Jordan, Conference Operator: Thank you for standing by. My name is Jordan, and I’ll be your conference operator today. At this time, I’d like to welcome everyone to the Q2 2026 Pediatrix Medical Group, Inc. earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker’s remarks, there will be a question and answer session. If you’d like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you’d like to withdraw your question, press star one again. Thank you. I’d now like to turn the call over to Ashley Snyder. Please go ahead.

Ashley Snyder, Investor Relations / Legal Compliance, Pediatrix Medical Group, Inc.: Good morning. Certain statements and information during this conference call may be deemed to be forward-looking statements within the meaning of the Federal Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on assumptions and assessments made by Pediatrix’s management in light of their experience and assessment of historic trends, current conditions, expected future developments, and other factors they believe to be appropriate. Any forward-looking statements made during this call are made as of today. Pediatrix undertakes no duty to update or revise any such statements, whether as a result of new information, future events, or otherwise. Important factors that could cause actual results, developments, and business decisions to differ materially from forward-looking statements are described in the company’s filings with the SEC, including the sections entitled Risk Factors. In today’s remarks by management, they will be discussing non-GAAP financial metrics.

A reconciliation of these non-GAAP financial measures to the most comparable GAAP measures can be found in this morning’s earnings press release, in the company’s quarterly and annual reports, and on the Pediatrix website at www.pediatrix.com. I will turn the call over to Mark Ordan, Chief Executive Officer of Pediatrix Medical Group.

Mark Ordan, Chief Executive Officer, Pediatrix Medical Group, Inc.: Thank you, Ashley. Good morning, everyone. Also with me today is Kasandra Rossi, our Chief Financial Officer. We are pleased to report another solid quarter with adjusted EBITDA of $76 million. Same unit revenue was buoyed by strong RCM collections, payer mix, importantly, continuing rise in acuity. While we did see modestly lower volumes, primarily in neonatology, with NICU days down 3%. Our overall results for the quarter were in line with our expectations. We reaffirm our full year 2026 outlook of $280 million-$300 million in adjusted EBITDA. In the quarter, we repurchased just under two million shares of our stock, bringing our total buybacks since August of 2025 to seven million shares and our shares outstanding to 81 million, down from 87 million at the end of the second quarter of 2025. Our cash balance is at $289 million, with total debt of $584 million.

We’ve spoken before about our financial strength, which enables our consistent support for our practices, quality programs, research, and growth. Before Kasandra provides additional details on the quarter, I’ll comment on how the pieces of our business fit our strategic positioning. You know our sector-leading footprint in neonatology and Maternal-fetal medicine. Today, we are in the process of building a significant function to augment our physical services with teleservices nationwide. No other entity is able to provide the services that we can offer to hospital partners, obstetricians, and patients. I’m sure you can imagine, we believe telemedicine is most effective when it’s combined with physical patient visits. As one of our MFM physician leaders, Dr. Amber Samuel, put it, "Access when you need it and hands-on when required." Only Pediatrix has a multi-state footprint of over 170 MFMs, by far the largest in the nation.

These practices are very closely linked to the over 360 NICUs across 32 states in which our clinicians provide services, which also is, of course, by far the largest in the country and which also handles more high acuity patients than anyone else. We believe that telemedicine without a physical link is an imperfect offering. We expect tele-hybrid medicines to add significant value to Pediatrix as it furthers our expansion in women’s and children’s care. This important area is not limited to MFM. Areas including retinopathy, neurology, infectious disease, and of course, neonatology are all under this umbrella. I spoke on a previous call about our expanding OBH footprint, which takes advantage of our embedded significant relationship with over 400 hospitals. We have recruited leaders in both tele-hybrid medicine and in OBH to help us expand both areas effectively.

Last on growth, we’re not a bank and our business is not holding deposits. Our strong balance sheet, cash position, and debt capacity enables us to take advantage of outside opportunities as they arise. We are very actively looking at possible growth avenues within women’s and children’s medicine, including potential opportunities to augment our strength by working with outside JV and capital investors. We have continued to buy back our shares and will continue to, unless and until we see opportunities that make clear operating and financial sense. Now I’ll turn the call to Kasandra to provide those additional details.

Ashley Snyder, Investor Relations / Legal Compliance, Pediatrix Medical Group, Inc.: Thanks, Mark. Good morning, everyone.

Kasandra Rossi, Chief Financial Officer, Pediatrix Medical Group, Inc.: Our consolidated revenue increased by 4%, driven by non-same unit activity, primarily recent acquisitions and same unit growth of 2%. Same unit pricing was up 4%, driven by strong RCM cash collections, favorable payer mix, and increased patient acuity, primarily in neonatology. Payer mix improved by 135 basis points as compared to the prior year second quarter, and importantly, improved by 120 basis points as compared to the first quarter of 2026. Same unit patient service volumes were down 2%, driven by hospital-based services, primarily neonatology, and we were up against a tough comp. Practice level SW&B expenses increased year-over-year, and on a same unit basis, reflected increases in salary expenses and malpractice expense. Salary growth has remained in a pretty tight band, consistent with the ranges we have seen for the last 18 months.

Our G&A expense increased year-over-year, primarily related to executive transition-related costs flowing through compensation expense. G&A expense increased to $5.8 million as compared to $5.3 million in the prior year, primarily reflecting capital expenditures and amortization of intangible assets from recent acquisitions. Other non-operating expense decreased to $2.9 million as compared to $4.9 million for the prior year period, primarily reflecting a decrease in interest expense from modestly lower interest rates and borrowings, and an increase in interest income on higher cash balances. Moving to cash flow, we generated $126 million in operating cash flow in the second quarter, compared to $138 million in the prior year, with the change driven by decreases in cash flow from accounts payable and accrued expenses and accounts receivable.

With cash of $289 million and net debt of just over $295 million, leverage sits at just above one time using the midpoint of our adjusted EBITDA outlook range for 2026. Our accounts receivable DSO at June 30th of 42.5 days were fairly unchanged from March 31st and December 31st, but were down just under four days year-over-year, primarily related to improved cash collections at our existing units. For the second half of 2026, we expect that our adjusted EBITDA will be fairly ratable in the third and fourth quarters. Now, I’ll turn the call back over to Mark.

Mark Ordan, Chief Executive Officer, Pediatrix Medical Group, Inc.: Thanks, Cassandra. Now, we are able to take questions if you have them.

Jordan, Conference Operator: As a reminder, if you’d like to ask a question, simply press star followed by the number one on your telephone keypad. Your first question comes from the line of Ryan Daniels from William Blair. Your line is live.

Matthew Mardula, Analyst, William Blair: Yeah, hello. This is Matthew Mardula on for Ryan. Thank you for taking the question as well as for the details in the prepared remarks. With the payer mix remaining stable this quarter and then increasing for commercial non-government payers year-over-year, and then also from Q1, based on the prepared remarks, why do you think you have been having a stable payer mix compared to your other peers in healthcare? Any comments on the consumer trend that is driving that payer mix for you, as well as any insights into your expectations of how this payer mix could hold up into the second half?

Mark Ordan, Chief Executive Officer, Pediatrix Medical Group, Inc.: Matthew, thanks for the question. We’ve said on previous calls, we said recently in a filing that we have not seen the same effect that others have experienced. We can guess that it has something to do with the fact that if you’re pregnant, then the relative value of insurance is a lot greater for you than it might be for somebody else. It would make sense to me that somebody would retain their health insurance if you’re pregnant. We don’t know what the future holds. Many people was concerned that we hadn’t built in some negative assumption, we look at the facts. We looked at, to date, it’s still very strong. We’re not saying we’re immune from it. We don’t really know. We can only say that there is a logical reason that we would be continuing to be strong.

It would make sense that in other cases, people would drop off the insurance because of the subsidy lapse. That’s all we know. There has been absolutely no sign of a change to date at Pediatrix.

Matthew Mardula, Analyst, William Blair: Great. Thank you for those details. Given that we’ve seen a couple of quarters of this volume decrease, do you still believe this is not a trend occurring? If so, what’s that reasoning behind the belief that the decrease in the patient volume seen is not a trend occurring? I know you were talking about in the prepared remarks, the tough comp, and it’s just difficult to assess or predict the birth trends. If you could give any color into maybe when you believe an increase in patient volume, maybe it’s that second half of this year, given the easier comps we see in the second half of this year. Just any color into the potential increase in that patient volume.

Mark Ordan, Chief Executive Officer, Pediatrix Medical Group, Inc.: Well, the change in volume is pretty much on trend with past seasonal patterns. We expect for the year that we’ll be overall flat in volume to maybe slightly down. As for an ongoing trend, we don’t know. We have seen the numbers that we report that show a slight decline in volume that’s been offset by the factors that we outlined. Other than that, we look at what the birth rate is, which is not a perfect indicator of what happens in neonatology. Importantly, because we sit on the high acuity side of neonatology, we look a lot at that. When I talked in my remarks about telemedicine, we can reach into other parts of the country where there are really care deserts, where there isn’t care available to provide care, and when necessary, bring patients in for physical care. We’re on trend.

This is typically a lower volume quarter, we’re on trend for the year to be flat to possibly slightly down.

Matthew Mardula, Analyst, William Blair: Great. Thank you so much for all the details. I greatly appreciate it.

Mark Ordan, Chief Executive Officer, Pediatrix Medical Group, Inc.: Thanks for your question, Matthew.

Jordan, Conference Operator: Your next question comes from the line of A.J. Rice from UBS. Your line is.

A.J. Rice, Analyst, UBS: Hi, everybody. Just a couple of things maybe. On the pricing, I know you’re attributing part of that to better collections, part of it to payer mix, and it sounds like some of it to acuity. Is there any way to delineate that a little further into what are the drivers of the extent to which either any of those were the primary driver?

Kasandra Rossi, Chief Financial Officer, Pediatrix Medical Group, Inc.: Hey, A.J., it’s Kasandra. Yeah, on the drivers, they are really following the same order that we’ve seen for the past several quarters. The biggest contributor is the RCM collections. Really coming in a close second is the payer mix impact. Rearing it up there is the acuity. Those three drivers are about 95% of the pricing for the quarter. As we’ve talked about, we do anticipate that the RCM collections piece that we’ve been seeing, that tailwind, will begin to dissipate in the second half of 2026. Like Mark said, we have no reason to believe at this time that acuity will wane. We’ve seen over the past few years, that is definitely on an upward trajectory. Payer mix, Mark already covered.

A.J. Rice, Analyst, UBS: Okay, that’s good. On the non same-store contribution to growth, acquisitions offset maybe by a little bit of dispositions. Can you tell us a little more about what you’re doing on the acquisition front, what you’re seeing, pricing? Was there much in the way of dispositions, or is most of that behind you at this point?

Kasandra Rossi, Chief Financial Officer, Pediatrix Medical Group, Inc.: Well, all the dispositions are definitely behind-

A.J. Rice, Analyst, UBS: There’s very little-

Kasandra Rossi, Chief Financial Officer, Pediatrix Medical Group, Inc.: All the dispositions are behind us, and then I’ll let Mark cover acquisitions.

Mark Ordan, Chief Executive Officer, Pediatrix Medical Group, Inc.: Look, we do see a lot of opportunities where pricing is fair. We expect to find opportunities, and as I mentioned before, if there are larger opportunities, we also see a big appetite from capital partners to join us in some way, to help provide additional financing. Look, we obviously are looking for ways to grow. We just want to make sure that it makes sense, as I said in the call, both on an operating basis and a financial basis. It does seem like a good time in the market to find smart opportunities that fit in the women’s and children’s space.

A.J. Rice, Analyst, UBS: Okay. Maybe just the last point of clarification. It sounded like there might be some unusual items. I think you mentioned executive transition compensation in the G&A. Is there an unusual item in there that we should back out to come up with a run rate for G&A going forward?

Kasandra Rossi, Chief Financial Officer, Pediatrix Medical Group, Inc.: We said that G&A, we expect for 2026 to be somewhere in the range of $230 million-$240 million. It’ll probably be on the higher end of that range. Like we mentioned in our remarks, most of the growth in G&A was related to those executive transition costs that we would say are one-time-ish.

A.J. Rice, Analyst, UBS: Okay. That’s done for the second half, so you’ll see it step down a bit in the second half. Is that the way to think about it?

Kasandra Rossi, Chief Financial Officer, Pediatrix Medical Group, Inc.: Yeah. There was an increase in the second quarter in particular.

A.J. Rice, Analyst, UBS: Okay. All right. Thanks so much.

Mark Ordan, Chief Executive Officer, Pediatrix Medical Group, Inc.: Thanks, AJ.

Kasandra Rossi, Chief Financial Officer, Pediatrix Medical Group, Inc.: Thanks.

Jordan, Conference Operator: Your next question comes from the line of Jack Slevin from Jefferies. Is now live.

Brett Grilkowski, Analyst, Jefferies: Hi, good morning. This is Brett Grilkowski on for Jack Slevin. Thanks for taking the questions here. Maybe just to double-click into kind of the previous questions been asked here, pricing in the back half of the year. What are the trends you’re currently expecting? I know you kind of called out the RCM comps there, but do you see any other incremental opportunities? Thank you.

Kasandra Rossi, Chief Financial Officer, Pediatrix Medical Group, Inc.: I mean, our pricing drivers are, they pretty much follow the four. RCM collections, which we’ve covered, which we will be lapping to some extent. Like we said, we do anticipate acuity will continue to be a positive factor for us in pricing. Payer mix, we’ve already covered. We have seen contract revenue come in through our pricing in past quarters. It wasn’t as much of a contributor this quarter, but nothing else to really call out there for the back half of the year.

Brett Grilkowski, Analyst, Jefferies: Okay, great. Maybe could you give some extra color on where you’re seeing wage inflation tracking? How can we expect this to progress into the rest of the year and then maybe into 2027?

Kasandra Rossi, Chief Financial Officer, Pediatrix Medical Group, Inc.: On the salaries expense, we’ve talked about that quite a bit for the past several quarters. We’ve been able to keep our salary increases in a pretty tight band, somewhere in that 3%-3.5% area. If you go back historically, we were up in the mid-single digits. We don’t see anything really changing. We’ve got really tight controls in that area.

Brett Grilkowski, Analyst, Jefferies: Great. Thank you.

Kasandra Rossi, Chief Financial Officer, Pediatrix Medical Group, Inc.: Sure, Brett.

Jordan, Conference Operator: There are no further questions. I’d like to turn the call back to Mark or Dan for closing remarks.

Mark Ordan, Chief Executive Officer, Pediatrix Medical Group, Inc.: Thank you very much. Thanks everybody for your continued support and interest in Pediatrix. I hope you’re enjoying your summer. Have a great day.

Jordan, Conference Operator: That concludes today’s meeting. You may now disconnect.