che-20230331x8k
false000001958400000195842023-03-312023-03-31

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):

March 31, 2023

CHEMED CORPORATION

(Exact name of registrant as specified in its charter)

Delaware

     1-8351

  31-0791746

(State or other
jurisdiction of
incorporation)

(Commission File Number)

(I.R.S. Employer
Identification
Number)

2600 First Financial Center, 255 East 5th Street, Cincinnati, OH 45202

(Address of principal executive offices)             (Zip Code)

Registrant's telephone number, including area code:

(513) 762-6690

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 (see General Instruction A.2 below):

[_]      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 Exchange Act (17 CFR 240-14d-2(b))

[_]      Pre-commencement communications pursuant to Rule 13e-4 (c) under Exchange Act (17 CFR 240-13e-4(c))

Securities registered pursuant to 12(b) of the Act:

 

Title of each class

 

Trading symbol

Name of each exchange on which

registered

Capital stock $1 par value

CHE

NYSE

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.  [_]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  [_]

Page 1 of 3


Item 2.02 Results of Operations and Financial Condition

On April 26, 2023, Chemed Corporation issued a press release announcing its financial results for the quarter ended March 31, 2023. A copy of the release is furnished herewith as Exhibit 99.

Item 9.01 Financial Statements and Exhibits

d)

Exhibit

 

 

 

 

 

(99) Registrant’s press release dated April 26, 2023

 

 

104 The cover page from this Current Report on Form 8-K formatted in Inline XBRL

Page 2 of 3


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

CHEMED CORPORATION

Dated:   April 26, 2023

By:

/s/ Michael D. Witzeman

Michael D. Witzeman

Vice President and Controller

Page 3 of 3

Exhibit 99

Picture 2



CONTACT:  David P. Williams

(513) 762-6901

Chemed Reports First-Quarter 2023 Results



CINCINNATI, April 26, 2023—Chemed Corporation (Chemed) (NYSE: CHE), which operates VITAS Healthcare Corporation (VITAS), one of the nation’s largest providers of end-of-life care, and Roto-Rooter, the nation’s largest commercial and residential plumbing and drain cleaning services provider, reported financial results for its first quarter ended March 31, 2023, versus the comparable prior-year period, as follows:



Consolidated operating results:

·

Revenue increased 5.6% to $560 million

·

GAAP Diluted Earnings-per-Share (EPS) of $3.58

·

Adjusted Diluted EPS of $4.82, an increase of 0.6%



VITAS segment operating results:

·

Net Patient Revenue of $310 million, an increase of 3.8%

·

Average Daily Census (ADC) of 17,830, an increase of 3.0%

·

Admissions of 16,179, a decline of 2.1%

·

Net Income, excluding certain discrete items, of $32.9 million, a decline of 10.5%

·

Adjusted EBITDA, excluding Medicare Cap, of $47.2 million, a decline of 10.1%

·

Adjusted EBITDA margin, excluding Medicare Cap, of 15.1%, a decrease of 234-basis points



Roto-Rooter segment operating results:

·

Revenue of $250 million, an increase of 7.9%

·

Net Income, excluding certain discrete items, of $50.7 million, an increase of 9.3%

·

Adjusted EBITDA of $71.8 million, an increase of 9.0%

·

Adjusted EBITDA margin of 28.8%, an increase of 29-basis points



VITAS



VITAS net revenue was $310 million in the first quarter of 2023, which is an increase of 3.8% when compared to the prior year period.  This revenue increase is comprised primarily of a 3.0% increase in days-of-care and a geographically weighted average Medicare reimbursement rate increase of approximately 2.9%, partially offset by 200-basis points as a result of CMS reimplementing the 2% sequestration cut that was suspended at the start of the pandemic in 2020.  Acuity mix shift had minimal impact in the quarter when compared to the prior-year revenue and


 

level-of-care mix.  The combination of Medicare Cap and other contra revenue changes negatively impacted revenue growth by 10-basis points.

 

In the first quarter of 2023, VITAS accrued $2.75 million in Medicare Cap billing limitations.  This compares to a $2.5 million Medicare Cap billing limitation in the first quarter of 2022.



Of VITAS’ 30 Medicare provider numbers, 25 provider numbers have a trailing six-month Medicare Cap cushion of 10% or greater, one provider number has a cushion between 5% and 10%, one provider number has a cushion between 0% and 5% and three provider numbers have a trailing six-month billing limitation liability.



Average revenue per patient per day in the first quarter of 2023 was $198.86 which is 100-basis points above the prior-year period. Reimbursement for routine home care and high acuity care averaged $173.39 and $1,042.06 respectively.  During the quarter, high acuity days-of-care were 2.9% of total days of care, essentially equal to the prior-year quarter.



The first quarter 2023 gross margin, excluding Medicare Cap and the hiring and retention bonus program, was 22.5%.  This is a 220-basis point margin decline when compared to the first quarter of 2022. The majority of this margin decline is the result of CMS reimplementing sequestration which reduced gross margins 200-basis points. During the quarter,  VITAS increased the licensed healthcare staff by 200 professionals.  This results in  total licensed staff increasing by 475 professionals since the inception of the retention program on July 1, 2022.  The increase of 200 professionals hired during the first quarter of 2023 is estimated to have negatively impacted margins in the quarter by approximately 50-basis points. 



Selling, general and administrative expenses were $23.3 million in the first quarter of 2023 and compares to $22.5 million incurred in the prior-year quarter.  Adjusted EBITDA, excluding Medicare Cap, totaled $47.2 million in the quarter, a decrease of 10.1%.  Adjusted EBITDA margin in the quarter, excluding Medicare Cap, was 15.1%, which is 234-basis points below the prior-year period.  This Adjusted EBITDA margin was negatively impacted by 200-basis points for the reimplementation of sequestration and approximately 50-basis points due to the addition of 200 licensed professionals during the first quarter of 2023. 



Roto-Rooter



Roto-Rooter generated quarterly revenue of $250 million in the first quarter of 2023, an increase of 7.9%, when compared to the prior-year quarter.



Roto-Rooter branch commercial revenue in the quarter totaled $59.9 million, an increase of 10.1%, over the prior year.  This aggregate commercial revenue growth consisted of drain cleaning revenue increasing 4.0%, plumbing increasing 10.7%, excavation increasing 26.2%, and water restoration increasing 7.4%.



Roto-Rooter branch residential revenue in the quarter totaled $169 million, an increase of 7.5%, over the prior-year period.  This aggregate residential revenue growth consisted of drain cleaning decreasing 2.9%, plumbing expanding 3.6%, excavation expanding 3.9%, and water restoration


 

increasing 27.4%.



Roto-Rooter’s gross margin in the quarter was 53.1%, a 37-basis point increase when compared to the first quarter of 2022.  Adjusted EBITDA in the first quarter of 2023 totaled $71.8 million, an increase of 9.0%.  The Adjusted EBITDA margin in the quarter was 28.8%, which is a 29-basis point improvement when compared to the prior year.



Chemed Consolidated



As of March 31, 2023, Chemed had total cash and cash equivalents of $58.1 million and $21.3 million of current and long-term debt.



In June 2022, Chemed entered into a five-year $550 million Amended and Restated Credit Agreement (Credit Agreement).  This Credit Agreement consisted of a $100 million amortizable term loan and a $450 million revolving credit facility. The interest rate on this Credit Agreement has a floating rate that is currently SOFR plus 100-basis points.  During the quarter, the Company paid off the majority of the term loan, with $21.3 million remaining as of March 31, 2023.  The Company has approximately $405 million of undrawn borrowing capacity under the revolving portion of the credit agreement.







Guidance for 2023



Management anticipates providing updated 2023 earnings guidance as part of the June 30, 2023, earnings press release.

 







Conference Call



Chemed will host a conference call and webcast at 10 a.m., ET, on Thursday April 27, 2023, to discuss the company's quarterly results and to provide an update on its business. Participants may access a live webcast of the conference call through the investor relations section of Chemed’s website, Investor Relations Home | Chemed Corporation or the hosting website   https://edge.media-server.com/mmc/p/j92nc5np.



Participants may also register via teleconference at:

https://register.vevent.com/register/BI022164faf96b4f54a3fa9a29dc1a2511Once registration is completed, participants will be provided with a dial-in number containing a personalized conference code to access the call. All participants are instructed to dial-in 15 minutes prior to the start time.






 

A  taped replay of the conference call will be available beginning approximately two hours after the call's conclusion. You may access the replay via webcast through the investor relations section of Chemed’s website.



Chemed Corporation operates in the healthcare field through its VITAS Healthcare Corporation subsidiary.  VITAS provides daily hospice services to approximately 17,800 patients with severe, life-limiting illnesses. This type of care is focused on making the terminally ill patient's final days as comfortable and pain-free as possible.



Chemed operates in the residential and commercial plumbing and drain cleaning industry under the brand name Roto-Rooter. Roto-Rooter provides plumbing, drain cleaning, and water cleanup services through company-owned branches, independent contractors and franchisees in the United States and Canada. Roto-Rooter also has licensed master franchisees in the republics of Indonesia and Singapore, and the Philippines.



 

This press release contains information about Chemed’s EBITDA, Adjusted EBITDA and Adjusted Diluted EPS, which are not measures derived in accordance with GAAP and which exclude components that are important to understanding Chemed’s financial performance. In reporting its operating results, Chemed provides EBITDA, Adjusted EBITDA and Adjusted Diluted EPS measures to help investors and others evaluate the Company’s operating results, compare its operating performance with that of similar companies that have different capital structures and evaluate its ability to meet its future debt service, capital expenditures and working capital requirements. Chemed’s management similarly uses EBITDA, Adjusted EBITDA and Adjusted Diluted EPS to assist it in evaluating the performance of the Company across fiscal periods and in assessing how its performance compares to its peer companies.  These measures also help Chemed’s management to estimate the resources required to meet Chemed’s future financial obligations and expenditures.  Chemed’s EBITDA, Adjusted EBITDA and Adjusted Diluted EPS should not be considered in isolation or as a substitute for comparable measures calculated and presented in accordance with GAAP. We calculated Adjusted EBITDA Margin by dividing Adjusted EBITDA by service revenue and sales.  A reconciliation of Chemed’s net income to its EBITDA, Adjusted EBITDA and Adjusted Diluted EPS is presented in the tables following the text of this press release.





Forward-Looking Statements



Certain statements contained in this press release and the accompanying tables are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The words "believe," "expect," "hope," "anticipate," "plan" and similar expressions identify forward-looking statements, which speak only as of the date the statement was made. Chemed does not undertake and specifically disclaims any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These statements are based on current expectations and assumptions and involve various risks and uncertainties, which could cause Chemed's actual results to differ from those expressed in such forward-looking statements.




 

These risks and uncertainties arise from, among other things, possible changes in regulations governing the hospice care or plumbing and drain cleaning industries; periodic changes in reimbursement levels and procedures under Medicare and Medicaid programs; difficulties predicting patient length of stay and estimating potential Medicare reimbursement obligations; challenges inherent in Chemed's growth strategy; the current shortage of  qualified nurses,  other healthcare professionals and  licensed plumbing and drain cleaning technicians; Chemed’s dependence on patient referral sources; and other factors detailed under the caption "Description of  Business by  Segment" or "Risk Factors" in Chemed’s  most recent  report on  form 10-Q  or 10-K and its other filings with the Securities and Exchange Commission.  You are cautioned not to place undue reliance on such forward-looking statements and there are no assurances that the matters contained in such statements will be achieved.


 









 

 

 

 

 

 

 

CHEMED CORPORATION AND SUBSIDIARY COMPANIES

CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share data)(unaudited)



 

 

 

 

 

 

 



 

Three Months Ended March 31,

 



 

2023

 

2022

 

Service revenues and sales

 

$

560,157 

 

$

530,549 

 

Cost of services provided and goods sold

 

 

370,705 

 

 

336,552 

 

Selling, general and administrative expenses (aa)

 

 

100,095 

 

 

89,954 

 

Depreciation

 

 

12,286 

 

 

12,138 

 

Amortization

 

 

2,513 

 

 

2,518 

 

Other operating expense

 

 

1,739 

 

 

13 

 

Total costs and expenses

 

 

487,338 

 

 

441,175 

 

Income from operations

 

 

72,819 

 

 

89,374 

 

Interest expense

 

 

(1,551)

 

 

(810)

 

Other expense--net (bb)

 

 

(103)

 

 

(3,862)

 

Income before income taxes

 

 

71,165 

 

 

84,702 

 

Income taxes

 

 

(17,044)

 

 

(20,533)

 

Net income

 

$

54,121 

 

$

64,169 

 

Earnings Per Share

 

 

 

 

 

 

 

Net income

 

$

3.62 

 

$

4.28 

 

Average number of shares outstanding

 

 

14,966 

 

 

14,986 

 

Diluted Earnings Per Share

 

 

 

 

 

 

 

Net income

 

$

3.58 

 

$

4.22 

 

Average number of shares outstanding

 

 

15,110 

 

 

15,192 

 



 

 

 

 

 

 

 

(aa)    Selling, general and administrative ("SG&A") expenses comprise (in thousands):



 

 

 

 

 

 

 



 

Three Months Ended March 31,

 



 

2023

 

2022

 

SG&A expenses before long-term incentive compensation

 

 

 

 

 

 

 

and the impact of market value adjustments related to

 

 

 

 

 

 

 

deferred compensation plans

 

$

97,902 

 

$

92,578 

 

Long-term incentive compensation

 

 

2,514 

 

 

1,310 

 

Market value adjustments related to deferred

 

 

 

 

 

 

 

compensation trusts

 

 

(321)

 

 

(3,934)

 

Total SG&A expenses

 

$

100,095 

 

$

89,954 

 



 

 

 

 

 

 

 

(bb)    Other expense--net comprises (in thousands):

 



 

Three Months Ended March 31,

 



 

2023

 

2022

 

Market value adjustments related to deferred

 

 

 

 

 

 

 

compensation trusts

 

$

(321)

 

$

(3,934)

 

Interest income

 

 

150 

 

 

73 

 

Other

 

 

68 

 

 

(1)

 

Total other expense--net

 

$

(103)

 

$

(3,862)

 




 





 

 

 

 

 

 

CHEMED CORPORATION AND SUBSIDIARY COMPANIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)(unaudited)



 

 

 

 

 

 



 

March 31,



 

2023

 

2022

Assets

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash and cash equivalents

 

$

58,054 

 

$

18,160 

Accounts receivable less allowances

 

 

153,816 

 

 

117,319 

Inventories

 

 

10,663 

 

 

10,540 

Prepaid income taxes

 

 

10,633 

 

 

9,143 

Prepaid expenses

 

 

29,055 

 

 

29,589 

Total current assets

 

 

262,221 

 

 

184,751 

Investments of deferred compensation plans held in trust

 

 

97,436 

 

 

100,139 

Properties and equipment, at cost less accumulated depreciation

 

 

204,164 

 

 

192,405 

Lease right of use asset

 

 

131,219 

 

 

134,169 

Identifiable intangible assets less accumulated amortization

 

 

97,348 

 

 

106,367 

Goodwill

 

 

581,286 

 

 

579,704 

Other assets

 

 

57,511 

 

 

8,222 

Total Assets

 

$

1,431,185 

 

$

1,305,757 

Liabilities

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Accounts payable

 

$

40,279 

 

$

64,710 

Current portion of long-term debt

 

 

5,000 

 

 

 -

Income taxes

 

 

11,223 

 

 

15,390 

Accrued insurance

 

 

63,150 

 

 

58,952 

Accrued compensation

 

 

50,152 

 

 

62,205 

Accrued legal

 

 

6,061 

 

 

871 

Short-term lease liability

 

 

38,291 

 

 

38,856 

Other current liabilities

 

 

69,304 

 

 

38,667 

Total current liabilities

 

 

283,460 

 

 

279,651 

Deferred income taxes

 

 

35,418 

 

 

19,136 

Long-term debt

 

 

16,250 

 

 

120,000 

Deferred compensation liabilities

 

 

97,285 

 

 

100,812 

Long-term lease liability

 

 

106,212 

 

 

109,121 

Other liabilities

 

 

12,507 

 

 

10,332 

Total Liabilities

 

 

551,132 

 

 

639,052 

Stockholders' Equity

 

 

 

 

 

 

Capital stock

 

 

36,884 

 

 

36,579 

Paid-in capital

 

 

1,186,119 

 

 

1,064,448 

Retained earnings

 

 

2,246,354 

 

 

2,029,158 

Treasury stock, at cost

 

 

(2,591,588)

 

 

(2,465,716)

Deferred compensation payable in Company stock

 

 

2,284 

 

 

2,236 

Total Stockholders' Equity

 

 

880,053 

 

 

666,705 

Total Liabilities and Stockholders' Equity

 

$

1,431,185 

 

$

1,305,757 




 









 

 

 

 

 

 

CHEMED CORPORATION AND SUBSIDIARY COMPANIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)(unaudited)



 

 

 

 

 

 



 

Three Months Ended March 31,



 

2023

 

2022

Cash Flows from Operating Activities

 

 

 

 

 

 

Net income

 

$

54,121 

 

$

64,169 

Adjustments to reconcile net income to net cash provided

 

 

 

 

 

 

by operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

14,799 

 

 

14,656 

Stock option expense

 

 

8,482 

 

 

7,451 

Benefit for deferred income taxes

 

 

(3,195)

 

 

(4,047)

Noncash long-term incentive compensation

 

 

2,024 

 

 

1,185 

Amortization of debt issuance costs

 

 

95 

 

 

76 

Changes in operating assets and liabilities, excluding

 

 

 

 

 

 

amounts acquired in business combinations:

 

 

 

 

 

 

(Increase)/decrease in accounts receivable

 

 

(14,318)

 

 

19,610 

Increase in inventories

 

 

(391)

 

 

(431)

Decrease in prepaid expenses

 

 

1,236 

 

 

3,099 

Decrease in accounts payable and

 

 

 

 

 

 

other current liabilities

 

 

(24,109)

 

 

(30,332)

Change in current income taxes

 

 

19,118 

 

 

23,530 

Net change in lease assets and liabilities

 

 

(632)

 

 

743 

Increase in other assets

 

 

(2,173)

 

 

(1,562)

Increase in other liabilities

 

 

5,313 

 

 

2,958 

Other sources/(uses)

 

 

122 

 

 

(15)

Net cash provided by operating activities

 

 

60,492 

 

 

101,090 

Cash Flows from Investing Activities

 

 

 

 

 

 

Capital expenditures

 

   

(17,020)

 

   

(12,649)

Business combinations, net of cash acquired

 

 

 -

 

 

(1,650)

Proceeds from sale of fixed assets

 

 

146 

 

 

485 

Other uses

 

 

(139)

 

 

(134)

Net cash used by investing activities

 

 

(17,013)

 

 

(13,948)

Cash Flows from Financing Activities

 

 

 

 

 

 

Payments on long-term debt

 

 

(76,250)

 

 

 -

Proceeds from exercise of stock options

 

 

25,680 

 

 

7,692 

Dividends paid

 

 

(5,685)

 

 

(5,322)

Capital stock surrendered to pay taxes on stock-based compensation

 

 

(3,166)

 

 

(4,893)

Payments on revolving line of credit

 

 

 -

 

 

(86,500)

Proceeds from revolving line of credit

 

 

 -

 

 

21,500 

Purchases of treasury stock

 

 

 -

 

 

(27,794)

Change in cash overdrafts payable

 

 

 -

 

 

(7,051)

Other (uses)/sources

 

 

(130)

 

 

491 

Net cash used by financing activities

 

 

(59,551)

 

 

(101,877)

Decrease in Cash and Cash Equivalents

 

 

(16,072)

 

 

(14,735)

Cash and cash equivalents at beginning of year

 

 

74,126 

 

 

32,895 

Cash and cash equivalents at end of year

 

$

58,054 

 

$

18,160 










 





 

 

 

 

 

 

 

 

 

 

 

 

CHEMED CORPORATION AND SUBSIDIARY COMPANIES

CONSOLIDATING STATEMENTS OF INCOME

FOR THE THREE MONTHS ENDED MARCH 31, 2023 AND 2022

(in thousands)(unaudited)



 

 

 

 

 

 

 

Chemed



 

VITAS

 

Roto-Rooter

 

Corporate

 

Consolidated

2023 (a)

 

 

 

 

 

 

 

 

 

 

 

 

Service revenues and sales

 

$

310,478 

 

$

249,679 

 

$

 -

 

$

560,157 

Cost of services provided and goods sold

 

 

253,654 

 

 

117,051 

 

 

 -

 

 

370,705 

Selling, general and administrative expenses

 

 

23,336 

 

 

60,813 

 

 

15,946 

 

 

100,095 

Depreciation

 

 

4,958 

 

 

7,312 

 

 

16 

 

 

12,286 

Amortization

 

 

26 

 

 

2,487 

 

 

 -

 

 

2,513 

Other operating expense

 

 

12 

 

 

1,727 

 

 

 -

 

 

1,739 

Total costs and expenses

 

 

281,986 

 

 

189,390 

 

 

15,962 

 

 

487,338 

Income/(loss) from operations

 

 

28,492 

 

 

60,289 

 

 

(15,962)

 

 

72,819 

Interest expense

 

 

(50)

 

 

(133)

 

 

(1,368)

 

 

(1,551)

Intercompany interest income/(expense)

 

 

4,648 

 

 

2,743 

 

 

(7,391)

 

 

 -

Other income/(expense)—net

 

 

189 

 

 

29 

 

 

(321)

 

 

(103)

Income/(loss) before income taxes

 

 

33,279 

 

 

62,928 

 

 

(25,042)

 

 

71,165 

Income taxes

 

 

(8,515)

 

 

(15,275)

 

 

6,746 

 

 

(17,044)

Net income/(loss)

 

$

24,764 

 

$

47,653 

 

$

(18,296)

 

$

54,121 



 

 

 

 

 

 

 

 

 

 

 

 

2022 (b)

 

 

 

 

 

 

 

 

 

 

 

 

Service revenues and sales

 

$

299,189 

 

$

231,360 

 

$

 -

 

$

530,549 

Cost of services provided and goods sold

 

 

227,240 

 

 

109,312 

 

 

 -

 

 

336,552 

Selling, general and administrative expenses

 

 

22,453 

 

 

56,954 

 

 

10,547 

 

 

89,954 

Depreciation

 

 

5,551 

 

 

6,569 

 

 

18 

 

 

12,138 

Amortization

 

 

24 

 

 

2,494 

 

 

 -

 

 

2,518 

Other operating expense/(income)

 

 

(148)

 

 

161 

 

 

 -

 

 

13 

Total costs and expenses

 

 

255,120 

 

 

175,490 

 

 

10,565 

 

 

441,175 

Income/(loss) from operations

 

 

44,069 

 

 

55,870 

 

 

(10,565)

 

 

89,374 

Interest expense

 

 

(52)

 

 

(115)

 

 

(643)

 

 

(810)

Intercompany interest income/(expense)

 

 

4,656 

 

 

2,176 

 

 

(6,832)

 

 

 -

Other income/(expense)—net

 

 

37 

 

 

35 

 

 

(3,934)

 

 

(3,862)

Income/(loss) before income taxes

 

 

48,710 

 

 

57,966 

 

 

(21,974)

 

 

84,702 

Income taxes

 

 

(12,229)

 

 

(14,029)

 

 

5,725 

 

 

(20,533)

Net income/(loss)

 

$

36,481 

 

$

43,937 

 

$

(16,249)

 

$

64,169 



 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

The "Footnotes to Financial Statements" are integral parts of this financial information.














 





 

 

 

 

 

 

 

 

 

 

 

 

CHEMED CORPORATION AND SUBSIDIARY COMPANIES

CONSOLIDATING SUMMARIES OF EBITDA

FOR THE THREE MONTHS ENDED MARCH 31, 2023 AND 2022

(in thousands)(unaudited)



 

 

 

 

 

 

 

Chemed



 

VITAS

 

Roto-Rooter

 

Corporate

 

Consolidated

2023

 

 

 

 

 

 

 

 

 

 

 

 

Net income/(loss)

 

$

24,764 

 

$

47,653 

 

$

(18,296)

 

$

54,121 

Add/(deduct):

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

50 

 

 

133 

 

 

1,368 

 

 

1,551 

Income taxes

 

 

8,515 

 

 

15,275 

 

 

(6,746)

 

 

17,044 

Depreciation

 

 

4,958 

 

 

7,312 

 

 

16 

 

 

12,286 

Amortization

 

 

26 

 

 

2,487 

 

 

 -

 

 

2,513 

EBITDA

 

 

38,313 

 

 

72,860 

 

 

(23,658)

 

 

87,515 

Add/(deduct):

 

 

 

 

 

 

 

 

 

 

 

 

Intercompany interest expense/(income)

 

 

(4,648)

 

 

(2,743)

 

 

7,391 

 

 

 -

Interest (income)/expense

 

 

(121)

 

 

(29)

 

 

 -

 

 

(150)

Licensed healthcare retention bonus

 

 

10,916 

 

 

 -

 

 

 -

 

 

10,916 

Stock option expense

 

 

 -

 

 

 -

 

 

8,482 

 

 

8,482 

Long-term incentive compensation

 

 

 -

 

 

 -

 

 

2,514 

 

 

2,514 

Litigation settlements

 

 

 -

 

 

1,756 

 

 

 -

 

 

1,756 

Adjusted EBITDA

 

$

44,460 

 

$

71,844 

 

$

(5,271)

 

$

111,033 



 

 

 

 

 

 

 

 

 

 

 

 

2022

 

 

 

 

 

 

 

 

 

 

 

 

Net income/(loss)

 

$

36,481 

 

$

43,937 

 

$

(16,249)

 

$

64,169 

Add/(deduct):

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

52 

 

 

115 

 

 

643 

 

 

810 

Income taxes

 

 

12,229 

 

 

14,029 

 

 

(5,725)

 

 

20,533 

Depreciation

 

 

5,551 

 

 

6,569 

 

 

18 

 

 

12,138 

Amortization

 

 

24 

 

 

2,494 

 

 

 -

 

 

2,518 

EBITDA

 

 

54,337 

 

 

67,144 

 

 

(21,313)

 

 

100,168 

Add/(deduct):

 

 

 

 

 

 

 

 

 

 

 

 

Intercompany interest expense/(income)

 

 

(4,656)

 

 

(2,176)

 

 

6,832 

 

 

 -

Interest income

 

 

(37)

 

 

(36)

 

 

 -

 

 

(73)

Stock option expense

 

 

 -

 

 

 -

 

 

7,451 

 

 

7,451 

Direct costs related to COVID-19

 

 

391 

 

 

961 

 

 

 -

 

 

1,352 

Long-term incentive compensation

 

 

 -

 

 

 -

 

 

1,310 

 

 

1,310 

Adjusted EBITDA

 

$

50,035 

 

$

65,893 

 

$

(5,720)

 

$

110,208 



 

 

 

 

 

 

 

 

 

 

 

 

The "Footnotes to Financial Statements" are integral parts of this financial information.


















 



 

 

 

 

 

 

CHEMED CORPORATION AND SUBSIDIARY COMPANIES

RECONCILIATION OF ADJUSTED NET INCOME

(in thousands, except per share data)(unaudited)



 

 

 

 

 

 



 

 



 

Three Months Ended March 31,



 

2023

 

2022

Net income as reported

 

$

54,121 

 

$

64,169 

Add/(deduct) pre-tax cost of:

 

 

 

 

 

 

Licensed healthcare worker retention bonus

 

 

10,916 

 

 

 -

Stock option expense

 

 

8,482 

 

 

7,451 

Long-term incentive compensation

 

 

2,514 

 

 

1,310 

Amortization of reacquired franchise agreements

 

 

2,352 

 

 

2,352 

Litigation settlements

 

 

1,756 

 

 

 -

Direct costs related to COVID-19

 

 

 -

 

 

1,352 

Add/(deduct) tax impacts:

 

 

 

 

 

 

Tax impact of the above pre-tax adjustments (1)

 

 

(5,624)

 

 

(2,413)

Excess tax benefits on stock compensation

 

 

(1,650)

 

 

(1,441)

Adjusted net income

 

$

72,867 

 

$

72,780 



 

 

 

 

 

 

Diluted Earnings Per Share As Reported

 

 

 

 

 

 

Net income

 

$

3.58 

 

$

4.22 

Average number of shares outstanding

 

 

15,110 

 

 

15,192 



 

 

 

 

 

 

Adjusted Diluted Earnings Per Share

 

 

 

 

 

 

Adjusted net income

 

$

4.82 

 

$

4.79 

Average number of shares outstanding

 

 

15,110 

 

 

15,192 



 

 

 

 

 

 

(1) The tax impact of pre-tax adjustments was calculated using the effective tax rate of the operating unit for which each adjustment is associated.



 

 

 

 

 

 

The "Footnotes to Financial Statements" are integral parts of this financial information.




 



 

 

 

 

 

 

CHEMED CORPORATION AND SUBSIDIARY COMPANIES

OPERATING STATISTICS FOR VITAS SEGMENT

(unaudited)



 

 

 

 

 

 



Three Months Ended March 31,

 

OPERATING STATISTICS

2023

 

2022

 

Net revenue ($000) (c)

 

 

 

 

 

 

Homecare

$

267,050 

 

$

257,636 

 

Inpatient

 

29,093 

 

 

26,570 

 

Continuous care

 

19,941 

 

 

19,578 

 

Other

 

3,021 

 

 

3,007 

 

Subtotal

$

319,105 

 

$

306,791 

 

Room and board, net

 

(2,769)

 

 

(2,117)

 

Contractual allowances

 

(3,108)

 

 

(2,985)

 

Medicare cap allowance

 

(2,750)

 

 

(2,500)

 

Net Revenue

$

310,478 

 

$

299,189 

 

Net revenue as a percent of total before Medicare cap allowance

 

 

 

 

 

 

Homecare

 

83.7 

%

 

84.0 

%

Inpatient

 

9.1 

 

 

8.7 

 

Continuous care

 

6.2 

 

 

6.4 

 

Other

 

1.0 

 

 

0.9 

 

Subtotal

 

100.0 

 

 

100.0 

 

Room and board, net

 

(0.8)

 

 

(0.7)

 

Contractual allowances

 

(1.0)

 

 

(1.0)

 

Medicare cap allowance

 

(0.9)

 

 

(0.8)

 

Net Revenue

 

97.3 

%

 

97.5 

%

Days of care

 

 

 

 

 

 

Homecare

 

1,286,437 

 

 

1,258,672 

 

Nursing home

 

265,429 

 

 

248,468 

 

Respite

 

5,760 

 

 

5,368 

 

Subtotal routine homecare and respite

 

1,557,626 

 

 

1,512,508 

 

Inpatient

 

26,369 

 

 

24,587 

 

Continuous care

 

20,686 

 

 

21,082 

 

Total

 

1,604,681 

 

 

1,558,177 

 



 

 

 

 

 

 

Number of days in relevant time period

 

90 

 

 

90 

 

Average daily census ("ADC") (days)

 

 

 

 

 

 

Homecare

 

14,294 

 

 

13,985 

 

Nursing home

 

2,949 

 

 

2,761 

 

Respite

 

64 

 

 

60 

 

Subtotal routine homecare and respite

 

17,307 

 

 

16,806 

 

Inpatient

 

293 

 

 

273 

 

Continuous care

 

230 

 

 

234 

 

Total

 

17,830 

 

 

17,313 

 

Total Admissions

 

16,179 

 

 

16,530 

 

Total Discharges

 

15,405 

 

 

16,862 

 

Average length of stay (days)

 

99.9 

 

 

104.8 

 

Median length of stay (days)

 

15.0 

 

 

14.0 

 

ADC by major diagnosis

 

 

 

 

 

 

Cerebro

 

41.8 

%

 

36.7 

%

Neurological

 

19.3 

 

 

22.9 

 

Cancer

 

10.5 

 

 

11.1 

 

Cardio

 

16.0 

 

 

15.9 

 

Respiratory

 

7.3 

 

 

7.4 

 

Other

 

5.1 

 

 

6.0 

 

Total

 

100.0 

%

 

100.0 

%

Admissions by major diagnosis

 

 

 

 

 

 

Cerebro

 

26.4 

%

 

22.9