it's like up personal It more back our the way, question, shows in good And which care, goes members bad services reimbursement is your that thing, that that value this cycle normal up to increased people's previous through of but a your consolidation. for every these in the gets

realize more seeing that consolidate. to sophisticated and up and So continue you're people roll that

So I happening for and continues. the what's there, -- and view hours that, a the there's whole. plenty thing hope the as positive I expect a that industry marketplace as up in of And

a not threat. So

I that I continue. think good industry, to the for and expect

from The next of question Stephens. is Scott coming Fidel

potentially an monetization 'XX seeing to into insights operational a back turnaround. looking if then out doing opportunity with of talked you've question, opportunity. about just for I their been has And Matrix any just half know that how got interested the you've First

around thoughts potential catalyst. that updated your in interested Just

of Yes. not the thesis the of We're months, what really COVID last has X pops post that completely in divestiture them new there. over X to proud businesses restructuring of management team, continuing but COVID, was Matrix done really

gets team get be performance back and those related the risk adjustment not pre-COVID. and this then more distraction brought the was way the they're even So pretty business, a the And they within the levels to all restructuring with costs. that in, to it take lifting importantly, of a and done are that that, that costs lot out then of to heavy away to much

Unfortunately, tech, we kind people. that, our in beyond part kind But process back new on and kind focus increasing those XXXX. XXXX of of lost early that's and that XXXX, of of they're even

So each been up there, the continue showing I'm accelerate expect that to to quarter. improve numbers, performance in related really financial the encouraged doing what and they've in to I about

them that's I in know is I be be in for we to and right XXXX. the them watching now perform But and them do think and again, that monetization there an still point us could And potentially, I've said early that in there. perform. we're happen something there's will And exit would what for helping seeing is be us. look XXXX. the yes, it will watching time, so forward at really

course seems some does higher out think Understood. redeterminations? factor mix just right, utilization And modeling start of see sort in we sort us would about building to in just play just we of question, of assuming in obviously, exercise in. you're in sound impact, I of average be prudent. modeling in as which getting sort of membership and my trickier some and until you're just all terms interested back we as quarters redeterminations It follow-up XXXX, the the think of I how over a like for then that's just the tempo to kick

Yes.

right. you're So

wins We expect numbers we that -- we're But what that coming we our into new that have membership portfolios QX of to QX. expansion other with have in doing, do we also and certain do modeled that offsets coming have. down, down

does happening to I in we're redetermination, probably And happen. think it's also through. So it conservative a we our start think we'll if little manage do likely to something able that's is why be going model saying for what's

know, people requirements and we'll that what requirement people the they everybody roll talked around detailed. to take Scott, And I out and have some figure they appropriate laborious do The before -- you a to going a to time. price. states talk you If this. and lot I to And of do think that's are think lot a do and I off for

So it's we're modeling -- again, it. I think

in the it's chunk think we're model, that latter this it in with volume business half is of offsetting a year. conservative, but way of new I new the good our and

The Chickering next from coming Bank. Peter question Deutsche of is

with call is about start there looks you Peter. across end you the costs for wage that Kieran key some the Ryan I the top others? there color Can guidance. like sticks on guidance on expense between good businesses. us XXXX. versus the just the off is out growth X.X% This like low it's to high more out the range, is swing And turnover, can of factors anything have and within X.X% X.X% in are line It But assumptions transportation that margin growth, given whether than any

Yes.

both a our well latter that side, to that things. where expense as right with back coming life costs structure we of those Getting the in doing. high the in are we couple part cost The of in on the the at Mobility is as and So down are to and now, start operating in initiatives the year. expect or Mobility COGS point of cycle unit this we

remained that full how the So we'd cost still the year, high. And end to structure of year, not it is again, be elevated off rolling the exiting. it's to for

the for margin we explanation one have. that that's So

making And year latter in out getting that of now other where centralized, moving said because earlier, happening start right deliberate absolutely as into now. to a this and the part and will that in also in we have centralized cost thing little this why shift lot those bit the model In reason need as that people. we the changes sense. is back we're Personal and the actually the Care the new office catch to cost well a the And it makes I with we're business investing and do, operations doing we're that this other processes we're of basically

it building up the we'll tech, integration to in cost operating people, finish with process deliberate of be But part the We're in in way we the the centrally. and right latter year. able that this lower with as field

higher we're the and aside, exiting cost from exit a that improve probably point the perspective of at range Personal our XXXX. to expect in a again, and I from the margin So be segment Care and end high perspective on

selling. about focus Margins Really that as and monitoring are very the We're us, is the opportunity strong. same with -- all for well. the we're in

XXXX nominally getting We leverage on are I minimal to G&A this year expect beyond. then that the improve and and side.

different that we parts that right we're QX. So right also in look investing we're we that this in the And that the have as in ensure, forward if releasing talked of our to well with that around and how the of in right expect we and earlier at And a to happen the people business, did are seats. right see that again, part other doing, we what you about I we I people and the ensuring can thing add-backs, that are we the going people have seat. you did

feel All we really going comfortable cost and beyond ranges people that putting aside, our feel have that. with margin about the from the and in really get we XXXX that we comfortable leverage structure

at margins that I that would we will be of comment the $X X.X% X.X% benefit other The the right end on that experienced for million fourth you add take call, onetime what the to low The if XXXX. out in quarter. we of is the mentioned

so And appropriate. like jumping-off point feel we is the really,

And opportunity like we XXXX. so in have feel we upside

just quick then a And helpful. follow-up. very That's

of there's there. -- on impact factor pricing and just negative back that? attribute Is quite that is just Top as quarter? look from is RPM dynamics the leverage out faster not just to need Guardian And get a other for line, annualize there. leverage some of growing do most that and some but we generating it's or that point then there acquisition where are touched than these EBITDA should kind that you revenue. you to that know those you of operating there kind to contract to holding You well, I about up Would talked repricings last much G&A as

in Yes. pricing actually Guardian line the it. is has Yes. with right The the of rest

it So integrated, -- getting it's -- RPM drag. not just hasn't off leverage are from been really successful of that The acquisition a a within Guardian group. is the we a

to really us. the that's So congratulations good team for and successful, it's

deliberately coming that margin we had in MA a license large even because that pricing to the and the we On we're national into to getting side, had doing XXXX, the for a related definitely hunt. that payer pricing is

that So of is business the because MA again, in for -- all decrease forward. delta business, I'll going the that's that day, and that help for main do will But that dollar margin on. the amount but the the brought we MA day reason every grow

that. we're excited about -- really So that

still because I are don't there and are point want on just Margins the lower we're to leverage opportunity on us, more are the around strong, really with well. side. For think a levels expected, overplay the if about where G&A leverage now. then performing growing we're G&A are we're that but whole. And platform side. to as it's we that well. is that MA still -- they and the and I that do I'm now, as growth ModivCare ensuring those there's But an get business stuff. are fine right on we purpose continue necessary I'll do And prioritizing as one the just to

the great short, to MA and I that beyond. purpose continue story and based long So for expect on on margin, XXXX business,

coming The Brian Tanquilut from next is question of Jefferies.

me follow-up for do Thanks here. a letting

provided, about ranges think you I for EBITDA. both say, longer-term in guidance previously As XXXX, had and revenue the

out where about think some us it of want are we bit and right? conservatism or next to in would you -- call little growth valid that implies about year So acceleration should you XX, 'XX or be in for 'XX acceleration I either 'XX, should drive for you years? or that thinking anything a in

the is Home reasonable. division growth the So within very

to to about in the to has is those have, the talked we line where with business. and I'm June, what do of with growth with performance. expect with additional in we we in Where with this at what comfortable market, and most And and last for kind needs in happen line look you really the us, really selling. are are line just where primarily, If the steady NEMT that --

So there's X I and 'XX dynamics that the and accelerated going around feel comfortable bump into 'XX. happened business with NEMT what has in why

-- for talking And every out. of about is have XX-plus pushed RFPs been RFPs -- a pushed many pushback I'd for really out think One months. Many them the we're month, of the and I these large year. say they keep getting

this latter But than we that share more lot expect win until so those. will XXXX. year, and come RFPs of a of of volume larger year, to And come our this part up, fair will the these on

other So that the half of selling. is

hired we've So our some focus right. hunters, --

signing also but past big clients. hunters. That we We deal have there. are we our many focus payer focus talk hasn't a that the close there's big out large before, people, with lot other in is great there's been big know management even on more large And our hired we've And And account our to growth a really -- really to X. on of focus. before. haven't current the to We didn't a talked payers we beyond we

we kind So articulated, time since the -- pipeline, August-September is the as up of and frame. significantly

So together, share to with timing the across in the targets our will XXXX. allow hit growth those therefore, Mobility RFPs, our coupled us of to two through large hunting company targets those fair winning the hold and growth

next Research. Mike The question Petusky from is coming of Barrington

one Just others. two then possibly or one and one maybe real quick

a in completely that is the is the -- saying? what Is you're On characterization essentially of essentially impact the payables fair sure issue, I out. of saying impact cash axed not reduced, sort you're flows 'XX just to make but way on want

see that in there's you kind of happens with more happened in happen there's see and quarter. XXXX, little said happen anywhere kind Well, the that that -- a things. fourth of that that what million always, $XX so yes, of unusual is a to $XX million should I in Consistent that you so -- There's paid before, bit out like little a explain. couple I

are contracts seeing increase bit. in We little still that a certain that still

a is contracts there of our lumpiness payable a So little to for few going bit some -- be in contracts.

a is to COVID we're capital the the consistently little is that increases still million in that saying. $XX each the working not decreases that bit kind extent back quarters, of been I've there through us. be I and will and big working but to behind earlier then, of normal some to bump don't want that couple million lumpy is to $XX therefore, distract we quarter. of message But next from that the I said

Okay.

be trying and mouth, not that -- your the of mean, I in the $XX So over possibly maybe but or? words it just I could put of to sort $XX of mean I'm million like terms of terms in something million, drag, magnitude, course year or in

the that's to way box in. Yes, right it

in attrition in And sort to some the then attrition can that potential the with any then size and your sort I the way, second allude associated of relationships. half, pushout which of risk size assuming mean, attrition that up, around Perfect. of also in transportation? you seem and in have the I'm of been that on aggregate in Okay. is sort obviously, existing you out there mind pushed half contract I contract sort the guess existing be could second

Yes.

having half see So I don't attrition. the second incremental

we QX, but the numbers. within volume what won until our in in right main the haven't part I again, year, That's continue you're latter expect wouldn't are in to attrition expect What's think I increased numbers well we any volumes, QX, of new we more XXXX. win but the that numbers don't happening And we've is QX. now on got and expected. has that in current I our right, actually right -- we our we this continuing to come now message. to the get beyond win so

that other there large going a have kind to we to annual happening. really it's said, us on for material then good. that that can I'm have $XX either don't very asked the material to thing glad and I is to I are because nothing don't don't size million want so the there's question we're So get the But side, was of opportunity EBITDA risk one an a million, That of contracts contract expect attrition or impact. as -- a you that the from right, good want don't stand-alone, -- range which to is because we have additional have $X perspective, being

that. we a But through at some from risk can of time, perspective, same the manage

the up I So probably will that over next year range. I perspective the expect that, to be range this months right to that come contracts a of the to don't XX from coming on risk forward. come off. all expect But that, going X in X like there's anything opportunities

Got you. right. All

it are delivery and sneak like more any down thinking about back more go think should me this it of seems one a for last how maybe Let times, I've on guys realistically but 'XX road this you something asked about of is burner as guys really a long we Or of term, back And on? couple update the you and that? meal burner might just in. in and sort about that all

No.

in feel our want plan really meals. to what do we for I So good about

new platform referral-based -- makes in a that the platform Home great people have a we that our We over, and division, that which business. of sense lot it's because is have actually it's on the have that taken it's

the the they people have that skill states appropriately to that and grow. have the -- we've tools, -- we So have to have the set. right And picked right we partner, start

because on mainly we we for we objectives, the want will show, it we're contribution have getting sure We thing. be that have that will to expect this that. look as achieve that prove we're -- I to to in EBITDA have OKRs it, and accelerate doing we and quarter and clear The designed XXXX, model and out nominal really do I revenue updating right year, continue it. how But the place right yes, in this you it's I each before mousetrap make we

in do XXXX to going it's beyond. what around conviction my and Here's

So a good meals. be to it's for year going

a in actually it point 'XX it a? to actually talking about as could So start you get where

Well, mean that, commitments will. team and got execute from customer place, perspective. it's say I expect have, we to this working I I don't the have better. on Better, actions I that that disciplined that that right? hope that, that's from a we the on the we've we and in mean

turn for time, to over At additional comments. the or floor Sampson Mr. this closing to back like I'd

participating for in thank to your interest you want on and our this call morning I ModivCare.

website. Our and on are quarterly updated Investor Relations deck investor presentation supplemental the posted

interested speaking quarter our before Ellich, we Kevin contact look results Investor next please days, many calls, scheduling May. over of any are follow-up If to weeks, number forward in Head months report of you you Relations. the with We our in of

you a the thank for again Have support. great all So day.

This participation. Ladies you your event. for today's thank gentlemen, concludes and

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