Surgery Partners Inc: A Strong Revenue Growth Story in 2024

In the fourth quarter of 2024, Surgery Partners Inc (SGRY) reported a robust 17.5% increase in revenue, reaching $864.4 million, compared to the same period in 2023. This growth trajectory aligns with the company's consistent and predictable organic growth, with same-facility revenues increasing by 5.6% and same-facility cases rising by 5.1%. The company's Adjusted EBITDA also grew by 15.1% to $163.8 million for the fourth quarter, reflecting its strong operational performance.



Several factors contributed to Surgery Partners' impressive revenue growth in 2024:

1. Same-facility revenue growth: The company's existing facilities contributed significantly to its revenue growth, with a 5.6% increase in same-facility revenues for the fourth quarter and an 8.0% increase for the full year. This growth was driven by a 0.5% increase in revenue per case and a 5.1% increase in same-facility cases in the fourth quarter, and a 4.0% increase in revenue per case and a 3.9% increase in same-facility cases for the full year.
2. Acquisitions: Surgery Partners deployed nearly $400 million on accretive acquisitions during 2024. These acquisitions helped expand the company's portfolio of high-quality, short-stay surgical facilities, offering exceptional value to patients, health plans, and communities. This strategic move contributed to the company's consistent and predictable organic growth, with same-facility revenue growth of 8.0%.
3. New facility openings: The company opened eight de novo facilities in 2024, further expanding its portfolio and providing additional revenue streams. The opening of these facilities was a significant factor in the company's 17.5% revenue increase for the fourth quarter and 13.5% revenue increase for the full year.



These strategic initiatives were effective in expanding margins, as evidenced by the company's full year 2024 Adjusted EBITDA margin growing by 30 basis points to 16.3%. Additionally, the company's liquidity position of over $770 million at the end of 2024 enhanced its confidence and ability to continue funding accretive M&A without needing to access capital markets.

Looking ahead, Surgery Partners Inc projects full year 2025 revenue to be in the range of $3.30 billion to $3.45 billion and Adjusted EBITDA to be in the range of $555 million to $565 million. The company's guidance reflects approximately $11 million of Adjusted EBITDA related to divestitures that occurred late in the fourth quarter of 2024.

In conclusion, Surgery Partners Inc's strong revenue growth in 2024, driven by same-facility revenue growth, acquisitions, and new facility openings, positions the company for sustained success in 2025 and beyond. The company's disciplined management approach, strong underlying business fundamentals, and the benefits of its multi-year growth investments have enabled it to maintain its mid-teens growth trajectory while expanding margins. With a liquidity position of over $770 million, Surgery Partners Inc is well-positioned to continue funding accretive M&A without needing to access capital markets.