XML 27 R16.htm IDEA: XBRL DOCUMENT
v3.24.3

Derivative Instruments | 9 Months Ended
--- | ---
Sep. 30, 2024
Derivative Instruments [Abstract] |
Derivative Instruments | 9. Derivative Instruments The Company is exposed to certain market risks in the ordinary course of business due to adverse changes in interest rates. The exposure to interest rate risk primarily results from the Company’s variable-rate borrowing. The Company may elect to use derivative financial instruments to manage risks from fluctuations in interest rates. The Company does not purchase or hold derivatives for trading or speculative purposes. Fluctuations in interest rates can be volatile and the Company’s risk management activities do not eliminate these risks. Interest Rate Swap In May 2022, the Company entered into an interest rate swap agreement, effective on June 30, 2022, with Bank of America, N.A, which had a $150 million notional value, and a maturity date of June 30, 2027. Beginning in July 2022, the Company receives 1-month SOFR, and pays a fixed rate of interest of 2.815% on 1-month SOFR on a quarterly basis. The total interest rate in any period will also include an applicable margin based on the Company’s consolidated leverage ratio. In connection with the swap, no cash was exchanged between the Company and the counterparty. The Company designated its interest rate swap as a cash flow hedge and structured it to be highly effective. Consequently, unrealized gains and losses related to the fair value of the interest rate swap are recorded to accumulated other comprehensive income (loss), net of tax. The impact of the Company’s derivative instruments on the accompanying Consolidated Statements of Comprehensive Income are presented in the table below.
|  | For the Three Months Ended |  |  | For the Nine Months Ended |
|  | September 30, 2024 |  |  | September 30, 2023 |  |  | September 30, 2024 |  |  | September 30, 2023 |
|  | (In thousands) |
Net income |  | $ | 9,777 |  |  | $ | 12,222 |  |  | $ | 33,106 |  |  | $ | 38,513 |
Other comprehensive (loss) gain: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Unrealized (loss) gain on cash flow hedge |  |  | (3,687 | ) |  |  | 1,276 |  |  |  | (1,937 | ) |  |  | 2,340 |
Tax effect at statutory rate (federal and state) |  |  | 942 |  |  |  | (326 | ) |  |  | 495 |  |  |  | (598 | )
Comprehensive income |  |  | 7,032 |  |  |  | 13,172 |  |  |  | 31,664 |  |  |  | 40,255 |
Comprehensive income attributable to non-controlling interest |  |  | (3,149 | ) |  |  | (2,968 | ) |  |  | (10,926 | ) |  |  | (10,930 | )
Comprehensive income attributable to USPH shareholders |  | $ | 3,883 |  |  | $ | 10,204 |  |  | $ | 20,738 |  |  | $ | 29,325 |
The valuations of the Company’s interest rate derivatives are measured as the present value of all expected future cash flows based on SOFR-based yield curves. The present value calculation uses discount rates that have been adjusted to reflect the credit quality of the Company and its counterparty which is a Level 2 fair value measurement. The carrying and fair value of the Company’s interest rate derivatives (included in other current assets and other assets) were as follows.
|  | As of |
|  | September 30, 2024 |  |  | September 30, 2023 |
|  | (In thousands) |
Other current assets |  | $ | 1,373 |  |  | $ | 3,561 |
Other assets |  |  | 425 |  |  |  | 4,156 |
|  | $ | 1,798 |  |  | $ | 7,717 |

X
- References No definition available. + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 40 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480237/815-40-50-5 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 5C -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-5C Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 815 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/815/tableOfContent + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration