Addus HomeCare Reports Second Quarter 2014 Results
Second Quarter Review
Total net service revenues from continuing operations for the second quarter of 2014 were
Mr. Heaney also said, "We welcome the employees of Aid & Assist who give us a stronger presence in
Heaney continued, "Focusing on the needs of our growing managed care payors continues to be a strategic focus of the organization. Our pilot programs with Aetna and
Same store average census grew 8.7%. Acquired census added an additional 7.9% for total census growth of 16.6% compared to the prior year quarter. Billable hours per business day increased 20.9%, offset by a slight decline in average revenues per billable hour.
Four consistently underperforming offices were closed in the quarter. These offices, located in
General and administrative expenses include
The estimated increase in Work Opportunity Tax Credits to be awarded in 2014 reduced our effective tax rate for the quarter to 30.9%, with an estimated overall rate for 2014 of 32.8%. This increased earnings by an estimated
Net income from continuing operations increased 5.7% to
Cash flow for the quarter was positive with
Six Month Review
Total net service revenues for the six months ended
Net income from continuing operations for the six months ended
2013 results were favorably affected by substantially lower effective tax rates in 2013 than experienced in 2014 (32.8% in 2014 vs. 28.5% in 2013). The net effect of the lower tax rates in 2013 was to increase earnings in that year by
Adjusted EBITDA for the six months ended
Non-GAAP Financial Measures
The information provided in this release includes Adjusted EBITDA, a non-GAAP financial measure, which the Company defines as earnings before discontinued operations, interest expense, taxes, depreciation, amortization, M&A expense and stock-based compensation expense. The Company has provided, in the financial statement tables included in this press release, a reconciliation of Adjusted EBITDA to net income, the most directly comparable GAAP measure. Management believes that Adjusted EBITDA is useful to investors, management and others in evaluating the Company's operating performance, to provide investors with insight and consistency in the Company's financial reporting and to present a basis for comparison of the Company's business operations among periods, and to facilitate comparison with the results of the Company's peers.
Conference Call
Addus will report its 2014 second quarter results on
A live broadcast of
About Addus
Addus is a comprehensive provider of home and community based services which are primarily social in nature and are provided in the home, focused on the dual eligible population. Addus' services include personal care and assistance with activities of daily living, and adult day care. Addus' consumers are individuals who are at risk of hospitalization or institutionalization, such as the elderly, chronically ill and disabled. Addus' payor clients include federal, state and local governmental agencies, commercial insurers and private individuals. For more information, please visit www.addus.com.
Forward-Looking Statements
Certain matters discussed in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements may be identified by words such as "continue," "expect," and similar expressions. Forward-looking statements involve a number of risks and uncertainties that may cause actual results to differ materially from those expressed or implied by such forward-looking statements, including the anticipated transition to managed care providers, expected benefits and costs of acquisitions and dispositions, management plans related to dispositions, the possibility that expected benefits may not materialize as expected, the failure of the business to perform as expected, changes in reimbursement, changes in government regulations, changes in Addus HomeCare's relationships with referral sources, increased competition for
Investor Contact:
Chief Financial Officer
Phone: (630)-296-3400
Email: DMeulemans@addus.com
ADDUS HOMECARE CORPORATION AND SUBSIDIARIES |
|||||||||
Condensed Consolidated Statements of Income and Cash Flow Information |
|||||||||
(amounts and shares in thousands, except per share data) |
|||||||||
(Unaudited) |
|||||||||
Income Statement Information: |
For the Three Months Ended June 30 |
||||||||
Same Store |
Acquisitions |
Total |
|||||||
2014 |
2013 |
||||||||
Net service revenues |
$ 70,158 |
$ 6,807 |
$ 76,965 |
$ 65,755 |
|||||
Cost of service revenues |
51,604 |
4,781 |
56,385 |
49,142 |
|||||
Gross profit |
18,554 |
2,026 |
20,580 |
16,613 |
|||||
26.4% |
29.8% |
26.7% |
25.3% |
||||||
General and administrative expenses |
13,743 |
1,656 |
15,399 |
12,092 |
|||||
Depreciation and amortization |
1,068 |
15 |
1,083 |
541 |
|||||
Total operating expenses |
14,811 |
1,671 |
16,482 |
12,633 |
|||||
Operating income from continuing operations |
3,743 |
355 |
4,098 |
3,980 |
|||||
Total interest expense, net |
151 |
- |
151 |
142 |
|||||
Income from continuing operations before taxes |
3,592 |
355 |
3,947 |
3,838 |
|||||
Income tax expense |
1,108 |
110 |
1,218 |
1,256 |
|||||
Net income from continuing operations |
2,484 |
245 |
2,729 |
2,582 |
|||||
Discontinued operations: |
|||||||||
Loss from home health business, net of tax |
- |
- |
- |
(150) |
|||||
Loss from discontinued operations |
- |
- |
- |
(150) |
|||||
Net income |
$ 2,484 |
$ 245 |
$ 2,729 |
$ 2,432 |
|||||
Net income per share: |
|||||||||
Basic |
|||||||||
Continuing operations |
$ 0.23 |
$ 0.02 |
$ 0.25 |
$ 0.24 |
|||||
Discontinued operations |
- |
- |
- |
(0.01) |
|||||
Basic income per share |
$ 0.23 |
$ 0.02 |
$ 0.25 |
$ 0.23 |
|||||
Diluted |
|||||||||
Continuing operations |
$ 0.23 |
$ 0.02 |
$ 0.25 |
$ 0.23 |
|||||
Discontinued operations |
- |
- |
- |
(0.01) |
|||||
Diluted income per share |
$ 0.23 |
$ 0.02 |
$ 0.25 |
$ 0.22 |
|||||
Weighted average number of common shares outstanding: |
|||||||||
Basic |
10,903 |
10,903 |
10,903 |
10,785 |
|||||
Diluted |
11,138 |
11,138 |
11,138 |
11,016 |
|||||
Cash Flow Information: |
For the Three Months Ended June 30 |
||||||||
2014 |
2013 |
||||||||
Net cash provided by operating activities |
$ 14,263 |
$ 21,221 |
|||||||
Net cash used in investing activities |
(11,687) |
(228) |
|||||||
Net change in cash |
2,576 |
20,993 |
|||||||
Cash at the beginning of the period |
16,965 |
17,784 |
|||||||
Cash at the end of the period |
$ 19,541 |
$ 38,777 |
ADDUS HOMECARE CORPORATION AND SUBSIDIARIES |
|||||||||
Condensed Consolidated Statements of Income and Cash Flow Information |
|||||||||
(amounts and shares in thousands, except per share data) |
|||||||||
(Unaudited) |
|||||||||
Income Statement Information: |
For the Six Months Ended June 30 |
||||||||
Same Store |
Acquisitions |
Total |
|||||||
2014 |
2013 |
||||||||
Net service revenues |
$ 136,674 |
$ 11,974 |
$ 148,648 |
$ 128,753 |
|||||
Cost of service revenues |
101,116 |
8,284 |
109,400 |
96,342 |
|||||
Gross profit |
35,558 |
3,690 |
39,248 |
32,411 |
|||||
26.0% |
30.8% |
26.4% |
25.2% |
||||||
General and administrative expenses |
27,061 |
2,741 |
29,802 |
23,602 |
|||||
Depreciation and amortization |
1,553 |
25 |
1,578 |
1,087 |
|||||
Total operating expenses |
28,614 |
2,766 |
31,380 |
24,689 |
|||||
Operating income from continuing operations |
6,944 |
924 |
7,868 |
7,722 |
|||||
Total interest expense, net |
305 |
- |
305 |
350 |
|||||
Income from continuing operations before taxes |
6,639 |
924 |
7,563 |
7,372 |
|||||
Income tax expense |
2,172 |
308 |
2,480 |
2,103 |
|||||
Net income from continuing operations |
4,467 |
616 |
5,083 |
5,269 |
|||||
Discontinued operations: |
|||||||||
Loss from home health business, net of tax |
- |
- |
- |
(687) |
|||||
Gain on sale of home health business, net of tax |
- |
- |
- |
11,111 |
|||||
Earnings from discontinued operations |
- |
- |
- |
10,424 |
|||||
Net income |
$ 4,467 |
$ 616 |
$ 5,083 |
$ 15,693 |
|||||
Net income per share: |
|||||||||
Basic |
|||||||||
Continuing operations |
$ 0.41 |
$ 0.06 |
$ 0.47 |
$ 0.49 |
|||||
Discontinued operations |
- |
- |
- |
0.97 |
|||||
Basic income per share |
$ 0.41 |
$ 0.06 |
$ 0.47 |
$ 1.46 |
|||||
Diluted |
|||||||||
Continuing operations |
$ 0.40 |
$ 0.06 |
$ 0.46 |
$ 0.48 |
|||||
Discontinued operations |
- |
- |
- |
0.96 |
|||||
Diluted income per share |
$ 0.40 |
$ 0.06 |
$ 0.46 |
$ 1.44 |
|||||
Weighted average number of common shares outstanding: |
|||||||||
Basic |
10,878 |
10,878 |
10,878 |
10,779 |
|||||
Diluted |
11,121 |
11,121 |
11,121 |
10,920 |
|||||
Cash Flow Information: |
For the Six Months Ended June 30 |
||||||||
2014 |
2013 |
||||||||
Net cash provided by operating activities |
$ 16,933 |
$ 34,246 |
|||||||
Net cash (used in) provided by investing activities |
(13,171) |
19,252 |
|||||||
Net cash provided by (used in) financing activities |
214 |
(16,458) |
|||||||
Net change in cash |
3,976 |
37,040 |
|||||||
Cash at the beginning of the period |
15,565 |
1,737 |
|||||||
Cash at the end of the period |
$ 19,541 |
$ 38,777 |
Condensed Consolidated Balance Sheets |
|||
(Amounts in thousands) |
|||
June 30, 2014 |
June 30, 2013 |
||
(Unaudited) |
|||
Assets |
|||
Current assets |
|||
Cash |
$ 19,541 |
$ 38,777 |
|
Accounts receivable, net |
48,725 |
43,605 |
|
Prepaid expenses and other current assets |
4,555 |
5,754 |
|
Deferred tax assets |
8,326 |
7,258 |
|
Total current assets |
81,147 |
95,394 |
|
Property and equipment, net |
6,958 |
2,502 |
|
Other assets |
|||
Goodwill |
64,324 |
50,456 |
|
Intangible assets, net |
11,753 |
5,691 |
|
Investment in joint venture |
900 |
900 |
|
Other assets |
53 |
212 |
|
Total other assets |
77,030 |
57,259 |
|
Total assets |
$ 165,135 |
$ 155,155 |
|
Liabilities and stockholders' equity |
|||
Current liabilities |
|||
Accounts payable |
$ 4,769 |
$ 5,415 |
|
Accrued expenses |
37,438 |
36,365 |
|
Deferred revenue |
3 |
10 |
|
Total current liabilities |
42,210 |
41,790 |
|
Deferred tax liability |
3,441 |
3,097 |
|
Total stockholders' equity |
119,484 |
110,268 |
|
Total liabilities and stockholders' equity |
$ 165,135 |
$ 155,155 |
Key Statistical and Financial Data (Unaudited) |
||||||||
For the Three Months Ended June 30 |
For the Six Months Ended June 30 |
|||||||
2014 |
2013 |
2014 |
2013 |
|||||
General: |
||||||||
Adjusted EBITDA (in thousands) (1) |
$ 5,922 |
$ 4,633 |
$ 10,373 |
$ 9,026 |
||||
States served at period end |
22 |
19 |
||||||
Locations at period end |
133 |
93 |
||||||
Employees at period end |
17,754 |
14,854 |
||||||
Home & Community |
||||||||
Average billable census - same store |
28,453 |
26,173 |
28,163 |
26,501 |
||||
Average billable census - acquisitions |
2,070 |
- |
1,847 |
- |
||||
Average billable census total |
30,523 |
26,173 |
30,010 |
26,501 |
||||
Billable hours (in thousands) |
4,536 |
3,872 |
8,773 |
7,586 |
||||
Average billable hours per census per month |
49.5 |
49.0 |
48.7 |
48.0 |
||||
Billable hours per business day |
72,006 |
59,569 |
69,076 |
58,806 |
||||
Revenues per billable hour |
$16.97 |
$16.98 |
$ 16.94 |
$16.97 |
||||
Percentage of Revenues by Payor: |
||||||||
State, local and other governmental programs |
89 |
% |
94 |
% |
90 |
% |
94 |
% |
Managed Care |
6 |
1 |
5 |
1 |
||||
Private duty |
4 |
4 |
4 |
4 |
||||
Commercial |
1 |
% |
1 |
% |
1 |
% |
1 |
% |
(1) We define Adjusted EBITDA as earnings before discontinued operations, interest expense, taxes, depreciation, amortization, M&A expenses and stock-based compensation expense. Adjusted EBITDA is a performance measure used by management that is not calculated in accordance with generally accepted accounting principles in the United States (GAAP). It should not be considered in isolation or as a substitute for net income, operating income or any other measure of financial performance calculated in accordance with GAAP. |
Adjusted EBITDA (1) (Unaudited) |
For the Three Months Ended June 30 |
For the Six Months Ended June 30 |
|||||
2014 |
2013 |
2014 |
2013 |
||||
Reconciliation of Adjusted EBITDA to Net Income: |
|||||||
Net income |
$ 2,729 |
$ 2,432 |
$ 5,083 |
$ 15,693 |
|||
Less: (Earnings) from discontinued operations, net of tax |
- |
150 |
- |
(10,424) |
|||
Net income from continuing operations |
2,729 |
2,582 |
5,083 |
5,269 |
|||
Interest expense, net |
151 |
142 |
305 |
350 |
|||
Income tax expense from continuing operations |
1,218 |
1,256 |
2,480 |
2,103 |
|||
Depreciation and amortization |
1,078 |
541 |
1,573 |
1,087 |
|||
M&A expenses |
536 |
- |
601 |
- |
|||
Stock-based compensation expense |
210 |
112 |
331 |
217 |
|||
Adjusted EBITDA |
$ 5,922 |
$ 4,633 |
$ 10,373 |
$ 9,026 |
|||
(1) We define Adjusted EBITDA as earnings before discontinued operations, interest expense, taxes, depreciation, amortization, M&A expenses and stock-based compensation expense. Adjusted EBITDA is a performance measure used by management that is not calculated in accordance with generally accepted accounting principles in the United States (GAAP). It should not be considered in isolation or as a substitute for net income, operating income or any other measure of financial performance calculated in accordance with GAAP. |
SOURCE