How should investors think about future EBITDA margins given Q2 strength and the end of separation costs? What were the details of the Tennessee rate increase and the drivers of work comp revenue per visit growth?

Management clarified that Q2 and Q3 are seasonally highest margin quarters but expects margins to move up from the current 21% (midpoint of guide) as visit growth, rate increases, and M&A continue. Tennessee rate increase was roughly 30% blended. Work comp revenue per visit growth of 4.9% was driven by California/Tennessee rate bumps and a favorable mix of higher-reimbursement initial injury visits, plus easier year-over-year comparisons due to Nova integration in Q2 2025. “we do anticipate the margins to move up as we continue to grow visits, have rate increases, execute on our M&A strategy. And I think this quarter, you can really see the visit and rate strength and how that flows through the margin closer to the combined with the efficiencies that we had in the quarter.”

Is the current above-trend workers' comp visit growth sustainable, potentially indicating a cyclical upturn from data center activity? How much market share runway remains within Fortune 500 and SMID cohorts?

Management believes the strong work comp performance is durable, driven by macro tailwinds (manufacturing/construction, early signs of data centers) and internal efforts (market share gains, technology for customer retention). They see significant "white space" for continued penetration into existing large customers and prospecting small customers, facilitated by technology and improved patient/customer experience. “Yes, from a workers' comp perspective, we really had a strong year, probably one of the best years we've seen in 20 years so far. And we continue to see strength in those visits as we go forward.”

Why is there a higher mix of initial injury visits, and is this a durable trend? How does the improved leverage impact the deal pipeline, and what is the balance between core occupational health and other opportunities, including asset size?

The higher initial injury mix is attributed to market share gains, high customer retention, and macro backdrop, though management noted it can fluctuate. Regarding M&A, the pipeline is strong with mid-sized bolt-on opportunities, but nothing the size of Nova. The improved leverage (below 3x) allows for continued M&A without impacting deleveraging goals, as cash flow will manage it. “We've got a strong deal pipeline at this point in time, both from a bricks and mortar and an on-site perspective, prospecting them all, moving them all along the pathway. As far as anything the size of Nova, that's not going to happen. But several nice midsized ones that we think can get across the goal line in the coming months.”

CON

Concentra (CON) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Health Care· Aug 7, 2026

Source: earnings call transcript

Executive summary

Concentra Q2 FY26 — Strong Revenue and EBITDA Growth, Accelerated Deleveraging

The company delivered a strong second quarter, marked by robust revenue and EBITDA growth, driven by increased patient visits and higher revenue per visit across its occupational health centers. The business continues to execute on its strategy of expanding access through de novo development and disciplined acquisitions, while also achieving significant operational efficiencies and deleveraging ahead of schedule. The CEO transition to Matt DiCanio reflects continuity in strategy and leadership.

Highlights

Total company revenue grew 10% YoY to $606 million, with core revenue up 8% excluding Pivot acquisition.
Adjusted EBITDA increased 22.5% to $140.9 million, with adjusted EBITDA margin expanding 240 bps to 23.3%.
Adjusted EPS grew approximately 40% to $0.52, and adjusted net income increased to $66.7 million.
Net leverage ratio decreased to just under 3x, ahead of schedule, from 3.4x in Q1.
Free cash flow totaled $121 million, an increase from $63.2 million in the prior year.

Concerns

Seasonality of margins
Conservatism in guidance

Guidance & targets

Category	Target	Timeline	Confidence
Full-year 2026 Revenue	$2.325 billion to $2.375 billion high materiality	FY26	High
Full-year 2026 Adjusted EBITDA	$485 million to $495 million high materiality	FY26	High
Full-year 2026 Free Cash Flow	$220 million to $240 million high materiality	FY26	High
Full-year 2026 Capital Expenditure	$70 million to $80 million medium materiality	FY26	High
De novo centers opened	8 to 10 medium materiality	FY26	High
De novo centers opened	double-digit new sites medium materiality	FY27 and beyond	Medium
Work Comp visit growth rate	low single-digit medium materiality	long-term	High
Revenue per visit growth	closer to 3% medium materiality	remainder of the year · FY26	High
Net leverage ratio	near 2.5x high materiality	long-term	High

Segment performance

Segment	Revenue	YoY	QoQ	Margin
Occupational Health Centers This segment represents the core occupational health business, showing strong growth in both work comp and employer services revenue. Work comp specific revenue: $361.2 millionWork comp specific revenue growth: 8.7% YoYEmployer Services specific revenue: $183.2 millionEmployer Services specific revenue growth: 5.1% YoY	$553.5 million	7.2%	—	—
Onsite Health Clinics Reported strong growth, significantly boosted by the Pivot acquisition, with robust organic growth indicating strong underlying demand and successful integration. Organic growth (excluding Pivot acquisition): 27.9% YoY	$38.8 million	72.1%	—	—
Other Businesses Includes telemed, pharmacy operations, and other OcHealth-related service businesses, showing solid double-digit growth.	$13.7 million	13.3%	—	—

Deals & partnerships

Pivot Acquisition of Pivot

The Pivot acquisition in June of last year continues to perform very well and is ahead of underwriting. It helped leverage relationships and expand with existing customers.

Nova Acquisition of Nova

The Nova acquisition continues to perform very well and is ahead of underwriting. It helped expand into markets with data center build activity.

Risks & headwinds

Seasonality of margins remainder of FY26

Q2 and Q3 are the highest margin quarters

Mitigation:Management expects margins to move up over time, but acknowledges seasonal fluctuations will impact the second half of the year.

Conservatism in guidance remainder of FY26

Guidance raised by more than the beat, but still some conservatism in the outlook

Mitigation:Management stated this is not due to any negative market signals but rather a prudent approach given several months left in the year.

What to watch in Q3 FY26

Work comp visit growth rate

next quarter

Current 3.7% in Q2 FY26

Target Sustained above long-term low single-digit average

Why it matters

Continued strong work comp visit growth, especially from manufacturing/construction and data center activity, would indicate durable market tailwinds and market share gains, supporting revenue growth.

So we still point to the low single-digit visit growth rate as our expectation over a long period of time. Obviously, the last 3 quarters of last year were in the 3% to 4% range. We had an outsized Q1 at 6.2%, and we're back in the 3% to 4% range this quarter. So it's above our long-term algorithm.

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Q&A highlights

Why isn't guidance raised more given the strong beat, implying conservatism? What is the long-term work comp visit growth expectation, and how might reshoring/data centers impact it?

Management confirmed some conservatism in the outlook, but stated it's not due to any negative market signals. They reiterated low single-digit long-term work comp visit growth but noted current trends are above average, with early signs of manufacturing/construction activity from reshoring and data center development potentially adding to future growth.

“I think there's -- could potentially be a little conservatism in the outlook for the rest of the year. So it's definitely not something we're seeing. We continue to see strong visit growth and obviously had a great rate quarter as well.”

asked by Ann Hynes · answered by Matthew DiCanio

2 min read 6 chapters

Detailed narrative

CEO Transition and Leadership Continuity

The company announced a planned CEO transition, with Keith Newton moving to Executive Chairman and Matt DiCanio, current President and CFO, becoming President and CEO effective November 1, 2026. This transition is the result of a multi-year succession plan and emphasizes continuity in strategy and leadership, supported by a highly tenured executive team with an average tenure of approximately 20 years.

DiCanio highlighted that the company's strategy of customer value proposition, access expansion, and operating leverage will remain unchanged.

Strong Core Business Performance

Concentra reported one of its strongest core revenue growth quarters, with total revenue up 10% year-over-year to $606 million, and core revenue (excluding Pivot) up 8%. This was driven by a 2.6% increase in total occupational health center patient visits, averaging over 56,000 visits per day.

Work comp visits increased 3.7%, and employer services visit volume increased 1.8%, reflecting a resilient blue-collar labor market and market share gains.

Operational Efficiencies and Margin Expansion

Adjusted EBITDA surged 22.5% to $140.9 million, leading to a 240 basis point expansion in adjusted EBITDA margin to 23.3%. This improvement was attributed to strong rate and volume growth, coupled with effective operational efficiencies and the elimination of prior-year Nova acquisition-related integration costs.

Cost of services improved to 68.3% of revenue from 70.7% in the prior year, driven by staffing efficiencies and technology-enabled productivity gains.

Deleveraging and Capital Allocation

The company achieved its net leverage ratio goal of under 3x (specifically, just under 3x) well ahead of schedule, down from 3.4x at the end of Q1. This was due to strong free cash flow generation of $121 million and EBITDA growth.

Management reiterated a long-term leverage target of near 2.5x. Capital allocation included $11 million in share repurchases (424,000 shares) and $8 million in dividends, with $54 million remaining on the $100 million repurchase program.

Strategic Growth Initiatives

Concentra continues to expand its footprint through de novo centers and bolt-on M&A. One new center was opened in Q2, and two more post-quarter, including its first in Idaho (42nd state). The company targets 8-10 de novo centers for FY26 and expects double-digit new sites in 2027 and beyond.

The Onsite Health clinics segment demonstrated robust growth, with reported revenue up 72.1% and organic growth (excluding Pivot) of 27.9%, driven by increased demand and successful integration of acquisitions.

Separation from Select Medical Nearing Completion

The complex separation from Select Medical is substantially complete, with most process and technology implementations finalized, including the ERP system conversion in May. Remaining TSA services spend is immaterial and will be entirely eliminated by November 2026, allowing internal resources to focus on higher-value projects.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.