U.S. Physical Therapy Profile

U.S. Physical Therapy, Inc. operates outpatient physical and occupational therapy clinics that provide pre- and post-operative care and treatment for orthopedic-related disorders, sports-related injuries, preventative care, rehabilitation of injured workers and neurological-related injuries. The Company primarily operates through subsidiary clinic partnerships, in which it generally owns a 1% general partnership interest and a 64% limited partnership interest and the managing therapist(s) of each clinic owns the remaining limited partnership interest in the majority of the clinics. To a lesser extent, the Company also operates some clinics, through wholly owned subsidiaries, under profit sharing arrangements with therapists. At December 31, 2004, the Company operated 264 outpatient physical and occupational therapy clinics in 35 states. In addition to owned clinics during the period, it also managed four physical therapy facilities for third parties, including physicians. For the three months ended 31 March 2006, U.S. Physical Therapy, Inc.'s revenues increased 12% to $34.7M. Net income decreased 27% to $1.5M. Revenues reflect an increase in patient visits & higher net patient revenue per visit. Net income was offset by higher salaries & related costs, an increase in rent, clinic supplies, contract labour & other costs, rise in depreciation expense & professional fees and lower net interest income.