EX-99.1 2 d742124dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO

 

Contacts:   
Brian W. Poff    Dru Anderson
Executive Vice President,    Corporate Communications, Inc.
  Chief Financial Officer    (615) 324-7346
Addus HomeCare Corporation    dru.anderson@cci-ir.com
(469) 535-8200   
investorrelations@addus.com     

ADDUS HOMECARE ANNOUNCES FIRST-QUARTER 2019 FINANCIAL RESULTS

Revenues Increase 27.2% to $139.3 million

Net Income of $4.9 Million or $0.36 per Diluted Share,

and Adjusted Diluted Earnings per Share of $0.52

Adjusted EBITDA Increases 23.1% to $10.8 Million

Same-Store Sales Increase 5.6%

Frisco, Texas (May 6, 2019) – Addus HomeCare Corporation (NASDAQ: ADUS), a provider of comprehensive home care services, today announced its financial results for the first quarter ended March 31, 2019.

Net service revenues were $139.3 million for the first quarter of 2019, up 27.2% from $109.5 million for the first quarter of 2018. Net income was $4.9 million, compared with $4.9 million for the first quarter of 2018, while net income per diluted share was $0.36, compared with $0.42 per diluted share for the prior-year period. Adjusted net income per diluted share grew 23.8% to $0.52 for the first quarter of 2019 from $0.42 for the first quarter of 2018.

Adjusted net income per diluted share for the first quarter of 2019 excludes M&A expenses of $0.03, restructuring, severance and other costs of $0.05, and stock-based compensation expense of $0.08. Adjusted net income per diluted share for the first quarter of 2018 excludes prompt payment interest income of $0.16 from the state of Illinois, M&A expenses of $0.07, restructuring, severance and other costs of $0.03, and stock-based compensation expense of $0.06.

Adjusted EBITDA increased 23.1% to $10.8 million for the first quarter of 2019 from $8.8 million for the first quarter of 2018. (See page 8 for a reconciliation of all non-GAAP and GAAP financial measures in this news release.)

Dirk Allison, President and Chief Executive Officer, commented, “We are proud of our solid financial results for the first quarter, marking a great start to 2019. First-quarter revenues reflected a strong increase in same-store revenue of 5.6%, exceeding our target range of 3% to 5%. This increase was primarily driven by higher revenue in our New York market, as we saw significant consumer growth due to the ongoing narrowing of provider networks in the state. In addition, we saw referral volumes in the first quarter return to more normal levels in both New Mexico and Illinois, as expected.”

At March 31, 2019, the Company had cash of $66.2 million and bank debt of $20.0 million, while availability under its revolving credit facility was $141.2 million. Net cash used in operating activities was $3.2 million for the first quarter of 2019.

 

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ADUS Announces First-Quarter 2019 Financial Results

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May 6, 2019

 

Mr. Allison added, “As our first-quarter results indicate, we have continued to execute our organic growth and acquisition strategies and extend our market reach as a leading provider of comprehensive home care services. With our strong value proposition, including hospice and home health services, we believe we are well positioned to meet the increasing demand for our services.

“In April, we received approval from the Public Health and Health Planning Council of the New York Department of Health for our previously announced transaction to purchase the assets of VIP Health Care Services, a New York City-based provider of personal care services with annual revenues of approximately $50 million. We expect to complete the final requirements for licensure in order to close the transaction on or about June 1, 2019. This acquisition will further advance our strategy of enhancing strong operations in states where we operate. Importantly, we continue to have the flexibility and capital to pursue additional acquisitions that fit our strategic profile and enhance our ability to drive long-term growth in earnings and shareholder value. Our pipeline remains strong, and we are excited about the opportunities ahead for Addus in 2019.”

Non-GAAP Financial Measures

The information provided in this release includes adjusted net income per diluted share, adjusted EBITDA and adjusted net service revenues, which are non-GAAP financial measures. The Company defines adjusted net income per diluted share as net income per diluted share, adjusted for interest income from the State of Illinois, M&A expenses, stock-based compensation expense, restructure charges, and severance and other costs. The Company defines adjusted EBITDA as net income before interest expense, interest income, other non-operating income, taxes, depreciation, amortization, interest income from the State of Illinois, M&A expenses, stock-based compensation expense, restructure charges, and severance and other costs. The Company defines adjusted net service revenues as net service revenues adjusted for the closure of certain sites. The Company has provided, in the financial statement tables included in this press release, a reconciliation of adjusted net income per diluted share to net income per diluted share, a reconciliation of adjusted EBITDA to net income and a reconciliation of adjusted net service revenues to net service revenues, in each case, the most directly comparable GAAP measure. Management believes that adjusted net income, adjusted net income per diluted share, adjusted EBITDA and adjusted net service revenues are 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 host a conference call on Tuesday, May 7, 2019, beginning at 9:00 a.m. Eastern time. The toll-free dial-in number is (877) 930-8289 (international dial-in number is (253) 336-8714), pass code 1186139. A telephonic replay of the conference call will be available through midnight on May 21, 2019, by dialing (855) 859-2056 (international dial-in number is (404) 537-3406) and entering pass code 1186139.

A live broadcast of Addus HomeCare’s conference call will be available under the Investor Relations section of the Company’s website: www.addus.com. An online replay of the conference call will also be available on the Company’s website for one month, beginning approximately two hours following the conclusion of the live broadcast.

 

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ADUS Announces First-Quarter 2019 Financial Results

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May 6, 2019

 

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. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. 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 discretionary determinations by government officials, the consummation and integration of acquisitions, anticipated transition to managed care providers, our ability to successfully execute our growth strategy, unexpected increases in SG&A and other expenses, expected benefits and unexpected 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 Addus HomeCare’s services, changes in the interpretation of government regulations, the uncertainty regarding the outcome of discussions with managed care organizations, changes in tax rates, the impact of adverse weather, higher than anticipated costs, lower than anticipated cost savings, estimation inaccuracies in future revenues, margins, earnings and growth, whether any anticipated receipt of payments will materialize and other risks set forth in the Risk Factors section in Addus HomeCare’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 15, 2019, which is available at www.sec.gov. Addus HomeCare undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In addition, these forward-looking statements necessarily depend upon assumptions, estimates and dates that may be incorrect or imprecise and involve known and unknown risks, uncertainties and other factors. Accordingly, any forward-looking statements included in this press release do not purport to be predictions of future events or circumstances and may not be realized. (Unaudited tables and notes follow).

About Addus

Addus is a provider of comprehensive home care services that include, primarily, personal care services that assist with activities of daily living, as well as hospice and home health services. Addus’ consumers are primarily persons who, without these services, 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, managed care organizations, commercial insurers and private individuals. Addus currently provides home care services to approximately 39,000 consumers through 157 locations across 24 states. For more information, please visit www.addus.com.

 

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ADUS Announces First-Quarter 2019 Financial Results

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ADDUS HOMECARE CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Income

(amounts and shares in thousands, except per share data)

(Unaudited)

 

  
Income Statement Information:    For the Three Months
Ended March 31,		  
     2019     2018  

Net service revenues

    $ 139,254     $ 109,476  

Cost of service revenues

      101,680       81,543  
  

 

 

    

 

 

  

Gross profit

      37,574       27,933  
     27.0 %      25.5 % 

General and administrative expenses

      29,257       21,537  

Depreciation and amortization

      2,074       1,807  
  

 

 

    

 

 

  

Total operating expenses

      31,331       23,344  
  

 

 

    

 

 

  

Operating income from continuing operations

      6,243       4,589  

Total interest expense, net

      403       (1,412 ) 
  

 

 

    

 

 

  

Income before income taxes

      5,840       6,001  

Income tax expense

      978       1,115  
  

 

 

    

 

 

  

Net income

    $ 4,862     $ 4,886  
  

 

 

    

 

 

  

Net income per diluted share

    $ 0.36     $ 0.42  
  

 

 

    

 

 

  

Weighted average number of common shares outstanding—diluted

      13,381       11,696  
Cash Flow Information:    For the Three Months
Ended March 31,		  
     2019     2018  

Net cash (used in) provided by operating activities

    $ (3,197 )    $ 14,276  

Net cash (used in) investing activities

      (1,006 )      (3,699 ) 

Net cash (used in) financing activities

      (33 )      (925 ) 
  

 

 

    

 

 

  

Net change in cash

      (4,236 )      9,652  

Cash at the beginning of the period

      70,406       53,754  
  

 

 

    

 

 

  

Cash at the end of the period

    $ 66,170     $ 63,406  
  

 

 

    

 

 

  

 

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ADUS Announces First-Quarter 2019 Financial Results

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May 6, 2019

 

ADDUS HOMECARE CORPORATION AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Amounts in thousands)

(Unaudited)

 

  
     March 31,  
     2019      2018  

Assets

 

Current assets

      

Cash

    $ 66,170      $ 63,406  

Accounts receivable, net

      120,143        88,380  

Prepaid expenses and other current assets

      7,146        7,250  
  

 

 

     

 

 

  

Total current assets

      193,459        159,036  
  

 

 

     

 

 

  

Property and equipment, net

      10,843        7,384  

Other assets

      

Goodwill

      135,399        93,090  

Intangible assets, net

      22,531        16,480  

Operating lease asset

      16,691        —    

Deferred tax assets, net

      —          1,472  
  

 

 

     

 

 

  

Total other assets

      174,621        111,042  
  

 

 

     

 

 

  

Total assets

    $ 378,923      $ 277,462  
  

 

 

     

 

 

  

Liabilities and Stockholders’ Equity

 

Current liabilities

      

Accounts payable

    $ 11,506      $ 9,578  

Accrued expenses

      17,202        11,545  

Accrued payroll

      24,139        20,012  

Accrued workers compensation

      14,537        13,599  
  

 

 

     

 

 

  

Total current liabilities

      67,384        54,734  
  

 

 

     

 

 

  

Deferred tax liabilities, net

      615        —    

Long-term debt, less current portion, net of debt issuance costs

      17,375        39,396  

Long-term operating lease liabilities, less current portion

      11,679        —    

Other long-term liabilities

      242        —    

Long-term lease liability, less current portion

      —          407  

Contingent earn-out obligation, less current portion

      —          847  
  

 

 

     

 

 

  

Total long-term liabilities

      29,911        40,650  
  

 

 

     

 

 

  

Total liabilities

      97,295        95,384  
  

 

 

     

 

 

  

Total stockholders’ equity

      281,628        182,078  
  

 

 

     

 

 

  

Total liabilities and stockholders’ equity

    $ 378,923      $ 277,462  
  

 

 

     

 

 

  

 

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ADUS Announces First-Quarter 2019 Financial Results

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May 6, 2019

 

ADDUS HOMECARE CORPORATION AND SUBSIDIARIES

Net Service Revenues by Segment

(Amounts in thousands)

(Unaudited)

 

  
     For the Three Months
Ended March 31,		  
     2019      2018  

Personal Care

    $ 128,641      $ 109,476  

Hospice

      7,917        —    

Home Health

      2,696        —    
  

 

 

     

 

 

  

Total Revenue

    $ 139,254      $ 109,476  
  

 

 

     

 

 

  

 

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ADUS Announces First-Quarter 2019 Financial Results

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ADDUS HOMECARE CORPORATION AND SUBSIDIARIES

Key Statistical and Financial Data

(Unaudited)

 

  
     For the Three Months
Ended March 31,		  
     2019     2018  

General:

     

Adjusted EBITDA (in thousands) (1)

    $ 10,790     $ 8,762  

States served at period end

      24       23  

Locations at period end

      157       115  

Employees at period end

      30,990       26,358  

Personal Care

     

Average billable census—same store (2)

      34,013       34,194  

Average billable census—acquisitions

      3,556       —    

Average billable census total

      37,569       34,194  

Billable hours (in thousands)

      6,864       6,030  

Average billable hours per census per month

      60.4       58.8  

Billable hours per business day

      107,250       92,768  

Revenues per billable hour

    $ 18.74     $ 18.15  

Hospice

     

Admissions

      511       —    

Average daily census

      575       —    

Average length of stay

      115.1       —    

Patient days

      51,724       —    

Revenue per patient day

    $ 153.07     $ —    

Home Health

     

New Admissions

      715       —    

Recertifications

      519       —    

Total Volume

      1,234       —    

Visits

      19,554       —    

Percentage of Revenues by Payor:

     

Personal Care

     

State, local and other governmental programs

      56.0 %      61.5 % 

Managed care organizations

      37.3       34.6  

Private duty

      3.9       3.4  

Commercial

      1.5       0.5  

Other

      1.3       —    

Hospice

     

Medicare

      93.3 %      —    

Managed care organizations

      4.6       —    

Other

      2.1       —    

Home Health

     

Medicare

      81.6 %      —    

Managed care organizations

      15.4       —    

Other

      3.0       —    

 

(1)

We define Adjusted EBITDA as earnings adjusted for interest expense, taxes, depreciation, amortization, M&A expenses, stock-based compensation expense and restructure and severance costs. 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.

(2)

Exited sites would have reduced same store census for the three months ended March 31, 2018 by 5.

 

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ADUS Announces First-Quarter 2019 Financial Results

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May 6, 2019

 

ADDUS HOMECARE CORPORATION AND SUBSIDIARIES

Reconciliation of Non-GAAP Financial Measures

(amounts in thousands, except per share data)

(Unaudited)

 

  
     For the Three Months
Ended March 31,		  
     2019      2018  

Reconciliation of Adjusted EBITDA to Net Income: (1)

      

Net income

    $ 4,862      $ 4,886  

Interest expense, net

      403        841  

Interest income from Illinois

      —          (2,253 ) 

Income tax expense

      978        1,115  

Depreciation and amortization

      2,074        1,807  

M&A expenses

      496        1,002  

Stock-based compensation expense

      1,233        859  

Restructuring, severance and other costs

      744        505  
  

 

 

     

 

 

  

Adjusted EBITDA

    $ 10,790      $ 8,762  
  

 

 

     

 

 

  

Reconciliation of Adjusted Net Income to Net Income: (2)

      

Net income

    $ 4,862      $ 4,886  

Interest income from Illinois, net of tax

      —          (1,831 ) 

M&A expenses, net of tax

      413        815  

Restructuring, severance and other costs, net of tax

      620        410  

Stock-based compensation expense, net of tax

      1,026        698  
  

 

 

     

 

 

  

Adjusted Net Income

    $ 6,921      $ 4,978  
  

 

 

     

 

 

  

Reconciliation of Diluted Earnings per Share to Adjusted Diluted Earnings per Share: (3)

 

Diluted earnings per share

    $ 0.36      $ 0.42  

Interest income from Illinois

      —          (0.16 ) 

M&A expenses per diluted share

      0.03        0.07  

Restructuring, severance and other costs per diluted share

      0.05        0.03  

Stock-based compensation expense per diluted share

      0.08        0.06  
  

 

 

     

 

 

  

Adjusted net income per diluted share

    $ 0.52      $ 0.42  
  

 

 

     

 

 

  

Reconciliation of Net Service Revenues to Adjusted Net Service Revenues: (4)

 

Net service revenues

    $ 139,254      $ 109,476  

Revenue associated with the closure of certain sites

      —          (5 ) 
  

 

 

     

 

 

  

Adjusted net service revenues

    $ 139,254      $ 109,471  
  

 

 

     

 

 

  

 

(1)

We define Adjusted EBITDA as earnings before interest expense, interest income, other non-operating income, taxes, depreciation, amortization, M&A expenses, stock-based compensation expense, restructure expenses, severance and other costs. 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.

(2)

We define Adjusted Net Income as net income before interest income from the state of Illinois, M&A expenses, stock-based compensation expense, restructure expenses, severance and other costs. Adjusted Net Income 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.

(3)

We define Adjusted diluted earnings per share as earnings per share, adjusted for interest income from the State of Illinois, M&A expenses, stock compensation expense and restructure expense, severance and other costs. Adjusted diluted earnings per share 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.

(4)

We define Adjusted net service revenues as revenue adjusted for the closure of certain sites. Adjusted net service revenues 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.

 

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