ATI Physical Therapy, Inc. (NYSE:ATIP) Q3 2023 Earnings Call Transcript

Joseph Jordan: I’m going to break out interest expense from cash interest because I’m guessing you care a little bit more about the cash interest piece of it. The cash interest, probably somewhere around $14 million a quarter in cash interest based on the debt structure, assuming the current interest rate environment. Now there’s recent improvements in the interest rate environment, which could drive it down because our interest does have a variable component to it. But I think 14% is a good place to earmark it. And so, to your point, that’s $56 million of cash interest. So we will be a user of cash in 2023, although we think Q4 will be generating single-digit millions of cash. In 2024, we’ll come out and talk more about that, obviously, when we’re in 2024, but you could do the math on the cash interest plus some amount of CapEx and realize that to be cashflow positive.

It’s probably somewhere in the 70-plus-million of adjusted EBITDA range. And we like the momentum that we’ve been able to gain throughout 2023 and through Q3. And as I mentioned, we think we’ll continue to gain momentum in 2024. I don’t foresee being cash flow positive in 2024 yet, but it’s an important step towards cash flow positive. And with the $40 million of liquidity and the availability that we have on the delayed draw term loan, I think we feel that it gives us the runway to continue to grow into our capital structure.

Operator: [Operator Instructions]. All right. And there are no further questions at this time. I’d like to turn the call back over to Sharon Vitti for any additional or closing remarks.

Sharon Vitti: This ends the Q&A portion of our call. Thank you to our investors, analysts and all the ATI team members for joining the ATI Q3 quarterly earnings call and we will look forward to seeing you in the new year.

Operator: Thank you. And that does conclude today’s presentation. Thank you for your participation. You may now disconnect.