Surgery Partners, Inc. (NASDAQ:SGRY) Q4 2022 Earnings Call Transcript

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And I would like to see those trends continue into the current year, and I think that is the expectation of the Board of Directors as well.

Eric Evans: Yes. And Bill, I’d just say, look, you guys — again, I can’t speak to why the market is where it is or other companies are where they are. This was our expectation. I mean we kind of built — we knew what we had, what we expect to do in the fourth quarter, it matched our expectations based on all the different programs, whether it’s recruitment or new service lines. This came in where we expected it to be and kind of continues that long-term trend of real consistency on how we build that growth into our operating system. So, we expect to continue to execute on this. We were happy with the fourth quarter. Obviously, it’s always seasonally a big quarter. We had some new service lines. But in general, it is just continued execution on the long-term strategy.

Bill Sutherland: Got it. And as you look at your pipeline of investments, the majority and otherwise, is the — is it largely a mix of MSK and Cardiac at this point?

Wayne DeVeydt: Heavily weighted yes. Heavily weighted.

Eric Evans: I mean we’ll certainly look at other service lines where we can expand into those higher acuity with an existing facility. So, I won’t say it’s all we’ll buy. But if you wanted to weight them, it’s absolutely MSK, cardio weighted.

Bill Sutherland: Okay, thanks guys.

Operator: Thank you. The next question comes from Lisa Gill from JPMorgan. Please proceed with your question, Lisa.

Lisa Gill: Great. Thanks very much and good morning. I just wanted to go back to your early comments. Wayne you talked about hospital partnerships, can you talk about how to think about the economic model and how that flows through the income statement for Surgery Partners?

Wayne DeVeydt: Hi, Lisa. So let me talk about first and foremost, when we talk about a hospital partnership, what that means to us. And I actually feel optimistic that we will be announcing some partnerships being signed this year. Again, we’re close on a number of items. So hopefully we’ll be able to talk about that in the very near term. But first and foremost, we have to be like-minded. And what like-minded means to us at Surgery Partners is that we are aligned around supporting the ecosystems where we have patients’ needs a quality metrics that need to be met and continuing to be a unique value play to the market. Two is we have to be able to not only have ownership in those facilities that those health systems have today, but we have to be the operators of those facilities.

So when we talk about partnerships, view it as us most likely taking a minority ownership in existing facilities within health systems, but becoming the operator of choice for those facilities. And then finally, we want to know that there’s a growth trajectory here to expand into new markets with those health systems. And that is the last piece that I would highlight. And I would tell you that all of those, as we go through this, we waste time and energy and effort versus what alternatives are available to us. And so €“ but in many cases, we view these as very attractive relationships when we align on those three kind of like-minded scenarios. And again, I’m optimistic. I think Eric, you would €“ he’s nodding as we’re saying this, I think Eric would say the same that we will be announcing some partnerships this year.

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