[8-K] Encompass Health Corp Reports Material Event

Rhea-AI Filing Summary

Encompass Health Corp provided forward-looking non-GAAP guidance in an Item 7.01 disclosure, projecting net operating revenue of $5,880 million to $5,980 million, Adjusted EBITDA of $1,220 million to $1,250 million, and adjusted earnings per share from continuing operations of $5.12 to $5.34. The company states it does not provide comprehensive GAAP guidance because certain items cannot be reliably predicted, but it estimates 2025 interest expense and amortization of debt discounts and fees of approximately $125 million and amortization of debt-related items of approximately $10 million. The disclosure is furnished under Regulation FD and is not deemed "filed" for Section 18 purposes.

Positive

• Clear non-GAAP guidance ranges for net operating revenue, Adjusted EBITDA, and adjusted EPS provide forward targets
• Estimated interest and debt amortization figures (approx. $125M and $10M) supply partial reconciliation help

Negative

• No full GAAP guidance or complete reconciliation is provided, increasing uncertainty when modeling GAAP results
• Certain significant reconciling items (settlements, mark-to-market, tax adjustments) are excluded and described as unpredictable

Insights

Securities Analyst

TL;DR: Guidance provides clear non-GAAP targets but omits GAAP figures and some reconciling items, limiting full comparability.

The company supplies a concise set of non-GAAP forward targets: revenue, Adjusted EBITDA, and adjusted EPS ranges. These figures give investors a view of expected operational performance, while management cautions that GAAP reconciling items are unpredictable and therefore excluded from guidance. The provided estimates for interest-related costs (~$125 million) and debt amortization (~$10 million) help approximate some GAAP impacts, but the absence of a full GAAP bridge means analysts must model remaining reconciling items separately. Overall, the disclosure is material as directional guidance but incomplete for precise GAAP earnings modeling.

Corporate Finance Specialist

TL;DR: The ranges are useful for operational outlook; limited GAAP reconciliation raises forecasting uncertainty.

Encompass Health's guidance focuses on non-GAAP metrics commonly used to illustrate operating performance. The explicit ranges for net operating revenue and Adjusted EBITDA enable margin and leverage analysis at a high level. Stating estimated interest and debt amortization amounts is helpful, yet without estimates for tax adjustments, settlements, mark-to-market effects, and other reconciling items, converting to a GAAP EPS estimate remains imprecise. Investors should treat these as directional targets rather than fully reconciled earnings guidance.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant To Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (date of earliest event reported): September 12, 2025

Encompass Health Corporation

(Exact name of Registrant as specified in its Charter)

Delaware

(State or Other Jurisdiction of Incorporation)

001-10315			63-0860407
(Commission File Number)			(IRS Employer Identification No.)

9001 Liberty Parkway, Birmingham, Alabama 35242

(Address of Principal Executive Offices, Including Zip Code)

(205) 967-7116

(Registrant’s Telephone Number, Including Area Code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐			Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐			Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐			Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐			Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.     Emerging growth company   ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Securities registered pursuant to Section 12(b) of the Act:

Title of each class			Trading Symbol(s)			Name of each exchange on which registered
Common Stock, par value $0.01 per share			EHC			New York Stock Exchange

ITEM 7.01. Regulation FD Disclosure.

Members of Encompass Health Corporation’s (the “Company” or “Encompass Health”) senior management team are scheduled to meet with investors and analysts at various meetings on September 12, 2025, October 1, 2025, and October 6, 2025.

The Company reiterates as of the date hereof its guidance previously reported in the Current Report on Form 8-K, dated August 4, 2025, and during the Company's earnings conference call held on August 5, 2025. Accordingly, the Company continues to expect the following full-year 2025 ranges:

•Net operating revenue of $5,880 million to $5,980 million;

•Adjusted EBITDA of $1,220 million to $1,250 million; and

•Adjusted earnings per share from continuing operations attributable to Encompass Health of $5.12 to $5.34.

The information contained herein is being furnished pursuant to Item 7.01 of Form 8-K, “Regulation FD Disclosure.” This information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. The furnishing of this information will not be deemed an admission as to the materiality of any information contained herein.

Note Regarding Presentation of Non-GAAP Financial Measures

Excluding net operating revenues, the Company does not provide guidance on a GAAP basis because it is unable to predict, with reasonable certainty, the future impact of items that are deemed to be outside the control of the Company or otherwise not indicative of its ongoing operating performance. Such items include government, class action, and related settlements; professional fees—accounting, tax, and legal; mark-to-market adjustments for stock appreciation rights; gains or losses related to hedging instruments; loss on early extinguishment of debt; adjustments to its income tax provision (such as valuation allowance adjustments and settlements of income tax claims); items related to corporate and facility restructurings; and certain other items the Company believes to be not indicative of its ongoing operations. These items cannot be reasonably predicted and will depend on several factors, including industry and market conditions, and could be material to the Company’s results computed in accordance with GAAP.

However, the following reasonably estimable GAAP measures for 2025 would be included in a reconciliation for Adjusted EBITDA if the other reconciling GAAP measures could be reasonably predicted:

•Interest expense and amortization of debt discounts and fees - approximately $125 million

•Amortization of debt-related items - approximately $10 million

Forward-Looking Statements

Statements contained in this Form 8-K which are not historical facts, such as those relating to business outlook and guidance, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In addition, Encompass Health, through its senior management, may from time to time make forward-looking public statements concerning the matters described herein. All such estimates, projections, and forward-looking information speak only as of the date hereof, and Encompass Health undertakes no duty to publicly update or revise such forward-looking information, whether as a result of new information, future events, or otherwise. Such forward-looking statements are necessarily estimates based upon current information and involve a number of risks and uncertainties. Actual events or results may differ materially from those anticipated in these forward-looking statements as a result of a variety of factors. While it is impossible to identify all such factors, factors which could cause actual events or results to differ materially from those estimated by Encompass Health include, but are not limited to, infectious disease outbreak, including the speed, depth, geographic reach and duration of its spread, which could decrease our patient volumes and revenues and lead to staffing and supply shortages and associated cost increases; Encompass Health's infectious disease prevention and control efforts; the demand for Encompass Health’s services, including based on any downturns in the economy, consumer confidence, or the capital markets; the price of Encompass Health's common stock as it affects Encompass Health's willingness and ability to repurchase shares and the financial and accounting effects of any repurchases; any adverse outcome of various lawsuits, claims, and legal or regulatory proceedings involving Encompass Health, including any matters related to yet undiscovered issues, if any, in acquired operations; Encompass Health's ability to attract and retain key management personnel; potential disruptions, breaches, or other incidents affecting the proper operation, availability, or security of Encompass Health's or its vendors' or partners’ information systems, including unauthorized access to or theft of patient, business associate, or other sensitive information or inability to provide patient care because of system unavailability; Encompass Health's ability to successfully complete and integrate de novo developments, acquisitions, investments, and joint ventures consistent with its growth strategy; Encompass Health’s ability to realize construction time and cost savings from prefabrication of hospitals; increases in Medicare audit activity, including increased use of sampling and extrapolation, resulting in additional unpaid reimbursement claims and an increase in the backlog of appealed claims denials; changes, delays in (including in connection with resolution of Medicare payment reviews or appeals), or suspension of reimbursement for Encompass Health's services by governmental or private payors; changes in the regulation of the healthcare industry at either or both of the federal and state levels, including as part of national healthcare reform and deficit reduction and Encompass Health's ability to adapt operations to those changes, including in connection with the CMS inpatient rehabilitation review choice demonstration project; competitive pressures in the healthcare industry and Encompass Health's response thereto; Encompass Health's ability to obtain and retain favorable arrangements with third-party payors; Encompass Health's ability to control costs, particularly labor and employee benefit costs, including group medical expenses; adverse effects resulting from coverage determinations made by Medicare Administrative Contractors regarding its Medicare reimbursement claims and lengthening delays in Encompass Health's ability to recover improperly denied claims through the administrative appeals process on a timely basis; Encompass Health's ability to adapt to changes in the healthcare delivery system, including value-based purchasing and involvement in coordinated care initiatives or programs that may arise with its referral sources; Encompass Health's ability to attract and retain nurses, therapists, and other healthcare professionals in a highly competitive environment with often severe staffing shortages, which may be worsened by infectious disease outbreaks, and the impact on Encompass Health's labor expenses from potential union activity, staffing shortages, and competitive compensation practices; general conditions in the economy and capital markets, including any instability or uncertainty related to trade war, armed conflict or an act of terrorism, governmental impasse over approval of the United States federal budget, an increase in the debt ceiling, or an international sovereign debt crisis; the increase in the cost of, or the decrease in the availability of, construction materials and necessary supplies, including as a result of tariffs and import restrictions; the increase in the costs of defending and insuring against alleged professional liability claims, and Encompass Health's ability to predict the estimated costs related to such claims; and other factors which may be identified from time to time in Encompass Health's SEC filings and other public announcements, including Encompass Health's Form 10‑K for the year ended December 31, 2024 and Form 10-Q for the quarters ended March 31, 2025 and June 30, 2025.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.

ENCOMPASS HEALTH CORPORATION
By:			/S/   DOUGLAS E. COLTHARP
			Name:			Douglas E. Coltharp
			Title:			Executive Vice President and Chief Financial Officer

Dated: September 12, 2025

FAQ

What revenue guidance did Encompass Health (EHC) provide?

Encompass Health provided a net operating revenue range of $5,880 million to $5,980 million.

What Adjusted EBITDA and adjusted EPS did EHC forecast?

The company forecasted Adjusted EBITDA of $1,220 million to $1,250 million and adjusted EPS of $5.12 to $5.34.

Does the filing include GAAP guidance for 2025?

No. The company stated it does not provide comprehensive GAAP guidance because certain reconciling items cannot be reasonably predicted.

What estimated interest and debt amortization costs did EHC disclose?

Encompass Health estimated interest expense and amortization of debt discounts and fees of approximately $125 million and amortization of debt-related items of approximately $10 million for 2025.

Is this disclosure considered "filed" under the Exchange Act?

The company noted the information is furnished under Regulation FD and explicitly stated it is not to be deemed "filed" for Section 18 purposes.