Thank you, operator, and good morning. Certain statements and information during this 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 management in light of their experience and assessment of historical 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, and 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, we 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, our quarterly and annual reports, and on our website at www.pediatrix.com. With that, I will turn the call over to Mark Ordan, our Chief Executive Officer.

Thanks, Mary Ann, and good morning, everyone. Also with me today is Kasandra Rossi, our Chief Financial Officer.

Our fourth quarter results were quite strong and capped an equally strong 2025. Our adjusted EBITDA of $66 million was in line with our upwardly adjusted guidance.

Throughout 2025, including the fourth quarter, strong volume, acuity, and payer mix, combined with strong financial control, gave rise to these results. During this time, we welcomed new leaders in key areas of the company, all of whom are dedicated in some way to focusing on care quality, which, of course, is the very essence of Pediatrix.

With these investments and record practice bonuses, our full-year adjusted EBITDA was a very strong $276 million. We expect our results in 2026 to be in the range of $280 to $300 million, which, at its midpoint, of course, is 5% above 2025.

This projection assumes steady metrics, including volume, acuity, and payer mix, and recent though early results support this outlook. Despite these steady metrics on our top line, we have several operational initiatives which we believe will flow favorably to our adjusted EBITDA.

We have said that we assumed that there was some payer mix benefit in 2025 from ACA subsidies. If those continue to lapse with no effective remedy, we would expect some effect.

As we have said before, this is very difficult to quantify such an effect because there are many possible outcomes. Kasandra will now provide some additional details on the quarter and preliminary outlook for 2026.

Thanks, Mark, and good morning, everyone. Our consolidated revenue decrease was driven by net non-same-unit activity of $26 million, including a decrease in revenue from our portfolio restructuring, partially offset by an increase in revenue from acquisition and organic growth.

This decrease was partially offset by same-unit growth of 4%, with same-unit pricing up just under 7% and overall patient service volumes down just under 3%. Pricing was driven by solid RCM cash collections, favorable payer mix, increased patient acuity in neonatology, and an increase in contract administrative fees.

While we saw volume declines across all our service lines during the quarter, including NICU days down about 2%, we were up against a tough comp. Practice-level SW&B expenses declined slightly year-over-year, reflecting our portfolio restructuring activity, partially offset by same-unit increases.

On a same-unit basis, we saw increases in variable practice incentive compensation and salary and benefits. Salary growth for the fourth quarter was modestly below the ranges that we have seen for the prior six quarters.

Those averaged around 3%. Our G&A expense increased year-over-year, driven by a modest increase in salary expense, as well as some travel expenses.

D&A expense decreased year-over-year, resulting from lower overall CapEx and an increase in fully depreciated assets. Other non-operating expense decreased year-over-year, driven by higher interest income on cash balances and a decrease in interest expense on modestly lower average borrowings at slightly lower rates.

Moving on to cash flow: we generated $115 million in operating cash flow in the fourth quarter, compared to $135 million in the prior year, primarily related to decreases in cash flow from AP and accrued and other liabilities. We also deployed $64 million of capital during the quarter to buy 2.9 million shares of our stock, leaving us with just about 83 million shares outstanding.

We ended the quarter with cash of $375 million and net debt of just over $220 million. This reflects net leverage of just under one times.

Our AR DSO at December 31st of 42.8 days were down slightly from September 30th, but were down almost 5 days year-over-year, driven by improved cash collections at our existing units. Moving on to our preliminary 2026 outlook that Mark noted earlier, this outlook contemplates full-year revenue of approximately $1.9 billion, in line with 2025.

It also contemplates full-year G&A expense in the range of $230 to $240 million, compared to our 2025 G&A of $241 million. Achieving the middle of the range would put it down about 20 basis points as a percent of revenue.

I'll also note the normal seasonality of our quarterly results. Within our expectations of full-year adjusted EBITDA, we anticipate that our first quarter 2026 adjusted EBITDA will represent about 17% to 19% of that annual expected range.

Historically, the first quarter adjusted EBITDA has ranged from 17% to 21% of the full year. We have also not factored any contribution to our results from M&A activity in 2026, and we plan to update you on the timing and magnitude of any potential additions.

I'll now turn the call back over to Mark.

Thanks, Kasandra. Our very strong balance sheet and cash flow enable us to invest in quality and clinical support and to attract and retain the finest clinicians in each of our areas of concentration.

In the fourth quarter, we introduced two new programs to further align our physicians and at Pediatrix. The first program provides a portion of the physicians' cash bonus in a stock-price-tracking element that is paid out over multiple years.

This program is a first step for us toward creating greater alignment across the entire organization, and we hope to expand it in the future. More than 500 physicians are participating in this program in its first year, and we expect this to create greater awareness of and responsibility for our collaborative role in delivering best-in-class care.

We are also excited to announce Pediatrix Partners. This is a group of 46 physicians from across our specialties who have received a stock-price-tracking grant to recognize their leadership role along with future efforts to help guide our decisions in quality, hospital relations, recruiting and retention, and growth.

We anticipate annually adding physicians to this inaugural class. Looking into 2026 and beyond, we see many areas of potential opportunity.

With our great physical footprint, we have the ability to leverage advanced telemedicine. This can provide vital assistance in care to people who are currently out of reach and can be a bridge to our national in-person care presence.

As we speak, we are looking at additional growth opportunities in our physical core, both in NICUs and maternal-fetal medicine, along with OBH. On OBH, we have a very strong presence in OB hospital medicine, and we see very strong demand for us to really increase our presence here.

Remember, our long-established hospital relations, thanks to our NICU, PICU, and MFM practices, provide an obvious entree here. Given our existing physical presence and dedicated overhead already, we believe we can provide a cost advantage to our hospital partners.

We love this space we're in, and we enjoy our leadership positions. We're also very aware of opportunities outside of our pediatrics and obstetrics space.

We assure you that we will guard our balance sheet strength carefully and only consider other opportunities that do not dilute our great strength in pediatrics and obstetrics. In our core areas in pediatrics and obstetrics, we see many viable growth avenues.

We are uniquely positioned, have the financial strength and discipline to accomplish this, and we are determined to do all we can to achieve smart growth. Operator, I'd like to now turn the call over to questions.

Hello, this is Matthew Mardula on for Ryan Daniels. Thank you so much for taking my question.

I know in your prepared remarks you said full-year revenue of $1.9 billion for 2026. Could you kind of give us the drivers of that revenue growth?

Any color into the expectations for facility volume growth or pricing expectations for the 2026 year would be great to hear about.

Hey, Matthew. Really, this overall assumes that we are going to be flat both in volume and in pricing.

While there will be some kind of ups and downs within the components that are part of pricing, overall we do expect both to be pretty flat.

Great. Thank you for that.

Then with the negative patient volume year-over-year this quarter, is there anything you could call out regarding kind of what happened there? I know you've previously mentioned it's difficult to call out one exact factor or one reason why, but kind of with the strong volume we have seen the past couple of quarters, is there any color we could hear about with what happened this quarter?

Thanks.

No, really that's about the comp. We tried to mention that the volume being down this quarter was really because the comp was fairly tough from the fourth quarter of last year.

Great. Thank you so much for all those insights.

You're welcome, Matthew. Thanks.

Hey, good morning. Thanks for taking the question.

I want to drill in a little bit on probably the quarter and the guidance as well. Maybe slightly different start on the quarter: the variable comp expense, I think we saw this in 2021 where you had a really strong year and then variable comp sort of spiked higher.

I know you sort of gave a little bit of a hint at it with the wide guidance range heading into the quarter. Is there any way to quantify or talk about sort of what that was in the quarter and how that drove earnings?

Then the second piece, Mark, hearing your commentary on some of the changes to some of the physician or stock-based comp structures, should we think about that as something that might have a smoothing effect for this same sort of dynamic in future years?

Two things. One is there were a variety of factors that led to our fourth quarter operations and going into 2026.

There's really no better parsing that I could provide. In terms of alignment, I'd say that's really the key driver of this.

It's not to achieve a smoothing effect. It's really just to make sure that over time our doctors, who have an enormous role in our hospital relations, quality, recruiting and retention, really feel a strong tie to the company and that we have a mutual bond to each other.

That's the driver of this.

Understood. Appreciate that.

Then just thinking about the guidance, hearing your commentary, and it's been consistent over a decent period about how it's hard to quantify or for you all to parse out exchange impact or subsidy impact on your overall volumes. I guess trying to think about the guidance, is there any way to understand what could possibly be embedded in the guidance for that factor?

Then hearing a little bit of your commentary, it sounds like you might have said early in the year you have indications that sort of things are consistent. Should I take that as payer mix, other sort of early indicators on this specific issue would tell you that you're not really seeing a change yet?

Thanks. That's exactly right.

We're not seeing a change yet, but the government hasn't yet figured out what the changes are in enrollment. You don't know yet whether people who said they're going to enroll are going to pay.

We don't know yet what the government might do in terms of a stopgap. Then the question is, what do people do?

Are people going on to commercial insurance? There are so many variables that make this up.

Obviously our antenna is up, and I probably look twice a day and see what the government is up to. It's just very hard to quantify.

In our guidance, we assume that we have the same metrics that we had during 2025.

Okay. Maybe just one follow-up, Mark or Kasandra, on that: just like to think about pricing really strong.

There really wasn't that much payer mix movement in '25. If I think about that flat pricing assumption, is it fair to say that in the way you've built that, some of the trends on hospital contract admin fees or core pricing or acuity might be balancing against some sort of implicit downside protection for an issue on exchanges?

Is that a fair way to think about how you've structured that pricing assumption?

No, it's not really tied to anything with the exchanges. We did actually see some incremental favorable payer mix in '25, although of course the start of the shift was in '24.

We did see that. Really we're just saying that we expect everything to remain pretty steady in 2026, really an average of what we saw in 2025.

That's where the guidance is based on.

As there are many components of it, from volume, acuity, basic payer mix. We're assuming all the factors that were in 20 we have no reason to think that any of those will change for 2026, so that's why our forecast is as it is.

Understood. Appreciate all the color, guys.

Hi, everybody. Your EBITDA at the midpoint is supposed to grow about $14 million year-to-year in '26, and it looks like you've got some assumptions about G&A cost reduction in there, maybe other cost reductions.

Can you just flesh out a little bit more what is embedded in guidance with respect to the costs or expense side of the equation?

It's really just that. We did call out, I think Kasandra called out likely expense reduction of a small scale, and that's really it.

We're overall forecasting pretty much the same kind of results that we had in '25 carrying into '26. Just because of normal operations changes, quarter to quarter, that's where we fall out.

As I said in my comments, there are many things that we're working on that could affect this going forward, but nothing that we could call out specifically at this time.

I was just thinking usually people would assume you get some kind of inflationary update in G&A, and you're actually forecasting about a $6 million decline year-to-year, which, I don't know, I thought there might be something specific behind that. On the comments about capital deployment, you said no M&A embedded in the guidance.

Obviously, you're doing share repurchases. Can you just give us a little flavor for how much share repurchases is anticipated in the current guidance?

Then if you did M&A, I know you said you've got the opportunity to grow in NICU, you got the opportunity with maternal-fetal medicine. Is it that type of thing, or those are just potentially bid on contracts, recruit individual doctors?

Is there any place where you're looking for M&A that might be a little bigger and chunkier that you would potentially consider?

On the first part of your question, we assume in our guidance a much smaller amount of stock buyback, we'll be opportunistic about that. Probably we don't anticipate at the same scale as we did in 2025.

In terms of growth opportunities, they're really many. They range from physical practices to telemedicine within our space.

I mentioned OB hospitalist, which is a very important program nationwide in many hospitals. We have a real strength in that, and as I said earlier, because of our NICU relationships, maternal-fetal medicine relationships, PICU relationships across the nation, we're uniquely positioned to do that and do it in a cost-efficient way.

Then, A.J., yes, there are lots of companies out there, many that are private equity-owned, that are looking for a new home. I think there are a lot of people out there that are aware of our balance sheet and, my team and I have certainly done deals like that over time, we get a lot of inbound interest.

We want to balance that inbound interest with the strength of our core and make sure that we don't do anything that can take away from our core. This is a time when it's good to have strong cash flow, a strong balance sheet, a great relationship with hospitals, and be opportunistic if there's something out there that we can do.

Okay. All right, thanks so much.

Thanks, A.J.

Great. Good morning and thank you.

Can we just talk about pricing? It seemed very strong in the quarter, up around over 9%, and this is versus the 7% in Q3.

I know you talked about acuity and other drivers, but it still seems very high. Can you tell us what's happening with the acuity shift and payer mix, just more detail on just that strength over the past couple of quarters and how sustainable you think it is?

That'd be great. Thank you.

For the quarter, it was actually up just under 7%, and it's really the same things we've seen for the past couple of quarters. We really have strong RCM collections coming through, which was related to all the stabilization efforts that we undertook in '25 with our revenue cycle management transition.

Then we did have some favorable impact from payer mix that we've talked a little bit about. Acuity was also strong again, and we did have contract administrative fees that were up a bit.

It's really the same things we've seen, and then what we anticipate is that is going to stay, kind of get steady as we move into '26, and of course in '26 the comps are going to be tougher.

On acuity, with advances, our hospitals are known because of our NICUs to be able to handle patients that in the past you could never have handled. I think there is certainly something that favors us because we are the leader in level 3 and level 4 NICUs around the country.

As Cassandra said, there's just been a real strengthening in that part of the business.

Thank you.

Great. Thank you all very much and have a great day.