8-K

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):

November 12, 2013

RES-CARE, INC.

(Exact Name of Registrant as specified in Charter)

Kentucky	0-20372	61-0875371
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

9901 Linn Station Road, Louisville, Kentucky	40223
(Address of principal executive offices)	(Zip code)

(502) 394-2100

(Registrant's telephone number, including area code)

(Former name or former address, if changed since last report.)

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 communications 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))

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INFORMATION TO BE INCLUDED IN THE REPORT

Item 2.02 Results of Operations and Financial Condition.

Res-Care, Inc. is furnishing unaudited financial information related to the results of its third quarter ended September 30, 2013, that was posted to its website on November 12, 2013.  The information, which is attached as Exhibit 99.1 to this report, includes certain non-GAAP financial measures and related reconciliations to GAAP measures that were not included in the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2013.

Item 9.01  Financial Statements & Exhibits.

Exhibit Number	Description of Exhibit
99.1	Unaudited financial information for the third quarter ended September 30, 2013.

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SIGNATURE

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 thereunto duly author­ized.

		RES-CARE, INC.
Date: November 12, 2013	By:	/s/ Ross Davison
		Ross Davison
		Chief Financial Officer

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EXHIBIT INDEX

Exhibit Number	Description of Exhibits
99.1	Unaudited financial information for the third quarter ended September 30, 2013.

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EX-99.1

Exhibit 99.1

RESCARE THIRD QUARTER 2013 RESULTS

Third Quarter 2013 Financial Results

Revenues for the third quarter of 2013 were $409.9 million, which was a 3.3% increase over prior year period revenues of $396.8 million.  Increased revenues from acquisitions in our Residential and HomeCare segments were partially offset by contract losses and modifications in the Workforce Services segment.

Net income was $11.4 million for the third quarter of 2013, compared with $12.3 million in the same period of 2012.  The decrease is primarily due to non-recurring legal and insurance costs in the third quarter of 2013.   Adjusted EBITDA for the third quarter of 2013 was $34.6 million versus $37.9 million in the prior year quarter.

RES-CARE, INC.

Unaudited Financial Highlights

(In thousands)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Income Statement Data:
Revenues	$	409,934		$	396,838		$	1,195,621		$	1,194,082
Cost of services		305,518			295,997			894,967			896,420
Gross profit		104,416			100,841			300,654			297,662
Operating expenses:
Operational general and administrative		59,018			57,331			178,932			176,412
Corporate general and administrative		20,474			14,774			51,828			48,905
Total operating expenses		79,492			72,105			230,760			225,317
Operating income		24,924			28,736			69,894			72,345
Interest expense, net		8,140			8,243			24,342			27,075
Loss on extinguishment of debt		—			—			—			7,129
Income before income taxes		16,784			20,493			45,552			38,141
Income tax expense		5,450			8,249			12,683			15,363
Net income		11,334			12,244			32,869			22,778
Net loss – noncontrolling interest		(34	)		(24	)		(110	)		(85	)
Net income – Res-Care, Inc.	$	11,368		$	12,268		$	32,979		$	22,863
Other comprehensive income:
Foreign currency translation adjustments		56			265			(358	)		294
Comprehensive income attributable to Res-Care, Inc.	$	11,424		$	12,533		$	32,621		$	23,157
Total comprehensive income	$	11,390		$	12,509		$	32,511		$	23,072

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RES-CARE, INC.

Unaudited Financial Highlights (continued)

(In thousands)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Net income to EBITDA and Adjusted EBITDA:
Net income	$	11,334	$	12,244	$	32,869	$	22,778
Add:  Interest, net		8,140		8,243		24,342		27,075
Loss on extinguishment of debt		—		—		—		7,129
Depreciation and amortization		8,809		8,199		25,535		25,208
Income tax expense		5,450		8,249		12,683		15,363
EBITDA (1)		33,733		36,935		95,429		97,553
Add:  Share-based compensation		824		920		2,376		2,945
Acquisition costs		—		75		—		339
Adjusted EBITDA (1)	$	34,557	$	37,930	$	97,805	$	100,837

	September 30, 2013		December 31, 2012
Balance Sheet Data:
ASSETS
Cash and cash equivalents	$	51,190	$	50,134
Accounts receivable, net		230,745		228,377
Other current assets		48,286		39,705
Total current assets		330,221		318,216
Property and equipment, net		100,128		97,030
Goodwill		301,710		288,265
Other intangible assets, net		326,038		321,293
Other assets		23,703		27,154
	$	1,081,800	$	1,051,958
LIABILITIES AND SHAREHOLDER’S EQUITY
Current liabilities	$	192,153	$	175,174
Other long-term liabilities		146,463		162,722
Long-term debt		364,287		370,052
Shareholder’s equity		378,897		344,010
	$	1,081,800	$	1,051,958

(1) EBITDA is defined as income from continuing operations before depreciation and amortization, net interest expense, loss on extinguishment of debt and income taxes.  Adjusted EBITDA is defined as EBITDA before share-based compensation and acquisition costs.  EBITDA and Adjusted EBITDA should not be considered as measures of financial performance under accounting principles generally accepted in the United States of America.  The items excluded from EBITDA and Adjusted EBITDA are significant components in understanding and assessing financial performance.  Management routinely calculates and presents EBITDA and Adjusted EBITDA because it believes that EBITDA and Adjusted EBITDA are useful to investors and are used as analytical indicators within the industry to evaluate performance, measure leverage capacity and debt service ability, and to estimate current or prospective enterprise value.  EBITDA is also used in measurements under certain covenants contained in the Company’s credit agreement.

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RES-CARE, INC.

Unaudited Financial Highlights (continued)

(In thousands)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Cash Flow Data:
Net income	$	11,334		$	12,244		$	32,869		$	22,778
Adjustments to reconcile net income to cash provided by (used in) operating activities:
Depreciation and amortization		8,809			8,199			25,535			25,208
Amortization of discount and deferred debt issuance costs		870			824			2,612			2,091
Share-based compensation		824			920			2,376			2,945
Deferred income taxes, net		(867	)		998			1,480			1,622
Provision for losses on accounts receivable		1,087			1,352			4,430			4,237
Loss on extinguishment of debt, net of original issue discount paid		—			—			—			6,400
Loss on sale of assets		(19	)		(19	)		81			76
Changes in operating assets and liabilities		(656	)		(6,782	)		(13,935	)		(23,102	)
Cash provided byoperating activities		21,382			17,736			55,448			42,255
Cash flows from investing activities:
Proceeds from sale of assets		160			37			344			80
Purchases of property and equipment		(6,795	)		(3,909	)		(15,007	)		(11,324	)
Acquisitions of businesses, net of cash acquired		(17,761	)		(13,415	)		(19,995	)		(22,077	)
Cash used in investing activities		(24,396	)		(17,287	)		(34,658	)		(33,321	)
Cash flows from financing activities:
Debt repayments, net		(6,857	)		(4,718	)		(19,636	)		(1,587	)
Debt issuance costs		—			(29	)		(2	)		(4,007	)
Cash used in financing activities		(6,857	)		(4,747	)		(19,638	)		(5,594	)
Effect of exchange rate on cash and cash equivalents		(15	)		84			(96	)		93
(Decrease) increase in cash and cash equivalents	$	(9,886	)	$	(4,214	)	$	1,056		$	3,433

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RES-CARE, INC.

Unaudited Financial Highlights (continued)

(Dollars in thousands)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Segment Data:
Revenues:
Residential Services	$	224,823		$	212,623		$	651,678		$	631,533
ResCare HomeCare		93,645			82,996			271,886			250,462
Education & Training Services		31,074			36,946			100,492			114,058
Workforce Services		42,257			48,797			121,671			149,113
Pharmacy Services		18,135			15,476			49,894			48,916
Consolidated	$	409,934		$	396,838		$	1,195,621		$	1,194,082
Operating Income(1):
Residential Services	$	29,127		$	29,819		$	78,673		$	83,998
ResCare HomeCare		7,843			5,886			18,921			16,234
Education & Training Services		2,867			2,979			7,601			9,552
Workforce Services		4,909			3,448			12,589			7,751
Pharmacy Services		844			1,405			4,448			3,717
Corporate		(20,666	)		(14,801	)		(52,338	)		(48,907	)
Consolidated	$	24,924		$	28,736		$	69,894		$	72,345
Operating Margin(1):
Residential Services		13.0	%		14.0	%		12.1	%		13.3	%
ResCare HomeCare		8.4	%		7.1	%		7.0	%		6.5	%
Education & Training Services		9.2	%		8.1	%		7.6	%		8.4	%
Workforce Services		11.6	%		7.1	%		10.3	%		5.2	%
Pharmacy Services		4.7	%		9.1	%		8.9	%		7.6	%
Corporate		(5.0	%)		(3.7	%)		(4.4	%)		(4.1	%)
Consolidated		6.1	%		7.2	%		5.8	%		6.1	%

(1) Other (expense) income, which is included with corporate general and administrative expenses per the Income Statement Data on page 1, has been allocated for purposes of segment reporting.

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