The Ensign Group Reports Third Quarter 2009 Adjusted Earnings of $0.38 per Share

Conference Call and Webcast Scheduled for November 3, 2009 at 10:00 am PT

MISSION VIEJO, Calif., Nov. 2 /PRNewswire-FirstCall/ -- The Ensign Group, Inc.
(Nasdaq: ENSG), the parent company of the Ensign(TM) group of skilled nursing,
rehabilitative care services, hospice care and assisted living companies,
today reported record results for the third quarter of fiscal year 2009.

(Logo: http://www.newscom.com/cgi-bin/prnh/20071213/LATH168LOGO)

Financial Highlights for the Quarter Include:
-- Total revenue was a record $132.9 million, up 14.3% compared to $116.3
million for the third quarter of 2008;
-- Same-store skilled mix by revenue increased to 50.5% from 49.5% in the
prior year quarter;
-- The company's same-store average daily Medicare rate increased by 7.1%
to $560 per patient day, an increase of $37 per patient day, as the
company's overall patient base continued shifting to a higher acuity
mix;
-- Consolidated EBITDAR climbed 19.0% to $20.8 million, an increase of
$3.3
million, with consolidated EBITDAR margins improving by 62 basis
points
to 15.6%, and same-store EBITDAR margins improving 80 basis points to
16.5%; and

-- Consolidated net income for the quarter climbed 13.1% to $7.7 million,
compared to $6.8 million the year before, with year-to-date net
margins
increasing to 6.0% from 5.7%.

Operating Results
Ensign's President and Chief Executive Officer Christopher Christensen
congratulated Ensign's facility leaders and their teams. "This solid third
quarter has provided a great platform for the continuing expansion of our
business," he said.

The company recently announced four facility acquisitions, bringing the total
to eleven year to date. He added that the company is seeing compelling
acquisition opportunities in several of its key markets, and expects to grow
further in the near term. In addition, he noted that the opportunities for
organic growth and improvement across the company's existing portfolio are
outstanding, as local leaders continue to focus on business fundamentals and
higher-acuity patients.

He also discussed the company's recent enhancement of its financial reporting
methodologies. These details provide greater transparency into company
operations, as it continues to layer in underperforming facilities and execute
the long-term process of stabilizing and growing their operations.

Operational results are now being categorized by "same-store," referring to
facilities that have been under the Ensign umbrella more than three full
calendar years, "transitional," referring to facilities acquired from between
one and three full calendar years ago, and "recently acquired," referring to
facilities which joined the Ensign organization less than one full calendar
year ago.

"This change reflects the sometimes-vast disparity between the operating
metrics of different facilities as they go through the successive stages of
the stabilization and growth process, which typically takes several years," he
noted.

He also commented on the national healthcare debate, reductions in Medicare
payments to skilled nursing facilities, and declines in state Medicaid rates.
"Our operators have proven again this quarter that our unique operating model
is well suited to, and even thrives in, uncertain operating environments," he
observed. He added that company leaders "expect, based on our history and
experience, to continue delivering solid returns and superior patient outcomes
regardless of changes in reimbursement or regulation."

The company generated net cash from operations of $28.7 million in the nine
months ended September 30, 2009. Net operating assets and liabilities grew by
$8.0 million in the first nine months of 2009, which was primarily
attributable to the growth in accounts receivable as revenues grew,
particularly in recently-added facilities. Net cash used in investing
activities during the first nine months was $45.4 million, which was primarily
related to business acquisitions and purchases of property and equipment.

Consolidated EBITDA grew by $2.9 million for the quarter to $17.1 million, an
increase of 20.4%; however, when adjusting for the one-time recovery of
$660,000 related to the favorable settlement of an accrued contingent rent
liability in the prior year quarter, the percentage increase in EBITDA was
actually 26.2%. EBITDAR climbed 19.0% to $20.8 million from $17.5 million in
the third quarter of 2008, an increase of $3.3 million.

Fully diluted GAAP earnings per share were $0.37 for the quarter, compared to
$0.33 per share in the prior year. Excluding acquisition expenses,
amortization of patient bases and the effect on net income of one lease
expiration in the quarter, adjusted net income was $7.9 million or $0.38 per
diluted share.

A discussion of the company's use of non-GAAP financial measures is set forth
below. A reconciliation of net income to EBITDAR and EBITDA, as well as a
reconciliation of GAAP earnings per share and net income to adjusted net
earnings per share and adjusted net income, appear in the financial data
portion of this release.

More complete information is contained in the Company's 10-Q, which was filed
with the SEC today and can be viewed on the Company's website at
http://www.ensigngroup.net.

2009 Guidance Reaffirmed
Management reaffirmed its previously-announced 2009 annual revenue guidance of
$536 million to $541 million, and earnings guidance of $1.58 per share to
$1.63 per share, for the year. The guidance is based on diluted weighted
average common shares outstanding of 21.5 million and assumes, among other
things, no additional acquisitions or dispositions beyond those made to date,
and essentially flat overall reimbursement.

Management Changes
Ensign today announced that Gregory K. Stapley, its Vice President and General
Counsel since 1999, has been named Executive Vice President of the Company
effective as of November 2, 2009. He has been replaced by Beverly B. Wittekind
as Vice President and General Counsel.

Ms. Wittekind has served as Ensign's Corporate Compliance Officer, and as
Vice-President and General Counsel for Ensign Facility Services, Inc., its
Service Center subsidiary, since 2002. Prior to joining Ensign Ms. Wittekind
was with Vista Hospital Systems, a non-profit hospital system based in Corona,
California, where she served as General Counsel, Chief Compliance Officer and
Vice-President of Risk and Litigation Management. A 1989 graduate of the
University of Notre Dame Law School, Ms. Wittekind began her career at the law
firm of Snell & Wilmer, and was a partner at Doyle Winthrop Oberbillig & West,
both in Phoenix, Arizona, where she specialized in the defense of healthcare
providers in medical malpractice litigation.

In addition, Daniel H. Walker was named Assistant Secretary of the Company,
also effective November 2, 2009. Mr. Walker has served as the Deputy General
Counsel of Ensign Facility Services, Inc., and as the Company's Associate
General Counsel for Securities, since 2007. Prior to joining Ensign, Mr.
Walker was with the law firm of Lewis and Roca, LLP in Phoenix, Arizona, where
he advised public and private companies on securities issues, mergers and
acquisitions, and real estate and corporate transactions. Mr. Walker is a 2005
graduate of the J. Rueben Clark Law School at Brigham Young University.

Recent Highlights
The Company recently announced that it acquired four long-term care facilities
in two separate transactions on October 1, 2009. The facilities include Golden
Acres, a 22-acre campus in Dallas, Texas which has 264 skilled nursing beds,
222 of which are in private rooms, and a 39-unit independent living section.
The Golden Acres acquisition also included a profitable and well-regarded
hospice business, Custom Care Hospice. Although many Ensign facilities offer
hospice services through third-party agencies, this is the first time Ensign
has engaged in the hospice business itself.

Ensign also acquired three facilities in Utah: Castle Country Care Center, an
80-bed skilled nursing facility in Price, South Valley Care Center, a 116-bed
skilled nursing facility in metropolitan Salt Lake City, and Rock Canyon Rehab
& Care Center, a 200-bed skilled nursing facility in Provo. The Utah
facilities were purchased with a combination of cash and seller financing.

Ensign also allowed the lease on one of its Arizona assisted living facilities
to expire as of September 30, 2009, turning the operation over to a new
tenant. An Ensign affiliate had operated Greenfields Assisted Living in Mesa,
Arizona since 1999. Management has indicated that it expects the lease
expiration to be slightly accretive going forward.

Management has reaffirmed that Ensign is actively seeking additional
opportunities to acquire both well-performing and struggling long-term care
operations across the Western United States. The four acquisitions and one
lease expiration bring Ensign's growing portfolio to 73 facilities, 42 of
which are Ensign-owned, with Ensign affiliates holding purchase options on
nine of Ensign's 31 leased facilities.

Conference Call
A live webcast will be held on Tuesday, November 3, 2009, at 10:00 a.m.
Pacific Time (1:00 p.m. Eastern Time) to discuss Ensign's third quarter
financial results. To listen to the webcast, or to view any financial or
statistical information required by SEC Regulation G, please visit the
Investors section of the Ensign website at http://investor.ensigngroup.net.
The webcast will be recorded, and will be available for replay via the website
until 5:00 p.m. Pacific Time on Tuesday, November 10, 2009.

About Ensign(TM)
The Ensign Group, Inc.'s operating subsidiaries provide a broad spectrum of
skilled nursing and assisted living services, hospice services, physical,
occupational and speech therapies, and other rehabilitative and healthcare
services for both long-term residents and short-stay rehabilitation patients
at 73 care facilities in California, Arizona, Texas, Washington, Utah, Idaho
and Colorado. Each of these facilities is operated by a separate, wholly-owned
independent operating subsidiary that has its own management, employees and
assets. References herein to the consolidated "Company" and "its" assets and
activities, as well as the use of the terms "we," "us," "its" and similar
verbiage are not meant to imply that The Ensign Group, Inc. has direct
operating assets, employees or revenue, or that any of the facilities, the
Service Center or the captive insurance subsidiary are operated by the same
entity. More information about Ensign is available at
http://www.ensigngroup.net.

Safe Harbor Statement under the Private Securities Litigation Reform Act of
1995:
This press release contains, and the related conference call and webcast will
include, forward-looking statements that are based on management's current
expectations, assumptions and beliefs about its business, financial
performance, operating results, the industry in which it operates and other
future events. Forward-looking statements can often be identified by words
such as "anticipates," "expects," "intends," "plans," "predicts," "believes,"
"seeks," "estimates," "may," "will," "should," "would," "could," "potential,"
"continue," "ongoing," similar expressions, and variations or negatives of
these words. These forward-looking statements include, but are not limited to,
statements regarding growth prospects, future operating and financial
performance. They are not guarantees of future results and are subject to
risks, uncertainties and assumptions that could cause actual results to
materially and adversely differ from those expressed in any forward-looking
statement.

These risks and uncertainties relate to the company's business, its industry
and its common stock and include: reduced prices and reimbursement rates for
its services; its ability to acquire, develop, manage or improve facilities,
its ability to manage its increasing borrowing costs as it incurs additional
indebtedness to fund the acquisition and development of facilities; its
ability to access capital on a cost-effective basis to continue to
successfully implement its growth strategy; its operating margins and
profitability could suffer if it is unable to grow and manage effectively its
increasing number of facilities; competition from other companies in the
acquisition, development and operation of facilities; and the application of
existing or proposed government regulations, or the adoption of new laws and
regulations, that could limit its business operations, require it to incur
significant expenditures or limit its ability to relocate its facilities if
necessary. Readers should not place undue reliance on any forward-looking
statements and are encouraged to review the company's periodic filings with
the Securities and Exchange Commission, including its Form 10-Q, which was
filed today, for a more complete discussion of the risks and other factors
that could affect Ensign's business, prospects and any forward-looking
statements. Except as required by the federal securities laws, Ensign does not
undertake any obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events, changing
circumstances or any other reason after the date of this press release.

Condensed Consolidated Statements of Income
(in thousands, except per share data)
-------------------------------------

Three Months Nine Months
Ended Ended
September 30, September 30,
------------- -------------
2009 2008 2009 2008
---- ---- ---- ----
Revenue $132,924 $116,328 $395,387 $345,425
Expense:
Cost of services
(exclusive of
facility rent and
depreciation and
amortization
shown separately
below) 107,264 94,297 316,753 278,364
Facility rent-cost
of services 3,707 3,282 11,132 11,229
General and
administrative
expense 4,883 4,565 15,261 14,628
Depreciation and
amortization 3,239 2,350 9,413 6,513
----- ----- ----- -----
Total expenses 119,093 104,494 352,559 310,734
Income from
operations 13,831 11,834 42,828 34,691
Other income
(expense):
Interest expense (1,249) (1,183) (3,718) (3,553)
Interest income 81 239 220 1,094
---- --- --- -----
Other expense, net (1,168) (944) (3,498) (2,459)
Income before
provision for
income taxes 12,663 10,890 39,330 32,232
Provision for
income taxes 4,977 4,093 15,537 12,582
----- ----- ------ ------
Net income $7,686 $6,797 $23,793 $19,650
====== ====== ======= =======
Net income per share:
Basic $0.37 $0.33 $1.16 $0.96
===== ===== ===== =====
Diluted $0.37 $0.33 $1.14 $0.95
===== ===== ===== =====
Weighted average
common shares
outstanding:
Basic 20,616 20,525 20,591 20,512
====== ====== ====== ======
Diluted 20,928 20,777 20,910 20,667
====== ====== ====== ======

Condensed Consolidated Balance Sheets
(in thousands)

September 30, December 31,
2009 2008
------------- ------------
Assets
Cash and cash
equivalents $21,365 $41,326
Other current assets 68,397 63,122
------ ------
Total current assets 89,762 104,448
Property and
equipment, net 181,643 157,029
Other assets 50,445 35,424
------ ------
Total assets $321,850 $296,901
======== ========
Liabilities and
stockholders' equity
Current liabilities:
Current liabilities,
excluding current
maturities of
long-term debt $56,182 $56,575
Current maturities of
long-term debt 1,122 1,062
----- -----
Total current
liabilities 57,304 57,637
Long-term debt-less
current maturities 58,632 59,489
Other long-term
liabilities 26,675 23,754
Total Stockholders'
equity 179,239 156,021
------- -------
Total liabilities and
stockholders' equity $321,850 $296,901
======== ========

Reconciliation of Net Income to EBITDAR
(in thousands)
--------------

Three Months Nine Months
Ended Ended
September 30, September 30,
------------ -------------
2009 2008 2009 2008
---- ---- ---- ----
Net income $7,686 $6,797 $23,793 $19,650
Interest expense, net 1,168 944 3,498 2,459
Provision for income taxes 4,977 4,093 15,537 12,582
Depreciation And
amortization 3,239 2,350 9,413 6,513
----- ----- ----- -----
EBITDA 17,070 14,184 52,241 41,204
Facility rent-cost of
services 3,707 3,282 11,132 11,229
----- ----- ------ ------
EBITDAR $20,777 $17,466 $63,373 $52,433
======= ======= ======= =======

Adjusted Condensed Consolidated
Statements of Income
(In thousands, except per share data)
-------------------------------------

Three Months Ended
September 30, 2009
------------------
Non-
As GAAP Expiration As
Reported Adj. of Lease (4) Adjusted
-------- ---- ------------ --------
Revenue $132,924 $(496) $132,428
Expense:
Cost of services
(exclusive of facility
rent and depreciation
and amortization
shown separately
below) 107,264 (76) (1) (507) 106,681
Facility
rent-cost
of services 3,707 (137) 3,570
General and
administrative
expense 4,883 4,883
Depreciation
and amortization 3,239 (13) (2) (111) 3,115
----- -------- ----- -----
Total expenses 119,093 (89) (755) 118,249
Income from operations 13,831 89 259 14,179

Other income (expense):
Interest expense (1,249) (1,249)
Interest income 81 81
---- ----
Other expense, net (1,168) (1,168)
Income before
provision for income
taxes 12,663 89 259 13,011
Provision for income
taxes 4,977 35 (3) 103 5,115
----- ------ --- -----
Net income $7,686 54 156 $7,896
====== == === ======

Net income per share:
Basic $0.37 $0.38
===== =====
Diluted $0.37 $0.38
===== =====
Weighted average common
shares outstanding:
Basic 20,616 20,616
====== ======
Diluted 20,928 20,928
====== ======

Nine Months Ended
-----------------
September 30, 2009
------------------
Non-
As GAAP Expiration As
Reported Adj. of Lease (4) Adjusted
-------- ---- ------------ --------

Revenue $395,387 $(1,412) $393,975
Expense:
Cost of services
(exclusive of
facility rent
and depreciation
and amortization
shown separately
below) 316,753 (177) (1) (1,185) 315,391
Facility rent-cost
of services 11,132 (416) 10,716
General and
administrative
expense 15,261 15,261
Depreciation and
amortization 9,413 (388) (2) (153) 8,872
----- --------- ----- -----
Total expenses 352,559 (565) (1,754) 350,240
Income from operations 42,828 565 342 43,735

Other income (expense):
Interest expense (3,718) (3,718)
Interest income 220 220
--- ---
Other expense, net (3,498) (3,498)
Income before provision
for income taxes 39,330 565 342 40,237
Provision for income
taxes 15,537 223 (3) 136 15,896
------ ------- --- ------
Net income $23,793 342 206 $24,341
======= === === =======

Net income per share:
Basic $1.16 $1.18
===== =====
Diluted $1.14 $1.16
===== =====
Weighted average common
shares outstanding:
Basic 20,591 20,591
====== ======
Diluted 20,910 20,910
====== ======

(1) Represents acquisition-related costs expensed, which were previously
capitalizable during 2008.

(2) Represents amortization costs related to patient base intangible assets
acquired. Patient base intangible assets are amortized over a period of four
to eight months, depending on the classification of the patients and the level
of occupancy in a new acquisition on the acquisition date.

(3) Represent s the tax impact of the acquisition costs and patient base
non-GAAP adjustments represented in entries (1) and (2).

(4) Represents the impact on net income, including tax effect, of the
expiration of the Company's lease at one of its assisted living facilities in
Arizona.

Discussion of Non-GAAP Financial Measures
EBITDA consists of net income before (a) interest expense, net, (b) provisions
for income taxes, and (c) depreciation and amortization. EBITDAR consists of
net income before (a) interest expense, net, (b) provisions for income taxes,
(c) depreciation and amortization, and (d) facility rent-cost of services. The
Company believes that the presentation of EBITDA and EBITDAR provides
important supplemental information to management and investors to evaluate the
Company's operating performance. The Company believes disclosure of adjusted
non-GAAP net income and non-GAAP diluted earnings per share has economic
substance because the excluded expenses are infrequent in nature and are
variable in nature, or do not represent current cash expenditures. A material
limitation associated with the use of these measures as compared to the GAAP
measures of net income and diluted earnings per share is that they may not be
comparable with the calculation of net income and diluted earnings per share
for other companies in the Company's industry. These non-GAAP financial
measures should not be relied upon to the exclusion of GAAP financial
measures. For further information regarding why the Company believes that this
non-GAAP measure provides useful information to investors, the specific manner
in which management uses this measure, and some of the limitations associated
with the use of this measure, please refer to the Company's Report on Form
10-Q filed today with the SEC. The Form 10-Q is available on the SEC's website
at www.sec.gov or under the "Financial Information" link of the Investor
Relations section on Ensign's website.

SOURCE The Ensign Group, Inc.

Robert East of Westwicke Partners LLC, +1-443-213-0500,
bob.east@westwickepartners.com, for The Ensign Group, Inc.; or Gregory
Stapley, Investor/Media Relations of The Ensign Group, Inc., +1-949-487-9500,
ir@ensigngroup.net