ModivCare Inc (MODV) 2024 Q2 法說會逐字稿

Good morning and welcome to ModivCare's second quarter 2024 financial results conference call. (Operator Instructions) Please note this conference call is being recorded.

早安，歡迎參加 ModivCare 2024 年第二季財務績效電話會議。（操作員說明）請注意，本次電話會議正在錄音。

I would now like to turn the call over to Kevin Ellich, Head of Investor Relations. Mr. Ellich, you may begin.

我現在想把電話轉給投資人關係主管凱文‧埃里奇(Kevin Ellich)。埃利奇先生，您可以開始了。

Good morning and thank you for joining ModivCare's second quarter 2024 earnings conference call and webcast. Joining me today is Heath Sampson, ModivCare's President and Chief Executive Officer; and Barbara Gutierrez, ModivCare's Chief Financial Officer.

早安，感謝您參加 ModivCare 2024 年第二季財報電話會議和網路廣播。今天加入我的是 ModivCare 總裁兼執行長 Heath Sampson；以及 ModivCare 財務長 Barbara Gutierrez。

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

在我們開始之前，我想提醒大家，在今天的電話會議中，管理階層將根據《私人證券訴訟改革法案》做出前瞻性聲明。這些陳述涉及風險、不確定性和其他因素，可能導致實際結果或事件與預期有重大差異。有關這些因素的資訊包含在今天的新聞稿和公司向 SEC 提交的文件中。

We will also discuss non-GAAP financial measures that provide additional information to investors. A definition of these non-GAAP financial measures and to the extent applicable, a reconciliation to their most directly comparable GAAP financial measures is included in our press release and Form 8-K.

我們還將討論為投資者提供更多資訊的非公認會計準則財務指標。我們的新聞稿和 8-K 表中包含了這些非 GAAP 財務指標的定義以及在適用的情況下與其最直接可比較的 GAAP 財務指標的調整表。

A replay of this conference call will be available approximately one hour after today's call concludes and will be posted on our website modivcare.com

今天的電話會議結束後大約一小時將提供本次電話會議的重播，並將發佈在我們的網站 modivcare.com 上

This morning, Heath Sampson will begin with opening remarks. Barbara will review financial results and guidance, and then we'll open the call for questions.

今天上午，希斯桑普森將致開幕詞。芭芭拉將審查財務業績和指導，然後我們將開始提問。

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

這樣，我就把電話轉給 Heath。

Good morning, and thank you for joining our second quarter 2024 earnings call. Second quarter results were in line with our expectations with adjusted EBITDA of $45 million and revenue of $698 million. These results were primarily driven by our strong operational performance in our NEMT segment due to our improved go-to-market capabilities, resulting in new business wins and upward pricing.

早安，感謝您參加我們的 2024 年第二季財報電話會議。第二季業績符合我們的預期，調整後 EBITDA 為 4,500 萬美元，營收為 6.98 億美元。這些業績主要得益於我們在 NEMT 領域的強勁營運業績，以及我們改進的上市能力，從而贏得了新的業務並提高了定價。

Additionally, our cost structure continues to improve as we automate and optimize our omnichannel engagement capabilities and multimodal network. Within personal care services, the ongoing centralization and standardization has provided a solid platform to build upon, but has temporarily increased our cost structure and moderated growth.

此外，隨著我們自動化和優化全通路參與能力和多式聯運網絡，我們的成本結構不斷改善。在個人護理服務領域，持續的集中化和標準化提供了堅實的平台，但暫時增加了我們的成本結構並放緩了成長。

That said, our PCS performance improved sequentially, and we exited the quarter trending towards our long-term margin target. Additionally, the softening labor market is favorable for our recruiting and retention efforts. Remote patient monitoring revenue growth was lower on a year over year basis due to client membership churn, primarily because of reduction in our membership within our largest Medicare advantage clients.

也就是說，我們的 PCS 業績連續改善，並且我們在本季結束時朝著長期利潤目標的方向發展。此外，勞動市場疲軟有利於我們的招募和留任工作。由於客戶會員流失，遠距病患監護收入年增率較低，這主要是因為我們最大的醫療保險優勢客戶的會員數量減少。

Although the overall MA supplemental benefit market is under pressure, we have a differentiated market position, as our RPM business is primarily Medicaid long-term services and support and we feel confident about RPM growth normalizing in the second half of the year with mid 30% margins.

儘管整個 MA 補充福利市場面臨壓力，但我們擁有差異化的市場地位，因為我們的 RPM 業務主要是 Medicaid 長期服務和支持，我們對下半年 RPM 增長正常化 30% 充滿信心邊距。

Based on our first half results, we reaffirmed our 2024 revenue guidance of $2.7 billion to $2.9 billion and lowered adjusted EBITDA guidance to $185 million to $195 million, primarily due to lower than anticipated personal care services results from the first half of 2024. However, we expect to exit 2024 at a seasonally adjusted run rate of $210 million to $220 million of adjusted EBITDA.

根據我們上半年的業績，我們重申了2024 年27 億至29 億美元的收入指引，並將調整後EBITDA 指引下調至1.85 億至1.95 億美元，這主要是由於2024 年上半年個人護理服務業績低於預期。然而，我們預期 2024 年經季節性調整後的 EBITDA 運作率為 2.1 億至 2.2 億美元。

Next, I'd like to recap some highlights for the second quarter. Starting with business development. During the second quarter, we won $33 million of annual contract value, adding to the $36 million won in the first quarter. In addition to various other client onboarding, we onboarded a significant state contract in early June, which is already demonstrating strong performance and results.

接下來，我想回顧一下第二季的一些亮點。從業務發展開始。第二季度，我們贏得了 3,300 萬美元的年度合約價值，第一季為 3,600 萬美元。除了各種其他客戶入職之外，我們還在 6 月初簽訂了一份重要的州合約，該合約已經展示了強勁的業績和成果。

Importantly, we received extensions on 84% or $526 million out of $623 million in our state Medicaid contracts that were up for renewal this year, including a verbal commitment from our largest state contract in New Jersey to extend through July of 2025. We remain highly confident in our ability to extend the remainder of our state contracts and win additional contracts in the second half of the year.

重要的是，我們在今年續簽的6.23 億美元州醫療補助合約中獲得了84%（即5.26 億美元）的延期，其中包括我們新澤西州最大的州合約的口頭承諾，將延期至2025 年7 月。我們對延長剩餘的州合約並在下半年贏得更多合約的能力仍然充滿信心。

Next, an update on our cost saving initiatives. In the second quarter, we realized $7 million in net cost savings, driven primarily by our strategic initiatives in our NEMT segment. Our omnichannel engagement includes digital tools that help members, transportation providers, and medical facilities manage trips through apps, text messages, web portals, IVA, IVR or when needed a low-cost high touch experience with our integrated contact center.

接下來，我們介紹一下我們的成本節約計畫的最新情況。第二季度，我們實現了 700 萬美元的淨成本節省，這主要得益於我們在 NEMT 領域的策略性舉措。我們的全通路參與包括數位工具，可協助會員、交通提供者和醫療機構透過應用程式、簡訊、入口網站、IVA、IVR 或在需要時透過我們的整合聯絡中心提供低成本高接觸體驗來管理行程。

For example, digital reservations increased to 33% in the second quarter, up from 23% a year ago. Additionally, we are the most connected and connectable NEMT provider, meaning that we are the only company that's digitally integrated with our nationwide network of transportation providers through 40 trip management systems.

例如，第二季數位預訂增加至 33%，高於一年前的 23%。此外，我們是聯繫最緊密、連接性最強的 NEMT 供應商，這意味著我們是唯一一家透過 40 個行程管理系統與全國交通提供者網路進行數位整合的公司。

We're fully integrated with rideshare providers like Lyft and Uber and we're connected with over 4,000 medical facility portals and we have over 250,000 members and caregivers, who are connected through our member app.

我們與 Lyft 和 Uber 等共乘服務提供者完全集成，並與 4,000 多個醫療機構入口網站連接，並且擁有超過 250,000 名會員和護理人員，他們透過我們的會員應用程式連接。

Additionally and uniquely, we have API connections with our largest clients. This setup allows real-time automated eligibility verification and enables clients to manage the member experience through an API connection to our platform. All these components not only improve the stakeholder experience, but also reduce costs, evidenced by our call to trip ratio improving to 38% from 52% a year ago.

此外，最獨特的是，我們與最大的客戶有 API 連接。此設定允許即時自動資格驗證，並使客戶能夠透過與我們平台的 API 連接來管理會員體驗。所有這些組件不僅改善了利害關係人的體驗，而且還降低了成本，我們的呼叫出行比率從一年前的 52% 提高到 38% 就證明了這一點。

Our second strategic initiative involves sophisticated AI algorithms and technology to manage transportation using fit for purpose modes, which is our multimodal network management initiative. This ensures the optimal time in place for the members' transportation needs, enhancing the clients and member experience.

我們的第二個策略舉措涉及複雜的人工智慧演算法和技術，以使用適合目的的模式來管理運輸，這是我們的多式聯運網路管理舉措。這確保了會員交通需求的最佳時間到位，從而增強了客戶和會員的體驗。

This initiative has also shifted more trips to lower cost modalities, though the most appropriate level of service for members including rideshare, mileage reimbursement and public transit, which combined accounted for 45% of trips in the second quarter.

這項舉措也使更多的旅行轉向了成本更低的方式，儘管最適合會員的服務水平包括共乘、里程報銷和公共交通，這些服務合計佔第二季度旅行的 45%。

Additionally, our digital engagement in AI algorithms are further reducing waste and improving efficiencies in routing, enabling us to lower our purchased services cost per trip by 5% year-over-year, and payroll and other expenses per trip by 17%, despite inflationary pressures.

此外，我們對人工智慧演算法的數位參與進一步減少了浪費並提高了路線效率，使我們能夠將每次行程購買的服務成本同比降低5%，並將每次行程的工資和其他費用降低17%，儘管通膨壓力。

Our strategic initiatives are also effectively offsetting impact of rising health care utilization and Medicaid redeterminations. We remain confident in achieving our targeted savings of $30 million to $50 million in 2024 as most of the initiatives have been developed, implemented, and are in varying phases of adoption and optimization.

我們的策略措施也有效抵消了醫療保健利用率上升和醫療補助重新確定的影響。我們仍有信心在 2024 年實現節省 3,000 萬至 5,000 萬美元的目標，因為大多數措施已經制定、實施，並處於不同的採用和優化階段。

Our platform enhancements resulted in a member facing, data rich platform, which ultimately improves the member experience and allows us to save costs through greater efficiencies in our trip management and related revenue cycle activities, which will help us achieve targeted cost savings of $60 million on a run-rate basis in 2025.

我們的平台增強功能打造了一個面向會員、數據豐富的平台，最終改善了會員體驗，並使我們能夠透過提高旅行管理和相關收入周期活動的效率來節省成本，這將幫助我們實現6000 萬美元的目標成本節省2025 年運行率基礎。

Additionally, our data rich capabilities further differentiate our ability to meet client needs, beyond the trip itself. Our clients greatly value our access to their hard to reach members. And when this is combined with critical insights from our tech-enabled data rich platform that impact the cost and quality of care, we become an indispensable partner. This differentiation not only strengthens our position to retain and expand NEMT services, but we'll also drive incremental revenue through value-based care programs.

此外，我們豐富的數據能力進一步增強了我們滿足客戶需求（超越旅行本身）的能力。我們的客戶非常重視我們接觸到他們難以接觸到的會員的機會。當這與我們技術支援的豐富數據平台中影響護理成本和品質的關鍵見解相結合時，我們成為不可或缺的合作夥伴。這種差異化不僅增強了我們保留和擴展 NEMT 服務的地位，而且我們還將透過基於價值的護理計劃來增加收入。

Shifting to our debt refinancing. On July 1, we completed the successful refinancing of our $500 million 2025 senior secured notes with a new $525 million term loan B. We thank our partners and new investors involved in this transaction.

轉向我們的債務再融資。7 月 1 日，我們透過新的 5.25 億美元定期貸款 B 成功完成了 5 億美元 2025 年優先擔保票據的再融資。

Next, I'll turn to our free cash flow. As anticipated, free cash flow in the first half of 2024 was negative due to settlements on contracts, payables, growth in contracts, receivables and our semiannual cash interest payments. However, the increase in our contract receivables is primarily related to a few customers with whom we are actively negotiating prepayment resets.

接下來，我將轉向我們的自由現金流。正如預期的那樣，由於合約、應付帳款的結算、合約、應收帳款的增長以及我們的半年度現金利息支付，2024 年上半年的自由現金流為負。然而，我們的合約應收帳款的增加主要與我們正在積極與少數客戶協商預付款重置有關。

These adjustments correspond with Medicaid redeterminations and higher utilization and will be retrospective, generating positive cash flows in the second half of 2024 and improving our cash conversion cycles.

這些調整與醫療補助的重新確定和更高的利用率相對應，並將具有追溯力，在 2024 年下半年產生正現金流，並改善我們的現金轉換週期。

While our quarterly free cash flow fluctuates throughout the year, we expect a normalized adjusted EBITDA to free cash flow conversion rate of 30% exiting 2024. Recovering from COVID and Medicaid redetermination has been challenging and extended, but our sustained differentiated offering and optimized cost structure are now delivering strong, sustainable results that will enhance shareholder value.

雖然我們的季度自由現金流全年都會波動，但我們預計 2024 年正常化調整後 EBITDA 與自由現金流的轉換率為 30%。從新冠疫情和醫療補助重新確定中恢復過來一直充滿挑戰，而且時間較長，但我們持續的差異化產品和優化的成本結構現在正在帶來強勁、可持續的成果，從而提高股東價值。

Diving a little deeper into our segment performance. Second quarter NEMT performance showed meaningful top line sequential growth and meaningful improvement in our gross margins, driven by our cost saving initiatives. We are encouraged by performance in NEMT as overall health care service utilization continues to normalize, and again, we expect the new normal at year's end.

更深入了解我們的細分市場表現。在我們的成本節約措施的推動下，第二季度 NEMT 業績顯示出顯著的營收環比成長和毛利率的顯著改善。隨著整體醫療保健服務利用率繼續正常化，我們對 NEMT 的表現感到鼓舞，並且我們再次預計年底會出現新常態。

Our strategic positioning and enterprise go-to-market approach has enabled us to secure upward pricing to offset higher utilization even in a challenging environment. Our payer clients are under significant pressure to maintain their margin amidst rate cuts and inflationary pressures impacting their growth.

我們的策略定位和企業進入市場的方法使我們能夠確保上調定價，以抵消更高的利用率，即使在充滿挑戰的環境中也是如此。在降息和通膨壓力影響其成長的情況下，我們的付款人客戶面臨維持利潤的巨大壓力。

We have successfully navigated Medicaid redeterminations and the resulting increase in health care utilization, diligently managing the corresponding impact on our working capital. As evidenced by our contract wins and retention, we are well positioned to secure additional NEMT contracts.

我們成功地應對了醫療補助的重新確定以及由此帶來的醫療保健利用率的增加，並努力管理對我們營運資本的相應影響。正如我們贏得的合約和保留的合約所證明的那樣，我們有能力獲得更多 NEMT 合約。

Incremental volume flows through at a strong contribution margin to adjusted EBITDA, which is why we are excited about consistently adding net new volume each quarter and the significant positive impact this has on our future growth and margin prospects.

增量流量對調整後 EBITDA 的貢獻率很高，這就是為什麼我們對每季持續增加淨新銷售量以及這對我們未來成長和利潤前景產生重大積極影響感到興奮。

In the second quarter, PCS performance showed sequential improvement with study growth in both revenue and hours. We recently secured a meaningful rate increase from New Jersey effective July, 1 and continued to benefit from rate increases in New York that became effective on March 1.

第二季度，隨著研究收入和小時數的成長，PCS 的業績呈現較上季改善。我們最近從新澤西州獲得了有意義的加息，並於 7 月 1 日生效，並繼續受益於紐約於 3 月 1 日生效的加息。

Over the past year, our centralization and standardization efforts have driven efficiencies, aligned incentives and strengthened our core capabilities. However, as often occurs during the rapid transformation, margins and growth has been temporarily affected.

在過去的一年裡，我們的集中化和標準化工作提高了效率，調整了激勵措施並增強了我們的核心能力。然而，正如快速轉型過程中經常發生的那樣，利潤和成長受到了暫時的影響。

We have two focused strategic initiatives, first, business development and referral management, and second, optimizing our centralization and standardization efforts to enhance our hyper local community focus, thereby enabling and empowering us to accelerate caregiver recruiting and retention.

我們有兩項重點策略舉措，第一，業務發展和轉介管理，第二，優化我們的集中化和標準化工作，以增強我們對當地社區的關注，從而使我們能夠加速護理人員的招聘和保留。

As a result, we remain confident in driving profitable growth in our personal care segment and have implemented the necessary people process and technology changes to return to a 10% margins in the coming quarters.

因此，我們仍然有信心推動個人護理領域的獲利成長，並實施了必要的人員流程和技術變革，以在未來幾個季度恢復 10% 的利潤率。

With respect to PCS regulatory environment, while there is ongoing information from New York regarding the consumer-directed personal assistance program or CDPAP, we are well positioned with a diversified and healthy book of agency and high acuity waiver business. Only $3 million to $5 million of PCS adjusted EBITDA is derived from CDPAP. Additionally, we may benefit from changes as we have the expertise and scale to manage consumer-directed programs.

就 PCS 監管環境而言，雖然紐約不斷有關於消費者導向個人援助計劃 (CDPAP) 的信息，但我們憑藉多元化、健康的代理和高敏銳度豁免業務，處於有利地位。PCS 調整後 EBITDA 中只有 300 萬至 500 萬美元來自 CDPAP。此外，我們可能會從變革中受益，因為我們擁有管理消費者導向計劃的專業知識和規模。

Our RPM business continues to experience higher than expected churn from MCO clients, primarily within our largest MA client. However, we expect top line growth will reaccelerate in the second half of 2024. We remain confident that growth will normalize, and we believe margins will remain in the mid 30% level as we invest in our offerings and focus on getting more share of clinical budgets allocated for monitoring and engagement services, which have not been impacted by the shifting reimbursement landscape.

我們的 RPM 業務的 MCO 客戶（主要是我們最大的 MA 客戶）的流失率持續高於預期。然而，我們預計營收成長將在 2024 年下半年重新加速。我們仍然相信成長將正常化，我們相信利潤率將保持在30% 左右的水平，因為我們投資於我們的產品，並專注於為監測和參與服務分配更多的臨床預算份額，而這些預算並未受到轉變的影響報銷景觀。

We have made significant progress over the last 18 months. Our strategy remains clear as we are well positioned to capitalize on the evolving health care market, which demand services to manage health outside of the clinical settings.

過去 18 個月我們取得了重大進展。我們的策略仍然明確，因為我們處於有利地位，可以利用不斷發展的醫療保健市場，該市場需要在臨床環境之外管理健康的服務。

We are focused on enabling members to stay at home and are taking a more proactive approach to their health. We have added technology and clinical resources to go beyond trips in home care for monitoring devices to manage high-risk cohorts, truly lowering costs and improving health outcomes for our clients.

我們致力於讓會員能夠待在家裡，並採取更積極主動的方法來保護他們的健康。我們增加了技術和臨床資源，超越了居家照護的範圍，使用監測設備來管理高風險族群，真正降低了成本並改善了客戶的健康結果。

Our proprietary platform and differentiated tech-enabled healthcare services delivers risk appropriate care based on member acuity and SDoH needs that serve as an extension of the member's existing primary care and care team.

我們的專有平台和差異化的技術支援醫療保健服務根據會員的敏銳度和 SDoH 需求提供風險適當的護理，作為會員現有初級護理和護理團隊的延伸。

We have modernized three service lines, that can operate independently as differentially aided scale platforms. When combined our service lines leverage our unique cost structure with shared services and business development, but also having ability to drive incremental growth from cross-selling opportunities.

我們對三條服務線進行了現代化改造，這些服務線可以作為差異化輔助規模平台獨立運作。當我們的服務線合併時，我們將利用我們獨特的成本結構與共享服務和業務開發，同時也有能力透過交叉銷售機會推動增量成長。

Also, it's important to note that our business is countercyclical, given the ongoing uncertainty about the macro environment and potential economic downturn, the demand for our supportive care services is expected to remain stable.

此外，值得注意的是，我們的業務是反週期的，鑑於宏觀環境的持續不確定性和潛在的經濟衰退，對我們的支持性護理服務的需求預計將保持穩定。

Regarding our capital structure, now that our debt refinancing is complete. Our top priority is to proactively deleverage our balance sheet. We will evaluate all options to enhance value by optimizing our operations and continuing our mission to build a scaled SDoH platform.

關於我們的資本結構，現在我們的債務再融資已經完成。我們的首要任務是主動去槓桿化資產負債表。我們將評估所有選項，透過優化我們的營運並繼續我們建立規模化 SDoH 平台的使命來提高價值。

As for Matrix Medical, we remain aligned with our partner and Matrix management, and we'll provide updates about a potential monetization event when there are developments to report. As we previously indicated, we anticipate this will be later this year or early next year.

至於 Matrix Medical，我們與合作夥伴和 Matrix 管理層保持一致，當有進展需要報告時，我們將提供有關潛在貨幣化事件的最新資訊。正如我們之前指出的，我們預計這將在今年晚些時候或明年初進行。

I appreciate the hard work and effort from all team members at ModivCare’s as we continue to provide great value to the health care system, our clients and our members.

我感謝 ModivCare 的所有團隊成員的辛勤工作和努力，因為我們繼續為醫療保健系統、我們的客戶和我們的會員提供巨大的價值。

Now I'll turn the call over to Barb, who will share additional details about our future results and outlook for 2024. Brab?

現在我將把電話轉給 Barb，他將分享有關我們未來業績和 2024 年展望的更多詳細資訊。布拉布？

Thank you, Heath, and good morning, everyone. Second Quarter 2024 revenue was flat year-over-year at $698 million driven by 3.5% PCS growth, offset by a 1% decrease in both NEMT and RPM. Second quarter net loss was $129 million, largely due to the $105 million goodwill impairment in our RPM segment and adjusted net loss was $375,000, or $0.03 per diluted share.

謝謝希斯，大家早安。2024 年第二季營收同比持平，為 6.98 億美元，主要受到 PCS 成長 3.5% 的推動，但被 NEMT 和 RPM 下降 1% 所抵消。第二季淨虧損為 1.29 億美元，主要是由於 RPM 部門的商譽減損為 1.05 億美元，調整後淨虧損為 375,000 美元，即稀釋後每股虧損 0.03 美元。

Second quarter adjusted EBITDA was $45 million or 6.5% of revenue, driven by solid performance in our NEMT and RPM segments, as well as sequential improvement in PCS. Turning to a review of our segment financials.

第二季調整後的 EBITDA 為 4,500 萬美元，佔營收的 6.5%，這得益於我們的 NEMT 和 RPM 部門的穩健業績，以及 PCS 的連續改善。轉向對我們部門財務狀況的審查。

NEMT second quarter revenue decreased 1% year-over-year, but increased 2.4% sequentially to $491 million. NEMT revenue incrementally benefited from successful execution of contract reconciliations and negotiated pricing increases that were more favorable than expected.

NEMT 第二季營收年減 1%，但季增 2.4%，達到 4.91 億美元。 NEMT收入逐漸受益於合約對帳的成功執行以及比預期更有利的協商定價上漲。

Average monthly membership increased 2% sequentially to $29.7 million due to the onboarding of previously announced contract wins modestly offset by Medicaid redeterminations. Trip volume increased 2.5% quarter-over-quarter, while revenue per trip decreased modestly due to contract mix.

平均每月會員資格比上一季增長 2%，達到 2,970 萬美元，原因是先前宣布的合約贏得金額被醫療補助重新確定適度抵消。出行量較上季成長 2.5%，但由於合約組合，每次出行收入略有下降。

Sequentially, NEMT gross margin increased 120 basis points, primarily due to trip mix and our cost savings initiatives, notably payroll and other expense per trip decreased 11% sequentially to $6.94, while purchased services expense per trip was relatively flat. The decrease in service costs unit metrics illustrates continued traction from our cost savings initiatives.

隨後，NEMT 毛利率增加了120 個基點，這主要是由於旅行組合和我們的成本節約舉措，特別是每次旅行的工資和其他費用環比下降11% 至6.94 美元，而每次旅行的購買服務費用相對持平。服務成本單位指標的下降說明了我們的成本節約計畫的持續吸引力。

NEMT adjusted EBITDA was $35 million and NEMT margin improved 150 basis points sequentially to 7.2%, driven by $8 million of repricing and contract reconciliation, of which $2.5 million was attributable to 2023 and greater than anticipated. $5.5 million was related to repricing and in-year contract reconciliations for the first half of 2024. The increase pricing is in our run rate as well as our guidance.

NEMT 調整後 EBITDA 為 3500 萬美元，NEMT 利潤率環比提高 150 個基點至 7.2%，這得益於 800 萬美元的重新定價和合約調節，其中 250 萬美元歸屬於 2023 年，高於預期。 550 萬美元用於 2024 年上半年的重新定價和年內合約調節。上漲的定價符合我們的運作率和指導。

During the second quarter, our membership was impacted by Medicaid redeterminations of approximately 600,000 members, which is modestly higher than we previously expected for the quarter, but still in line with our overall expectations for the cumulative impact from redeterminations. We believe redetermination is essentially complete and expect a minimal impact on our Medicaid membership for the remainder of the year.

第二季度，我們的會員資格受到約 60 萬名會員的醫療補助重新確定的影響，該數字略高於我們先前對本季度的預期，但仍符合我們對重新確定的累積影響的總體預期。我們認為重新確定已基本完成，並預計今年剩餘時間對我們的醫療補助會員資格的影響最小。

Redetermination impacted second quarter revenue by $3 million and adjusted EBITDA by approximately $1 million. Overall, Medicaid re-determination is tracking in line to slightly better with our expectations and it's estimated to adversely impact revenue by $60 million and adjusted EBITDA by about $25 million to $30 million in 2024, which aligns with our original adjusted EBITDA range of $20 million to $40 million.

重新確定影響第二季營收 300 萬美元，調整後 EBITDA 影響約 100 萬美元。整體而言，醫療補助重新確定的進展與我們的預期稍好一些，預計2024 年將對收入產生6000 萬美元的不利影響，調整後EBITDA 約2500 萬至3000 萬美元，這與我們最初調整後的2000 萬美元的EBITDA 範圍一致至 4000 萬美元。

Turning to our personal care segment, second quarter personal care revenue increased 4% year-over-year to $187 million, driven by 2% growth in hours and 2% growth in revenue per hour. We are seeing solid revenue growth driven by hours and a reimbursement rate increase in New York that became effective on March 1, subsequent to their minimum wage increase earlier this year.

談到我們的個人護理部門，第二季度個人護理收入年增 4%，達到 1.87 億美元，這得益於工作時間增長 2% 和每小時收入增長 2%。我們看到紐約的收入在工作時間和報銷率增長的推動下穩步增長，該報銷率在今年早些時候提高了最低工資後於 3 月 1 日生效。

Additionally, during the quarter, New Jersey approved a rate increase of approximately $1.50 per hour effective on July 1. Personal care adjusted EBITDA was $15 million or 8% of revenue which was a 200 basis points improvement from the first quarter, driven primarily by rate increases and operating expense controls.

此外，在本季度，新澤西州批准將費率提高約 1.50 美元/小時，自 7 月 1 日起生效。個人護理調整後 EBITDA 為 1,500 萬美元，佔收入的 8%，較第一季提高 200 個基點，這主要是由於費率上漲和營運費用控制所致。

We are encouraged by the improvement in personal care margins, we expect the momentum to continue in the second half of the year and remain confident margins will approach the 10% level by year end.

我們對個人護理利潤率的改善感到鼓舞，我們預計下半年這一勢頭將持續，並對年底利潤率將接近 10% 的水平充滿信心。

RPM revenue decreased 1% year-over-year to $19 million. As we also indicated during the first quarter, lower RPM revenue was primarily attributable to Medicare Advantage contract churn from earlier this year. With churn issues believed to be behind us, we saw solid growth exiting the quarter, which we expect will carry into Q3 and the second half of 2024. RPM adjusted EBITDA was $6.1 million or 32% margin. We continue to expect RPM margins in the mid 30% range in the second half of 2024.

RPM 營收年減 1%，至 1,900 萬美元。正如我們在第一季指出的那樣，每千次展示收益 (RPM) 收入下降主要是由於今年早些時候的 Medicare Advantage 合約流失。隨著客戶流失問題被認為已經過去，我們在本季度看到了穩健的成長，我們預計這種成長將延續到第三季和 2024 年下半年。RPM 調整後 EBITDA 為 610 萬美元，利潤率為 32%。我們繼續預計 2024 年下半年的 RPM 利潤率將在 30% 左右。

During the quarter, we performed our annual goodwill impairment assessment, and we recorded a noncash goodwill impairment of $105.3 million for the RPM segment. As a reminder, the impairment is a noncash expense and does not impact our operating cash flows our ongoing activities.

本季度，我們進行了年度商譽減損評估，並記錄了 RPM 部門的非現金商譽減損 1.053 億美元。提醒一下，減損是非現金支出，不會影響我們正在進行的活動的營運現金流。

Turning to our balance sheet and cash flow. During the quarter, free cash flow was negative $62 million, consisting of a net use of cash provided by operating activities of approximately $55 million and capital expenditures of $7 million, which was 1% of revenue. Driven by NEMT working capital dynamics, we ended the quarter in a net contract receivables position of $79 million. Contract receivables increased by $12 million sequentially to $166 million, primarily due to successful repricing and contract reconciliations during the quarter.

轉向我們的資產負債表和現金流。本季自由現金流為負 6,200 萬美元，其中經營活動提供的現金淨使用額約為 5,500 萬美元，資本支出為 700 萬美元，佔收入的 1%。在 NEMT 營運資金動態的推動下，本季末我們的合約應收帳款淨額為 7,900 萬美元。合約應收帳款較上季增加 1,200 萬美元，達到 1.66 億美元，這主要是由於本季成功的重新定價和合約對帳。

Contract payables decreased by $41 million quarter-over-quarter to $87 million, primarily due to the expected annual reconciliation and settlement on certain contracts. We have made progress on renegotiating prepayment terms on our shared risk contracts and expect the growth of our contract receivables will be reduced going forward.

合約應付款項季減 4,100 萬美元，至 8,700 萬美元，主要是由於某些合約的預期年度對帳和結算。我們在風險共擔合約的預付款條款重新談判方面取得了進展，預計未來合約應收帳款的成長將會減少。

We have visibility into the collection of approximately $60 million of contract receivables, in addition to our normal run rate collections in the third quarter through retrospective rate increases and settlements. As a result of increased utilization in the first half of 2024, and the mismatch in contract payables and receivables affecting our quarterly working capital, our revolving credit facility balance increased by $62 million in the second quarter to $183 million.

除了第三季透過追溯費率上漲和結算的正常運行率收款之外，我們還可以了解約 6000 萬美元的合約應收款收款情況。由於 2024 年上半年利用率增加，以及影響我們季度營運資金的合約應付帳款和應收帳款不匹配，我們的循環信貸額度餘額在第二季度增加了 6,200 萬美元，達到 1.83 億美元。

We ended the second quarter with $10.5 million in cash, approximately $1.17 billion of debt and our bank defined net leverage ratio decreased modestly to 5.22 times as of June 30, against our maximum net leverage covenant of 5.5 times.

截至第二季末，我們的現金為1,050 萬美元，債務約為11.7 億美元，截至6 月30 日，我們銀行規定的淨槓桿率小幅下降至5.22 倍，而我們的最大淨槓桿率承諾為5.5倍。

On July 1, we successfully completed the refinancing of our $500 million in 2025 senior unsecured notes with a new $525 million term loan B, with a current interest rate at the secured overnight financing rate so far plus 475 basis points. Since this is a variable rate debt, we will see a benefit if there are any rate cuts. The refinancing was in line with our expectations, and we appreciate the diligence and support from our lending partners and advisers on the transaction.

7 月 1 日，我們成功完成了 5 億美元 2025 年高級無抵押票據的再融資，其中包括新的 5.25 億美元定期貸款 B，當前利率為迄今為止的有擔保隔夜融資利率加 475 個基點。由於這是浮動利率債務，如果降息，我們將看到好處。再融資符合我們的預期，我們感謝貸款合作夥伴和顧問對本次交易的勤奮和支持。

Shifting to cash flow. Free cash flow was a use in the first half of 2024, given the payment timing mismatch of contract receivables, certain larger settlements on our contract payables and our semi-annual cash interest.

轉向現金流。鑑於合約應收帳款的付款時間不符、合約應付帳款的某些較大額結算以及半年度現金利息，自由現金流在 2024 年上半年得到了使用。

We've made progress on the retrospective renegotiation of the prepayment amount on a number of our shared risk contracts and in-year contract settlements, which gives us confidence that free cash flow will be positive for the year. Accounting for the first half of 2024, results with the impact of our debt refinancing, we now expect an adjusted EBITDA to free cash flow conversion rate at approximately 30% exiting 2024.

我們在一些共擔風險合約和年內合約結算的預付款金額的追溯性重新談判方面取得了進展，這讓我們相信今年的自由現金流將為正值。考慮到 2024 年上半年的結果以及債務再融資的影響，我們現在預計 2024 年結束時調整後的 EBITDA 與自由現金流的轉換率約為 30%。

Shifting to guidance, we maintained our 2024 revenue guidance in the range of $2.7 billion to $2.9 billion and lowered our adjusted EBITDA to a range of $185 million to $195 million due to the lower than anticipated results from PCS during the first half of the year, while we continue to see solid performance from NEMT.

轉向指導，我們將 2024 年營收指引維持在 27 億美元至 29 億美元的範圍內，並將調整後的 EBITDA 下調至 1.85 億美元至 1.95 億美元的範圍，因為上半年 PCS 的業績低於預期，同時我們繼續看到NEMT 的穩健表現。

Here are a few qualitative and quantitative items for you to consider for the remainder of 2024. Medicaid redetermination continues to track in line to slightly better than our original expectations. For the year, we expect a $25 million to $30 million adjusted EBITDA impact, nearly all of which is in our run rate now. We continue to expect business development to be a meaningful contributor to adjusted EBITDA in the second half of the year, largely driven by NEMT contract settlements and repricing’s as well as net new contract wins.

以下是您在 2024 年剩餘時間內需要考慮的一些定性和定量項目。醫療補助重新確定的情況持續略好於我們最初的預期。今年，我們預計調整後的 EBITDA 影響將達到 2500 萬至 3000 萬美元，幾乎所有這些都在我們現在的運行率中。我們仍然預計業務發展將對下半年調整後的 EBITDA 做出有意義的貢獻，這主要是由 NEMT 合約結算和重新定價以及淨新合約贏得推動的。

Cost savings are expected to be at least $30 million for the year, net of investment and digital service costs. The majority of cost savings are in our run rate, and we expect to generate an incremental $4 million to $6 million in the second half of 2024.

扣除投資和數位服務成本後，預計今年將節省至少 3,000 萬美元的成本。大部分成本節省體現在我們的運作率上，我們預計在 2024 年下半年將增加 400 萬至 600 萬美元。

We expect utilization within our current contract mix to normalize in a range of 10% to 11% for 2024 and to be a headwind of $4 million to $7 million in the second half of the year. We anticipate continued momentum coming out of the second quarter for PCS and RPM, which are expected to contribute $13 million to $15 million of adjusted EBITDA growth in the second half of 2024.

我們預計，到 2024 年，目前合約組合的利用率將正常化在 10% 至 11% 的範圍內，下半年將出現 400 萬至 700 萬美元的阻力。我們預計 PCS 和 RPM 第二季將繼續保持成長勢頭，預計在 2024 年下半年貢獻 1,300 萬至 1,500 萬美元的調整後 EBITDA 成長。

We expect to invest $7 million to $8 million in innovation and G&A for the second half of the year. We continue to expect a steady progression in adjusted EBITDA over the next two quarters, driven by new contract implementations, greater cumulative benefit from cost savings, the diminishing impact from Medicaid redeterminations and sequential improvement in PCS, all contributing to financial results consistent with our revised guidance.

我們預計下半年將投資 700 萬至 800 萬美元用於創新和一般管理費用。我們繼續預計，在新合約實施、成本節約帶來的累積效益更大、醫療補助重新確定的影響逐漸減弱以及PCS 的連續改善的推動下，調整後的EBITDA 在未來兩個季度將穩步增長，所有這些都有助於實現與我們修訂後的財務表現一致指導。

In summary, our overall second quarter financial results were in line with our expectations, driven primarily by solid NEMT performance. Personal care and remote patient monitoring were moderately lower than our expectations. However, we saw notable progress throughout the quarter in both segments. We feel positive about the momentum of these segments for the rest of the year and achieving previous growth and margin targets as we exit the year. Now that our refinancing is behind us, our top priority is proactively delevering our balance sheet.

總而言之，我們第二季的整體財務表現符合我們的預期，這主要得益於 NEMT 的穩健表現。個人護理和遠端患者監測略低於我們的預期。然而，整個季度我們在這兩個領域都看到了顯著的進展。我們對今年剩餘時間這些細分市場的勢頭以及在今年結束時實現之前的成長和利潤目標感到樂觀。現在我們的再融資已經過去，我們的首要任務是積極去槓桿化我們的資產負債表。

In closing, I'd like to thank all of our teammates for their unwavering commitment and diligent efforts serving all of our members and clients with that. Operator, please open the call for questions.

最後，我要感謝我們所有的團隊成員為我們所有會員和客戶服務的堅定承諾和辛勤努力。接線員，請打開電話提問。

(Operator Instructions) Brian Tanquilut, Jefferies.

（操作員說明）Brian Tanquilut，Jefferies。

Hi, good morning, guys. I guess, Heath, as I think about the results here, pretty good NEMT progress and RPM as well, it looks like. So it's kind of like a state of the union. But as I think about the moving pieces between PCS and just the cash flow performance through the quarter, I mean, from where you sit, how are you thinking about the path moving forward here?

嗨，早上好，夥計們。我想，Heath，當我想到這裡的結果時，NEMT 進展和 RPM 看起來都相當不錯。所以這有點像國情咨文。但當我考慮 PCS 之間的變化以及整個季度的現金流表現時，我的意思是，從您的角度來看，您如何看待這裡的前進道路？

Yeah. Hi, good morning. Thanks. We have made a lot of progress across all our three segments, and you can see that specifically within NEMT. There was a lot of transformation around all things: people, process and tech. In personal care as well, especially over the last six months again, like we said, there we exited well in the second quarter and we expect to be back to growing and approaching the margins there anyway.

是的。嗨，早安。謝謝。我們在所有三個領域都取得了很大進展，您可以在 NEMT 中看到這一點。所有事物都發生了很大的轉變：人員、流程和技術。在個人護理領域也是如此，特別是在過去六個月中，正如我們所說，我們在第二季度表現良好，我們預計無論如何都會恢復成長並接近利潤率。

So each of the individual parts are doing very well and together as a whole we're getting scale and leverage. You can see that we're able to generate free cash flow. And as Barb just said, we expect to be positive free cash flow for the year, even though we're high users because of coming out of redetermination and higher utilization in the NEMT contract.

因此，每個單獨的部分都做得很好，作為一個整體，我們正在獲得規模和影響力。您可以看到我們能夠產生自由現金流。正如 Barb 剛才所說，我們預計今年的自由現金流將為正，儘管我們是高用戶，因為 NEMT 合約的重新確定和利用率更高。

So, yes, our job is to ensure that all three of these segments in the company as a whole is performing. But with that, with where we are, from a leverage perspective, everything is on the table for us. So we'll look at performing so whether that's delevering through our current cash flow or looking at other options for us. So again, we're evaluating everything and everything is on the table for us to ensure that we are able to delever and drive shareholder value.

所以，是的，我們的工作是確保公司的所有這三個部門作為一個整體都在運作。但這樣一來，從我們所處的位置來看，從槓桿的角度來看，一切都擺在我們的桌面上。因此，我們將考慮表現，無論是透過我們目前的現金流去槓桿化還是為我們尋找其他選擇。因此，我們正在評估一切，一切都擺在我們面前，以確保我們能夠去槓桿化並推動股東價值。

Heath, maybe just to that point, I know you touched upon it in your prepared remarks as well, right. So is there a leverage target that you've set? Or how are you thinking about when you say like everything is on the table just evaluating the different options or the different business segments that you have in terms of their contribution to the enterprise? I mean is that a returns based analysis or a cash flow based analysis. I am just curious how you're viewing that evaluation process or review?

希斯，也許就這一點而言，我知道您在準備好的發言中也談到了這一點，對吧。那麼您是否設定了槓桿目標呢？或者，當您說一切都擺在桌面上，只是評估不同的選擇或不同的業務部門對企業的貢獻時，您是怎麼想的？我的意思是基於回報的分析或基於現金流的分析。我只是好奇您如何看待評估過程或審查？

Yeah. Yes. So for consistent, what we've been saying for a while, 3 times is the target and from where we are today, that's a ways away, right. So considering the 3 times, that's why we're evaluating all the options. And the way we look at it is having each of those businesses to be strong and where they're kind of at from a value today and what can that be that incremental value that we could get from each of those segments or from the business as a whole.

是的。是的。因此，為了保持一致，我們已經說過一段時間了，3 次是目標，距離我們今天的位置，還有很長的路要走，對吧。因此考慮到 3 次，這就是我們評估所有選項的原因。我們看待它的方式是讓每個業務都變得強大，從今天的價值來看它們處於什麼位置，以及我們可以從每個細分市場或業務中獲得的增量價值是多少？

So it's a pretty simple analysis. The best thing for us is to do what we're doing is to ensure each of our businesses are performing. They're all at scale. They're all meeting where the market is going. We see that with our customers and we know what's happening in healthcare. So that is our priority. But again, if there is an option for us, we will evaluate those options. And again, it's just where we are today to what we could get is how we're looking at it.

這是一個非常簡單的分析。對我們來說，最好的事情就是確保我們的每項業務都能正常運作。它們都是規模化的。他們都在關注市場走向。我們在客戶身上看到了這一點，我們知道醫療保健領域正在發生什麼。所以這是我們的首要任務。但同樣，如果我們有選擇，我們將評估這些選擇。再說一次，這就是我們今天所處的位置，我們所能得到的就是我們如何看待它。

Appreciate it. Thank you so much.

欣賞它。太感謝了。

Bob Labick, CJS securities.

拉比克 (Bob Labick)，CJS 證券公司。

Good morning. Thanks for your questions. Thanks for all the information.

早安.感謝您的提問。感謝您提供的所有資訊。

Hey Bob.

嘿鮑伯。

I wanted -- good morning. I wanted to start and just ask you to elaborate more on the free cash flow discussion for the back half of the year. I think you said something along the lines of actively negotiating prepayment resets on $60 million receivables, I don’t know, I was typing fast. But maybe just help us understand kind of the process, the visibility, and when we get to a normal run rate of working capital and stuff like that. But more specifically, what’s the visibility to that, the strong free cash that you’re talking about in the second half?

我想要——早安。我想先請您詳細說明今年下半年的自由現金流討論。我想你說了類似積極協商 6000 萬美元應收帳款預付款重置的內容，我不知道，我打字很快。但也許只是幫助我們了解流程、可見度以及何時達到營運資金的正常運作率等。但更具體地說，你所說的下半年的強勁自由現金的可見度是多少？

Yeah, thanks, Bob. I’ll start here, and Barb can add some color. And we did in the investor deck, I think, slide 18, we gave a lot of disclosure and even some disclosure, what we expect for contracts payable and contracts receivable for Q3 and Q3. So it really gives a good kind of picture of what we expect.

是的，謝謝，鮑伯。我將從這裡開始，倒鉤可以添加一些顏色。我認為，我們在投資者平台上做了很多披露，甚至一些披露，我們對第三季和第三季的應付合約和應收合約的預期。所以它確實很好地描述了我們的期望。

So, the main driver for us, because the businesses are performing on our working capital, is the contracts, right. And again, the contracts, especially over the last kind of two years, 18 months, have been redesigned to ensure that we’re in this win-win relationship from a margin and P&L perspective.

因此，我們的主要驅動力是合同，因為業務是利用我們的營運資金來運作的，對吧。而且，合同，特別是過去兩年零 18 個月的合同，都經過了重新設計，以確保我們從利潤和損益的角度來看處於這種雙贏的關係中。

But where we’re hit, just as a reminder, you know very well that many other people with redetermination and then utilization, with the settlement times within our shared risk contracts, that goes on the balance sheet, mainly in AR, and then we have from the past being below that, we’re at the same time paying contracts payable. So the contracts are working as designed and protecting the downside and protecting the P&L. But there is no question there is a working capital challenge that we’ve been working through.

但是，提醒一下，我們很清楚，許多其他人會重新確定然後利用，在我們共同風險合約中的結算時間，會出現在資產負債表上，主要是在 AR 中，然後我們過去的收入低於這個水平，我們同時支付應付合約。因此，合約正在按設計運行，保護下行風險並保護損益。但毫無疑問，我們一直在努力解決營運資金的挑戰。

So within those contracts, we know the timing, and when those happen, they are written down. Unlike it was in the past, they were a little more ambiguous because COVID was new and wasn’t contemplated, but now they are all contemplated in the contract. So that’s the general statement. And, Barb, do you want to add something?

因此，在這些合約中，我們知道時間，並且當這些發生時，它們會被記錄下來。與過去不同的是，這些內容更加模糊，因為新冠病毒是新冠病毒，沒有被考慮在內，但現在它們都在合約中得到了考慮。這就是一般性的聲明。還有，Barb，你想補充點什麼嗎？

Yeah, so I will just add a little bit of color. Thanks for the question, Bob. So just to expand a little bit on what he said, in terms of the $60 million that we reference in the script, as he said, that’s a contractual amount, it’s not a fuzzy amount at all. So it’s a contractual amount. It’s a few payors where we’ve been successful in our repricing efforts and even successful in an in year contract settlement which is earlier than normal.

是的，所以我只添加一點顏色。謝謝你的提問，鮑伯。因此，稍微擴展一下他所說的內容，就我們在劇本中提到的 6000 萬美元而言，正如他所說，這是合約金額，根本不是一個模糊的金額。所以這是合約金額。我們在少數付款人的重新定價工作中取得了成功，甚至比正常情況更早地成功完成了年內合約結算。

So we have very good visibility to that $60 million in the third quarter. And again, it’s primarily related to our successful efforts in repricing. So good visibility, it’s contractual. And that really will continue to the improvement in the free cash flow in the back half of the year, in the third quarter and the back half of the year.

因此，我們對第三季的 6000 萬美元有很好的了解。再說一遍，這主要與我們在重新定價方面的成功努力有關。如此好的可見性，這是合約性的。這確實將繼續推動今年下半年、第三季和今年下半年自由現金流的改善。

We also, in the prepared remarks, commented that from an exit perspective, free cash flow will be improving. The conversion rate will be approximately 30% as we exit the year. So maybe those are a few highlights and data points to give you a little bit more color on the improvement in the free cash flow.

我們也在準備好的發言中評論說，從退出的角度來看，自由現金流將會改善。到今年結束時，轉換率將約為 30%。因此，也許這些是一些亮點和數據點，可以讓您對自由現金流的改善有更多的了解。

Okay, great. I appreciate that. And then on NEMT, obviously a nice quarter and I think utilization, and payroll and other were kind of the drivers there. So two questions. I am bouncing between your slide decks and trying to figure this out quickly, but it looks like the ending number of membership is lower than last quarter, [30.5] versus maybe [32]. The net client growth in the back half may have changed a little bit.

好的，太好了。我很欣賞這一點。然後在 NEMT 上，顯然是一個不錯的季度，我認為利用率、工資和其他因素是那裡的驅動因素。那麼兩個問題。我在你們的幻燈片之間跳來跳去，試圖快速弄清楚這一點，但看起來最終的會員數量低於上季度，[30.5] 與也許[32]。下半年淨客戶成長可能發生了一些變化。

What -- am I -- again I apologize if I got it wrong there, but what changed there and obviously what are the expectations for client growth? Is the onboarding taking longer or were there addition? What’s – thanks.

如果我在那裡弄錯了，我再次道歉，但是那裡發生了什麼變化，顯然對客戶成長的期望是什麼？入職時間是否需要更長的時間或是否有額外的時間？什麼 - 謝謝。

Yeah, very good question. Well, the current deck is the deck to look at with our membership because we have a really good understanding of the timing of clients onboarding. A couple things on that. If you triangulate and redetermination on the membership, it’s about 500,000 higher than we thought around that. We also did have one of our -- we won state businesses that got pushed into 2025.

是的，非常好的問題。嗯，目前的牌組是我們的會員值得關注的套牌，因為我們對客戶入職的時間有很好的了解。關於這一點有幾點。如果你對會員資格進行三角測量和重新確定，你會發現比我們想像的要高出大約 50 萬人。我們也確實贏得了國有企業，並將其推遲到 2025 年。

And then the other items are just a general estimate that we had before and when stuffs coming online or when contracts get ultimately finalized with the right mix. And that’s probably the biggest driver that we had that membership too high.

然後其他項目只是我們在東西上線之前或當合約最終以正確的組合敲定時的一般估計。這可能是我們會員人數過高的最大推動因素。

The important item is that’s just the membership item that you’re seeing. The economics, and the ultimate bottom line, and ultimate cash flow and timing are right in line with what we expected last quarter. It just is really a membership estimate change for those reasons that I just talked about.

重要的是，這正是您所看到的會員資格項目。經濟狀況、最終底線、最終現金流和時機都符合我們上季的預期。由於我剛才談到的這些原因，這其實只是會員估算的變化。

Okay, great. And last one, I’ll get in queue on this. The payroll and other was a nice substantial decline sequentially. And I mean, this is a trend we’ve been looking for and it was good to see and part of the strength in NEMT in the quarter. Just kind of a little bit behind that are we at a new run rate?

好的，太好了。最後一個，我將為此排隊。工資和其他方面連續大幅下降。我的意思是，這是我們一直在尋找的趨勢，很高興看到這也是本季 NEMT 實力的一部分。只是稍微落後了一點，我們的運行速度是否達到了新的水平？

Is there still more improvement there? Was there any onetime benefit there, et cetera? How should we think about that? Again, it was a great, comforting number. I just want to get a sense of how that plays out going forward.

還有更多改進嗎？那裡有什麼一次性的好處嗎？我們該如何思考這個問題？這又是一個偉大而令人欣慰的數字。我只是想了解未來的發展。

No it’s -- again, the efforts of the team and what we’re doing within our platform is tremendous. We gave a lot of detail in my opening comments. Hopefully that was helpful because really all those items together are what are driving our ability to meet the member where they are with technology, tools and processes in place. So that’s a real number. And we still have more in the tank.

不，再次強調，團隊的努力以及我們在平台內所做的事情是巨大的。我們在開場白中提供了很多細節。希望這對您有所幫助，因為實際上所有這些項目共同推動了我們透過適當的技術、工具和流程滿足會員需求的能力。所以這是一個實數。我們的油箱裡還有更多。

You will see in the cost savings that we’re actually achieving what we thought we would in that for the year, right. We’re going to be right where we expected. And then also in my comments, I do expect that we’re going to continue to accelerate beyond that to get closer to the [60].

您會在成本節約中看到，我們實際上實現了我們今年的預期目標，對吧。我們將會到達我們預期的位置。然後，在我的評論中，我確實希望我們將繼續加速超越這一目標，以更接近[60]。

So we expect more and more kind of on a linear basis as we finish the year and go into 2025. So it’s been really, really well done by the team. So you see that in payroll and other. In purchase services, as well, there is some kind of one time timing between Q1 and Q2, but that trend is going to continue down as well, again, from all the hard work we’re doing in each of those initiatives, it’s really paying off, so we feel good about it continuing.

因此，隨著今年的結束和 2025 年的到來，我們預計會出現越來越多的線性變化。所以團隊做得真的非常好。所以你可以在工資單和其他方面看到這一點。在採購服務方面，第一季和第二季之間也存在某種一次性時間安排，但由於我們在每項措施中所做的所有努力，這種趨勢也將繼續下降。所以我們對繼續下去感到很高興。

All right. Thank you very much.

好的。非常感謝。

Pito Chickering, Deutsche Bank.

皮托·奇克林，德意志銀行。

Hey, good morning, guys. Just going back to the timing of cash flows from NEMT risk contracting, Medicaid, liquid redetermination and legalization has been hot last sort of two years.

嘿，早上好，夥計們。回到近兩年來熱門的 NEMT 風險承包、醫療補助、流動性重新確定和合法化的現金流時機。

So why this happening this quarter versus other quarters? Is there any debate around how much is owed on these contracts? Have you had any issues collecting revenue from these risk sharing contracts in the last 12 months?

那麼，與其他季度相比，為什麼本季會發生這種情況？對於這些合約的欠款有多少存在爭議嗎？在過去 12 個月內，您從這些風險分擔合約收取收入時是否遇到任何問題？

Yeah. So you are on it and you’ve covered the payors. And I think many people on this phone know what’s happening. It’s pretty clear that utilization has been hot and it continues really to be hot. But why? It’s kind of isolated to really, it’s been happening, but really it’s kind of hitting this crescendo right now. It’s just kind of the timing of where we kind of benchmark and estimated when this was going to happen, coupled with our contracts get settled rather than 6 to 12 months.

是的。所以你已經參與其中並且已經支付了付款人。我想很多使用這款手機的人都知道發生了什麼事。很明顯，利用率一直很熱門，而且仍然很熱門。但為什麼？這確實是一種孤立的現象，它一直在發生，但實際上現在已經達到了高潮。這只是我們對何時發生這種情況進行基準和估計的時間，再加上我們的合約得到解決，而不是 6 到 12 個月。

So even though utilization was increasing in 2023, you settle up with a lot of those kinds of kind of 12 months later. And then coupled with where we’ve snapped the chalk line earlier on, that’s why it’s all coming to ahead right now, again which is why we said first part of the year we’re going to be using a lot and the second part of the year we’ll be able to delever.

因此，儘管 2023 年利用率有所增加，但 12 個月後您仍會遇到許多此類情況。再加上我們早些時候折斷粉筆線的地方，這就是為什麼現在一切都在向前推進，這也是為什麼我們說今年上半年我們將大量使用，今年下半年我們將能夠去槓桿化。

So it’s not a surprise. It’s really the design of our contracts and the timing of that. And yes, correct, the utilization has been high, but again, as expected.

所以這並不奇怪。這實際上是我們合約的設計和時間表。是的，沒錯，利用率很高，但同樣，正如預期的那樣。

Okay. So just be clear --

好的。所以只要說清楚--

I want to add --

我想添加--

Please go ahead.

請繼續。

Yeah, sorry, Pito. I would add. And in fact, it’s actually in part, it’s been our success in the contracting process where we’ve accelerated some of the reconciliation, some of the settlements in a couple of contracts. And so we’ve talked about that in the past, that that is our goal to try to accelerate that so that there is not so much time and distance between when we’re actually incurring those costs and that actual cash settlement. So we’ve actually been successful in accelerating a couple of those.

是的，對不起，皮托。我想補充一下。事實上，這在某種程度上是我們在簽約過程中取得的成功，我們在幾份合約中加快了一些和解、一些和解的速度。因此，我們過去已經討論過這一點，這就是我們試圖加速這一過程的目標，以便我們實際承擔這些成本和實際現金結算之間沒有太多的時間和距離。所以我們實際上已經成功地加速了其中的一些。

Great. So two more quick ones here. So just be clear, there is no risk for charges on RevRec around these risk-sharing contracts. And then last quarter you said that we exited the year at a free cash flow conversion of 40%, 50%, excluding the debt refinancing, now it’s 30%. Just wanted to understand the change of the 40%, to 50%, to 30%. Is it just the debt financing or something else?

偉大的。所以這裡還有兩個快速的。因此需要明確的是，圍繞這些風險分擔合約的 RevRec 不存在收費風險。然後上個季度，您說我們以 40%、50% 的自由現金流轉換結束了這一年，不包括債務再融資，現在是 30%。只是想了解 40%、50%、30% 的變化。只是債務融資還是其他？

Great. So two more quick ones here. So just be clear, there is no risk for charges on RevRec around these risk-sharing contracts. And then last quarter you said that we exited the year at a free cash flow conversion of 40%, 50%, excluding the debt refinancing, now it’s 30%. Just wanted to understand the change of the 40%, to 50%, to 30%. Is it just the debt financing or something else?

偉大的。所以這裡還有兩個快速的。因此需要明確的是，圍繞這些風險分擔合約的 RevRec 不存在收費風險。然後上個季度，您說我們以 40%、50% 的自由現金流轉換結束了這一年，不包括債務再融資，現在是 30%。只是想了解 40%、50%、30% 的變化。只是債務融資還是其他？

Yeah. So we do have a couple quarters ago we talked about one contract in Florida that we didn’t collect on, but we’ve collected 75%. That one is still open that remainder. So, there is one client that we’re having some, but it’s really small. So just to be transparent there was one client that we’re still in discussions to get the last 25%. Outside of that, we expect to collect all our receivables.

是的。因此，幾個季度前我們確實討論了佛羅裡達州的一份合同，我們沒有收取費用，但我們已經收取了 75%。剩下的那一個仍然開放。因此，我們有一個客戶，但規模很小。因此，為了透明起見，我們仍在討論一位客戶以獲得最後 25% 的收益。除此之外，我們希望收回所有應收帳款。

And then to do with the cash conversion, it really is -- we just with the higher cost in our new term loan that we got, it’s just math to take us down to that 30% from the 40%.

然後就現金轉換而言，確實是這樣——我們只是因為我們獲得的新定期貸款的成本更高，所以從數學上來說，我們可以從 40% 降低到 30%。

Great. And the last one for me here on RPM, churn rate, I guess, why is the churn rate so high from your largest customer? Is it pricing or service levels? Thanks so much.

偉大的。我想最後一個關於 RPM 的問題是流失率，為什麼你們最大的客戶的流失率這麼高？是定價還是服務水準？非常感謝。

Yes. The main reason -- excuse me, is one of our large clients on the -- excuse me, MA side. Again, if you’re talking to payors, and specifically supplemental benefit pressure with an MA is high across the board. And this is what happened with this payor. That’s where the churn was.

是的。主要原因是——對不起，是我們的大客戶之一——對不起，馬薩諸塞州這邊。再說一次，如果你正在與付款人交談，特別是 MA 的補充福利壓力全面很高。這就是這個付款人所發生的事情。這就是流失的地方。

First off, the churn related to them not winning states, so they lost states. Therefore we don’t get as much volume. That’s the biggest driver, but it also is just some pressure on supplemental benefits and offering, that is what is the issue. But as we pointed out, and we get some data in the deck here, we, unlike maybe a lot of other RPM businesses, we’re not as exposed to MA. It’s about 25% of our business. So yes, that was the reason. Going forward, we believe we’ll be able to manage through that challenge in the MA market.

首先，流失與他們沒有贏得州有關，所以他們失去了州。因此我們沒有得到那麼多的數量。這是最大的驅動力，但它也只是補充福利和產品方面的一些壓力，這就是問題所在。但正如我們所指出的，我們在這裡得到了一些數據，與許多其他 RPM 企業不同，我們並沒有那麼容易受到 MA 的影響。這約占我們業務的 25%。所以是的，這就是原因。展望未來，我們相信我們將能夠應對 MA 市場的挑戰。

Great. Thanks so much.

偉大的。非常感謝。

Scott Fidel, Stephens.

斯科特·菲德爾，史蒂芬斯。

Hi, thanks. Good morning. First question, just I thought it might be helpful if you wanted to, bridge just on the margins for NEMT and then with PCS, did catch the comment about getting you closer to 10% by our fourth quarter and the exit rate, maybe you want to sort of win, I guess, embedded in getting to that [220%] or [210%] to [220%] exit rate. How you see the NEMT margins progressing in 3Q and then 4Q and similarly with PCS in 3Q and 4Q as well?

你好，謝謝。早安.第一個問題，只是我認為如果您想在NEMT 的邊緣和PCS 之間架起橋樑，這可能會有所幫助，確實聽到了關於讓您在第四季度和退出率之前接近10% 的評論，也許您想要我想，要取得勝利，就必須達到 [220%] 或 [210%] 到 [220%] 的退出率。您如何看待 NEMT 利潤率在第三季和第四季的進展以及 PCS 在第三季和第四季的情況？

Yeah, thanks, Scott. Well, starting with NEMT, you can see the margins in that seven percentage range. And then to Bob’s kind of question around improving cost savings, that continuing, coupled with our continued onboarding of clients where we have again contribution margin that flow through strong.

是的，謝謝，斯科特。好吧，從 NEMT 開始，您可以看到這七個百分比範圍內的利潤。然後是鮑伯關於提高成本節約的問題，這個問題仍在繼續，再加上我們不斷吸引客戶，我們再次獲得了強勁的邊際貢獻。

So I do expect an uptick, call it a kind of to the end of the year, around 100 basis points plus is probably the right way to think about it on the NEMT side. PCS, you saw the jump in Q2, again, lots has transformed there and still lots of work to do. But we also said that we exited that quarter in a strong way. And then you couple that and why with PCS, not only have the cost, centralization costs normalized for us because we got it out, but we also have rate increases and that’s a big driver for us.

因此，我確實預計會出現上升，稱其為年底前的一種，大約 100 個基點以上可能是 NEMT 方面考慮這一問題的正確方式。PCS，您再次看到了第二季度的跳躍，那裡發生了很多變化，仍然有很多工作要做。但我們也表示，我們以強勁的方式退出了該季度。然後你將其與 PCS 結合起來，不僅使我們的成本、集中化成本標準化，因為我們把它拿出來了，而且我們還提高了費率，這對我們來說是一個很大的推動力。

So and those started here in early Q3. So you’ll see that jump. So that’ll be more than -- and as Barb alluded to, we’ll get closer to that 10% range. And then RPM will be kind of in that mid-30% range as well. So really -- so that’s the bridge and all in front of us. Most of it is the actions we have in place or things that we have done and it will trend that way. Is that helpful, Scott?

所以這些是在第三季初開始的。所以你會看到這種跳躍。因此，這將超過——正如 Barb 提到的那樣，我們將更接近 10% 的範圍。然後 RPM 也會在 30% 的中間範圍內。確實如此——這就是這座橋以及我們面前的一切。其中大部分是我們已經採取的行動或我們已經做過的事情，而且趨勢也會如此。這樣有幫助嗎，斯科特？

Yeah, it is. And then just one follow-up around that. Just on the PCS side, I was thinking -- I mean, should we see more of a step function up in the 3Q just because you guys have now gotten those rate increases or are there still some costs from the centralization and transformation that offsets that in the 3Q so that we see more of the margin in the 4Q show to get to that sort of close to 10%.

是的，確實如此。然後圍繞這一點進行一項後續行動。就PCS 而言，我在想- 我的意思是，我們是否應該在第三季度看到更多的階梯功能，僅僅因為你們現在已經獲得了這些費率的提高，或者是否仍然存在一些來自集中化和轉型的成本來抵消這些成本在第三季度，我們將在第四季度看到更多的利潤率，達到接近 10% 的水平。

You will see a step up because of the stuff. It won’t get all the way to the 10% range, but you will see a meaningful step up.

你會因為這些東西而看到一個進步。它不會一直達到 10% 的範圍，但您會看到有意義的提升。

Okay, got it. And then second question, just wanted to just get your update on, I know you guys talked a little bit about it with Pito just on the sub benefits in MA and some of the churn there in RMP, just looking out to 2025, just given the reimbursement pressure that MA plans are facing and the utilization they’ve seen on supplemental benefits this year.

好的，明白了。然後第二個問題，只是想了解您的最新情況，我知道你們與 Pito 討論了一些關於 MA 的子福利和 RMP 中的一些流失問題，只是展望 2025 年，剛剛給出MA 計劃面臨的報銷壓力以及今年對補充福利的利用。

What’s your visibility at this point into your MA books in NEMT and then in RPM in terms of sort of retention of volume and then your sort of pricing with your MA customers? Is that remaining consistent just or are you seeing some pushback just given the rate pressures and cost pressures that MA plans are experiencing?

目前，您對 NEMT 和 RPM 中的 MA 書籍的了解程度如何，包括數量保留情況以及與 MA 客戶的定價情況？是保持一致還是考慮到 MA 計劃正在經歷的利率壓力和成本壓力，您是否會看到一些阻力？

Yes. So, first -- you know this, but no exposure to MA on PCS. Within NEMT those really supplemental benefits have really been under pressure for the last couple years and it’s been pretty steady. And so we know the markets that our clients are not going to offer NEMT. So we know that and expect that.

是的。所以，首先 - 你知道這一點，但沒有接觸過 PCS 上的 MA。在 NEMT 內部，這些真正的補充福利在過去幾年確實面臨壓力，而且相當穩定。因此，我們了解客戶不會向哪些市場提供 NEMT。所以我們知道這一點並期待這一點。

There are no question pricing pressures, but we anticipated that, and it’s been baked into our current numbers and even what we expect in 2024, which is why again a company like us that has the size and scale and what we’re doing around automating, we can get to the right win-win price where we save money for people, as well as ensure that we maintain our margins.

毫無疑問，定價壓力是存在的，但我們已經預料到了這一點，並且它已融入我們當前的數字，甚至我們對 2024 年的預期，這就是為什麼像我們這樣擁有規模和規模的公司在圍繞自動化進行工作時，我們可以獲得正確的雙贏價格，為人們節省資金，並確保我們維持利潤。

The RPM business is probably the biggest business that is going to be impacted on supplemental benefits. I could spend a lot of time here. In the end, the technology in someone’s home is going to be really important, especially for people on certain population types.

RPM 業務可能是受到補充福利影響的最大業務。我可以在這裡度過很多時間。最後，家庭中的科技將非常重要，特別是對於某些人口類型的人來說。

So though, yes, the current model is under pressure, but I do think there is going to be a more outcomes based, populations based device in a home transformation. And those are the discussions we’re in. So I don’t expect large, large growth in the short term around MA and RPM, but I do expect more of a sustained kind of competitive advantage even on the MA side for us.

因此，是的，目前的模式面臨著壓力，但我確實認為在家庭改造中將會出現一種更基於結果、基於人群的設備。這些就是我們正在進行的討論。因此，我預計短期內 MA 和 RPM 不會大幅成長，但我確實預計，即使在 MA 方面，我們也能獲得更多持續的競爭優勢。

And again, the other thing, this is what’s happening, it’s not about the alert anymore, it’s really about what are you going to do with that alert and the clinical outcomes that are there. And because of what we’ve invested in with our clinical people as well as our technological capabilities, we’re able now to get into the clinical budget, because we’re really going to change outcomes. And that’s what I mean about the changing dynamic within the RPM world.

再說一次，另一件事，這就是正在發生的事情，它不再與警報有關，而是真正與您將如何處理該警報以及那裡的臨床結果有關。由於我們對臨床人員以及技術能力的投資，我們現在能夠進入臨床預算，因為我們真的要改變結果。這就是我所說的 RPM 世界中不斷變化的動態。

Got it. And one more if I can. Just as we sort of put all of this together, thought it might be helpful just at this vantage point if you wanted to sort of summarize what you see as the key headwinds and tailwinds for '25 and sort of your confidence and sort of getting back to EBITDA growth in a nice way.

知道了。如果可以的話，再來一張。正如我們將所有這些放在一起一樣，如果您想總結一下您認為 25 年的主要逆風和順風以及您的信心和恢復情況，那麼在這個有利位置可能會有所幫助以良好的方式實現 EBITDA 增長。

I mean, obviously there has been a number of these headwinds that seem to be more impacting the first half relative to the second half. But we all need to be respectful around the environment and a lot of fluidity that we see in the Medicaid market and in some of the businesses. So sort of taking all that heat, sort of, how would you lay out what you see as the key tailwinds and headwinds for next year?

我的意思是，顯然有一些不利因素對上半場的影響似乎比下半場更大。但我們都需要尊重環境以及我們在醫療補助市場和某些企業中看到的大量流動性。那麼，在承受所有這些熱量的情況下，您將如何列出您認為明年的關鍵順風和逆風？

Yeah. Well, so for next year and beyond, a lot of tailwinds from the pressures that are helping in the healthcare system and the societal demands of moving into the home. Again, those pressures, whether that’s cost or the evolution of understanding that care really matters outside of just the clinical episode, that’s going to continue to accelerate because it reduces cost as well as improves access, quality and costs.

是的。那麼，明年及以後，醫療保健系統的壓力和搬入家庭的社會需求將帶來許多推動力。同樣，這些壓力，無論是成本還是對醫療保健在臨床事件之外確實很重要的理解的演變，都將繼續加速，因為它降低了成本，並提高了可及性、品質和成本。

So those kind of macro are only going to continue and will happen in '24 I’m sorry, '25 and beyond. So, with that and what we’ve invested, we’re in a really good spot to ensure that we are meeting that. But specifically around 2025, a lot of what we’ve done within this transformation has been in place.

因此，這種宏觀政策只會持續下去，並且會在 24 年——對不起，25 年及以後發生。因此，有了這些以及我們的投資，我們就處於一個非常好的位置，可以確保我們實現這一目標。但具體到 2025 年左右，我們在這項轉型中所做的許多工作已經到位。

So a lot of the hard work around culture ensuring the strategy is there, ensuring the right operating model is there, has been in place. So now it’s about this continued execution and really being customer centric. I know that sounds kind of cliché, but that is our focus because our customers, whether they are doing explicitly at the contract level, because they’re doing explicitly at the executive level. Yeah, I love the trip piece, I love that you’ve done the work in the home and I love the device alert, but really I want an outcome and I want you to understand my population.

因此，圍繞文化的大量艱苦工作已經到位，以確保策略到位、確保正確的營運模式到位。所以現在的重點是持續執行和真正以客戶為中心。我知道這聽起來有點陳腔濫調，但這就是我們的重點，因為我們的客戶，無論他們是在合約層面明確地做，還是因為他們在執行層面明確地做。是的，我喜歡這個旅行片段，我喜歡你在家裡完成的工作，我喜歡設備警報，但我真的想要一個結果，我希望你了解我的人口。

So, that’s what we’re doing now. And then just a little bit around, I think, implicit in your question, PCS is a good example. We had a soft Q1 and Q2 because of what we’ve been doing from a centralization, standardization of one platform. But you’re seeing that grow. So those kind of internal dynamics are done. You never done transforming, but from reality of how much transformation we had, we’re able to build on top of that.

所以，這就是我們現在正在做的事情。然後，我想，你的問題隱含著一點，PCS 就是一個很好的例子。由於我們一直在一個平台的集中化、標準化上所做的事情，我們的第一季和第二季表現疲軟。但你會看到這種成長。這樣，這些內部動態就完成了。你從未完成過轉型，但從我們進行了多少轉型的現實來看，我們能夠在此基礎上再接再厲。

So, long story short, I feel good about what we’ve done internally. The headwinds, of course, are going to be these continued reimbursement pressures. But again, for each of our units, we have scale and size, and then the market tailwinds as long as we are meeting where the customer wants to go beyond just the transaction, which we are, we’re going to ensure that we’re in a good spot for growth. So I expect 2025 to be a really solid growth off our run rate that we disclosed earlier today.

所以，長話短說，我對我們內在所做的事情感到滿意。當然，阻力將是持續的報銷壓力。但同樣，對於我們的每個部門，我們都有規模和規模，然後只要我們滿足客戶想要超越交易的要求，市場就會順風順水，而我們就是這樣，我們將確保我們¤ 處於良好的成長點。因此，我預計 2025 年將比我們今天早些時候披露的運行率實現真正穩健的成長。

Okay. Thank you.

好的。謝謝。

Rishi Parekh, JPMorgan.

里希‧帕雷克 (Rishi Parekh)，摩根大通。

Hi. Thank you for taking my questions. First on the contract renegotiations that you were referring to earlier, I get that as a win-win, or at least you noted it as a win-win with the payors, but can you just help me better understand how is it a win for the actual payor?

你好。感謝您回答我的問題。首先，關於您之前提到的合約重新談判，我認為這是雙贏，或者至少您指出這是與付款人的雙贏，但是您能否幫助我更好地理解這是如何實現雙贏的？ ？

I mean, I get that you’re getting paid earlier, but are you giving up price or are you reducing price, or what are the economics that you’re changing to make sure that the payors are paying you early? And what does this also mean for payables? Are you going to also have to pay those out faster?

我的意思是，我知道你會提前收到付款，但是你是放棄價格還是降低價格，或者你正在改變什麼經濟學來確保付款人提前付款？這對於應付帳款意味著什麼？您是否還必須更快地支付這些費用？

Yeah. No on the payable side. But the win-win, yes, the payor wants the best price. So we’re able to offer the best price because of what we’ve done with our platform. But we’ve estimated that, so it’s not different than what we thought. They are getting a better price as we re-underwrite these deals. For us just in general because, and the other item that we need to perform.

是的。付款方沒有。但雙贏，是的，付款人想要最好的價格。因此，由於我們在平台上所做的一切，我們能夠提供最優惠的價格。但我們已經估計了這一點，所以它與我們想像的沒有什麼不同。當我們重新承銷這些交易時，他們獲得了更好的價格。對我們來說，一般來說是因為，以及我們需要執行的其他項目。

So, you need to ensure that on NEMT that of course you’re picking people up on time, there’s no complaints and then you’re starting to do more at the individual population. A dialysis member is very different than a mental health member. So, we are doing all that. So, that is really the main reason why our customer satisfy, later on that we can be the lowest cost, even better. So, that’s what I mean by win-win.

因此，您需要確保在 NEMT 上您能準時接人，沒有投訴，然後您就可以開始針對個人群體做更多的事情。透析會員與心理健康會員有很大不同。所以，我們正在做這一切。所以，這確實是我們客戶滿意的主要原因，以後我們可以做到成本最低，甚至更好。所以，這就是我所說的雙贏。

But specifically on your question around kind of the renegotiation, the renegotiation is two-fold. It’s when something comes up for renewal or when we’re at a juncture where we need to reset because of a mix change or because of what’s happening redetermination. Those we know that we’re going to get a lower price. Again, those are what have been baked into our 2024 numbers and what I expect in 2025.

但具體到你關於重新談判的問題，重新談判有兩面。當某些事情需要更新時，或​​者當我們因為混合變化或由於正在發生的事情重新決定而需要重新設定時。我們知道我們將獲得更低的價格。同樣，這些都是我們 2024 年的數字以及我對 2025 年的預期。

The other item around our free cash flow timing, that is the contractual design. We set this specific estimate of $5 and we know now that it’s $6, and we’re not going to settle up for that $6. That incremental 12 months, we’ve negotiated to get, call it half of that or some of that earlier. So it’s not an economic issue, it is a timing issue. And because of all the benefits that I talked about earlier, our large customers are receptive to do that for us.

關於我們的自由現金流時間安排的另一個項目是合約設計。我們將具體估算值定為 5 美元，現在我們知道它是 6 美元，而且我們不會滿足於 6 美元。我們已經協商獲得了這 12 個月的增量，可以稱之為提前的一半或其中的一部分。所以這不是一個經濟問題，而是一個時機問題。由於我之前談到的所有好處，我們的大客戶願意為我們這樣做。

And just to follow up on, is that something that's going to happen every year? Or is this just a temporary move just to collect on those receivables now for this year?

跟進一下，這樣的事情每年都會發生嗎？或者這只是一個臨時舉措，只是為了收回今年的應收帳款？

It's this year. We do expect as we exit this year, determination will be done really the kind of normalized health care utilization. So it's just a bolus because of those two reasons that we expect to be finished this year.

這是今年。我們確實預計，當我們今年退出時，將真正做出標準化醫療保健利用的決定。因此，由於這兩個原因，我們預計今年會完成這只是補充。

Okay. And then I know you went through some of the numbers on this and I apologize, those did not type fast enough. But your first half, second half EBITDA split is usually 50%, 50%. And based upon your guidance, it’s more like 40%, 60%. So there’s about a $35 million, $40 million delta just to get to your guidance, or at least the midpoint of the guidance. Can you just maybe walk me through what’s the big drivers to get to that number?

好的。然後我知道你已經瀏覽了一些關於此的數字，我很抱歉，這些數字輸入得不夠快。但你的上半年、下半年EBITDA分成通常是50%、50%。根據您的指導，大約是 40%、60%。因此，為了達到您的指導，或至少是指導的中點，大約需要 3500 萬美元、4000 萬美元的增量。您能否向我介紹一下達到該數字的主要驅動因素是什麼？

Yes, so the uncontrollable again and this is redetermination. Redetermination, major, large headwind for us. And that kind of peaked in Q2. So, that’s one. The other is timing of our kind of net sales wins. We did have legacy attrition. We’re offsetting that. And that onboarding of all those contract wins we had in 2023 and 2024 kind of really starts in Q2 and continues to accelerate. So, it’s working through the losses and the timing of putting the new ones on. So that’s -- those two big items

是的，所以再次無法控制，這就是重新決定。重新決定，對我們來說是一個重大的、巨大的阻力。這種情況在第二季度達到頂峰。所以，這就是其中之一。另一個是我們獲得淨銷售額的時機。我們確實存在遺產流失。我們正在抵消這一影響。我們在 2023 年和 2024 年贏得的所有合約實際上從第二季開始，並繼續加速。因此，它正在努力解決損失並安排新的投入時間。這就是——那兩個大項目

And then the last one, it’s across the board, but primarily within EMT is the continued traction and acceleration of the cost savings. So it really is. And there is not, hey, a big gap. We need to do X or Y. It really is those items that are in place and run writing or coming on board as scheduled. So, we have a lot of conviction in our ability to hit that. That appears ramped second half of the year for those reasons.

最後一個是全面的，但主要是在 EMT 範圍內，持續推動和加速成本節約。確實如此。嘿，差距並不大。我們需要做 X 或 Y。這確實是那些已就位並正在編寫或按計劃上線的項目。因此，我們對實現這一目標的能力充滿信心。由於這些原因，這一數字似乎在今年下半年有所增加。

If I could just squeeze one more in on your leverage target. I know you said three times. One, can you give us a target timeframe as to when you plan on getting there? But more importantly, is that 3 times based upon your covenant EBITDA number, which is about a two turn difference, or is it based upon actual EBITDA, which is about a four turn difference?

如果我能在您的槓桿目標上再加一點就好了。我知道你說了三遍。第一，您能給我們一個目標時間表，說明您計劃何時實現這一目標嗎？但更重要的是，這 3 倍是基於您的契約 EBITDA 數字（大約兩圈差異）還是基於實際 EBITDA（大約四圈差異）？

Well, so first off, the timing, and this is important for us, too, the timing will be hard to predict because we need to -- there is options for us to get there. So if it’s just generating cash from our businesses, that’s going to take longer. If it’s some other alternative, that would be faster.

嗯，首先是時機，這對我們來說也很重要，時機很難預測，因為我們需要——我們有多種選擇可以實現這一目標。因此，如果只是從我們的業務中產生現金，那將需要更長的時間。如果有其他選擇，速度會更快。

We’re going to do the right thing for us. We have the time, we have a good capital structure in place. So for us, it really is evaluating what’s the best economic answer for us. So timing is tough to predict. At the same time, we are looking at everything so we can do it as well. We really do understand and how important it is to ensure that we bring down leverage as fast as possible.

我們將做對我們來說正確的事情。我們有時間，我們有良好的資本結構。因此，對我們來說，它實際上是在評估對我們來說最好的經濟答案是什麼。所以時間很難預測。同時，我們正在考慮一切，以便我們也能做到。我們確實了解確保盡快降低槓桿率的重要性。

So, sorry for the fuzzy answer, but really it’s about ensuring that we do the right at the right time. But again, we have many options in front of us.

因此，對於模糊的答案感到抱歉，但實際上這是為了確保我們在正確的時間做正確的事情。但同樣，我們面前有很多選擇。

Sorry, if I could -- sorry go ahead.

抱歉，如果可以的話——抱歉，請繼續。

And then what's your second question.

那你的第二個問題是什麼？

Is it based on the covenant EBITDA, our actual EBITDA?

是基於契約 EBITDA，即我們的實際 EBITDA 嗎？

Well, so for us, it’s true economics. We don’t have a -- obviously we have covenants. We have to abide by those. But the decisions we make around timing are going to be economic, not driven by a covenant, because we feel good about our ability to make those covenants.

嗯，所以對我們來說，這是真正的經濟。我們沒有──顯然我們有契約。我們必須遵守這些規定。但我們圍繞著時間所做的決定將是經濟性的，而不是由契約驅動的，因為我們對自己做出這些契約的能力感到滿意。

And sorry, when you say the alternatives, how far down that path are you with those alternatives other than Matrix? I mean, are you in the third inning, fourth inning, or are you just scratching the service to evaluate those alternatives?

抱歉，當您說出替代方案時，除 Matrix 之外的其他替代方案您走了多遠？我的意思是，你是在第三局、第四局，還是只是在抓緊服務來評估這些替代方案？

Yes, that is not something we’re really -- because we’re not announcing anything like that. We are fully aware of all our businesses and the opportunities in the market, so we’re not in any inning or anything that we want to disclose around that again, other than Matrix, which we know the timing we talked about there already.

是的，這並不是我們真正想要的——因為我們不會宣布類似的事情。我們完全了解我們的所有業務和市場上的機會，因此，除了 Matrix 之外，我們沒有任何一局或任何我們想再次披露的內容，我們已經知道我們已經在那裡討論過的時機。

Great. Thank you.

偉大的。謝謝。

Mike Petusky, Barrington Research.

麥克佩圖斯基，巴靈頓研究中心。

Morning Heath. And I apologize, but you can do this super quick if you’re willing. I missed multiple calls this morning. I missed the first eight minutes of your prepared remarks. What did you say about Matrix?

早上希斯。我很抱歉，但如果您願意，您可以非常快地完成此操作。今天早上我錯過了多通電話。我錯過了你準備好的演講的前八分鐘。你對矩陣說了什麼？

Yeah, consistent to what we said last quarter from the timing either later this year or early next year.

是的，與我們上個季度所說的從今年晚些時候或明年初的時間安排來看是一致的。

Okay. All right, great. Yeah, great. I will read the transcript for anything else there. I appreciate it. So just going back to the $60 million contract receivable that you think is sort of teed up, how many contracts does that cover? Is that like three or four contracts primarily, or how many different accounts does that cover?

好的。好吧，太好了。是的，太棒了。我會閱讀那裡的其他內容的文字記錄。我很感激。那麼，回到您認為已經準備好的 6000 萬美元合約應收款，這涵蓋了多少份合約？這主要是三到四份合同，還是涵蓋多少個不同的帳戶？

Yeah, it's definitely more than one contract. As you all know, the concentration of payers, there's really kind of big eight people. So it is though it's still it's multiple contracts. It's isolated to a couple of large payers.

是的，這絕對不僅僅是一份合約。眾所周知，付款人的集中度確實是八個人。所以，儘管它仍然是多個合約。它與幾個大的付款人隔離。

Okay. So, like two.

好的。所以，就像兩個。

Yeah.

是的。

Okay. All right. And then just curious, has -- we're about into that quarter, has any of that been collected to this point or no?

好的。好的。然後只是好奇，我們即將進入那個季度，到目前為止是否已經收集到了這些數據？

There's lots of cash flow moves in and out. So yeah, were not going to front run Q3 for us. We just feel good about our ability at the end of Q3 to get those collections happening in total.

有大量的現金流進出。所以，是的，我們不會在第三季領先。我們對第三季末完成這些收集工作的能力感到滿意。

Okay, so can I just ask one more question just on sort of connected to the subject? So given the call out of the $60 million that you think is likely to be collected sooner rather than later. I mean, is sort of the cadence of the free cash flow in the second half going to be a little bit more heavily weighted in Q3 versus Q4? Is that a reasonable sort of guesstimate?

好的，我可以再問一個與主題相關的問題嗎？因此，考慮到您認為應該儘早籌集 6000 萬美元的呼籲。我的意思是，下半年自由現金流的節奏是否會比第四季在第三季的權重更大一些？這是合理的猜測嗎？

Yeah, though, you're right. And if you look at slide 18, you actually can see that, and which is why we gave all that disclosure.

是的，不過，你是對的。如果你看投影片 18，你實際上可以看到這一點，這就是我們揭露所有資訊的原因。

All right. Okay, very good. Thank you so much.

好的。好的，非常好。太感謝了。

Yeah.

是的。

Thank you. This does conclude our question-and-answer session. I'd now like to turn it back to Heath for any closing remarks.

謝謝。我們的問答環節到此結束。現在我想把它轉回給希思，讓他作結束語。

Yeah. Thank you for participating in our call this morning and for your interest in our company. Our updated investor presentation is posted on our Investor Relations website. If you want to schedule a follow-up call, please call Kevin Ellich, our Head of Investor Relations.

是的。感謝您今天早上參加我們的電話會議以及對我們公司的興趣。我們更新的投資者介紹發佈在我們的投資者關係網站上。如果您想安排後續電話會議，請致電我們的投資者關係主管 Kevin Ellich。

We look forward to speaking to many of you over the coming days weeks and months before we report our third quarter results in November. Thank you again. Thanks to the team everybody have a great day. Operator, this concludes our call.

我們期待在接下來的幾天、幾週和幾個月內與你們中的許多人交談，然後我們將在 11 月報告第三季業績。再次感謝您。感謝團隊，每個人都度過了愉快的一天。接線員，我們的通話到此結束。

Thank you. This does conclude today's conference. We thank you for your participation, you may disconnect your lines at this time and have a wonderful day.

謝謝。今天的會議到此結束。我們感謝您的參與，此時您可以斷開線路並祝您度過美好的一天。