Subsidiary Guarantors (Tables)

12 Months Ended

Dec. 31, 2012

Subsidiary Guarantors

Schedule of condensed consolidating balance sheet

	December 31, 2012
	SUCCESSOR
			Guarantor			Non-Guarantor						Consolidated
	ResCare, Inc.		Subsidiaries			Subsidiaries			Eliminations			Total
ASSETS
Current assets:
Cash and cash equivalents	$	42,633	$	4,795		$	2,706		$	—		$	50,134
Accounts receivable, net	21,515		206,491			371			—			228,377
Refundable income taxes	—		—			—			—			—
Deferred income taxes	17,589		—			—			—			17,589
Non-trade receivables	1,506		2,251			185			—			3,942
Prepaid expenses and other current assets	10,114		7,730			330			—			18,174
Total current assets	93,357		221,267			3,592			—			318,216
Property and equipment, net	43,320		53,282			428			—			97,030
Goodwill	282,832		—			5,433			—			288,265
Other intangible assets, net	302,293		19,000			—			—			321,293
Intercompany	—		622,481			70,335			(692,816		)	—
Investment in subsidiaries	900,087		41,782			—			(941,869		)	—
Other assets	24,073		3,064			17			—			27,154
	$	1,645,962	$	960,876		$	79,805		$	(1,634,685	)	$	1,051,958
LIABILITIES AND SHAREHOLDER’S EQUITY
Current liabilities:
Trade accounts payable	$	20,499	$	17,181		$	58		$	—		$	37,738
Accrued expenses	55,299		58,729			848			—			114,876
Current portion of long-term debt	13,098		1,573			1,746			(1,722		)	14,695
Current portion of obligations under capital leases	—		6,052			—			—			6,052
Accrued income taxes	1,843		—			(30		)	—			1,813
Total current liabilities	90,739		83,535			2,622			(1,722		)	175,174
Intercompany	691,094		—			—			(691,094		)	—
Long-term liabilities	56,090		229			—			—			56,319
Long-term debt	357,527		893			—			—			358,420
Obligations under capital leases	—		11,632			—			—			11,632
Deferred gains	150		—			—			—			150
Deferred income taxes	106,253		—			—			—			106,253
Total liabilities	1,301,853		96,289			2,622			(692,816		)	707,948
Preferred shares	—		—			—			—			—
Common stock	—		—			—			—			—
Additional paid-in capital	244,345		476,811			125,104			(601,915		)	244,345
Retained earnings	99,734		387,794			(47,445		)	(340,349		)	99,734
Accumulated other comprehensive (loss) income	30		(18		)	(377		)	395			30
Total shareholder’s equity-Res-Care, Inc.	344,109		864,587			77,282			(941,869		)	344,109
Noncontrolling interest	—		—			(99		)	—			(99		)
Total shareholder’s equity	344,109		864,587			77,183			(941,869		)	344,010
	$	1,645,962	$	960,876		$	79,805		$	(1,634,685	)	$	1,051,958

	December 31, 2011
	SUCCESSOR
				Guarantor			Non-Guarantor						Consolidated
	ResCare, Inc.			Subsidiaries			Subsidiaries			Eliminations			Total
ASSETS
Current assets:
Cash and cash equivalents	$	16,733		$	6,547		$	2,371		$	—		$	25,651
Accounts receivable, net	22,947			197,925			217			—			221,089
Refundable income taxes	11,432			—			—			—			11,432
Deferred income taxes	13,668			—			—			—			13,668
Non-trade receivables	752			5,650			282			—			6,684
Prepaid expenses and other current assets	8,556			9,738			238			—			18,532
Total current assets	74,088			219,860			3,108			—			297,056
Property and equipment, net	45,827			38,628			438			—			84,893
Goodwill	237,076			25,338			5,283			—			267,697
Other intangible assets, net	307,566			7,388			—			—			314,954
Investment in subsidiaries	827,292			41,782			—			(869,074		)	—
Other assets	24,548			3,079			31			—			27,658
	$	1,516,397		$	336,075		$	8,860		$	(869,074	)	$	992,258
LIABILITIES AND SHAREHOLDER’S EQUITY
Current liabilities:
Trade accounts payable	$	26,293		$	19,697		$	117		$	—		$	46,107
Accrued expenses	64,061			57,607			964			—			122,632
Current portion of long-term debt	1,700			2,704			2,143			(2,007		)	4,540
Current portion of obligations under capital leases	—			89			—			—			89
Accrued income taxes	1,051			—			(82		)	—			969
Total current liabilities	93,105			80,097			3,142			(2,007		)	174,337
Intercompany	606,864			(537,240		)	(71,631		)	2,007			—
Long-term liabilities	55,112			88			—			—			55,200
Long-term debt	363,786			1,068			—			—			364,854
Obligations under capital leases	—			342			—			—			342
Deferred gains	300			—			—			—			300
Deferred income taxes	98,275			—			(5		)	—			98,270
Total liabilities	1,217,442			(455,645		)	(68,494		)	—			693,303
Preferred shares	—			—			—			—			—
Common stock	—			—			—			—			—
Additional paid-in capital	240,509			476,808			125,106			(601,914		)	240,509
Retained earnings	58,611			314,912			(46,986		)	(267,926		)	58,611
Accumulated other comprehensive (loss) income	(176		)	—			(777		)	777			(176		)
Total shareholder’s equity-Res-Care, Inc.	298,944			791,720			77,343			(869,063		)	298,944
Noncontrolling interest	11			—			11			(11		)	11
Total shareholder’s equity	298,955			791,720			77,354			(869,074		)	298,955
	$	1,516,397		$	336,075		$	8,860		$	(869,074	)	$	992,258

Schedule of condensed consolidating statement of operations

	Year Ended December 31, 2012
	SUCCESSOR
				Guarantor			Non-Guarantor						Consolidated
	ResCare, Inc.			Subsidiaries			Subsidiaries			Eliminations			Total
Revenues	$	252,422		$	1,343,482		$	3,205		$	—		$	1,599,109
Operating expenses	274,339			1,212,102			3,509			—			1,489,950
Operating (loss) income	(21,917		)	131,380			(304		)	—			109,159
Other (income) expenses:
Interest, net	34,329			939			(11		)	—			35,257
Loss on extinguishment of debt	7,129			—			—			—			7,129
Equity in earnings of subsidiaries	(79,689		)	(232		)				79,921			—
Total other (income) expenses	(38,231		)	707			(11		)	79,921			42,386
Income (loss) from continuing operations before income taxes	16,314			130,673			(293		)	(79,921		)	66,773
Income tax (benefit) expense	(24,809		)	50,683			(114		)	—			25,760
Net income (loss)	41,123			79,990			(179		)	(79,921		)	41,013
Net loss-noncontrolling interest	—			—			(110		)	—			(110		)
Net income (loss)-Res-Care, Inc.	$	41,123		$	79,990		$	(69	)	$	(79,921	)	$	41,123
Other comprehensive income:
Foreign currency translation adjustments	206			—			206			(206		)	206
Comprehensive income attributable to Res-Care, Inc.	$	41,329		$	79,990		$	137		$	(80,127	)	$	41,329
Total comprehensive income	$	41,329		$	79,990		$	27		$	(80,127	)	$	41,219

	Year Ended December 31, 2011
	SUCCESSOR
				Guarantor			Non-Guarantor						Consolidated
	ResCare, Inc.			Subsidiaries			Subsidiaries			Eliminations			Total
Revenues	$	257,792		$	1,319,735		$	1,808		$	—		$	1,579,335
Operating expenses	275,681			1,197,406			2,348			—			1,475,435
Operating (loss) income	(17,889		)	122,329			(540		)	—			103,900
Other expenses (income):
Interest, net	42,124			(55		)	(10		)	—			42,059
Equity in earnings of subsidiaries	(73,831		)	—			—			73,831			—
Total other (income) expenses	(31,707		)	(55		)	(10		)	73,831			42,059
Income (loss) from continuing operations before income taxes	13,818			122,384			(530		)	(73,831		)	61,841
Income tax (benefit) expense	(19,414		)	39,590			(171		)	—			20,005
Income (loss) from continuing operations	33,232			82,794			(359		)	(73,831		)	41,836
Loss (income) from discontinued operations, net of tax	19,760			—			(8,604		)	—			11,156
Net income (loss)-including noncontrolling interest	52,992			82,794			(8,963		)	(73,831		)	52,992
Net loss-noncontrolling interest	(171		)	—			(171		)	171			(171		)
Net income (loss)-Res-Care, Inc.	$	53,163		$	82,794		$	(8,792	)	$	(74,002	)	$	53,163
Other comprehensive income (loss):
Foreign currency translation adjustments	(433		)	—			(433		)	433			(433		)
Comprehensive income (loss) attributable to Res-Care, Inc.	$	52,730		$	82,794		$	(9,225	)	$	(73,569	)	$	52,730
Total comprehensive income	$	52,559		$	82,794		$	(9,396	)	$	(73,398	)	$	52,559

	For the Period November 16, 2010 — December 31, 2010
	SUCCESSOR
				Guarantor			Non-Guarantor						Consolidated
	ResCare, Inc.			Subsidiaries			Subsidiaries			Eliminations			Total
Revenues	$	31,456		$	163,620		$	—		$	—		$	195,076
Operating expenses	31,487			147,399			136			—			179,022
Operating (loss) income	(31		)	16,221			(136		)	—			16,054
Other (income) expenses:
Interest, net	2,829			(8		)	(11		)	—			2,810
Equity in earnings of subsidiaries	(7,574		)	—			—			7,574			—
Total other (income) expenses	(4,745		)	(8		)	(11		)	7,574			2,810
Income (loss) before income taxes	4,714			16,229			(125		)	(7,574		)	13,244
Income tax (benefit) expense	(1,469		)	6,092			184			—			4,807
Income (loss) from continuing operations	6,183			10,137			(309		)	(7,574		)	8,437
Loss from discontinued operations, net of tax	—			—			(2,254		)	—			(2,254		)
Net income (loss)-including noncontrolling interest	6,183			10,137			(2,563		)	(7,574		)	6,183
Net loss-noncontrolling interest	(18		)	—			(18		)	18			(18		)
Net income (loss)-Res-Care, Inc.	$	6,201		$	10,137		$	(2,545	)	$	(7,592	)	$	6,201
Other comprehensive income (loss):
Foreign currency translation adjustments	257			—			257			(257		)	257
Comprehensive income (loss) attributable to Res-Care, Inc.	$	6,458		$	10,137		$	(2,288	)	$	(7,849	)	$	6,458
Total comprehensive income	$	6,440		$	10,137		$	(2,306	)	$	(7,831	)	$	6,440

	For the Period January 1, 2010 — November 15, 2010
	PREDECESSOR
				Guarantor			Non-Guarantor						Consolidated
	ResCare, Inc.			Subsidiaries			Subsidiaries			Eliminations			Total
Revenues	$	277,287		$	1,089,451		$	863		$	—		$	1,367,601
Operating expenses	543,735			1,013,681			4,744			—			1,562,160
Operating (loss) income	(266,448		)	75,770			(3,881		)	—			(194,559		)
Other (income) expenses:
Interest, net	16,521			(51		)	(9		)	—			16,461
Equity in earnings of subsidiaries	(41,952		)	—			—			41,952			—
Total other (income) expenses	(25,431		)	(51		)	(9		)	41,952			16,461
(Loss) income from continuing operations before income taxes	(241,017		)	75,821			(3,872		)	(41,952		)	(211,020		)
Income tax (benefit) expense	(64,668		)	17,515			(3,367		)	—			(50,520		)
(Loss) income from continuing operations	(176,349		)	58,306			(505		)	(41,952		)	(160,500		)
Loss from discontinued operations, net of tax	—			—			(15,849		)	—			(15,849		)
Net (loss) income-including noncontrolling interest	(176,349		)	58,306			(16,354		)	(41,952		)	(176,349		)
Net loss-noncontrolling interest	(172		)	—			(172		)	172			(172		)
Net (loss) income-Res-Care, Inc.	$	(176,177	)	$	58,306		$	(16,182	)	$	(42,124	)	$	(176,177	)
Other comprehensive income (loss):
Foreign currency translation adjustments	(627		)	—			(627		)	627			(627		)
Comprehensive income (loss) attributable to Res-Care, Inc.	$	(176,804	)	$	58,306		$	(16,809	)	$	(41,497	)	$	(176,804	)
Total comprehensive income (loss)	$	(176,976	)	$	58,306		$	(16,981	)	$	(41,325	)	$	(176,976	)

Schedule of condensed consolidating statement of cash flows

	Year Ended December 31, 2012
	SUCCESSOR
				Guarantor			Non-Guarantor						Consolidated
	ResCare, Inc.			Subsidiaries			Subsidiaries			Eliminations			Total
Operating activities:
Net income	$	41,013		$	79,990		$	(179	)	$	(79,811	)	$	41,013
Adjustments to reconcile net income, including noncontrolling interest, to cash provided by operating activities:
Depreciation and amortization	17,882			15,310			179			—			33,371
Amortization of discount and deferred debt issuance costs on notes	2,961			—			—			—			2,961
Stock compensation	3,836			—			—			—			3,836
Deferred income taxes, net	4,057			—			5			—			4,062
Provision for losses on accounts receivable	965			4,714			—			—			5,679
Loss on extinguishment of debt, net of original issue discount paid	6,400			—			—			—			6,400
Loss on sale of assets	—			238			—			—			238
Equity in earnings of subsidiaries	(79,579		)	(232		)	—			79,811			—
Changes in operating assets and liabilities	104,059			(39,126		)	(82,172		)	—			(17,239		)
Cash (used in) provided by operating activities	101,594			60,894			(82,167		)	—			80,321
Investing activities:
Purchases of property and equipment	(9,979		)	(5,337		)	(169		)	—			(15,485		)
Acquisitions of businesses, net of cash acquired	—			(30,690		)	—			—			(30,690		)
Proceeds from sale of assets	—			166			—			—			166
Cash (used in) provided by investing activities	(9,979		)	(35,861		)	(169		)	—			(46,009		)
Financing activities:
Long-term repayments	(171,828		)	(2,493		)	(397		)	—			(174,718		)
Long-term debt borrowings	175,000			—			—			—			175,000
Payments on obligations under capital leases, net	—			(6,034		)	—			—			(6,034		)
Debt issuance costs	(4,008		)	—			—			—			(4,008		)
Funds contributed by co-investors	—			—			—			—			—
Net payments relating to intercompany financing	(64,879		)	(18,189		)	83,068			—			—
Cash (used in) provided by financing activities	(65,715		)	(26,716		)	82,671			—			(9,760		)
Effect of exchange rate changes on cash and cash equivalents	—			(69		)	—			—			(69		)
Increase (decrease) in cash and cash equivalents	25,900			(1,752		)	335			—			24,483
Cash and cash equivalents at beginning of period	16,733			6,547			2,371			—			25,651
Cash and cash equivalents at end of period	$	42,633		$	4,795		$	2,706		$	—		$	50,134

	Year Ended December 31, 2011
	SUCCESSOR
				Guarantor			Non-Guarantor						Consolidated
	ResCare, Inc.			Subsidiaries			Subsidiaries			Eliminations			Total
Operating activities:
Net income	$	52,992		$	82,794		$	(8,963	)	$	(73,831	)	$	52,992
Adjustments to reconcile net income, including noncontrolling interest, to cash provided by operating activities:
Depreciation and amortization	12,824			8,060			108			—			20,992
Amortization of discount and deferred debt issuance costs on notes	2,943			—			—			—			2,943
Stock compensation	2,383			—			—			—			2,383
Deferred income taxes, net	4,458			—			(8		)	—			4,450
Provision for losses on accounts receivable	3,903			1,928			20			—			5,851
Write down of assets held for sale	2,808			—			(1,166		)	—			1,642
Loss on sale of assets	—			481			—			—			481
Equity in earnings of subsidiaries	(73,831		)	—			—			73,831			—
Changes in operating assets and liabilities	(151,659		)	120,299			12,238			—			(19,122		)
Cash (used in) provided by operating activities	(143,179		)	213,562			2,229			—			72,612
Investing activities:
Purchases of property and equipment	(21,566		)	7,826			233			—			(13,507		)
Acquisitions of businesses, net of cash acquired	—			(23,106		)	—			—			(23,106		)
Proceeds from sale of assets	—			221			—			—			221
Cash (used in) provided by investing activities	(21,566		)	(15,059		)	233			—			(36,392		)
Financing activities:
Long-term (repayments) debt borrowings	(37,134		)	2,142			(3,832		)	—			(38,824		)
Payments on obligations under capital leases, net	—			(92		)	—			—			(92		)
Debt issuance costs	(561		)	—			—			—			(561		)
Funds contributed by co-investors	1,400			—			—			—			1,400
Net payments relating to intercompany financing	206,689			(203,768		)	(2,921		)	—			—
Cash provided by (used in) financing activities	170,394			(201,718		)	(6,753		)	—			(38,077		)
Effect of exchange rate changes on cash and cash equivalents	—			(63		)	19			—			(44		)
Increase (decrease) in cash and cash equivalents	5,649			(3,278		)	(4,272		)	—			(1,901		)
Cash and cash equivalents at beginning of period	11,084			9,825			6,643			—			27,552
Cash and cash equivalents at end of period	$	16,733		$	6,547		$	2,371		$	—		$	25,651

	For the Period November 16, 2010 — December 31, 2010
	SUCCESSOR
				Guarantor			Non-Guarantor						Consolidated
	ResCare, Inc.			Subsidiaries			Subsidiaries			Eliminations			Total
Operating activities:
Net income	$	6,183		$	10,137		$	(2,563	)	$	(7,574	)	$	6,183
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization	464			1,820			31			—			2,315
Amortization of discount and debt issuance costs	70			—			—			—			70
Deferred income taxes, net	2,440			—			3			—			2,443
Provision for losses on accounts receivable	—			844			—			—			844
Gain on sale of assets	—			(27		)	—			—			(27		)
Equity in earnings of subsidiaries	(7,574		)	—			—			7,574			—
Changes in operating assets and liabilities	9,331			37,910			405			—			47,646
Cash provided by (used in) operating activities	10,914			50,684			(2,124		)	—			59,474
Investing activities:
Purchases of property and equipment	(1,258		)	(869		)	—			—			(2,127		)
Acquisitions of businesses, net of cash acquired	—			(7,192		)	—			—			(7,192		)
Proceeds from sale of assets	—			59			—			—			59
Cash used in investing activities	(1,258		)	(8,002		)	—			—			(9,260		)
Financing activities:
Long-term debt repayments	(122,450		)	(25		)	87			—			(122,388		)
Long-term debt borrowings	366,600			—			—			—			366,600
Short-term borrowings-three months or less, net	(50,000		)	—			—			—			(50,000		)
Payments on obligations under capital leases	—			(11		)	—			—			(11		)
Net payments relating to intercompany financing	32,946			(38,064		)	5,118			—			—
Debt issuance costs	(15,863		)	—			—			—			(15,863		)
Payments on common share exchange	(56,875		)	—			—			—			(56,875		)
Redemption of preferred shares	(158,843		)	—			—			—			(158,843		)
Return on preferred shares	(753		)	—			—			—			(753		)
Cash (used in) provided by financing activities	(5,238		)	(38,100		)	5,205			—			(38,133		)
Effect of exchange rate on cash and cash equivalents	—			(3		)	15			—			12
Increase in cash and cash equivalents	4,418			4,579			3,096			—			12,093
Cash and cash equivalents at beginning of period	6,666			5,246			3,547			—			15,459
Cash and cash equivalents at end of period	$	11,084		$	9,825		$	6,643		$	—		$	27,552

	For the Period January 1, 2010 — November 15, 2010
	PREDECESSOR
				Guarantor			Non-Guarantor						Consolidated
	ResCare, Inc.			Subsidiaries			Subsidiaries			Eliminations			Total
Operating activities:
Net (loss) income	$	(176,349	)	$	58,306		$	(16,354	)	$	(41,952	)	$	(176,349	)
Adjustments to reconcile net (loss) income to cash provided by operating activities:
Depreciation and amortization	10,083			11,541			824			—			22,448
Impairment charge	250,181			—			12,974			—			263,155
Amortization of discount and deferred debt issuance costs on notes	1,577			—			—			—			1,577
Share-based compensation	6,201			—			—			—			6,201
Deferred income taxes, net	(55,547		)	—			(51		)	—			(55,598		)
Provision for losses on accounts receivable	—			9,573			—			—			9,573
Excess tax benefit from exercise of stock options	1,176			—			—			—			1,176
Loss on sale of assets	—			198			—			—			198
Equity in earnings of subsidiaries	(41,952		)	—			—			41,952			—
Changes in operating assets and liabilities	(27,179		)	(25,872		)	6,496			—			(46,555		)
Cash (used in) provided by operating activities	(31,809		)	53,746			3,889			—			25,826
Investing activities:
Purchases of property and equipment	(4,275		)	(4,265		)	(53		)	—			(8,593		)
Acquisitions of businesses, net of cash acquired	—			(21,234		)	—			—			(21,234		)
Proceeds from sale of assets	—			120			—			—			120
Cash used in investing activities	(4,275		)	(25,379		)	(53		)	—			(29,707		)
Financing activities:
Long-term debt repayments	—			(1,395		)	—			—			(1,395		)
Long-term debt borrowings	2,594			—			—			—			2,594
Short-term borrowings-three months or less, net	3,237			151			2,612			—			6,000
Payments on obligations under capital leases	—			(85		)	—			—			(85		)
Net payments relating to intercompany financing	38,558			(26,491		)	(12,067		)	—			—
Debt issuance costs	(4,543		)	—			—			—			(4,543		)
Excess tax benefits from share-based compensation	(1,176		)	—			—			—			(1,176		)
Employee withholding payments on share-based compensation	(2,683		)	—			—			—			(2,683		)
Cash provided by (used in) financing activities	35,987			(27,820		)	(9,455		)	—			(1,288		)
Effect of exchange rate on cash and cash equivalents	—			44			(88		)	—			(44		)
Increase (decrease) in cash and cash equivalents	(97		)	591			(5,707		)	—			(5,213		)
Cash and cash equivalents at beginning of period	6,763			4,655			9,254			—			20,672
Cash and cash equivalents at end of period	$	6,666		$	5,246		$	3,547		$	—		$	15,459