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Physical therapy represents a $30 billion industry with an annual growth rate of 7% within the US. Despite the size of this market, it remains highly fragmented and extremely competitive with the largest 50 competitors comprising less than 25% of the market. The market is primarily composed of small, independent practices. U.S. Physical Therapy, Inc. is the only publicly traded pure-play provider of outpatient physical therapy in the United States.

U.S. Physical Therapy, Inc. operates outpatient physical therapy clinics that provide pre- and post-operative care and treatment for a variety of orthopedic-related disorders and sports-related injuries, neurologically-related injuries and rehabilitation of injured workers. At December 31, 2018, it operated 591 clinics in 42 states.

It also manages physical therapy facilities for third parties, such as physicians and hospitals, with 28 such third-party facilities under management as of December 31, 2018.

In March 2017, it purchased a 55% interest in its initial industrial injury prevention business. On April 30, 2018, it made a second acquisition and subsequently combined the two businesses. After the combination, it owned a 59.45% interest in the combined business. Services provided include onsite injury prevention and rehabilitation, performance optimization and ergonomic assessments.

The majority of these services are contracted with and paid for directly by employers, including a number of Fortune 500 companies. Other clients include large insurers and their contractors. It performs these services through Industrial Sports Medicine Professionals, consisting of both physical therapists and highly specialized certified athletic trainers (ATCs).

The Company’s clinics provide preventative and post-operative care for a variety of orthopedic-related disorders and sports-related injuries, treatment for neurologically-related injuries and rehabilitation of injured workers.

In addition to owning and operating clinics, the Company manages 28 physical therapy facilities for unaffiliated third parties, including hospitals and physician groups. The Company also has an industrial injury prevention business which provides onsite and offsite services for clients’ employees including injury prevention, rehabilitation, assessments and performance optimization.

The company just announced that it has acquired a third (unidentified) company that is a provider of industrial injury prevention services. This adds to the previous acquisitions in this business line occurred in 2017 and 2018.

The acquired company specializes in delivering injury prevention and care, post offer employment testing, functional capacity evaluations and return-to-work services. It performs these services across a network in 45 states including onsite at eleven client locations. This relationship-based health delivery system is paid for directly by corporate clients. Clients include large companies across a variety of industries.

The acquired business produced $13 million in revenue in 2018. U.S. Physical Therapy purchased the company for total consideration of $23.6 million. The business was then combined with Briotix Health, USPH’s industrial injury prevention operation, increasing U.S. Physical Therapy’s ownership position in the partnership to approximately 76%.

In conjunction with the acquisition announcement, U.S. Physical Therapy’s management is raising 2019 earnings guidance from Operating Results, a non-GAAP measure, to $35.9 million to $37.3 million, or $2.82 to $2.92 per share.